Business of the House

Debate between Alison Thewliss and Mel Stride

Thursday 11th July 2019 Commons Chamber

[Mel Stride]

May I first say how delighted I am that so many of our important sporting events are held in the north of our country, where there is a huge and enduring tradition of exactly that? On the rugby and the matter of trains, I point the hon. Lady to Department for Transport questions on Thursday 18 July.

[Alison Thewliss (Glasgow Central) (SNP)]

The Leader of the House might be aware that there have been a number of deaths on the Clyde in recent weeks. It is to the frustration of many people—the council, campaigners and the Glasgow Humane Society, which has spent 229 years campaigning to save lives on the Clyde—that signs recently installed to discourage people from tampering with and damaging water safety equipment have themselves been damaged. Will he agree to a debate on tampering with water safety equipment? Does he agree with the campaign that “Taking a lifebelt is taking a life”?

[Mel Stride]

The hon. Lady makes an important point: nobody wants to see anyone behaving dangerously or recklessly around water. I commend all the efforts that have been made, particularly on the Clyde, to ensure that such instances are minimised. Perhaps an Adjournment debate would be appropriate.

Cox Report: Implementation

Debate between Alison Thewliss and Mel Stride

Tuesday 18th June 2019 Commons Chamber

[The Leader of the House of Commons (Mel Stride)]

I congratulate those who brought forward this afternoon’s debate, most particularly my right hon. Friend the Member for Basingstoke (Mrs Miller)—I thank her for sitting down with me, prior to this debate, to talk through some of her thoughts on the very important issues that she has presented this afternoon—and of course the hon. Member for Birmingham, Yardley (Jess Phillips). I thank all the speakers who have contributed in such detail and such thoughtful ways on an issue that I know is of great importance to everybody right across the House.

We are privileged to work and legislate in the cradle of our great country’s democracy. As a legislature, we expect the very highest standards among all organisations in our lands—among all businesses, public organisations and so on. So if there is any one place where we should set the standard, it is here, and that standard should be a culture of respect and dignity.

At a time when the country is so divided and there is so much anger—we have heard from one or two contributors this afternoon about what is going on online—it is doubly important that we set the bar as high as we can, particularly when it comes to our own. All those who work in the Palace of Westminster, whether they report to line managers as part of the House staff or report to Members of Parliament, and all those who are visitors to this place, should experience the very best when it comes to a culture of dignity and respect.

[Alison Thewliss (Glasgow Central) (SNP)]

I have a very small request. I was in the Scottish Parliament the other week. In the toilets, they have posters that give contact details to report behaviour if someone feels that they have not been treated with dignity and respect. Could something like that happen in this building, and could it happen quickly?

[Mel Stride]

I will certainly take that specific point away, although I know that the behaviour code has been distributed widely across the estate. I will take the representation seriously and will come back to the hon. Lady on that specific point.

I pay tribute, as many have, to my predecessor, my right hon. Friend the Member for South Northamptonshire (Andrea Leadsom), who has been right at the heart of much of the progress that has been made. There has been a debate this afternoon about whether that progress has been too fast or too slow, but progress has been made. It is fair to say that, wherever we are today—satisfactory or otherwise—if it were not for her we would be a long way behind where we are.

In a sense, that is not surprising. As many Members have pointed out, we all operate in a historic, rather stratified environment, steeped in traditions, which tend to change extremely slowly. The hon. Member for Birmingham, Yardley referred to us being the masters of other people’s destiny and she makes an important point. She speaks an important truth. There are inevitably power dynamics in a place such as this.

There are many different strands of employment. There is the employee who works within the House administration, and there may be various sub-divisions within that, and there are those who work for Members of Parliament. There is also the fact that this is a very public place and that those who come forward and make complaints about how they are treated may expect that that will end up in the press and might identify them publicly. Those are additional stresses and complications with which this place has to grapple.

In that context, while we have not moved fast enough and I accept that, we should not overlook the progress that we have made. We have a code for ourselves and for the other place. We have a process that affords anonymity to those who need to come forward, with sometimes extremely serious concerns, and that has also been rolled out not just across this place but across the other place. That has been achieved through cross-party, cross-House work. I thank my opposite number, the hon. Member for Walsall South (Valerie Vaz), for coming to see me and sharing with me a lot of her valid and important insights into the current situation. I will come on to the House of Commons Commission in a moment.

What today’s debate shows is that we still need to do more. That is what the Cox report tells us. Of course, it is not just Cox. Understandably, Members have strayed beyond the terms of the debate this afternoon. My hon. Friend the Member for Chelmsford (Vicky Ford) talked particularly about online abuse. As Leader of the House, I feel particularly strongly about that. I raised it in my opening remarks in my first outing at business questions, and it is an area that I intend to lean in on quite hard. Of course this is an element that affects women in particular, sometimes in the most wicked and appalling way, but actually it affects all of us, too. As a father, I can tell Members that to have one of your children come home in floods of tears because they have been told things in the playground about you that may be entirely false, makes one, whether you are a man or a woman, feel pretty miserable. So I take that extremely seriously and I am grateful to my hon. Friend for choosing to raise it.

I pay tribute to Dame Laura Cox for a very thorough and detailed report, which came up with some very important recommendations. We must not forget the background to the report, which came about when my predecessor pushed for an inquiry around the allegations in March 2018 of extensive bullying and harassment in this place. We must not lose sight of where we have come from. There are some very, very serious allegations that relate to Parliament, both this House and the other place.

