Westminster Hall

Thursday 12th November 2026 Westminster Hall

Thursday 12 November 2026

[Clive Efford in the Chair]

China and the UK Economy

Thursday 12th November 2026 Westminster Hall

Business, Innovation, Science and Trade Committee

Select Committee statement

13:30

[Clive Efford (in the Chair)]

I call Liam Byrne.

[Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)]

Thank you, Mr Efford. I am grateful to the Backbench Business Committee for making time for today’s statement on the 10th report from my Committee in this Session, examining the UK-China economic relationship. I should probably preface my remarks by confessing a degree of interest in this issue. I have worked on the UK-China relationship for almost 20 years. I was among those who helped to launch the economic and financial dialogue with Lord Darling, God rest his soul. Back at the end of the last Labour Government, I was an active player in the UK-China leadership for the future forum. I sat on the board of the Great Britain-China Centre for many years, started the UK-China young leaders roundtable in my younger days and produced my own book on the UK-China relationship just before it became fashionable. This is a subject in which I have a long-standing interest, and I was grateful that the Committee agreed that it was an essential piece of our work and of the work we do on this nation’s economic security.

The House has within it a number of colleagues who would counsel that we should minimise our dialogue with China. But I am among those who believe, and my Committee agrees, that ostrich diplomacy does not serve the UK national interest especially well. The UK-China relationship will be one of the most consequential relationships for this country in the 21st century, so it was absolutely right that the new Government sought to intensify engagement with China from the moment they were elected to office. However, they undertook their audit of UK-China relationships in secret, and despite the efforts of a number of Select Committees, we have still not seen the results. Nor have we seen any comprehensive UK-China strategy that might sit on top of that new engagement or that audit.

We have what might be fairly summarised not as a strategy but as a punchline—the mantra of compete, collaborate and confront. That is a semi-helpful string of words, but it is not a strategy and not something the business community, in particular, can operationalise to any useful effect. That is important because right now many in the business community do want a deeper relationship with China. On the one hand, they are pulling their punches, pulling investment and pulling their effort; they are not intensifying in the way we might want them to, because, out of an abundance of caution, they simply do not want to put a foot wrong. On the other hand, there is now clear evidence that we are accumulating vulnerabilities in a way that is simply dangerous.

We need only look at two or three different decisions in the past, but also in the not-too-distant future, to see why some coherence and consistency and, crucially, a shared strategy between the state and the private sector are needed. The decision on Ming Yang involved the potential investment of a very significant amount by that Chinese firm in Scotland. We still do not know why that investment was pulled or why Government sent messages that it was not something to be welcomed. Equally, we were all called to this House—the Minister did a brilliant job of helping to lead the debate—to renationalise British Steel when, all of a sudden, its Chinese owners sent the business in the wrong direction.

There is now a lively debate about the sense in allowing Chinese connected tech to proliferate through our economy. We are also having a debate with our European partners about whether we should align on anti-competitive practices by China and introduce tariffs on electric vehicles.

In example after example, sector after sector, and investment after investment, we are now running into the necessity of a clear Government strategy for helping business in particular, but also civil society more widely, to understand where the guardrails are in the relationship with China. What this report seeks to do is to set out both the prize and the peril of a deeper relationship with China, and there are five points that stood out to me, as Chair of the Committee, in the work we did and that I would like to share with the House.

First, we feel there needs to be much clearer demarcation of those economic sectors in which we should encourage trade with China and those in which we should not. In the green zones, where trade should be welcomed, we should go all in. We should do more to encourage a deepening of economic relationships, and mobilising the UK’s soft power more comprehensively than we do today. That is important, not least because it is good for trade, jobs and economic growth. It is crucial for the UK’s long-term influence in China, which will extend well beyond the governance of President Xi and into what we hope will be a more constructive phase of Chinese leadership.

However, as part of that story, there need to be clear red zones. They would be easier to demarcate if the Government listened to our Committee, the Joint Committee on the National Security Strategy and the Defence Committee and set out the sovereign capabilities where trade with China is simply unwise. At the moment, business has to guess what that looks like. When we took evidence, officials and the Minister at the time, my right hon. Friend the Member for Rhondda and Ogmore (Chris Bryant), rightly said that this is very difficult and things might change, but that has not stopped allies like Canada setting out sovereign capabilities or allies like Japan setting out critical components where trade with China is unwise. The Government saying that something is difficult also does not stop other people having to make the difficult decision; it just transfers it to someone else. That transfer of risk to the private sector has a cost. We would like a clear demarcation of those sectors in which Chinese trade should be encouraged and those in which it should not.

Secondly, the new approach needs to be underpinned by very different rules of the game with China. That has to start with a much tougher approach to levelling the playing field. The brilliant work of the OECD makes it clear that in some sectors of the economy China is over-subsidising its industry by six times more than we are in Europe, which is simply unfair. What has become known as China shock 2.0 is costing tens of thousands of jobs across Europe. A weaker European manufacturing industry is simply not in our national interest. The Committee concludes that we should work much harder with our partners in the European Union to develop pro-competition, pro-fairness measures for levelling the playing field with China. If that means readying tariffs, that is exactly what we should do. We should align around the kinds of initiatives taken by President Macron and Chancellor Merz. I hope we see a little more progress on that at the summit with the European Union on 20 November.

The third takeaway is that although we should innovate carefully with China, which is important in fields like life science, we should be much more robust about defending technologically sensitive areas. That is particularly important in connected tech. We think that recent Lords amendments had a lot of virtue and that the Government should have supported them. We should ban Chinese connected tech from our critical national infrastructure and invest in supplying our universities with a much faster response to their inquiries about where research and development with Chinese partners is wise and where it is unwise. The recent revelations from the Security Service underline the necessity of making sure that Universities UK and our universities more widely are equipped with that knowledge.

Fourthly, we need to prepare now for the disruption to supply chains that might come. For example, if someone tries to change the status quo in the straits of Taiwan, that will be an enormous economic shock that will disrupt supply chains across our economy. We should stress-test now supply chains that will be impacted and work harder to diversify suppliers. As the Committee set out in its report on critical minerals last week, we should redouble our efforts, with a new critical minerals finance facility to bring online not just domestic supply and recycling, but a wider diversity of international supply.

Finally, we should act with speed and aggression to ban forced labour from supply chains. I was pleased to see the correspondence from the Secretary of State to my Committee at the end of last week, showing that the Government will move on that. I hope there will be Government amendments to part 5 of the Immigration and Asylum Bill to enshrine a responsibility on businesses to ensure that they are doing the right thing and banning forced labour from our country.

My final point is about the state. We are very lucky in this country to have the great Peter Wilson as our ambassador in Beijing, but in truth we have lost an immense amount of China expertise across Whitehall. It is clear that we do not have a systematic way of integrating threat assessments and benefit analysis to inform decision making in Whitehall and, crucially, regional governments. We will have to do better at building a strategic state to contend with China in the future, and I hope our report is a useful contribution to that debate.

[Clive Efford (in the Chair)]

In my eagerness to hear from Mr Byrne, I forgot to give him his full title and to read out the title of what we are debating. He is Chair of the Business, Innovation, Science and Trade Committee, and we are discussing the Committee’s 10th report, “China and the UK economy: the case for risk-managed growth”, HC 124.

[Perran Moon (Camborne and Redruth) (Ind)]

Meur ras, Mr Efford. It is an honour to serve under your chairship. I thank the Committee and its chair for this report, which makes for illuminating—if concerning—reading alongside last week’s critical minerals report.

As a Cornish MP and chair of the electric vehicle all-party parliamentary group, I have two separate but related questions. First, the report recommends “targeted interventions” to secure sovereign capabilities and hedge against growing dependence on China. Are Cornwall’s tin, lithium and tungsten projects the sort of sovereign capability the Committee has in mind? Secondly, given the warnings in the report about China shock 2.0, does the Chair of the Committee agree that heavily subsidised Chinese electric vehicles are a far greater threat to UK automotive manufacturers than the UK’s zero emission vehicle mandate?

[Liam Byrne]

Let me take the hon. Member’s questions in order. We believe that the right approach to derisking trade with China is not a wholesale decoupling. Instead, precision derisking is needed, where we take aim at specific things where we need to diversify supplies and ensure that we are not reliant on supplies from China. The best way to do that, given that we must make choices, is to look at which capabilities we as a country want to be sovereign and which we want to develop with close allies such as the Europeans, Canadians, Japanese, Australians or Koreans. This debate has rumbled on over the last couple of years, and the Government have set out different lists in different strategies. But clarity is really needed for the private sector because private sector investment needs to come over decades if we are to ensure we have resilient economic security in this country.

Inevitably, those sovereign capabilities will draw on the natural resources of Cornwall, and particularly the minerals the hon. Member set out. If we do not have up-to-date information about the geology in the geological surveys of this country, we are approaching this issue without the right information on the table. It is not free to update those geological surveys, but is it a wise investment? Yes, it is. Crucially, we then need to put together a finance stack that allows us to invest in the whole life journey of bringing online new mines and processing and recycling facilities, in a way that would be tremendous for his economy. He has been a doughty champion for the critical minerals industry in Cornwall, and Ministers would be wise to listen to his advice. The recommendations we laid out in our report on critical minerals last Friday were greatly informed by his contributions in this House over the last couple of years.

On EVs, the Secretary of State and Ministers have had to strike a delicate balance. They have been supremely conscious that if we introduce tariffs on Chinese imports, that raises the cost for British consumers and risks reciprocal action by China against British exports. My soundings with the British automotive industry today indicate that there is now far more support for introducing tariffs on over-subsidised Chinese EVs. Crucially, if we want to draw closer to the European Union over the years to come, it will insist that the UK is not a back door to over-subsidised Chinese products of any kind. It will also ask us to align more closely with it in protecting the European manufacturing industry from China shock 2.0. We are going to have to make a choice, and I think that the right choice is aligning with Europe and protecting European manufacturing and supply chains. That is in our national interest and it is what we will need in a more uncertain and risky world in the years to come.

13:46

Sitting suspended.

Backbench Business

Thursday 12th November 2026 Westminster Hall

Fire and Rescue Services: Suicide Prevention Training

Thursday 12th November 2026 Westminster Hall

13:50

[Luke Akehurst (North Durham) (Lab)]

I beg to move,

That this House has considered the matter of suicide prevention training for fire and rescue services.

It is a pleasure to serve under your chairmanship, Mr Efford. I thank the Backbench Business Committee for granting time for this debate and all the hon. Members from across the House who supported the application.

Today, I am backing the Samaritans’ “United with the frontline” campaign to call on the Government to ensure that every fire and rescue service in England has funded mandatory suicide prevention training for all its firefighters. I pay tribute to Samaritans, the UK and Ireland’s largest suicide prevention charity. Every 10 seconds, a Samaritans volunteer responds to a call for help. In 2025, that meant over 3.3 million calls. As well as the helpline, Samaritans works with people in community settings and prisons and provides training across different workplaces, including to fire services in England. Given its incredible service helping to save the lives of people at their most vulnerable, I believe that it is important that we, as policymakers, listen to the voice of Samaritans when deciding how we can best prevent lives being lost to suicide.

Samaritans tells me of a stark picture of the situation today. Last year, 5,728 deaths by suicide were registered in England and the suicide rate reached its highest level in over 20 years. Clearly, there is more that this place can do to support people in their hour of need and prevent the death by suicide of our constituents.

[Liz Twist (Blaydon and Consett) (Lab)]

I congratulate my hon. Friend on securing this important debate. In its briefing, Samaritans highlights not only the 3,200 suicide call-outs that fire crews attend, but the heavy toll on firefighters themselves, with over 60% reporting mental health struggles. Does he agree that mandatory training must work both ways: equipping crews to save lives in the community while building robust workplace support to protect its own staff?

[Luke Akehurst]

I thank my hon. Friend and neighbour for her helpful intervention. I agree that this cuts both ways. It is both about the members of the public that the fire service intervenes with when they are in crisis and the mental health of firefighters themselves. I will come to that point later in my speech.

Fire and rescue services play a key role supporting vulnerable people every day. Their skills are often required in attending complex incidents, meaning that they often interact with the people in society most at risk of suicidal crisis. Increasingly, fire and rescue services are being called out to people in suicidal crisis. In the last decade, the number of call-outs to suicide incidents has sadly tripled. Despite firefighters being more and more expected to support people in crisis, there is no current mandatory in-depth suicide training offer for every firefighter in England. Such provision could train them to spot the signs of suicidality, compassionately open up non-judgmental conversations about suicide and make a safe intervention to stop a suicide.

Exposing the postcode lottery that this gap in provision leads to, Samaritans made freedom of information requests in June last year, which indicated the variation across the country. While eight fire and rescue services had some form of mandatory training relating to suicide prevention, a further 18 only had optional training, while eight more had no suicide prevention or related mental health training whatever. Most commonly, optional training consists of a short e-learning module focused on awareness raising, which, although valuable, is unlikely to equip a firefighter with the skills needed to save a life.

Thankfully, in County Durham, Samaritans found that we do have mandatory operational training on a person in crisis. However, the disparity in provision can be seen just across our one region in the north-east as Cleveland has a non-mandatory version of that training, while Northumberland does not provide any training of this kind. Clearly, a national standard is needed to support fire and rescue services to provide the training that their workers need to respond to complex crises.

It is not just members of the public who are left unsupported by these gaps in training. Firefighters have prolonged contact with their peers in the fire and rescue services who also may be struggling with their mental health, exacerbated by the pressure of their role and the trauma that they often witness. Some 51 deaths by suicide among firefighters were recorded between 2011 and 2018, and 21 suicides by non-senior fire service officers were recorded between 2020 and 2022. A survey found that over 60% of fire service staff and volunteers had experienced mental health problems linked to traumatic events at work. I hope the Minister will outline in his remarks what the Government are doing to ensure that fire and rescue services have the support they need in the workplace to undertake their work while living happy and fulfilled lives.

[Dr Danny Chambers (Winchester) (LD)]

Firefighters and fire crews see traumatic events on a regular basis. Sometimes, on busy days, they get very little time to decompress or debrief between events. There is an amazing guy in Hampshire called Spencer Wragg, a former police officer, who is trying to get a mental health support app put on every police work phone in the country so that the police can get the support when they need it. Does the hon. Gentleman think that something similar should be explored for firefighters?

[Luke Akehurst]

I thank the hon. Gentleman for that useful intervention. If that idea is rolled out to the police, it ought also to be rolled out to other emergency responders.

In its first year of operation, the Fire Fighters Charity crisis line received more than 200 calls from firefighters in need of support. I pay tribute to that organisation’s work, providing online resources alongside that helpline. Individual fire and rescue services have also made strides to adopt and trial workplace support tools despite the lack of an overarching national framework.

Although forces have pioneered their own approaches, such as trauma risk management training and peer supporter systems to facilitate supportive conversations between colleagues, our fire and rescue services should not be left on their own when they are already under-resourced and be expected to work out the best mental health provision with no support or guidance from the top. Clearly, this industry needs bespoke mental health support for its workers. Firefighters put their lives on the line to keep us safe; the least we can do is provide them with the support they need for their mental wellbeing.

In discussing any expansion in the role of our fire and rescue services, the voice of firefighters must be front and centre. I urge the Government to engage constructively with the Fire Brigades Union, and I urge the Minister to set out the engagement of the Minister that he is standing in for today, the Under-Secretary of State for Education, with the union on this matter so far.

The evidence that this training can have a real impact is clear. Already, Samaritans and other providers deliver such training to workplaces that request it. The Samaritans’ training and engagement programme has proven that there is demand for workplace training on how to manage conversations about suicide, how to make a suicide intervention and how to manage the effects of a suicide within fire and rescue services. For example, Samaritans has worked with London Fire Brigade to provide such training to about 50 of their workers.

I pay tribute to the provisions on staff welfare that our local fire and rescue authority in County Durham and Darlington provide already. Those include counselling employer assistant programmes, signposting to local professional organisations that specialise in trauma support and utilising the Fire Fighters Charity crisis line, which all UK fire and rescue services subscribe to.

Let me come to the campaign’s asks of the Government and our asks of the Minister who is responding to the debate. Today, I want to back Samaritans’ call for a national approach to delivering suicide prevention training to fire and rescue services. Such a national approach will ensure that every force is equipped to support those in crisis and to save lives. In doing so, the Government would recognise that the support a person receives in a mental health crisis should not vary depending on where in the country they live or what operational decisions their fire and rescue authority has made with its limited resources. I urge the Minister to set out plans for this much-needed approach in his response.

I recognise and welcome steps that have already been taken to address these gaps, including a suicide prevention toolkit, published by the National Fire Chiefs Council, which I know Samaritans was successful in influencing. The Ministry of Housing, Communities and Local Government has launched a public consultation on the creation of a new college of fire and rescue to better align training and national standards across England in order to improve the health and wellbeing of fire and rescue staff. That consultation presents an opportunity to embed suicide prevention training in the improved offer.

Standards should be developed by a working group of suicide prevention experts, with a focus on training that is in-depth, facilitator-led and, where possible, carried out in person. Such training should focus on developing practical skills to support people’s safety through conversations about suicidal thoughts, with the aim of building confidence in signposting people to the right support. Training must also build practical skills in safely managing suicide prevention for someone in crisis. I would appreciate the Minister updating the House on whether suicide prevention training is being looked at as part of that consultation, and on how he will ensure that suicide prevention experts and people with lived experience are at the heart of any proposals.

I am grateful for the support from other hon. Members for this crucial campaign. No one suffering from a severe mental health crisis should ever be left without the support they need. In countless cases our fire and rescue services step in and provide that support. They can often be the literal difference between life and death. We owe it to them, and to everyone in our country who suffers from mental illness or who is at risk of a mental health crisis, to provide the training needed to save lives and begin the road to recovery. I look forward to the Minister’s outlining what the Government are doing to ensure that every fire and rescue service worker receives the training that they need so that all our constituents know that if they or a loved one ever needs that emergency support, they will receive it.

14:01

[Robbie Moore (Keighley and Ilkley) (Con)]

It is a pleasure to serve under your chairmanship, Mr Efford. I thank the hon. Member for North Durham (Luke Akehurst) for securing this important debate. I commend him on his speech, which went into a huge amount of detail on the suicide prevention training that is absolutely needed for our fire and rescue services.

Across the House we will no doubt agree that when constituents struggle with their mental health and reach out for help our mental health services must be robust and supported enough to deliver that. I draw the House’s attention to a deeply tragic case from my constituency. It brings into focus the devastating consequences of that system breaking down, which has deeply detrimental impacts. Last Friday I met my constituent Christine Meeking. She came to see me after losing her daughter, Nicola, to suicide. In the days before Nicola died, her GP tried on three separate occasions to reach Bradford’s First Response mental health crisis service but could not get through. Christine now carries the unbearable belief that if, from those attempts to reach out, Nicola had received the crisis support and care that she so desperately needed, she might still be here.

The failure did not end there. In my surgery last week Christine told me that, in seeking answers, she herself repeatedly tried calling First Response and was left on hold on the line for 40 minutes before the line cut out. She then tried to phone First Response back and waited for a further 48 minutes. Christine tried to get through for a total of 88 minutes. She made the point rightly to me that to anyone in crisis 88 minutes can seem an eternity. Unfortunately, that is exactly what happened to her daughter Nicola.

After Christine shared her story with me, I raised the issue with the Bradford district care trust and wrote to the Department of Health and Social Care—I know that a Minister from MHCLG is responding in this debate, but that builds the case I will make: that this is a cross-Government and cross-departmental issue. The trust’s reply to the concerns that I raised on behalf of Christine Meeking was not satisfactory. It was a standard letter designed specifically to pass the blame. I wrote to the Department of Health and Social Care on 7 August, but I am yet to receive a response on behalf of my constituent. That is simply not good enough, especially when we are nearly at the middle of November. In that time, Christine has rightly asked if the system that we are expected to rely on is suitable and fit for purpose. Clearly, it is not.

Christine has shown extraordinary courage in coming forward and meeting me. She did so simply to get that point across. She told me that, although nothing can bring back her daughter, if speaking out can save just one family from going through what she has suffered, it will be worth it.

That brings me to the subject of the debate: ensuring that our fire and rescue services receive suicide prevention training. Nicola’s experience demonstrates just how critical the first response is, and it does not always come from a mental health professional. Increasingly, our fire and rescue crews are being called upon to attend incidents involving people experiencing suicidal distress, and they are often the first on the scene. In those critical moments, having the right training can absolutely save someone’s life.

Figures show that suicide-related incidents attended by fire and rescue services in England rose from 1,119 in 2014 to 3,184 in 2024—and of course those are not just numbers; they represent people in desperate need of help. Yet there is still no mandatory, standardised suicide prevention training for firefighters. I have met many of the firefighters operating across my constituency, and they have reiterated to me time and again that they would absolutely welcome that training, if it were available to them as standard.

As the hon. Member for North Durham rightly pointed out, Samaritans has called for protected time for firefighters to undertake this training, following the Government’s announcement of similar provisions for some police officers. I would like reassurance from the Minister that this will be rolled out to firefighters. It should not be a provision made for the police, but not for firefighters; all emergency services should be offered this training. This cannot be left to individual fire and rescue authorities; it must be a direction coming from the centre.

With incidents rising so steeply over the 10 years from 2014 to 2024, as the data I referred to shows, we are in desperate need of a robust and consistent national approach. I therefore call on the Government to introduce mandatory, standardised suicide prevention training across all fire and rescue services, providing in-depth, in-person and practical skills and knowledge. We must also get over the siloed approach that naturally, but unfortunately, exists within Government between one Department and another. To reiterate, in Nicola’s case, the service provision that she was reaching out for would ultimately sit under the Department of Health and Social Care, but this debate is being answered by an MHCLG Minister. We must remove ourselves from that siloed thinking and do everything we can to ensure that when someone does reach out, the first response they receive is the right one. I urge the Government to commit today to making that happen.

14:04

[Marie Goldman (Chelmsford) (LD)]

It is a pleasure to serve under your chairship, Mr Efford. I thank the hon. Member for North Durham (Luke Akehurst) for securing this very important debate.

We have heard about some of the incredible, essential work that fire and rescue services do when responding to suicide call-outs. Often first on the scene, making life-or-death decisions in traumatic and dangerous situations that put their own safety at risk, firefighters deserve our utmost respect and support.

Since becoming an MP, it has been my pleasure to meet firefighters from my local fire and rescue service and their leadership in my constituency. As part of last year’s inaugural cohort of MPs taking part in the parliamentary knowledge scheme for frontline services, it was also a privilege to visit the London Fire Brigade station in Paddington, which is one of the busiest in London. I am always impressed by the work that firefighters are able to carry out, often in extreme conditions.

However, as we have heard, suicide-related call-outs to fire and rescue services have risen markedly. Since records began in England, they have more than tripled, with services attending 3,250 incidents in the year ending September 2025—about 62 every week. Indeed, other rescue services, such as the Royal National Lifeboat Institution and Mountain Rescue, also tell me that the biggest increase in their call-outs over the past few years has been to incidents involving self-harm or mental health more generally.

When that increase is added to more recent pressures on the fire service—be they budgetary pressures, such as fuel inflation, or the greater number of fire call-outs caused by increasingly hot summers due to the climate emergency—it is more important than ever that our fire and rescue services are better supported by the Government. That is why my Liberal Democrat colleagues and I believe that firefighters should have the training, skills and confidence that they need to respond safely and effectively when someone is experiencing a suicidal crisis.

It cannot be right that there is no consistent mandatory suicide prevention training across fire and rescue services in England, and that instead individual services are responsible for their own training. To guarantee any less is fair neither for a firefighter attending such a difficult and upsetting call-out, nor for a patient in need of help. The Liberal Democrats are calling for the Government to review introducing mandatory England-wide suicide prevention training for firefighters and to work with fire and rescue services, local authorities—we have a MHCLG Minister responding to the debate, and this is very relevant to his portfolio—and suicide prevention organisations.