I want to touch on the issue of where responsibility lies for how we move forward. The question posed by my right hon. Friend the Member for South Northamptonshire was: who owns the scheme? That is a good way of phrasing this particular conundrum. There is the sense that there is something we are trying to grasp here, but we are not quite sure who owns it or where the responsibility lies. Clearly, the House of Commons Commission is responsible for House administration and, in a sense, is therefore responsible for the Cox recommendations, but ultimately it is for us—not on a party basis, but as individuals Members—to push matters forward. Neither I as the Leader of the House nor my the shadow Leader of the House speaks directly for the Commission. That is why I was so pleased that the right hon. Member for Carshalton and Wallington (Tom Brake) was able to join us today as the official spokesperson for the House of Commons Commission.

To get to the heart of the accountability issue, my right hon. Friend the Member for Basingstoke termed it an accountability deficit. She in particular and my right hon. Friend the Member for South Northamptonshire raised the issue of the Commission and directly the way in which it works; whether it is representative enough; whether it should have members who are elected; whether it is transparent enough; whether, when the chair is not able to attend the meeting, the meeting should be postponed or chaired by somebody else; whether the minutes should be circulated more quickly; and whether there is an overall sense that the Commission is sufficiently functional for the challenges it faces. In that context, my right hon. Friend the Member for Basingstoke called for a series of motions on the Floor of the House on the delivery of Cox to address issues around the Commission, including the role of the Speaker in the Commission. The hon. Member for Perth and North Perthshire (Pete Wishart) suggested that it might be replaced by a Select Committee and run on those lines.

My message this afternoon is that I do not think anything should be off the table. I am not saying that we should necessarily jump instantly to conclusions and start to shake everything up, but we should be prepared to look at everything carefully and in the round. I say that as someone, like the hon. Gentleman, who has not yet attended a Commission meeting. I look forward to attending my first meeting on Monday 24 June. It may be that I go there and find that it is incredibly functional, very well run, very transparent and that nothing needs to change at all. I have an entirely open mind on the direction we should go in, but debate must be facilitated on exactly these matters.

Business of the House

Debate between Alison Thewliss and Mel Stride

Thursday 6th June 2019 Commons Chamber

[Mel Stride]

First, I congratulate the hon. Lady on the huge amount of effort she puts into the very important area of animal welfare, something to which this Government are totally committed; she will be aware of the many measures we have brought in during this Parliament. She asks what legislative vehicle there might be to further the issue of animal sentience that she has raised. I would like to give that some thought, and if she would like to have a conversation with me after questions, I would be happy to talk to her specifically about it.

[Alison Thewliss (Glasgow Central) (SNP)]

The Leader of the House’s predecessor was a keen supporter of breastfeeding, so I am sure he will be keen to congratulate all volunteers in Volunteers’ Week and all those in Scotland who are involved in Scottish Breastfeeding Week, which happens to coincide with Volunteers’ Week. May we have a debate on the “Becoming Breastfeeding Friendly Scotland” recommendations, which are part of a global project in which England is also involved, in conjunction with Yale University and other countries around the world?

[Mel Stride]

I thank the hon. Lady for raising the issue. She is absolutely right that breastfeeding was very important to the previous Leader of the House, and I recognise its importance, too. The extent of breastfeeding in the United Kingdom is below that in many other countries, most notably Sweden, where a high proportion of babies are breastfed. I recognise that it does matter and that it does make a difference. Perhaps a debate in Westminster Hall at the appropriate moment might be the right approach.

VAT (Place of Supply of Services) (Supplies of Electronic, Telecommunications and Broadcasting Services) (Amendment and Revocation) (EU Exit) Order 2019 Finance Act 2011, Schedule 23 (Data-Gathering Powers) (Amendment) (EU Exit) Regulations 2019 Customs (Records) (EU Exit) Regulations 2019

Debate between Alison Thewliss and Mel Stride

Tuesday 14th May 2019 General Committees

[Mel Stride]

I thank the hon. Members for Stalybridge and Hyde and for Glasgow Central for their contributions. I will endeavour to go through their points.

The hon. Member for Stalybridge and Hyde made a general overarching point about the uncertainty of Brexit. I agree with him about that, which is why the Government are working so hard, including through conversations with his Front Bench, to secure a negotiated arrangement with the European Union whereby we have an orderly exit. The measures are being brought in only on the basis that, in the unlikely event of day one no deal, we will be able to switch them on by way of an appointed day order.

An important point for the Committee is that we are not rushing these measures in immediately; we have time to see how the negotiations conclude and to bring the measures into effect at the appropriate moment. That also gives us some time to address the specific point about how we propose to make sure that those affected by the measures are aware of them. Of course, we have consulted extensively on these matters with businesses across the country that are involved in imports and exports, and there is an extensive amount of information on that area on gov.uk. There was also an impact assessment that covered, among others, the two instruments that relate specifically to VAT measures, which concluded that the impact would be relatively modest.

The hon. Gentleman is also concerned about the fact that we are using secondary legislation for the measures, but we published the statutory instruments some time ago. I think I am right in saying that the instrument relating to VAT MOSS was published in January, and the other two have also been available for hon. Members to consider for a reasonable amount of time. Of course, they are also affirmative instruments, rather than negative instruments, given that they make amendments to primary legislation.

I was asked specifically why the instruments were being moved today, rather than at any other point. It is a case of making sure that we put them in place so we can switch them on through an appointed day order in the event that we come out without a deal. Of course, in theory at least, we have until the end of October to conclude our arrangements with the European Union.

The hon. Gentleman spoke about the importance, as he saw it, of regulatory alignment with the EU in the context of VAT, on which I agree with him. We have always made it clear that it is our intention and desire for VAT and other tax issues, and indeed customs measures more generally, between us and the European Union to be as closely aligned as possible, so we have a period of stability as we go forward in whatever new arrangement we end up in.

The hon. Gentleman also asked about what would happen to the UK businesses that have benefited from what I accept are considerable easements and simplifications related to the operation of VAT MOSS if we leave without a deal. We have always been clear that either they would have to register with the individual member states with whom they were transacting VAT-applicable business and digital services, or they could afford themselves of the benefits of the non-Union VAT MOSS arrangements available to those outside the European Union.

The hon. Members for Stalybridge and Hyde and for Glasgow Central both made points about the data that will need to be collected under the parcels regulations. I assure the Committee that, as I set out in my opening remarks, there will be no additional burden on business. The focus is strictly on obtaining data that is relevant to parcel collections.

[Alison Thewliss]

The Minister says that there is no additional burden to business, but is he not asking businesses to do something that they were not doing before?

[Mel Stride]

The additional burden, such as it might be, would be registering and being prepared to provide information that is already being collected. In their day-to-day transactions, those businesses already collect a large amount of information, for example on the flow of parcels, where they come from and their value. As the hon. Lady will know, for parcels with a value below £135 the responsibility for accounting for the VAT will transfer from the UK to the sender in one of the EU27 states. To rephrase my point, the additional administrative burden will be proportionate and relatively slight—that is probably a better way to describe it.

The hon. Lady asked about the penalty regime with respect to the responsibilities and obligations that will materialise under the regulations on customs transactions. The answer is that there will be no change to the regime for the businesses concerned. She spoke about consultation, which I think I have dealt with. She also observed that the changes under the VAT MOSS order relate to changes that happened as recently as January 2019. We could not have foreseen those changes, and there are no changes to primary UK legislation. As I set out in my opening speech, it makes sense to rid ourselves of that superfluous legislation, for the reasons that I gave about the potential risk that it could be used for tax avoidance purposes.

The hon. Lady mentioned the three-year period for which customs data will have to be held. Under the current European Union arrangements, however, the data is retained for four years, so the new system will be no more onerous.

Question put and agreed to.

Resolved,

That the Committee has considered the Value Added Tax (Place of Supply of Services) (Supplies of Electronic, Telecommunication a Broadcasting Services) (Amendment and Revocation) (EU Exit) Order 2019 (S.I. 2019, No. 404).

Finance Act 2011, Schedule 23 (Data-gathering Powers) (Amendment) (EU Exit) Regulations 2019

Resolved,

That the Committee has considered the Finance Act 2011, Schedule 23 (Data-gathering Powers) (Amendment) (EU Exit) Regulations 2019 (S.I. 2019, No. 397).—(Mel Stride.)

Customs (Records) (EU Exit) Regulations 2019

Resolved,

That the Committee has considered the Customs (Records) (EU Exit) Regulations 2019 (S.I. 2019, No. 113).—(Mel Stride.)

Tax Avoidance, Evasion and Compliance

Debate between Alison Thewliss and Mel Stride

Monday 4th March 2019 Commons Chamber

[Mel Stride]

I thank my right hon. Friend for her questions. To reiterate, there is no connection between the loan charge and IR35; they are two distinctly different aspects of Government taxation policy. The purpose of my statement, in making it clear that we will not be actively or aggressively looking at previous activities in this area, was to show that we recognise that we need to get this right and that we need to support employers and contractors as we go through this process. That is the approach that we will take.

[Alison Thewliss (Glasgow Central) (SNP)]

We should have been debating the Financial Services (Implementation of Legislation) Bill this evening, but the UK Government are clearly feart. Can the Minister tell us when the Bill will return to the House? We were told that it was vital, urgent and necessary in the event of a no-deal Brexit, yet today we find that that urgency has evaporated. The statement today is nothing but a fig leaf to cover the embarrassment that the UK Government feel over the amendment tabled by the right hon. Members for Sutton Coldfield (Mr Mitchell) and for Barking (Dame Margaret Hodge). The Government should have acted on this after the Sanctions and Anti-Money Laundering Act 2018, but on public registers of beneficial ownership, they have taken their lead from the Prime Minister and kicked the can down the road to 2023.

On IR35 and the loan charge, what assessment has the Minister made of how many people were forced into the system by their employers and what action has been taken by the employers involved in those cases? How many people were separate from that and perhaps knowingly used the system to avoid tax? It seems to me that they are two separate classes of people who should be recognised and treated differently as we go forward.

On compliance and enforcement, this Government have a poor record because they have already closed HMRC offices in Scotland, the local knowledge of which played a vital and valuable role in enforcement, ensuring no avoidance or evasion and enforcing compliance. My hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East (Stuart C. McDonald) has asked this before, but will the Minister put the plans to close the HMRC office in that constituency on hold because it plays a vital role in the tax avoidance, evasion and compliance regime?

Finally, will the Minister act to make Companies House part of the anti-money laundering regime, which would close a huge loophole in the system that allows people to register companies falsely? Will he take action on Scottish limited partnerships, which are still allowing people to hide money and move it around? The last time I asked about SLPs, thousands of people still had not registered as a person of significant control but had not been fined. Does he not have an interest, as a Treasury Minister, in having that significant amount of money in the Treasury coffers rather than going unpaid?

[Mel Stride]

The hon. Lady asks about when today’s business will return to the House. That will be a matter for the business managers and the usual channels in the usual way. She asks about the loan charge and, specifically, about those who would be impacted by it, and I can tell her that, of the £1 billion that has been received by HMRC via pre-loan charge settlements, some 85% of those settlements by value came from companies, rather than from individuals. HMRC will go for companies in the first instance.