As other Members mentioned, the Government have rightly introduced protected time for trauma and suicide prevention training for new police recruits. It must surely follow that firefighters, who often face many of the same situations as police officers, receive equivalent support. Although that would be a welcome step, it should form part of a wider workplace wellbeing safety net. Regular exposure to suicide and traumatic call-outs has serious impacts on firefighters and their mental health, with inevitable knock-on effects for retention in the service. My Liberal Democrat colleagues are therefore keen to ensure regular and comprehensive health screenings for firefighters throughout the whole of their careers—and, indeed, their retirement—so that no firefighter is left without help.

Sadly, suicide prevention training is one small part of a broader package of support that fire and rescue services need. I hope the Government will seriously consider our calls for greater suicide prevention training and endorse the clear cross-party sentiment that fire and rescue services—indeed, all rescue services—need to be recognised and supported, given the increasing workloads and pressures that they face.

14:11

[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

It is a pleasure to serve under your chairmanship, Mr Efford. I congratulate the hon. Member for North Durham (Luke Akehurst) on securing this debate, and it is a pleasure to be opposite the Minister. It is a tribute to his intellectual breadth that this morning I heard him on the “Today” programme talking about youth unemployment, and this afternoon he is here to talk about fire services and suicide training.

This is an issue that most of us, as constituency Members of Parliament, will hear about when we engage with our local fire services. When I visited the station in Pinner, it was one of a number of concerns that seemed to emerge from the experience of those fire crews and the changing nature of the call-outs. They said that the job used to be predominantly about rescuing people in emergencies and attending house fires, but that they increasingly have to deal with things such as motor crashes and crises when a person has called the emergency services, uncertain about the exact nature of what is going on and the firefighters are the responders summoned. They therefore find themselves dealing with an individual in a moment of crisis, perhaps facing a situation that is outside the normal breadth of their training; my hon. Friend the Member for Keighley and Ilkley (Robbie Moore) set out a powerful constituency example showing how important that is.

The Government need to consider carefully how to roll out an appropriate level of training. One issue, and also perhaps a learning opportunity, is the way that the whole range of our public services addresses emerging issues. On suicide prevention, social workers, police officers and workers in various parts of the NHS have a high degree of personal expertise and will have had high-quality training and the opportunity to make a good assessment, based on the evidence, of what works effectively to prepare those individuals for the situations that they may come across. We must avoid reinventing the wheel for fire service professionals, when we may be able to use the learning from effective programmes in place elsewhere to ensure that what is provided is focused and appropriate, and gives firefighters the skills they need when dealing with members of the public in a moment of crisis.

It is important in such a debate to remind ourselves about the risks, particularly when we are talking about mandatory training and what that involves. Those of us who have spent a long time in local government dealing with issues such as child sexual exploitation will be very conscious that when everything is a priority, nothing is a priority any more. Recent estimates on the new Oliver McGowan training in the NHS, which is designed to raise awareness and skill levels about people with learning disabilities and how they interact with the health service, describe a potential bill of as much as £1 billion for a day and a half of mandatory training for every single member of staff—3.7 million people across the NHS and social care. That will also have a service impact due to the unavailability of those staff to deal with patients because they are being abstracted to undertake that training.

I know that the Minister and the Government will quite rightly have in mind—and the Opposition support them in this—ensuring a proportionate approach and making sure that the people who are in the best position to help individuals going through that moment of crisis are the ones who get the most focused training, but that the general level of awareness across those organisations is raised to the right level.

[Marie Goldman]

The hon. Member is making an interesting point about proportionality of training. He mentions the cost of doing the training, but I have not heard anything about the subsequent impact on the NHS—for example, if people are in better mental health because they have been helped by somebody who has had training, what positive knock-on impact might that have on the NHS? Has he made any assessment of that?

[David Simmonds]

I think proportionality encompasses exactly that question—a question that our public health professionals and our public services have to address every single day, with every patient that they see and with every organisational review that they undertake: what is the cost, benefit and consequence of this, especially when it involves taking a member of staff away from dealing directly with someone who might be in a moment of crisis, to undertake training on a different subject? What is the overall impact, and how do we make sure that those resources are best used?

Quite rightly, the hon. Member for North Durham and other contributors focused mainly on the impact on the public—the fact that this is a public service and what it means to those people who may be in a moment of crisis. However, it is also valuable to remember the contributions that touched on the impact on the firefighters and public servants more broadly. I am very conscious, from the work that I did on the impact of child sexual exploitation that it was about both making sure that people understood the signs in children and in families, and the indicators of risk that meant intervention was required, and also understanding the cumulative impact of dealing with incredibly difficult issues on someone’s mental health and wellbeing, and on their ability to do a professional job to a high standard.

The hon. Member for North Durham very nicely encompassed this point and my hon. Friend the Member for Keighley and Ilkley touched on it as well: this is also about us, as employers of public servants, making sure that we exercise an appropriate duty of care for the people who are doing this incredibly difficult job on behalf of our society, and that they have the skills, tools and training that they need to cope with the things that that will require them to do.

14:18

[The Minister for Housing and Planning (Matthew Pennycook)]

It is a pleasure to serve with you in the Chair, Mr Efford. I congratulate my hon. Friend the Member for North Durham (Luke Akehurst) on securing this important debate, and I thank the other Members who have spoken. I thank the shadow Minister, the hon. Member for Ruislip, Northwood and Pinner (David Simmonds), for his kind words; I was actually on the morning rounds speaking about service charge protections for leaseholders, but I was very glad to speak about youth unemployment and a variety of other topics as well.

Mr Efford, as will be evident to you, I am not the Minister for Homelessness, Democracy, Communities and Faith, who would ordinarily respond to a debate on this subject; my hon. Friend is currently taking the Building Safety (Remediation of Unsafe Cladding etc) Bill through its Committee stage, and so I am responding in her stead.

In the time I have available to me, I intend to provide some further clarity about the Government’s support for the fire and rescue services. Before I do, I make two general points. The first, as several hon. Members have alluded to, is that we should not lose sight of the people at the heart of this debate, namely individuals who have been lost to suicide or those whose suicidal feelings have led them to attempt to take their own lives. Every life lost to suicide is a tragedy, one that leaves a lasting impact on families, friends and communities. I join my hon. Friend the Member for North Durham in paying tribute to the work of the Samaritans. We value their expertise in suicide prevention and we take very seriously their concerns in this area.

Secondly, on behalf of the Government, I pay tribute to those firefighters, but also the control room staff and other emergency service personnel, who respond at some of the most difficult moments in people’s lives. The impacts of dealing with the situations that we have discussed this afternoon can stay with them long after an incident has ended, so it is vital that we support them with the skills and confidence they need to help people in crisis and to ensure their own wellbeing.

The data, as hon. Members have mentioned, is perfectly clear: firefighters are attending more suicide-related call-outs. In the year to March 2026, fire and rescue services in England attended 3,270 non-fire incidents involving suicide or attempted suicide. That is a 151% increase from 10 years ago. That trend reinforces the importance of firefighters being properly prepared and supported. But the attendance data does not tell us what training those firefighters receive, whether that training was adequate, why attendance has increased or how many individual firefighters have been exposed. The figures therefore provide a strong reason to examine current provision, but they do not demonstrate that existing training is inadequate or that mandatory training is the appropriate solution.

Our first step is to work with the sector to understand whether there are any material gaps in existing provision. We will seek the health and wellbeing task and finish group’s advice on current provision, and, taking account of that advice, consider with the National Fire Chiefs Council whether any further sector-led work is needed. If the evidence does identify material gaps, we will consider with the sector what further action would be appropriate. This could include the role of standards and inspection in providing greater assurance, but we do not want to pre-empt what the evidence tells us.

The important point to make clear is that any significant new national requirements, funding or assurance arrangements would require separate decisions, because further action will be informed by the evidence and what is practical and proportionate. I am glad the shadow Minister mentioned the need for proportionality. Our position is that work needs to be proportionate and predominantly sector-led unless the Government consciously decide to reprioritise resources. Responsibility for delivery is kept with fire and rescue authorities, while allowing the Government and sector partners to determine whether any further national or sector-led action is justified.

I want to make it clear, because this is the central point that my hon. Friend the Member for North Durham and others have put to me, that we are not ruling out mandatory national training in future. However, a nationally mandated requirement would represent a significant departure from the current approach. Fire and rescue authorities are responsible as employers for determining the training that their staff need, and the Government do not currently mandate individual training requirements. Our approach is generally, as I said, to support sector-led improvement, including through funding the National Fire Chiefs Council to target support where it is most needed. We do not currently have evidence that would justify making an exception to that approach for suicide prevention training.

In the Government’s view, the evidence does not demonstrate systemic failure across the sector or establish that mandation would be the most effective or proportionate response. However, given the increase in suicide-related incidents, stakeholder concerns and the policing commitment, there is good reason to work with the sector to understand whether there are material gaps in existing provision. As I said, if that work identifies significant and persistent gaps that cannot adequately be addressed through sector-led improvement, guidance or clearer expectations, we will consider what further action is justified by the evidence. But our immediate priority, as I have said, is to establish the evidence.

I should just make a point in terms of a comparison with the police because, as part of establishing the evidence base, we will draw on learnings from the police force. Police officers are being given protected time for trauma and suicide prevention training. Although there are important parallels between the services—firefighters and police officers can find themselves responding side by side to traumatic incidents—the policing commitment responds to the specific evidence and circumstances within policing, including geographical variation in workforce support and wider wellbeing pressures. The evidence of a particular problem in some police force training does not in itself demonstrate equivalent systemic gaps across fire and rescue services.

There is also existing support for the fire and rescue service, including the National Fire Chiefs Council’s suicide prevention and postvention toolkit, the development of which was supported through Government grant funding. The toolkit provides practical resources and pathways to support prevention, early intervention and postvention. We also recognise the important contribution of specialist organisations, including the Fire Fighters Charity and Samaritans. The Fire Fighters Charity provides dedicated suicide prevention resources and a 24-hour crisis line for the fire service community, which received more than 200 calls in its first year. Many services also work with Samaritans and other specialist organisations.

I will just say a little on improving existing training. Alongside our commitment to building the evidence base, the Government will also work closely with the sector to better understand best practice—there is good practice out there—and to identify where there might be material gaps in existing provision.

We will seek the advice of the cross-sector firefighter health and wellbeing task and finish group. Taking account of that advice, the Fire Minister—Baroness Blake of Leeds—will discuss with the National Fire Chiefs Council, the Local Government Association and other partners what further sector-led work is needed to identify and address material gaps. We will also engage with the Fire Standards Board and His Majesty’s Inspectorate of Constabulary and Fire and Rescue Services to consider how standards and inspection can provide stronger assurance.

[Marie Goldman]

The Minister has said “sector-led” a few times in his response, which is important. However, it is my understanding that this training is essentially something that Samaritans is asking for, and who can say that Samaritans does not lead the sector when it comes to suicide prevention? I wonder what more he needs to see from the sector to suggest that providing this training would not be the right approach to adopt.

[Matthew Pennycook]

I have tried to convey that although we take very seriously the concerns of Samaritans—we will work with Samaritans and we are interested in its evidence—it is the Government’s assessment that we do not have the evidence base that would justify, at this moment in time, mandating national guidance in a way that would be a significant departure from the current approach. However, as I have also tried to make clear, we are not shutting down the option of mandating such guidance; we want to explore whether it is required.

I will say a little on cross-Government work, because the hon. Member for Keighley and Ilkley (Robbie Moore) mentioned it; I will ensure that colleagues in the Department of Health and Social Care register his concerns. The Government are addressing the impacts of work-related trauma more widely through our broader work on firefighter health and wellbeing. My Department and the Department of Health and Social Care are working jointly with the sector on prevention, early intervention and longer-term support. This includes development of a cross-sector firefighter health and wellbeing concord, research into occupational health risks, and work to develop an enhanced health monitoring offer, building on existing arrangements and tailored to the occupational risks that firefighters face. That matters because, as I have said, the effects of traumatic incidents do not necessarily end when the incident ends; they may emerge later, or build up over a career. The Government’s approach recognises both the skills that firefighters need to help members of the public in crisis, and—as I have also said—the support that they themselves need.

Finally, as the Government have already announced, we intend to launch the college of fire and rescue in 2029 to strengthen professional standards, skills and training across the sector. The Government will carefully consider what support we might provide as the college’s functions are finalised, and I will ensure that the specific point made by my hon. Friend the Member for North Durham is considered by the Fire Minister.

I again thank my hon. Friend for securing this debate and I thank hon. Members for contributing. Firefighters are being called to increasing numbers of these deeply difficult incidents. They need the skills and confidence to help people experiencing suicidal crisis, and they deserve support for the effect that such work might have on them. Although I have not been able to commit to mandating a particular national training model today, I hope that in my response to the debate I have been able to reassure hon. Members that the Government are not simply assuming that current provision is good enough. As I have made clear, we want to work with the sector to understand whether there are material gaps in existing provision and to determine what further action, if any, is needed.

As we do so, I know that the Fire Minister will be more than happy to keep my hon. Friend the Member for North Durham and other hon. Members updated, and I will make sure that she responds specifically to a number of the points that my hon. Friend made, not least regarding what engagement she has had as Fire Minister with the Fire Brigades Union.

14:28

[Luke Akehurst]

I thank everyone who has participated in what I think has been a useful debate, during which we have had the time to delve into a serious and important subject in quite some detail.

The hon. Member for Keighley and Ilkley (Robbie Moore) made the important point that the first responder on the scene is critical and that the training that they have received can save lives. He outlined the tragic case of his constituent’s daughter, and it was important for us to hear about what this issue means for the people who are directly affected by it.

I also thank my hon. Friend the Member for Blaydon and Consett (Liz Twist) and the hon. Member for Winchester (Dr Chambers), who have now left the Chamber, but who made important and useful interventions before they did so.

The Liberal Democrat spokesperson, the hon. Member for Chelmsford (Marie Goldman), made some very important points in support of the call by Samaritans for mandatory training, and very importantly she raised the issue of the support offered to firefighters compared with the support offered to the police.

The shadow Minister, the hon. Member for Ruislip, Northwood and Pinner (David Simmonds), talked about the changing nature of call-outs and the increased number that involve an individual in crisis. He made a very important point about learning from what is effective in training programmes in other sectors rather than reinventing the wheel. He also made the important point about a proportionate approach to the time taken up in training and the costs involved, along with raising the important issue of the duty of care to the firefighters.

I thank the Minister for his very detailed response to the debate and for paying tribute to Samaritans as an organisation and our firefighters. It was important that he mentioned the control room staff. After a meeting last Friday, I had the honour of being taken into the control room for County Durham and Darlington by the chief fire officer. It was the height of the firework season and very busy, and I saw the calm way that those people dealt with dramatic phone calls coming in short order. I think of the impact that working in that way every day must have on them.

The Minister mentioned the importance of the National Fire Chiefs Council for looking at any gaps in training as a sector. He also mentioned not pre-empting the evidence that comes back along with the need for it to be sector-led. I accept that point and welcome that he did not rule out—if the evidence shows that it is needed—responding positively to the call for a national mandated requirement. I look forward to hearing what evidence comes back from that survey and whether the gaps identified from talking to the fire chiefs match those identified in the desktop survey that Samaritans did through freedom of information requests. I take the Minister’s points about learning from the police experience but not seeing it as mapping completely across. His points about the potential role of the college of fire and rescue were also important.

I end by echoing what the Minister said about not assuming that current provision is good enough. Certainly, the research by Samaritans suggested that there is considerable postcode variation even between the fire brigades within an individual region. I am reassured by what the Minister said about properly going away and looking at the evidence and seeing if what Samaritans has asked for is indeed what is needed.

Question put and agreed to.

Resolved,

That this House has considered the matter of suicide prevention training for fire and rescue services.

14:30

Sitting suspended.

Hospitality Sector VAT: Local Economies, Employment and Growth

Thursday 12th November 2026 Westminster Hall

[Dr Rupa Huq in the Chair]

[Relevant document: Correspondence from the Northern Ireland Affairs Committee to the Chancellor of the Exchequer, on the taxation of the hospitality and tourism sectors in Northern Ireland, reported to the House 22 October.]

15:14

[Dr Rupa Huq (in the Chair)]

As it is more than 10 minutes past 3 pm and the Member in charge is not here yet, I call Tonia Antoniazzi to move the motion.

[Tonia Antoniazzi (Gower) (Lab)]

I beg to move,

That this House has considered the impact of VAT policy for the hospitality sector on local economies, employment and growth.

It is an honour to serve under you chairship, Dr Huq; I am moving the motion on behalf of my hon. Friend the Member for Blackpool South (Chris Webb). Hospitality and tourism are not just industries; they are major employers, anchors of local economies and a vital part of the social fabric of communities right across the United Kingdom. Yet in my roles as Chair of the Northern Ireland Affairs Committee and chair of the all-party parliamentary beer group, we have seen that current VAT policy, combined with a range of other tax pressures, is placing hospitality businesses under significant strain and undermining their ability to compete.

Our inquiry heard from hotels, pubs, restaurants, caterers and tourism operators across Northern Ireland. We travelled to Derry/Londonderry and met businesses on the ground. Their message was consistent and clear: the current tax environment is holding back growth, limiting investment and threatening the long-term viability of businesses that are already operating on tight margins. Hospitality businesses are contending with a perfect storm of rising costs. Increased employer national insurance contributions have also hit the sector, which relies heavily on part-time and lower-paid workers. We heard evidence that it is around 8% more expensive to employ someone on the minimum wage in Derry/Londonderry than it is just a short distance away from the border in the Republic of Ireland.

Businesses also face high business rates and rising energy costs. Hospitality is an energy-intensive sector with little flexibility to move consumption away from peak trading hours. At the same time, consumer spending remains under pressure, particularly in Northern Ireland, where average wages remain lower than the UK average.

[Gregory Stafford (Farnham and Bordon) (Con)]

The hon. Lady is giving an excellent description of the problems happening in Northern Ireland, but they are happening in England, Wales and Scotland as well. I hold a regular quarterly meeting with my local publicans and hospitality businesses. They say repeatedly that the situation they face at the moment is worse than it was under covid, because at least under covid the Government stepped in to support them. The Government are now penalising them through all the things the hon. Lady just mentioned, such as the business rates increases—for one pub in my area they are going up by £32,000. That is just not sustainable, and there are the national insurance rises, too. Does she agree that although VAT is part of the picture, the Government really need to deal with all sorts of other parts of the tax system?

[Dr Rupa Huq (in the Chair)]

Order. The hon. Member’s remarks are a bit long for an intervention.

[Tonia Antoniazzi]

The hon. Member may question why, as a Welsh MP, I am not calling for a UK-wide reduction. I am not calling for that per se, but I do want to lay out why Northern Ireland is a special case and why it could be useful for the Government to do a pilot.

The more striking issue raised during our inquiry was the impact of VAT policy on competitiveness. Hospitality businesses in Northern Ireland operate in a unique environment, competing not only with businesses in other parts of the UK, but directly with establishments in the Republic of Ireland, and therefore Europe. The Republic of Ireland’s hospitality services benefit from significantly lower VAT rates, including a 9% rate on food and catering services and a 13.5% rate on accommodation, compared with the UK’s standard rate of 20%. That disparity has real-world consequences.

We were told that tour operators organising itineraries across the island of Ireland are increasingly choosing accommodation south of the border because of lower costs. Conference organisers, wedding planners and major event operators are making similar decisions. In many cases, Northern Irish venues simply cannot compete, despite offering excellent facilities and service. The result is real: lost business, lost investment and lost opportunities for growth. I wish to be clear: witnesses did not argue that VAT is the only challenge facing the sector, but many viewed it as the most straightforward and effective lever available to Government.

A reduction in VAT would provide businesses with breathing space. It would improve cash flow, strengthen margins, support investment in premises and staff, help to absorb rising operating costs and enhance competitiveness in an all-island market. Importantly, businesses told us that the primary benefit would not necessarily be cheaper prices for consumers. Rather, it would allow businesses to remain viable, invest for the future and create the conditions for sustainable growth. That is why the Committee has called for the Government to introduce a four-year pilot scheme in Northern Ireland, reducing VAT to 10% on food, excluding alcohol, and on accommodation.

A pilot scheme would provide an opportunity to gather robust evidence. It would give businesses sufficient time to adapt, secure new contracts, influence customer behaviour and demonstrate whether a lower VAT rate can stimulate economic activity, increase employment and ultimately generate broader returns for the public finances. Such an approach would not only benefit Northern Ireland; it could also provide valuable lessons for hospitality policy across the UK.

We have also called on His Majesty’s Treasury to engage with the Irish Government and Tourism Ireland to examine the impact of Ireland’s recent VAT reductions and previous temporary cuts. If there is evidence that lower VAT rates in Ireland have supported growth, jobs and tax revenues, we should be willing to learn from Ireland’s experience.

Hospitality businesses do not want special treatment. They want a fair opportunity to compete, and a tax system that recognises the unique pressures they face and the immense contribution they make to local economies. If we are serious about supporting jobs, encouraging investment and strengthening our tourism offer, we must recognise the role that VAT policy plays in shaping competitiveness. The case for a targeted VAT pilot in Northern Ireland is strong, the evidence is compelling and the potential rewards for growth and prosperity are significant. I urge the Government to listen to the sector and act accordingly.

15:20

[Chris Webb (Blackpool South) (Lab)]

I apologise for my slight delay in being here, Dr Huq; I had a personal incident back home and I was just on the phone about it.

As the chair of the all-party parliamentary group on hospitality and tourism, and the MP for a proud seaside town, I welcome this opportunity to talk about the important and timely issue of the role that VAT policy can play in supporting hospitality, tourism, employment and economic growth.

Hospitality is an important industry for communities across the country, employing around 3.5 million people nationally. On average, it provides work for 5,000 people in each constituency, but for constituencies such as Blackpool South that average figure is more than doubled. Our visitor economy supports local jobs, attracts investment and drives regeneration. Hospitality is central to our economic success and our identity. Hospitality jobs matter to local people and to the town.

For many people in Blackpool, including myself, hospitality gave us our first pay packet, our first reference and our first introduction to the world of work, and for many people that first job in hospitality turns into a career. I welcome the Government’s recent business rates freeze package for retail, hospitality and leisure. That freeze will benefit thousands of businesses in Blackpool. The changes to thresholds will mean that 68% of retail, hospitality and leisure properties in our town will now pay no business rates at all. That is a significant intervention, demonstrating that Ministers recognise the importance of these sectors.

However, we need to go further. Alongside Kate Shane, CEO of Blackpool Tourism Ltd, I continue to make the case for a Blackpool tourism enterprise zone, building on the existing enterprise zone model and extending it to our hospitality and tourism economy to unlock further growth, investment and job creation.

[Priti Patel (Witham) (Con)]

It is very nice to hear about Blackpool and everything in the hon. Gentleman’s constituency; I declare that I have visited Blackpool on many occasions. Hospitality businesses in the Witham constituency have been hit just as hard by VAT on the sector, as well as by employment taxes and the cumulative burden of increased taxation. Would he consider working with all of us in this debate to get the Government to recognise that at the next fiscal event—which will be next year, or even in the Finance Bill, when it arrives—by making changes to the VAT regime for hospitality, which is such an important sector?

[Chris Webb]

I thank the right hon. Lady for her intervention. I hope that my actions as the chair of the APPG on hospitality and tourism for the last two and a half years have shown that I will work with anyone across this House to support hospitality. The APPG has been quite vocal, including in our inquiries, about why there is a need to lower VAT, and we will continue to make that case.

Thousands of residents in my constituency have backed my idea to build a state-of-the-art arena at the Blackpool Central site, and we also have Government support for this proposal. However, by going further to support our tourism businesses at a policy level, we can give large investors the confidence to come to Blackpool, and ensure its future as a modern and leading entertainment destination, especially as we are in the final of the city of culture contest, which I know we will win.