The hon. Lady raises the issue of HMRC offices up and down the country. We are going through a transformation programme, as she will know, reducing the number of offices from 170, some of which had fewer than 10 staff, to produce 13 state-of-the-art hubs that will move our tax authorities into the 21st century, and so much more can be done through analysis, computers and intelligent interventions. I was privileged last week to visit our new office in Bristol, which will be the hub for the south-west of England. It is a truly stunning building that will house a state-of-the-art approach to tax collection.

The hon. Lady mentions Scottish limited partnerships and urges the Government to act. She will know that we have already taken action in that respect. The main point remains that we have been successful in keeping our tax gap as one of the lowest in the world, safeguarding and protecting some £200 billion of tax, which, let us not forget, is there for a purpose. Taxes support our vital public services, our doctors, our nurses, our brave servicemen and women, and our police force. We need that money, and that is why I am proud of our achievements in that area.

Leaving the EU: Economic Impact of Proposed Deal

Debate between Alison Thewliss and Mel Stride

Wednesday 20th February 2019 Commons Chamber

[Alison Thewliss (Glasgow Central) (SNP)]

The Scotch Whisky Association recently reported that the value of Scotch whisky exports to Mexico last year was £131.5 million—which is up 18.5% on 2017—and that Mexico is the fourth largest export market by volume for Scotch whisky. However, the Under-Secretary of State for Exiting the European Union, the hon. Member for Daventry (Chris Heaton-Harris) has confirmed by letter to the Procedure Committee that the Government

“do not…expect to replicate the existing Mexico spirits agreement in time for 29 March”.

What assessment has the Financial Secretary made of the impact that will have on geographic indicators for Scotch whisky and on the wider Scottish economy?

[Mel Stride]

This Government totally understand and get the significant importance—not just to Scotland but to the entire United Kingdom—of Scotch whisky exports, which account for some 20% of all exports of food and drink from our country. That was also signalled in our recent Budget, which once again froze duty on Scotch whisky. The hon. Lady can rest assured that we will make sure that we do the right thing by Scotland’s most important export.

Taxation of Low-income Families

Debate between Alison Thewliss and Mel Stride

Wednesday 16th January 2019 Westminster Hall

[The Financial Secretary to the Treasury (Mel Stride)]

It is a great pleasure to serve under your chairmanship, Sir David. I thank my hon. Friend the Member for Stafford (Jeremy Lefroy) for securing this debate and my hon. Friend the Member for Congleton (Fiona Bruce) for her insightful contribution. I also thank my hon. Friend the Member for Bolton West (Chris Green) for his involvement in the important report issued this morning. I can assure all present that it will be carefully digested by Ministers in the Treasury.

At the heart of the matter lies the issue of fairness in the taxation system and the way in which the benefits system operates in our country. Also at the heart lies the central point that many speakers have made this morning as to whether the tax and benefits system appropriately incentivises aspiration—a Conservative ideal—and effectively incentivises employment, including incentivising people to go out and get jobs. And of course there is the impact of all those matters on the crux of the issue, which is the social impact of these measures on the stability of the family unit. I, the Treasury and the Government more broadly certainly recognise that all those points are of critical importance. I am particularly proud that Conservative Members chose to secure this debate and were instrumental in producing such a thoughtful and detailed report. It is the Conservative party that believes most strongly and passionately in the issues that lie at the centre of the matters we are debating today.

Having accepted that the matters are important, I also accept the many examples given in the debate today on the way in which the system does not work effectively. The most important has been the very high level of marginal tax rates. Several examples were chosen of particular circumstances involving individuals and children and the make-up of families to illustrate that we can, under certain circumstances, have marginal tax rates as high as 73% or even beyond. I accept that that is deeply undesirable. That is not the same thing as suggesting that the entire system is broken. If we chose different examples we might get far lower marginal tax rates than those that have been rightly highlighted in the report and in the debate today. Indeed, the OECD has indicated that across the universe of low-income families in this country, we are above average when it comes to making sure that net income is received by those families. However, there will always be more to do, which is why this debate is important.

We should not overlook the fact that we have a very progressive tax system. Some 28% of all income tax is paid by the top 1% of earners. In the previous Budget, we met our manifesto commitment to increase the personal allowance to £12,500 one year early. It will come in next year and take millions of the lowest paid out of tax altogether. In case it is felt that only the lower paid face very large rates of marginal income tax, we must bear in mind that, under the current system, once someone earns beyond the large amount of £100,000, the personal allowance is tapered away at a rate of £1 for every £2 earned. At that point in the income distribution, wealthy people pay a marginal rate if we include national insurance of 63%. A necessarily complicated tax system, because it tries to do many things at the same time, throws up all sorts of deeply unsatisfactory anomalies. The complexities of the tax system and the interaction with the benefits system means a complicated challenge ahead.

Low tax matters. My hon. Friend the Member for South West Bedfordshire (Andrew Selous) put it eloquently. Low taxes matter for reasons other than fairness. They drive the economy, jobs and entrepreneurship. They make sure that we have, for example, halved the level of youth unemployment since 2010. He cited the very good example of Greece and other countries where they have taken a different way and have paid the consequences. The Government remain committed to lower taxes and to simplifying them to the extent possible and to making sure that the anomalies raised today are addressed.

On the benefits system, much has been said about universal credit. We all recognise that when the Labour party was in government, its benefits system was overly complicated. People had to go to the DWP, to the local housing authority and to HMRC to qualify for a variety of benefits, but we have simplified that to one benefit. When it comes to making work pay, which lies at the heart of many of the arguments, universal credit does exactly that. People no longer have the 16-hours-of-work cliff edge, beyond which they lose all their entitlement.