Blackpool was built as a place of rest, relaxation and entertainment for the working classes, and our visitors today continue to be highly price-sensitive. Blackpool prides itself on being able to offer a good family trip for the price of car parking, an ice cream and a fistful of 2p coins to feed the arcade machines. Thanks to the work of Blackpool council and Blackpool Tourism Ltd, we offer large-scale free events, ranging from our brilliant airshow to the Blackpool Illuminations, which bring hordes of tourists to our coast in search of a family budget-friendly trip.

However, we also rely on families spending much more money than they do already. When offered value for money, they will do so, but small increases in the cost of accommodation, meals, attractions and entertainment influence how long a family chooses to stay.

[Mike Wood (Kingswinford and South Staffordshire) (Con)]

The hon. Gentleman is making a powerful speech about the importance of the hospitality sector and the impact of even relatively small increases in costs for families. Does he agree that the Government ought to drop their proposals for an overnight visitor levy, which will only make accommodation more expensive for the families visiting his constituency?

[Chris Webb]

The hon. Gentleman has clearly had a quick glance at what I am coming to next in my speech. I welcome the fact that visitor levy receipts will stay local and will support tourism-related priorities, but businesses in places like mine have understandably raised concerns about the cumulative impact of rising costs. The levy is just one more addition to a growing list. What might work in the centre of Manchester does not work in coastal communities like Blackpool.

[George Freeman (Mid Norfolk) (Con)]

The hon. Gentleman is making a powerful point about Blackpool. I have many happy memoires of large party conferences there back in the day. He is talking about urban hospitality, but I want to make a plea for rural hospitality. My Mid Norfork constituency has 135 villages and 50 pubs, which are the heartbeat of the community; many businesses meet in them, and they are warm places in the winter. They are being hammered by high energy costs and the jobs tax, the tourism tax and the other taxes the Government have introduced. Rather than a £10 billion VAT cut for everyone, can we have targeted relief to rural hospitality venues, which are dying, along with the rural economy?

[Chris Webb]

The APPG has raised similar issues in our inquiries. We have said to the Government, at not just this Budget but the previous one, that we need to look at support packages, rather than sector-wide schemes. If the money is not available, we need to look at where the need is greatest right now.

The World Economic Forum’s travel and tourism development index places the UK 113th out of 119 countries for price competitiveness. Blackpool faces growing competition from domestic destinations and international markets, where hospitality VAT rates are often significantly lower.

Every £1 spent by a visitor in Blackpool moves through the wider economy to local suppliers, taxi drivers, independent retailers and cleaning businesses. When a family has a good weekend away, the benefit is felt far from the till.

If the Government want to invest in places such as Blackpool to deliver maximum value, they must also consider the tax environment in which our businesses operate. Our town continues to face significant challenges with economic inactivity and young people who are not in education, employment or training.

It is not just the lack of jobs: our young people are navigating entrenched multi-generational poverty, housing insecurity, caring responsibilities and poor health. They deserve the opportunity to get their lives on track. As I have said many times, hospitality is the sector best placed to give them their first step. I therefore welcome the partnership between the Government and major hospitality employers, facilitated by UKHospitality, which will deliver 100,000 opportunities for young people. But if we want businesses to create more jobs, take on more apprentices and invest in training, we must ensure that they have the confidence and capacity to grow.

[Several hon. Members rose—]

[Chris Webb]

It is busy! We will work our way round.

[Mims Davies (East Grinstead and Uckfield) (Con)]

The hon. Gentleman mentioned the wider economic impact. East Grinstead has the headquarters of the Caravan and Motorhome Club, which provides access to more than 2,200 campsites, glamping and all sorts of wonderful places. It will be affected by the overnight visitor levy, which means that a meal out and other things families want to do on those holidays just will not happen. Does the hon. Gentleman agree that that is what this means for families?

[Dr Rupa Huq (in the Chair)]

Order. We have half an hour to get everyone in. I hope Chris Webb will conclude so that other people can get in.

[Chris Webb]

I understand the point the hon. Member for East Grinstead and Uckfield (Mims Davies) makes, and I have heard it from caravan businesses and parks in my constituency. That has to be part of the discussions after the Second Reading of the Visitor Levy (England) Bill.

[Jessica Toale (Bournemouth West) (Lab)]

rose—

[Chris Webb]

I give way to my hon. Friend.

[Dr Rupa Huq (in the Chair)]

Order. No, you are not taking any more interventions. There is a hard stop at 4 pm, and we need to hear from the Front Benchers.

[Chris Webb]

The Great British summer savings scheme, which temporarily reduced VAT on attractions this summer, is a good case study of the potential impact of policy changes on local economies, employment and tourism. The scheme recognised that targeted VAT reductions can support both consumers and businesses, as can free bus travel.

Take the award-winning Blackpool pleasure beach in my constituency. During the pandemic, when VAT was cut to 5%, the park’s turnover rose, and it recorded an exceptional profit of £10.5 million—the biggest in years. As a consequence, it paid £1.9 million more in tax to His Majesty’s Revenue and Customs. Over the summer, businesses in my constituency were saved because of the summer savings scheme.

What assessments has the Minister’s Department made of the impact of rising costs on hospitality businesses, business investment, employment and opportunities for young people? What assessment has been made of the potential impact on local economic growth of reducing hospitality VAT? I look forward to hearing more from colleagues and to the Minister’s response.

[Dr Rupa Huq (in the Chair)]

I am setting a hard time limit of three minutes for everyone from now on.

15:30

[John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)]

It is a pleasure to serve with you in the Chair, Dr Huq. Whether it is a seaside town in Lancashire or on the Berwickshire coast, the story is much the same. In the coastal town of Eyemouth, next to the harbour, stands Giacopazzi’s, which was established in 1898 by Lorenzo Giacopazzi. Arriving in Scotland on his way to America, he instead decided to stay on the Scottish coast to seek his fortune. The business has been run by his family ever since, becoming famous for its fish and chips and award-winning ice cream. The family has recently invested in a new ice cream factory, a bar and bistro, and holiday accommodation. However, Peter Giacopazzi has written to me, as have many hospitality businesses across my constituency, to say that pressure has never been greater. The costs of employer national insurance, wages, energy and ingredients have all gone up. On top of that sits VAT at 20%.

In the borders, hospitality is the lifeblood of the high street. From the hotels of Kelso and Melrose to the cafés of Hawick and Galashiels and the bed and breakfasts at St Abbs and Coldingham, these businesses are often a town’s largest private employers, providing our young people with the opportunity to take that all-important first step into the world of work.

At the same time, many of these businesses in the Scottish Borders, Scotland and across the UK are competing for customers who might otherwise go to Europe. Our hospitality VAT rate is the second highest in Europe. France, Italy and Spain charge 10%, Ireland charges 9%, and Germany charges only 7%. The consequences are bleak. UKHospitality reports that three hospitality businesses have closed every day this year, and nearly 100,000 jobs have been lost across the sector. There is no doubt that lowering the rate of VAT would help save jobs.

[Mr Gagan Mohindra (South West Hertfordshire) (Con)]

My hon. Friend is making an excellent speech. As the shadow Minister, my hon. Friend the Member for Grantham and Bourne (Gareth Davies), will be aware, the Laffer curve says that if we tax something, we discourage it. Does my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk agree that the Government’s increase in employer national insurance contributions means they are forcing companies and businesses not to expand and, in some cases, to close down?

[John Lamont]

My hon. Friend makes an excellent point. We taxed smoking to try to stop people smoking, and the Government’s philosophy seems to be that they are taxing jobs to try to stop people being employed.

During the pandemic, hospitality VAT was cut to 5% to help businesses to survive. The Prime Minister has spoken in favour of a rate more aligned with Europe. Last month’s Budget was the chance to make that change, and it was missed. Business rates in Scotland are, of course, devolved so changes to rates in England do nothing for businesses in my constituency. However, VAT is UK-wide, so a cut would reach every hospitality business in the country, including those in the Scottish Borders.

My ask of the Minister, on behalf of the hundreds of businesses across the Scottish Borders that are desperate for financial relief, is that the Government reduce the pressure on businesses by looking again at a reduced VAT rate for the sector. Businesses such as Giacopazzi’s have served our communities for hundreds of years. Let us give them a fighting chance to survive, Minister.

15:34

[Brian Leishman (Alloa and Grangemouth) (Lab)]

It is a pleasure to have you in the Chair, Dr Huq. I thank my hon. Friend the Member for Gower (Tonia Antoniazzi) for being a super sub and introducing the debate.

I also thank all the publicans from across Alloa and Grangemouth, but especially Craig and Greg from the Royal Oak in Alloa for their time and for telling me about the impact that 20% VAT has on their business. Of course, hospitality venues must deal with more issues than just VAT. Those include soaring business rates, which Scottish pubs do not get relief from, the increase in alcohol duty, and crippling energy rates.

There is no doubt about it: the pub game is extremely tough. In Scotland, a pub closes on average every four and a half days. This year, that amounts to roughly 600 jobs lost. It is widely acknowledged that independent pubs often struggle to compete with the industry big guns such as Wetherspoons and Greene King. Those chains can negotiate lower prices for products and absorb loss leaders, and their profit and loss accounts are more able to sustain the cost of overheads.

With VAT at 20%, many independent pubs have to put prices up or cut costs. That may mean reducing opening hours, closing for full days or, sadly, job cuts. It definitely means being unable to grow their business. Quite simply, pubs in my constituency and all over Scotland need help. Reducing the VAT rate would give venues much-needed “breathing space”—something that means a lot to my Chancellor. Businesses could employ more staff and boost local economic growth—something that means a lot to our Prime Minister.

Alloa and Grangemouth has more than 550 hospitality establishments, with more than 3,200 people employed, bringing more than £100 million of annual economic value. Pubs and restaurants are essential to life in Alloa and Grangemouth and all of Scotland. That is why I support calls to lower VAT for hospitality businesses. Minister, let’s get behind these businesses and help them grow and thrive.

15:36

[Mr Paul Kohler (Wimbledon) (LD)]

It is an honour to serve under your chairship, Dr Huq. I refer Members to my entry in the Register of Members’ Financial Interests. I own CellarDoor, a small bar in Covent Garden, so I do not speak about hospitality in the abstract. I know what it means to have to find the money to make payroll in a bad month, to cut a shift I would rather keep and to wonder whether the doors will open next year.

We converted CellarDoor from a disused underground gentlemen’s toilet 20 years ago. We have weathered the financial crash, Brexit and covid, but I have never known it as hard as it is now. The new Prime Minister promised much, but his Chancellor delivered little. The Night Time Industries Association called the Government’s latest Budget “deeply disappointing” and said that it failed

“to deliver the meaningful support”

the sector “desperately needs”.

Raising the business rates relief threshold is welcome, but in Wimbledon just 1% of my local businesses will benefit. The hospitality industry is not a nice-to-have; it is an essential part of the economy, the largest employer of young people and school leavers, and the backbone of communities up and down the country. It invests £7 billion in high streets annually and supports 3.5 million jobs.

Across Wimbledon, the hospitality sector provides more than 4,200 jobs and brings £150 million into the local economy, but our pubs, bars, hotels, restaurants and cafés are feeling the strain. Craig Hurring of Love Wimbledon told me that businesses are facing “a perfect storm” of increased employer national insurance contributions, above-inflation uplifts to the minimum wage and continuing weak consumer confidence.

Nationally, the toll is stark. We are losing the equivalent of 13 night-time venues a week, while 100,000 jobs in the hospitality sector were lost in two years. Something must be done. The simplest lever is VAT. Our current rate of 20% is double that of some of our European neighbours.

[Leigh Ingham (Stafford) (Lab)]

Does the hon. Gentleman know when the rate was raised to 20%, and which parties were in government when that happened?

[Mr Kohler]

The issue is absolutely now, not the past. In Spain, hospitality pays a reduced rate of 10%, while across our one land border the Republic of Ireland has reduced VAT on hospitality to as low as 9%. We know that VAT cuts do work because we have done it before, during the pandemic. This summer, we learned that lower VAT brings more people through the door and helps struggling businesses.

Minister, will the Treasury commission a full cost-benefit analysis of reducing VAT on hospitality—not just the headline cost, but also the return in jobs, growth and lower welfare spending? The Night Time Industries Association has produced an analysis suggesting that it would have a net positive effect on the Government’s fiscal position—I think that is what we call a win-win.