[Alison Thewliss]

Will the Minister give way?

[Mel Stride]

Extremely briefly.

[Alison Thewliss]

Does the Minister accept the research by the Church of England that a single mum with three kids will have to work 45 hours to make up for his cuts?

[Mel Stride]

The point I was coming on to was the taper. In 2016, we announced a reduction in the taper rate from 65% to 63%. My hon. Friend the Member for Congleton called for it to be reduced further to 50%. That is a deeply desirable move if it can be achieved, but we must recognise the cost of doing so. The cost of having gone from 65% to 63% is £1.8 billion across the scorecard period. I do not have the figure to hand, but it would be absolutely enormous if we went to 50%. With great respect to Members, even the examples of where we could do more, such as tax relief on higher-rate pensions or the changes to child benefit and the way in which that might operate, would be dwarfed by any such move. We have to recognise, as my hon. Friend the Member for South West Bedfordshire explicitly did, the costs of making the changes that have been proposed.

The Conservative party introduced the national living wage. We should be enormously proud of that fact. It goes up by 4.9% in April, so those in full-time employment will take home £2,750 more than they did in 2010[Official Report, 31 January 2019, Vol. 653, c. 6MC.]. The marriage allowance is an example of exactly what the report calls for. Among the measures are a transferability of allowance to make provision for those who stay at home to look after children or elderly relatives. It transfers at a rate of 10%, provided the person is not a higher or additional-rate taxpayer. Once again, it is focused on the lowest paid in our society. We spent time reflecting on child support. We will spend £6 billion more per year by 2020, and we brought in tax-free childcare. If someone is on universal credit, they are able to claim back up to 85% of the cost of childcare.

In the remaining couple of minutes, I will respond directly to the overarching request made of me this morning, which is that I go back to the Treasury with the report and the comments made in this debate and look genuinely and deeply at the issues raised. I can give an unequivocal commitment to do precisely that because, despite what is going on in the House at the moment and the important vote tonight, certain things must continue uninterrupted. Our essential quest for social justice and the Conservative party’s commitment to the family and a society that is at ease and at one with itself, must not be diminished. The House has my commitment to do exactly as I have said. I will engage in the form that my hon. and right hon. Friends wish me to to make sure that we push forward on the important issues raised today.

Oral Answers to Questions

Debate between Alison Thewliss and Mel Stride

Tuesday 11th December 2018 Commons Chamber

[Alison Thewliss (Glasgow Central) (SNP)]

10. What discussions he has had with the Secretary of State for Scotland on the economic effect on Scotland of the UK leaving the EU customs union and single market.

[The Financial Secretary to the Treasury (Mel Stride)]

The Government are committed to delivering a deal that works for the whole of the United Kingdom—for every country and region within it, including Scotland—and Treasury Ministers of course have regular discussions with the Secretary of State for Scotland on just these matters.

[Alison Thewliss]

The Fraser of Allander Institute reports today that many firms are still ill prepared for a no-deal Brexit, that the worst-case scenario is the equivalent of making 100,000 people in Scotland unemployed, and that we face a recession double the size of that which Scotland experienced in the crash. Does the Minister not agree that the only way out of this Government shambles is to accept that staying in the single market and the customs union is the best compromise we can get?

[Mel Stride]

The best deal for the country, and indeed for Scotland, is the one that the Prime Minister has brought forward, and which she is now looking at with our European partners in Brussels: one that sees a free trade area right at the heart of our arrangements; that has no tariffs between ourselves and the EU27; that gives us control of our borders; that makes sure we put an end to sending vast sums of money to the European Union; that gives us control of our laws; and that enables us to conduct our own international trade affairs.

Leaving the EU: Economic Analysis

Debate between Alison Thewliss and Mel Stride

Wednesday 28th November 2018 Commons Chamber

[Mel Stride]

A second referendum would be deeply divisive for our country. It would send a signal—[Interruption.] The hon. Lady has had her say. She and I campaigned on the same side in the referendum. I wanted us to stay in the European Union, but the difference between us is that I am a democrat, and I believe that when we have a referendum, which was widely debated over a long period, and a result is given, on the highest turnout of any electoral contest in our country, that result must be respected.

[Alison Thewliss (Glasgow Central) (SNP)]

UK Government analysis in 2014 said that Scottish independence would cost the economy 0.4% to 1%, but HM Treasury analysis today says Brexit will hit the UK economy by 3.9%. With apologies to my former colleague Callum McCaig, the previous Member for Aberdeen South, does the Financial Secretary to the Treasury honestly believe that the UK can afford to be independent?

[Mel Stride]

Yes is the answer. We have a bright future ahead of us. We have the opportunity, with this deal, to go out and do other deals around the world with other countries. The report makes specific reference, for example, to the United States, China, India and other important trading nations. We know that those parts of the world outside the European Union are growing far more strongly than countries within the bloc of the EU27, so I am optimistic about the future of my country.

Oral Answers to Questions

Debate between Alison Thewliss and Mel Stride

Tuesday 22nd May 2018 Commons Chamber

[Alison Thewliss (Glasgow Central) (SNP)]

Several of my constituents who are highly skilled migrants made entirely legitimate and timely changes to their tax returns and are now facing removal by the Home Office under immigration rule 322(5). Will a Treasury Minister confirm that people should make entirely legitimate changes to their tax returns? Will they also have a conversation with their Home Office colleagues to prevent these highly skilled contributors from being removed from the UK?

[Mel Stride]

The answer to the hon. Lady’s question is that people should clearly continue to make appropriate changes to their tax returns. I reassure her and the House that Treasury Ministers and HMRC officials are working closely across Government—particularly with the Home Office—on the issues that she raised in order to ensure that we get these matters right.

Finance (No. 2) Bill (Sixth sitting)

Debate between Alison Thewliss and Mel Stride

Tuesday 16th January 2018 Public Bill Committees

[Alison Thewliss (Glasgow Central) (SNP)]

I do not a have tremendous amount to add to what the hon. Member for Bootle laid out, but I want to highlight the written evidence submitted by the Institute of Chartered Accountants in England and Wales regarding VAT and online marketplaces.

The institute is concerned that as well as this change proposed by the Government, there may be subsequent change, perhaps—if we are still subject to the European Union—with the principal VAT directive taking effect in 2021. What is the Government’s view of that directive? Do they think there is any chance that we will be in some transitional period, or that UK businesses will be under that directive? It is not clear at the moment.

The chartered accountants are asking for the UK to seek

“a derogation to implement these proposals from an earlier date than currently permitted under EU law.”

That will not be necessary if the UK has left and we are not subject to EU law, but the institute believes that the EU directive would give consistency to both UK and EU businesses and that there would be no double taxation risk in it.

To highlight some of the things that the hon. Member for Bootle mentioned, I am sympathetic to the Government view that this is a difficult area for enforcement. The online world is constantly changing and there are always new ways for businesses to get around their obligations. It might be useful to have a wider review, perhaps once we leave the EU, because in many areas there seems to be a way around for businesses not to pay their VAT—they pop up, do something else, and change and change, so perhaps there should be regulation of the marketplaces to a greater degree, for companies such as eBay and Amazon, to make sure that that is done. Perhaps we should get that VAT automatically at the point of sale, so that we do not have to go through companies in a longer and more protracted way. We know when goods are being delivered; they go to someone’s house, to an address, so for the most part we can trace where they are going. Perhaps there are other ways we can enforce VAT collection. At the moment it seems like an easy thing to get around and a difficult thing for Her Majesty’s Revenue and Customs to chase. If we want to ensure that we get the maximum VAT take, we have to look at different ways and try to get around the technology in a smarter way than we perhaps have been doing up to now.

[The Financial Secretary to the Treasury (Mel Stride)]

It is a pleasure to serve again under your chairmanship, Mr Owen.

The clause strengthens existing powers to make online marketplaces accountable for VAT evaded through their platforms. The growth and development of the online retail market mean that the average UK consumer can now buy a vast range of goods at very competitive prices, and have them delivered rapidly by sellers based all over the world. E-commerce plays an important part in the UK economy, but it also provides opportunities for abuse of the VAT system.

Businesses that sell goods to UK consumers via online marketplaces do not always pay the correct VAT to HMRC. When those businesses do not charge VAT correctly on their goods, they unfairly undercut the honest majority of businesses that comply with our VAT rules—that point was made by the hon. Member for High Peak. The businesses that do not charge VAT correctly abuse the trust of UK customers and deprive the Government of significant revenue.

At Budget 2016, the Government announced a package of measures to tackle online VAT fraud. That included a new joint and several liability provision giving HMRC the power to hold online marketplaces responsible for the future unpaid VAT of non-compliant overseas businesses that HMRC identifies operating on the marketplaces. It also included a fulfilment house due diligence scheme which opens for registration in April 2018 and will provide HMRC with an audit trail to track goods that UK-based warehouses are storing for overseas traders. The new package extends HMRC’s existing powers for tackling online VAT fraud. Taken together, the packages of Budget 2016 and autumn Budget 2017 are expected to raise just under £1 billion by 2023.

The clause strengthens HMRC’s existing joint and several liability powers and introduces a new requirement for online marketplaces to display valid VAT numbers on their platforms. Although online VAT fraud is not restricted to overseas businesses, the clause will ensure that joint and several liability rules cover all non-compliant businesses, including United Kingdom ones. It also strengthens the existing joint and several liability rules for overseas businesses and will enable HMRC to hold online marketplaces jointly and severally liable for the unpaid VAT of an overseas online seller from the point when the online marketplace knew or should have known that the overseas seller should be registered for VAT in the UK but was not.

At this point, I will turn to some of the specific points raised by hon. Members this morning. The hon. Member for Bootle was concerned about whether the measures are strong enough, although my hon. Friend the Member for Ochil and South Perthshire rightly pointed to the sittings of the Public Accounts Committee, in which the complexity and difficulties of this area have been highlighted.

Under the current arrangements, HMRC has received about 25,000 applications to register for VAT from non-EU-based online retailers. The VAT liability reported by such businesses has increased from £6 million in 2015 to £27 million in 2016, and we expect that to continue to rise. HMRC has issued more than 1,000 joint and several liability notices to online marketplaces resulting in the removal of non-compliant sellers. It has also issued assessments against online overseas traders for unpaid VAT amounting to more than £43 million, with a further £71 million in the pipeline. That covers at least some of the questions posed by the hon. Member for Bootle.

The hon. Gentleman also raised the issue of HMRC resourcing. We have provided HMRC with an additional £2 billion since 2010, which is part of the reason why it has been so successful in bringing in additional revenues by clamping down on avoidance, evasion and non-compliance. A further £170 million came through the recent Budget, which will raise more than £4 billion across the scorecard period. He also mentioned the issue of people and office closures. We have previously discussed how HMRC’s operations are now far more technology-driven and intelligence-led, and that kind of approach lends itself to the more centralised, high-tech, highly skilled operation that underpins much of the success that we are having today.