In short, hospitality is in crisis. There is no point in the Government giving a little with one hand while continuing to take far more with the other. The time has come for real action, not warm words.

15:39

[Alex McIntyre (Gloucester) (Lab)]

It is a pleasure to serve under your chairship, Dr Huq. If not for hospitality, I would not be here today—quite literally, because my parents met while working second jobs in a pub in north London. Later, they ran a small bed and breakfast, where I was cleaning rooms and serving breakfasts from an age I probably should not advertise here. I cooked my first full English for paying guests at 13 years old, and at the same age started working in the local pub as a pot wash. At 15, I moved to front of house at another hotel, where I worked for more than seven years. Hospitality gave me many of the skills that led me to this place, and I care deeply about the sector.

Times are tough. Small businesses across Gloucester tell me time and again about rising energy bills and soaring food prices, driven up both by the wars in Ukraine and the middle east, and by the tax burden they face. But in the middle of this difficult patch, Gloucester’s hospitality sector continues to deliver for local residents. Dr Foster in our docks was named best town pub at this year’s Great British pub awards, a real testament to the team there. We have fantastic independent coffee shops such as Coffee House 43, Forum Coffee and the Roastery, and brilliant restaurants such as Topoly’s Italian on Southgate Street. Just last Sunday, I was in The Fountain Inn for a fantastic roast dinner in between Remembrance Day services.

Many of those businesses have asked for a cut in VAT; I understand those calls, but I also recognise that in the current economic climate, that is a challenging decision for any Government to deliver. Any tax cut, proposed by any party, needs to be paid for, but that does not mean that we should not be supporting our hospitality industry, and in particular targeting support for local, independent small and medium-sized enterprises. I welcome the Government’s recent announcements on business rates: a 20% cut for pubs, clubs and music venues from April and taking around 70,000 smaller hospitality and retail businesses out of business rates altogether.

[Jessica Toale]

Does my hon. Friend agree that, if the Government cannot go the full way on the VAT cut that some in the hospitality sector are proposing, they should consider Hospitality Voice’s proposal, which is backed by research from Bournemouth University, for an emergency, time-bound cut from 20% to 13%? That would be an affordable alternative way to protect jobs and boost local economic activity.

[Alex McIntyre]

My hon. Friend makes an eloquent point raising important research from her constituency, and I am sure that the Minister has heard her intervention. I welcome the fact that the Government have made a start on business rates. I have continuously raised that issue with Ministers on behalf of Gloucester business owners, and it is good to see action.

I know that the Minister shares my commitment to our hospitality industry, so it would be helpful if he set out how the Government intend to go further to support hospitality businesses in Gloucester. For future generations, I know how important a first job in hospitality can be. We have 2,500 young people not in employment, education or training in Gloucester; that is why I am hosting the Gloucestershire futures summit later this month at Kingsholm rugby stadium. Can the Minister set out how the Government will make it easier for hospitality businesses to hire young people and offer the part-time weekend jobs that are the springboard for many young people in my city? Our pubs, cafés and restaurants are where Gloucester comes together. I owe my family to the jobs that they create. Let us make sure that they are still there for the next generation.

[Dr Rupa Huq (in the Chair)]

There are still nine people left and a hard stop at 4 o’clock, so there will be an immediate time limit of two minutes, although perhaps not everyone will get in.

15:43

[Seamus Logan (Aberdeenshire North and Moray East) (SNP)]

It is a pleasure to serve under your chairship, Dr Huq. I congratulate the hon. Member for Blackpool South (Chris Webb) on securing this debate.

I rise in support of small hospitality businesses. I hope that the Minister can discern the difference here; I am not speaking about large hotel, coffee shop or pub chains. If the Government are serious about supporting small hospitality businesses, protecting jobs and sustaining our high streets and coastal towns, they must act on VAT for those businesses. There will be real consequences if they do not: fewer jobs, less opportunity and, ultimately, weaker local economies. Yet, at the same time that these costs rise for those businesses, they are expected to compete with a VAT rate that remains stubbornly high compared with those of our European neighbours.

In February of this year, the Prime Minister, then Mayor of Greater Manchester, publicly said that he would argue for a hospitality VAT rate in line with Europe. It was so disappointing that in the first Budget under his leadership there was nothing about VAT for small hospitality businesses. This week, he said that that Budget was incredibly popular. I simply do not know what planet he is on. We have a situation where businesses are struggling to recruit, facing rising employment costs and dealing with high VAT all at the same time.

Ultimately, this is not just about balance sheets; it is about the local café that sponsors the local football team, the pub that hosts community events and the family-run restaurant that has been passed down through generations. It is about The Captain’s Table and Mrs Maitland’s café in Fraserburgh, and the Saplinbrae Hotel in Mintlaw—those are the family businesses that I am speaking about. They are places that bring people together, create jobs, support local suppliers and give our towns and villages their character. They deserve more than warm words; they deserve action. I urge the Minister to look again at VAT for small hospitality.

15:45

[Mary Kelly Foy (City of Durham) (Lab)]

It is a pleasure to serve under your chairship, Dr Huq. I am proud to represent so many outstanding hospitality businesses. Whether it is the Kingslodge Inn off Flass Street, Daisy Rose Coffee House in Cheveley Park, Adventure Valley in Brasside or the many other independent cafés, pubs and attractions across my constituency, hospitality businesses contribute enormously to community life.

Hospitality is one of the UK’s largest employers, supporting 3.5 million jobs and providing vital opportunities for young people. For many, hospitality businesses provide that crucial first opportunity to gain skills, confidence and work experience, helping them to build long-term careers. In Durham, hospitality is also central to our visitor economy. People come to enjoy our UNESCO world heritage site, which includes the magnificent Durham cathedral and castle, to attend events such as the Miners’ Gala and the Durham Fringe Festival, to enjoy performances at the Gala theatre and to experience everything that our fantastic city has to offer.

At a hospitality roundtable I hosted, many businesses raised concerns about costs and competitiveness, particularly around the UK’s VAT rate for hospitality, which is higher than that of many European countries. As businesses continue to face significant pressures, it is right that we consider how the tax system can best support growth, investment and jobs. I welcome the Government’s commitment to delivering growth in every postcode and supporting our high streets. Will the Minister outline what assessment has been made of the impact of current VAT arrangements on hospitality employment and investment? What consideration has been given to the role VAT policy could have in supporting local economies and regeneration in the city of Durham?

15:47

[Robbie Moore (Keighley and Ilkley) (Con)]

When a pub closes in Keighley, it is not just that we lose a business: the high street loses footfall, a teenager loses their first job opportunity and a community loses one of the best places for everyone to meet. In my constituency, hospitality is the beating heart of our economy; from Timothy Taylor’s, brewing in Keighley since 1858, to the pubs, cafés and guest houses that welcome visitors, hospitality businesses support thousands of local jobs, and right now, every one is being squeezed by a Labour Government that treat them as a cash cow, and not as the valuable assets that they are.

Ministers have already piled £6.8 billion of new costs on to hospitality businesses through two Budgets, the jobs tax, the cut to rates relief and the Employment Rights Act 2025. Right now, a likely £1.6 billion tourism tax will be hitting businesses like those across Haworth and Ilkley. What is the result? According to UKHospitality, 100,000 hospitality jobs have been lost in two years, making up 45% of all jobs lost across the entire economy. One in four businesses are losing money, and one in six fear they could fail within a year. With around 30% of young people getting their first jobs in hospitality, it is the next generation that is paying the price of this Labour Government.

I have three questions for the Minister. Do the Government accept that their Budget has cost the sector hugely? Will they scrap the tourism tax? Will the Prime Minister finally honour his words of February this year and support a VAT cut? The pubs, the cafés and the hospitality sector across Keighley and Ilkley do not want more warm words. They need a Government that stop taxing them out of existence.

15:49

[Dr Simon Opher (Stroud) (Lab)]

In my constituency, we are incredibly fortunate to have loads of thriving community independent pubs, restaurants and cafés. As my hon. Friend the Member for Gloucester (Alex McIntyre) said, many of us had our first jobs in pubs. I have been speaking to a number of people in independent hospitality businesses, such as Greg at Stroud Brewery, the irreplaceable Lotte and Miles at the Prince Albert, Fred Hulls at The Royal Oak in Wotton-under-Edge and others in many other pubs in my area. I welcome the steps taken by the Chancellor in the recent Budget to reduce the burden of business rates. Increasing the small business rates relief threshold has taken hundreds of our local businesses out of the rate systems altogether and many other venues have benefited from a two-year freeze.

One thing that many publicans talk about, however, is VAT, which creates a big financial burden. As has been said, we charge 20% VAT, which is a lot higher than most of Europe. I support a targeted reduction; we must be careful, because a universal cut in VAT for hospitality would cost about £12 billion and give McDonald’s about £400 million, which I am not in favour of. However, a targeted solution such as that proposed in Bournemouth is surely the way forward, so that our smaller pubs and hospitality venues can benefit.

I hope that Ministers will go further and examine the case for VAT relief. We must protect an industry that supports jobs—for many of us, our first jobs—strengthens our local economies and brings our communities together.

15:51

[Tom Gordon (Harrogate and Knaresborough) (LD)]

It is a pleasure to serve with you in the Chair, Dr Huq. Harrogate is often referred to as the jewel in the crown of North Yorkshire’s cultural offering. We have the flower show, the Great Yorkshire Show, the Harrogate International Festival, which is celebrating its 60th year, the conference centre and much more. We have the likes of the Great Knaresborough Bed Race in the town next door, which also has its iconic castle and viaduct. That means that we have a slew of fantastic hotels, pubs and cafés that support the important visitor economy in our area.

After the Budget a few weeks back, I held my second post-Budget business breakfast with the Harrogate District chamber of commerce. The thing that really came through was that they felt that the Budget was a missed opportunity to support the lifeblood of our local economy. They called for a VAT cut, which would help to reinvigorate our high streets, get young people into work and support the local economy, and were left disappointed with the Budget’s lacking ambition.

UKHospitality has a well-publicised campaign, “VAT’s the Problem”, to cut VAT to 10%. I suggest to the Minister that, if a cut to 10% would be too much, he could pick up Lib Dem plans to cut VAT to 15%. If we do not do something, we will see more businesses shut up shop and a further decline in our high streets. All that comes at the same time that the Government are looking to introduce a visitor levy, which would add to and compound those same problems. Will the Minister meet with Members who have made that point today and look again at a cut to the VAT?

15:52

[Leigh Ingham (Stafford) (Lab)]

It is a pleasure to serve under your chairship, Dr Huq. I commend my hon. Friends the Members for Blackpool South (Chris Webb) and for Gower (Tonia Antoniazzi) on this debate on an important topic that comes up a lot locally for me.

Like other Members, I have many businesses in my constituency concerned about rising costs and calling for greater stability. I recently had a lengthy discussion with Adam, the landlord of The Royal Oak—I think that is the third Royal Oak to be mentioned today—an award-winning independent pub in Church Eaton in my constituency. He was candid with me about the reality of running an independent pub.

Before I go into detail on the challenges he faces, I want to take a moment to note what an incredible steward he is of this wonderful community asset. The Royal Oak was acquired back in 2020, when members of the village clubbed together and put their mortgages on the line to save it. The period since then has been turbulent, including the pressures of the pandemic, but they have persevered because The Royal Oak is central to village life. Adam has personally committed to giving back to youngsters from the area the same opportunities he got as a young man. Right now he employs two local young lads, but the reality is that he and his family are working many unpaid hours because of spiralling costs.

Another award-winning business in Stafford, Jojo’s Fish & Chips, also shared with me their very real concerns. I will quote the owner, John, directly:

“It’s not a handout we are looking for; it is about creating a fairer system that enables small businesses to not only survive but also to thrive.”

I totally agree with him.

We should be encouraging growth in our communities. I welcome the business rates review currently under way and look forward to its outcome, which will be essential for pubs. However, we must ensure that any cuts to VAT are targeted effectively so that support reaches those who need it most, rather than simply boosting the profits of large corporations that do not face the same pressures as our independents. I would welcome hearing more from the Minister on whether we are considering different rates and targeted approaches so that support can be focused on the independent businesses at the heart of our communities.

15:55

[Graham Leadbitter (Moray West, Nairn and Strathspey) (SNP)]

It is a pleasure to serve under your chairship, Dr Huq. I commend the hon. Member for Blackpool South (Chris Webb) for securing the debate and the hon. Member for Gower (Tonia Antoniazzi) for moving it.

First, I reiterate the SNP’s steadfast, long-standing support for an immediate reduction of hospitality VAT to 10%. From the highlands to the borders, hospitality is the beating heart of our communities, yet our pubs, cafés, restaurants and hotels are being crushed under the perfect storm of soaring energy costs, food inflation and the UK Government’s hike to employer national insurance contributions.

[Ben Maguire (North Cornwall) (LD)]

A very well-known hotelier in my constituency said that if he had known about that national insurance rise, he would not have opened a particular hotel and potentially not given all its job opportunities to young people. Does the hon. Member agree that a targeted national insurance cut for young employees would be a good way to boost the hospitality sector?

[Graham Leadbitter]

Yes, absolutely. That was well debated this week, and we supported it. The sector pays an unsustainable 82p in business taxes for every £1 of profit. The Prime Minister has previously recognised the situation and has stated his support for cutting VAT for the hospitality industry. Now that he sits in Downing Street he must finally match his past rhetoric with action.

That call does not come from the SNP alone; it is backed by an overwhelming coalition. Over 400,000 people, including 100 leading chefs, have backed the “VAT’s the Problem” campaign, alongside UKHospitality and the British Beer and Pub Association. The public demand is deafening—and nowhere is that clearer than in my community. Of all constituencies in the country, Moray West, Nairn and Strathspey recorded the highest number of signatures—616—to the recent parliamentary petition calling for a 10% VAT rate on hospitality.

We have already felt heartbreaking losses. Many venues are struggling to recover after devastating summer wildfires that kept visitors away from affected areas. Champions of our local hospitality economy are backing that campaign to stay afloat, including—among many others—Scribbles restaurant in Elgin, Harbour Lights café and restaurant in Lossiemouth, the Aberlour hotel, the Apiary café in Dalwhinnie, Antlers café in Newtonmore and, needless to say, the Cairngorm mountain, which has the highest venue in the UK at 3,500 feet above sea level.

The Treasury continually hides behind its static, short-sighted cost figures, but a VAT cut is not lost revenue. It will be substantially offset as businesses reinvest their cash flow directly into physical assets and additional staff. The Treasury should listen to the hundreds of thousands across the country backing the campaign, listen to businesses and residents, and deliver the 10% VAT cut that will release the potential of our hospitality sector.

15:57

[Josh Dean (Hertford and Stortford) (Lab)]

It is a pleasure to serve with you in the Chair, Dr Huq. Whether it was told to me by Ruby and Jordi, who run Bean and Gone in Hertford, or by the team at the Saracens Head, including Laura and everyone pulling pints, what I have been told by businesses is consistent: costs are rising and margins are thinner. Among a number of pressures, VAT was mentioned consistently.

When our businesses look to their European counterparts and see the comparative rates of VAT, it is no wonder they ask why VAT is treated so differently, and is a heavier burden, in the UK. I welcome measures in the Budget to provide relief on business rates, which come up in every conversation I have with businesses, but I understand why some hospitality business owners are asking whether those measures go far enough to address the challenges that they face.

The question is not simply whether we should consider a reduction in VAT, but how that change should be designed. A blanket reduction may sound attractive, but we must consider who it would benefit most. If a cut simply increases the margins of large, multinational chains, we will have missed an opportunity and let our businesses down.

In our towns and villages—mine is a semi-rural community—our hospitality businesses are essential. They provide spaces for people to gather and jobs for young people. They act as anchors for our community. I support a targeted approach to ensure that we support SMEs in the hospitality sector to continue to provide that space for people in our community. When those businesses struggle, the consequences are felt far beyond their four walls: jobs are lost, supply chains are weakened and our towns become less vibrant.

I have had the opportunity to meet representatives of many such businesses and they are both ambitious and community-minded. Members of Parliament may come and go, but those businesses have been in place for years—for decades or even longer. They deserve a tax system that recognises the value that they create, that supports them to provide employment opportunities, and that helps our businesses and communities thrive.

15:59

[Steve Darling (Torbay) (LD)]

It is a pleasure to serve under your chairmanship, Dr Huq. I congratulate the hon. Member for Blackpool South (Chris Webb) on obtaining this important debate. As somebody who was brought up in a guest house, this subject is in my DNA. In fact, as a three and four-year-old, I used to really enjoy sitting with the guests for their evening meals. That used to annoy my father massively, so he would drag me out from among the guests. One time, my sandal fell off into the soup and splashed everyone—I assure Members that our B&B model was not completely modelled on “Fawlty Towers”. Although that is a little bit of fun, the reality is that our hospitality industry faces a challenging world.

[Vikki Slade (Mid Dorset and North Poole) (LD)]

While we are talking about incredible hotels, I am privileged to have the Priory hotel in Wareham. However, it does not qualify for either the small business rate relief or the pub relief, because it is an award-winning hotel with 17 bedrooms and a Michelin key. Its rates have gone through the roof, yet it does not qualify for anything. Does my hon. Friend agree that hotels are vital to our small towns, particularly those on the south coast, and that the rest of our hospitality industry will really struggle if we do not look after them?

[Steve Darling]

My hon. Friend makes a powerful point, and I will come on to some of those challenges. As has been alluded to, one significant challenge is the fact that some of our major competitors in the tourism and hospitality industry, such as Spain, France and Italy, pay only 10%. Those of us who have recently had the pleasure of going on holiday abroad will have seen the real difference in what we are paying for a meal out, and that will affect where people choose to go on holiday.

Something that has affected all of us in western Europe is the massive increase in utility bills following the war in Ukraine. However, other countries in Europe will not have been impacted by the Employment Rights Act, and they will not have had the national insurance hikes impacting on their ability to employ. On viability, I am only too aware of one restaurant in Torquay that has a profit margin of only 4%, so the continued pressures on their world are significant.

Hon. Members have done incredible work in highlighting challenges in their own constituencies, but one issue that has not been raised is the cost of online travel agencies, which is something that I only recently became aware of. It is almost a given that hotels and B&Bs will advertise on Booking.com, because it is how they reach out to the market and land new people in their accommodation. However, the online agency takes a minimum 15% slice out of the pie of their booking, and it will not stomach covering the costs of this VAT policy, which only enhances those costs for the overnight accommodation provider.

The Government need to be alive to these issues when they look at bringing in new charges, such as the overnight visitor levy, which could be the straw that breaks the camel’s back for many of these industries. Another issue that has been raised—I must admit it is what I have heard from my hospitality industry—is that it was too complex to do the reduction in VAT for youngsters over the summer; it was a massive challenge.

I want to talk about the impact of this VAT policy. Whitbread is a big player in this sector, and in April it announced 3,800 job cuts across the United Kingdom, with its Brewers Fayres and Beefeaters closing. Just in my patch of Torbay, we have had three of its offers close and dozens of people lose their jobs. Tim Rew from the Livermead House hotel shared with me that he has had to let five members of staff go, as he has had to make £180,000-worth of savings in recent months because of the continued pressure. He sees these workers as being sacrificed on the altar of bigotry against business. He has some real challenges there, as do many up and down the United Kingdom.

The Liberal Democrats see the cut from 20% to 15% for a time-bound period as an opportunity to give a boost to our hospitality industry. That could be achieved through an additional levy on the banks where they are making additional unforeseen profits. We also believe that there should be limited cuts to the national insurance hikes that we have seen, which could help get young people into employment, because there have been 100,000 job losses in the hospitality industry.

I would welcome the Minister’s reflections on a time-limited cut to VAT, as hon. Members have already asked for. I also ask whether the Minister has undertaken any review of the VAT reduction over the summer and its negative or positive impact, and whether there are opportunities to expand on that with similar cuts, but in a more profound way for the industry.

16:06

[Gareth Davies (Grantham and Bourne) (Con)]

As always, it is a great pleasure to see you in the Chair, Dr Huq. I congratulate the hon. Member for Gower (Tonia Antoniazzi) on opening the debate—as a former Welsh rugby player, she certainly knows what to do with a loose ball.

I speak for the whole Chamber when I say what a pleasure it is to see the hon. Member for Blackpool South (Chris Webb) in his place. He has been a long-standing champion of the hospitality industry. He serves as chairman of the APPG, and records show that he has been quite consistent on this subject, so I pay tribute to him. He gave an excellent speech.

In fact, with all the talk of cutting taxes on business and slashing VAT, which is of course a tax that we are now free to set ourselves following our departure from the European Union, as the MP for Grantham I can tell the hon. Member that Margaret Thatcher would have been proud of his speech—maybe that is an endorsement he can put on his leaflet in Blackpool. We will see.

Every Member gave a fantastic speech, but it is fair to say that we do not spend enough time in this place talking about the businesses where so many people spend their evenings and weekends. As has been rightly pointed out, there are approximately 170,000 hospitality businesses in the UK, almost all of which are small businesses. They provide 2.6 million jobs, spread throughout every corner of our country. They are economically vital, providing 4% of our economic output, but like so many other businesses across the country, as has been eloquently pointed out from all sides of the Chamber, the sector is certainly suffering.

My hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (John Lamont) pointed out that his constituents are suffering just as others are in Wimbledon—in fact, the hon. Member for Wimbledon (Mr Kohler) speaks with great authority in this area as the owner of hospitality businesses. When he speaks on this matter, we should all listen.

I have been struck by the number of examples that Members from all parties have provided. We all share the desire to help pubs, restaurants and cafés so that they thrive. I am particularly delighted that a Labour Member secured this debate to call for tax cuts on businesses, which the Conservative party of course agrees with. I hope we can agree, as a general principle, that businesses are taxed too much, and that that has a significant negative impact.

[Rosie Duffield (Canterbury) (Ind)]

Does the hon. Gentleman agree that the Government not cutting VAT on hospitality is quite literally a false economy, because three or four businesses shutting a day generates precisely zero income for the Treasury? Does that not strike him as completely bonkers?

[Gareth Davies]

We have to be clear that any support or tax cut has to be fully funded and cannot drive borrowing and debt even higher, particularly now that our debt has reached more than £3 trillion. Some have suggested that a 10% cut to VAT would cost £10.5 billion. As has been mentioned today, that is not an insignificant figure. I have not heard anybody detail how we should pay for such a significant cut, but I am sure the Minister would welcome suggestions.

A VAT reduction is just one way in which we could support the hospitality industry. If hon. Members are serious about cutting taxes and being low-tax champions, let me suggest a few other policies to help hospitality survive and grow, which are fully funded as part of our £71 billion plan of savings.

One of the measures addresses business rates. As has been pointed out, quite rightly, business rates are a significant contributing factor to the cost base of hospitality businesses. We have set out a plan to abolish business rates for 250,000 retail, hospitality and leisure businesses, which would cost £4 billion. Under Labour, business rates have increased. Some pubs and clubs are seeing their business rates increase by as much as 95% over just a couple of years. The Government inherited 75% rates relief for the sector, and then they cut it to 40%. I urge all Members to support the Conservative plan to bring 250,000 hospitality businesses out of paying business rates altogether.

Perhaps more than any other sector, hospitality relies on workers. Working behind a bar or in a kitchen is where so many young people get their first taste of work, as was set out in many examples today. The £25 billion national insurance tax hike has made hiring young people far more costly—often too costly, when combined with Labour’s increase to business rates. Under this Government, the hardest thing to get right now is a job in the hospitality industry. That is not right and does not help young people.

To address that, we Conservatives have outlined how we would cut in half the national insurance paid by an employer hiring someone between the age of 21 and 24. Halving national insurance would mean more young people getting a good start in life, fewer people starting life on benefits and employment costs cut for hospitality. That would cost £2.3 billion, paid for in full by reinstating the two-child benefit cap at a saving of £3.1 billion.