The hon. Member for Glasgow Central asked about VAT directives. I think—I am interpreting her remarks; she can correct me if I am wrong—that she might be referring to VAT arrangements between the EU and the UK. There is acquisition VAT, as opposed to import VAT, which applies to businesses importing from non-EU countries. The customs Bill going through Parliament at the moment will effect a change from acquisition VAT to import VAT. It will, of course, be down to the negotiation where exactly we land in terms of the arrangements that pertain after our exit from the European Union, but I assure her that HMRC will consider carefully the impact of where we land to ensure that we continue to make progress on online VAT fraud. She suggested a review after we have left the European Union of the measures and the operation of online platforms. We can certainly consider that for the future. I am sure that we will come back to the issue many times in the years ahead.

Finally, the clause requires online marketplaces to ensure that VAT numbers are valid and displayed on websites when they are provided by the seller. The requirement will be supported by regulatory penalty. Taken together, the changes will make it more difficult for non-compliant online businesses to trade in the UK, and will enable HMRC to tackle them more easily.

I welcome the opportunity to speak to the amendments tabled by the hon. Members for Oxford East and for Bootle. At this stage, I should say that something rather extraordinary and slightly worrying has occurred: the Government have decided that we are content to accept one of the amendments. After all the constant chipping away at us, one amendment has got through. I would not get too excited—it is slightly technical—but we are grateful to the Opposition for their scrutiny of the Bill and for tabling this amendment. The Government agree with amendment 56 and will therefore specify that it is section 69(1) of the Value Added Tax Act 1994 being amended.

Amendment 57 would increase the penalty for online marketplaces that fail to display a valid VAT number when provided with one. The current penalties refer to daily amounts and are entirely consistent with the penalties awarded for similar offences. In contrast, the proposed amendment could result in a marketplace receiving a penalty of up to £1.5 million for failing to display a valid VAT number for a single online sale. We believe that a sanction such as that would be unreasonable.

Amendment 58 would limit the time available for an online marketplace to ensure the compliance or removal of a non-compliant seller to 10 days after receipt of a joint and several liability notice. It would also require HMRC to issue a JSL notice in every case where VAT revenue would be protected or enhanced. Such an amendment would restrict HMRC’s ability in handling non-compliance on a case-by-case basis. It is also somewhat unfair, denying an online marketplace a sufficient opportunity to tackle non-compliance by sellers on its platforms before being held jointly and severally liable.

Similarly, amendment 59 would reduce the period in which an online marketplace must ensure compliance or removal of an overseas seller, from the point of view that it knew or should have known that a particular seller should be registered for UK VAT but is not. The amendment would reduce the period allowed from 60 days to 10 days. That would not allow enough time for an online marketplace acting in good faith to assist an overseas seller in becoming registered for UK VAT without still incurring joint and several liability. I commend the clause to the Committee.

--- Later in debate ---

[Mel Stride]

The clause makes a number of changes to section 33 of the VAT Act 1994, which allows certain bodies to recover normally irrecoverable VAT. First and foremost, the clause fulfils the commitment made in autumn Budget 2017 to legislate to provide VAT refunds to Police Scotland and the Scottish Fire and Rescue Service.

The Committee will be aware that in 2012, the Scottish Government chose to restructure Scottish police and fire services to create national bodies. At the time, the Scottish Government understood that those bodies would not be entitled to VAT refunds as they were no longer locally funded. They none the less continued with the change on the basis that VAT costs would be outweighed by potential savings.

A number of representations have been made to the Government on the issue and the Government have listened carefully to the concerns expressed. I am pleased that the provisions in clause 39 will enable the Scottish services to fully recover VAT, in effect providing £40 million additional financial support each year.

The clause also makes minor changes to the legislative basis by which combined authorities and English and Welsh fire authorities receive VAT refunds. Those bodies are currently eligible for VAT refunds but each authority is added to section 33 individually by statutory instrument, which takes up parliamentary time. The clause removes the need for statutory instruments and ensures that English and Welsh fire authorities are automatically entitled to VAT refunds. It does not substantially affect the VAT treatment of combined authorities or English and Welsh fire authorities. It simply removes an unnecessary administrative barrier, freeing up parliamentary time by allowing authorities to access refunds automatically.

Finally, I will touch on the VAT treatment of police services in Northern Ireland. Northern Irish police services have always had the right to reclaim VAT refunds and it is absolutely right that that is the case. However, it is a complex area of VAT law and the Government have decided to clarify the legislation to put the matter beyond doubt. The clause therefore makes explicit the right of the Northern Irish policing bodies to receive VAT refunds.

The clause makes a number of changes to the treatment of public bodies in the VAT Act, as well as making procedural amendments. It delivers on the Chancellor’s Budget announcement on Scottish police and fire services, providing VAT refunds worth around £40 million a year to support the delivery of frontline services. I therefore commend the clause to the Committee.

[Alison Thewliss]

We support the U-turn by the UK Government to allow VAT to be reclaimed by Police Scotland and the Scottish Fire and Rescue Service. I should declare that I was a councillor on the board of Strathclyde fire and rescue when this was being discussed; I know the matter well and know the issues that the Minister referred to. There was a great deal of correspondence at that time from Scottish Government Ministers to the UK Government, requesting that the change be made, so it is with some incredulity that we hear, “Oh wait; all of a sudden we have just realised, yes, we are going to fix it now”—now, rather than several years earlier.

It seems logical that if the argument stands today and it stood in the Budget, then it stood all along, so the Government should do right by the Scottish Fire and Rescue Service and Police Scotland and refund the VAT that we are due. Given that those services’ funding was pushed on to the Scottish Government via the UK Government’s austerity agenda, they very much need that money.