[Ben Lake (Ceredigion Preseli) (PC)]

On the point about the cumulative impact and pressures on businesses, and underlining the urgency of the situation, I spoke to some hospitality business owners in my constituency last week who told me that I could offer them a newly refurbished town centre restaurant and they would throw the keys back at me, because it is not worth it any more.

[Gareth Davies]

I am extremely sorry to hear that. The hon. Member represents a beautiful part of the country. People should visit it and give all the custom they can to the businesses that he represents. The reality is that the compound effect of multiple costs and tax rises is having a real-life impact. I hope the Minister is listening.

I have not yet mentioned the holiday tax, another measure forcing hospitality businesses to raise their prices for working families who just want to take a break away and have a holiday. Many Members have compared this particular tax with those of our European competitors. UKHospitality has been clear that the holiday tax will mean that holidays in England are charged double the tax of visiting Paris and 70% the tax of visiting Barcelona or Rome. Only this Government could look at a wet weekend at the British seaside and decide that the problem was that it was too cheap.

We have to take action. There has been so much anti-growth taxation and regulation, I could go on and on, but I will save Government Members their blushes. This Government now tax the pint, the pub, the person pulling the pint, and the bed upstairs—alcohol duty, energy costs, labour cost hikes, the Employment Rights Act or, as some have called it, the unemployment rights Act—all piling on pressure at the same time. This Government keep ordering rounds and leaving the landlord with the tab.

Prosperity begins small. It begins with the pub on the corner, the small B&B and the family-run café. Those are the employers and businesses that we should seek to support. I hope that the Minister will listen to the many concerns expressed across the Chamber. The Opposition share them, and that is why we have set out a number of costed ways in which to ease the pressure on the hospitality industry for all our constituents.

16:15

[The Financial Secretary to the Treasury and Paymaster General (James Murray)]

It is a pleasure to respond to the debate with you in the Chair, Dr Huq. I thank my hon. Friend the Member for Blackpool South (Chris Webb) for securing this important debate and my hon. Friend the Member for Gower (Tonia Antoniazzi) for opening it.

My hon. Friend the Member for Blackpool South has been a strong advocate for the hospitality and tourism sectors. The strength of his advocacy is recognised in all parts of the House, although I appreciate that he might not reproduce the specific terms of endorsement offered by the Opposition Front Bencher, the hon. Member for Grantham and Bourne (Gareth Davies). My hon. Friend’s work—in his constituency championing Blackpool, and in his role as chair of the all-party parliamentary group for hospitality and tourism—is widely recognised in the House and he deserves that recognition.

All Members who contributed spoke passionately about their support for hospitality and the importance of such venues in all our constituencies. We all feel close to and supportive of the pubs, restaurants, cafés and other hospitality venues that give our areas their distinctive character and, of course, provide jobs. Many of us have worked in hospitality at different times in our lives. My hon. Friend the Member for Stroud (Dr Opher) said that many people have their first jobs in hospitality. Actually, my second job was in hospitality—my first was in retail—but I am glad to be part of the club, I hope, for where we started out. Learning the important skills in the workplace, earning money, going to work, developing social skills and contributing to the local economy are all so important for young people and, indeed, people of all ages.

Our hospitality venues provide employment opportunities. They support our high streets and town centres with their vitality. They are integral to tourism and the visitor economy. Most importantly, they provide spaces where people come together. The shadow Minister said that those are the places where we all spend our spare time. I think that the role they play in all our lives, irrespective of our political differences on how we support them, is something we can agree on firmly.

[Vikki Slade]

I am excited that Wimborne in my constituency has today been named as a finalist in the Let’s Celebrate Towns competition. What makes it such a special town, however, is the places within it, whether the cafés, the restaurants, the museums or the theatre—all those things. My big concern is that, while I welcome the shift on the small business rate relief that was announced at the Budget, it does not help places in the south, where most of our businesses have business rates of £20,000, £25,000 or £30,000, whereas hospitality relief on VAT would benefit every business, whether in Wimborne or Wimbledon, in a fair and transparent way. Will the Minister go back to the Treasury and think about that again? That is a consistent message from across the sector.

[James Murray]

The increase in the small business rates relief threshold takes about 70,000 businesses in retail, hospitality and leisure out of business rates altogether and it is just one part of the support for the RHL sector. Alongside that, the 20% cut to business rates for pubs, I am sure will benefit some pubs—

[Vikki Slade]

indicated dissent.

[James Murray]

The hon. Lady is shaking her head, implying that no pubs in her constituency benefit from that. I will happily check and get back to her to confirm that the 20% cut does apply in her constituency. Also, more widely, we are having a real-terms freeze for all business rates for retail, hospitality and leisure. I think it is clear that retail, hospitality and leisure properties of all sizes benefit from a real-terms freeze, a cut or being taken out altogether.

Businesses in the sector have had to contend with a number of challenges in recent years, including higher operating costs. Members have spoken about the impact that that has had. The Government take those concerns seriously. We continue to engage with the sector about what support we can give.

A number of Members have made the case for reducing the current rate of VAT to 10%, and we have considered that case carefully. Let me be clear that we recognise that reducing the rate of VAT would provide a benefit to affected hospitality businesses. Businesses would make their own decisions about how to use that benefit: whether to strengthen their finances, support employment and investment, or reduce prices for customers. As the Minister responsible for the tax system, I have to consider the significant fiscal implications that such a change would have.

[Monica Harding (Esher and Walton) (LD)]

The Minister talks about reducing prices for customers, yet a Michelin-starred restaurant in my constituency, Starling, cannot pass those costs on to customers because they cannot pay it, and it cannot keep up with the rising costs. The Good Earth, which I think many people will be familiar with, have seven sites throughout London and the south-east; they have lost the opportunity to expand, they are reviewing locations and looking at their employment practices. That is without mentioning the pubs that are struggling to survive, which is completely heartbreaking. Does the Minister agree that not enough is being done to save these restaurants that are so much part of our high streets?

[James Murray]

I am sorry to hear from the hon. Member about the challenges that the business in her constituency is facing. Let me be clear on the point I made so that there is no misunderstanding: if there were a reduction in the rate of VAT, it would be for businesses to decide how to use that benefit. Were the rate of VAT to be cut, how that was used—whether to strengthen finances, support employment or be passed on to customers—would be a decision for businesses to take.

[Seamus Logan]

Will the Minister give way?

[James Murray]

Given we have a 4.30 pm cut-off, I had better make some progress.

As the Minister responsible for the tax system, I have to consider the wider fiscal implications. VAT is one of the UK’s largest sources of tax revenue, helping to fund public services that households and businesses rely on. That means that any proposed VAT relief must be carefully considered against its affordability and whether it represents value for money for the taxpayer. His Majesty’s Revenue and Customs estimates that reducing VAT on accommodation and food and beverage services from the standard rate of 20% to 10% would cost around £11 billion a year, which is of course a significant amount of revenue. VAT is UK wide but even a similar such cut in Northern Ireland only would cost £300 million, as my hon. Friend the Member for Gower said. A more limited reduction would remain expensive: it is estimated that a reduction to 15% would cost around £5 billion a year and a 12.5% rate would cost around £8 billion a year.

[Seamus Logan]

Does the Minister understand the difference between McDonald’s and Mackenzie’s little café on the street corner? That is the point. Do those figures include large chains as well as small hospitality businesses?

[James Murray]

The VAT cut would apply to the headline rate of VAT for hospitality across businesses of all sizes as proposed, but targeted support is available in England through the business rates system by cutting the business rates for small retail, hospitality and leisure businesses.

There is a wider question that other Members have raised about the wider effects that a cut would have. I want to address that directly to explain that the Treasury has considered, were there to be a cut in the rate of VAT for hospitality more broadly, what impact that would have, because the Treasury’s costing already takes account of expected behavioural effects, including the impacts on demand and supply and the resulting impact on VAT receipts.

There may also be wider economic benefits, but the evidence from the independent Office for Budget Responsibility is that these effects typically offset only part of the direct cost of a tax reduction, rather than allowing the tax cuts to pay for themselves. Of course, we need to consider how any tax reduction would be paid for, as indeed the shadow Minister, the hon. Member for Grantham and Bourne, recognised, because lower VAT revenues ultimately mean higher taxes elsewhere, lower public spending or additional borrowing, all of which have economic impacts of their own.

The decision not to introduce a permanent VAT reduction does not mean that the Government are standing aside from challenges facing hospitality. As many hon. Members have mentioned, in the Budget two weeks ago my right hon. Friend the Chancellor of the Exchequer deliberately prioritised support for retail, hospitality and leisure properties on our high streets. I note that the shadow Minister mentioned a relief that was in existence towards the end of his time in office; he neglected to mention that that support would have ended entirely in April 2025 and it was only thanks to this Government that anything continued.

In this Budget, we have said that from April 2027 every retail, hospitality and leisure property in England will see its business rates frozen in real terms, reduced, or cut to zero. We have announced a two-year, real-terms freeze for all retail, hospitality and leisure properties, capping bill increases at inflation. We are providing an additional 20% business rates reduction for pubs and all but the largest live music venues. Increasing the small business rates relief thresholds means that about 70,000 more retail, hospitality and leisure businesses will pay no business rates at all. When the measures are taken together, half of all retail, hospitality and leisure businesses will pay no business rates from April 2027. That is significant targeted support for businesses that are at the heart of our high streets and communities.

Dr Huq, I am conscious that I need to leave time for the—

[Dr Rupa Huq (in the Chair)]

Actually, we are suspending that, given the debate was opened by another Member.

[James Murray]

Thank you. I will continue, then. As hon. Members have mentioned, many people take their first step into the labour market through hospitality, and the sector provides flexible employment and apprenticeship opportunities across the country. That is why the Government have more than doubled the employment allowance, taking it from £5,000 to £10,500. That particularly benefits small businesses, taking many of them out of liability for employer national insurance altogether.

[Alex McIntyre]

Given that we provide some carve-outs for retail, hospitality and leisure businesses on business rates, will there be scope in future for expanding employment allowance for those businesses to allow them to take on more people before they incur national insurance contributions?

[James Murray]

The Chancellor takes decisions on fiscal policy at fiscal events, as my hon. Friend will know, but the employment allowance increase applies broadly across different sectors and parts of the economy, and sits alongside other reliefs in the tax system. I think that this will be of interest to him, given that he asked specifically about helping young people into work. The Government are protecting employer national insurance relief for all employees under the age of 21 and apprentices up to the age of 25. More recently, we have secured a commitment from the hospitality sector to create more than 100,000 opportunities for young people who are not in education, employment or training. That response from industry sits alongside the Government’s work through the youth guarantee and our reforms in respect of skills and employment support.

I might briefly address some other points from hon. Members. Some Members referred to the impacts of energy costs on hospitality businesses, and we recognise the impact that global events beyond our control are having on the costs of running a business in the UK. As all Members will have seen in the Budget two weeks ago, the Chancellor and the Government are taking that very seriously and starting the longer-term reforms needed to make the energy system fairer, cheaper and easier for businesses. That includes action to control new policy costs, reform energy institutions and improve access to grid connections.

Some hon. Members asked about the UK’s treatment of hospitality, compared with what happens among EU countries. A number of European countries do apply reduced rates to hospitality. France and Italy apply rates of 10%, Germany applies a rate of 7% and Ireland applies a rate of 9% for most hospitality supplies. But different countries make different choices about the balance of taxation and expenditure. The UK’s standard VAT rate is close to the OECD average and, as I set out earlier in my remarks, VAT is only one element of the business environment—it sits alongside business rates, which I have set out—and should not be considered in isolation.

[Graham Leadbitter]

I appreciate all the different taxes and all the different aspects that the Minister is juggling, but given that the now First Lord of the Treasury has said as recently as this year that he supports this proposal, is it not just a matter of time?

[James Murray]

As the hon. Gentleman will know, the Chancellor makes decisions on fiscal policy at fiscal events, including the one that we had just two weeks ago.

Before I close, I would briefly like to address the question raised—

[Dr Rupa Huq (in the Chair)]

Order.

Question put and agreed to.

Resolved,

That this House has considered the impact of VAT policy for the hospitality sector on local economies, employment and growth.

16:29

Sitting adjourned.