--- Later in debate ---

[Mel Stride]

The hon. Member for Glasgow Central asked: why now? Why has this not been done before? I guess, as with all policy decisions taken in politics, there was a balance to be struck between resources available, the lobbying that occurred and the input of competing interests. Without going too far into this point, I think it is fair to say that since 2015, the lobbying became fairly intense. That is not to deny in any way that there was fairly intensive lobbying prior to 2015. The decision was taken in the round at the time of the Budget, when all the competing uses for the UK Exchequer’s funds were balanced up. The question, “Why now, rather than at any particular time in the past?” could be applied to almost any tax change. It is a fairly generic point, in that sense.

The hon. Member for Bootle was firm, as was the hon. Member for Aberdeen North, on the perceived unfairness of the original decision. I remind Members that the original decision was taken by the Scottish Government in the knowledge that restructuring their services in this way would have a particular impact on the ability to claim relief for VAT.

[Alison Thewliss]

Will the Minister acknowledge that the original decision by the UK Government not to allow VAT relief was also part of that process?

[Mel Stride]

I was not party to the discussions that occurred at that time. The simple fact is that when the Scottish Government took the decision to restructure, they knew what the consequences would be; that is the critical point. There was no question of the UK Government having been vague or imprecise on that point; we made the consequences very clear to them at that point.

The hon. Member for Glasgow Central suggested that the measures in the clause relating to VAT exemptions for other authorities in England and Wales were somehow linked to this, and forced our hand on the decision about VAT relief for the Scottish fire and rescue service. There is no link; that can be seen from what the two different elements of the clause do. Unlike the provisions on Scotland, the measures on English and Welsh authorities do not extend VAT relief where it is not otherwise available; they are simply to do with the mechanics of how authorities benefit from that relief, and absolve Parliament from having to take the time to agree each and every instance through a statutory instrument.

As a matter of principle, the Treasury would not normally look at bringing in taxes retrospectively. We should be thankful that we have now resolved this issue. I hope that as the years roll by, this will fade into the background, and we will reach a point when we can all feel that we are in a good position regarding VAT and Scottish fire and rescue.

Question put and agreed to.

Clause 39 accordingly ordered to stand part of the Bill.

Clause 42

Landfill tax: disposals not made at landfill sites, etc

Question proposed, That the clause stand part of the Bill.

Finance (No. 2) Bill (Third sitting)

Debate between Alison Thewliss and Mel Stride

Thursday 11th January 2018 Public Bill Committees

[Mel Stride]

The hon. Gentleman is shaking his head; I am pleased, because there will be many opportunities as we go forward. Of course, one of the reasons why the question of impacts is difficult and challenging is that, at this stage, we do not know exactly where the negotiation will land, exactly what the treaty arrangements will be between us and the European Union after our exit, and what our customs arrangements and new trading arrangements with the rest of the world will be, and so on. We await those details.

Returning to the Bill, the amount of R and D expenditure supported through the tax credits doubled to £23 billion between 2010 and 2015-16. At the autumn Budget 2017, the Government announced a further £2.3 billion of additional direct R and D spending in 2021-22. That is on top of the record investment of £4.7 billion by the national productivity investment fund in R and D that was announced in the autumn statement 2016. Taken together, total Government support for R and D will increase by a third from 2015-16 to 2021-22. I am clear that the change in this Bill, along with the wider support that the Government are providing, will give valuable help to businesses investing in R and D in the period in which we will leave the EU. The change reaffirms our ambition to increase total UK investment in R and D to 2.4% of GDP.

[Alison Thewliss (Glasgow Central) (SNP)]

The briefing from the Chartered Institution of Taxation points out that there may be merit in expanding R and D relief to product commercialisation, because we do lots of development in the UK but not necessarily all the commercialisation, and some of that benefit goes overseas. Will the Minister explore whether that might be possible?

--- Later in debate ---

[Mel Stride]

I am sure you will be entirely obliging. This has been a wide-ranging debate, covering just about everything. We have had an absence of the biblical references and classical quotations that normally enliven our discussions at this time of the day.

We all agree about the essential role that productivity plays, and, in turn, the essential role that R and D plays in driving productivity. Paul Krugman is entirely right that, in the long run, productivity is almost everything, because if we do not get a rise in productivity we do not get a rise in real wages, living standards and all the things that Governments ensure happen. It is not just our country that has had a productivity challenge since the crash in 2008. The productivity rates of most of our competitor countries are all well down on where they were prior to that point. We certainly have a particular challenge in the United Kingdom, which is why we are doing so much in the productivity space. R and D tax credits are but one element of that. We have now set an R and D target: as I said earlier, 2.4% of GDP will be R and D expense by 2027.

It is useful to note that much was made of how this Government are performing relative to the past, as if in the past we were doing incredibly well with R and D. The reality is that over the past 30 years there has never been a single year in which R and D expenditure as a proportion of GDP has exceeded 2%. That is a simple fact. That goes for this Government, the coalition Government and the Labour Governments who preceded them, so in a sense we are all in the same boat.

I do not accept that we are not doing enough in this area. R and D tax credits are but one example. The amount going in since 2012-13 has doubled to £2.9 billion. In 2016, we announced direct R and D expenditure of £2.3 billion by 2020 to 22. We have had major announcements on infrastructure and roads and rail. As I said in my opening remarks, in the previous Budget we expanded the national productivity investment fund to £31 billion.

On the specific issue that the hon. Member for Aberdeen North—and others, by way of intervention—raised, we totally accept that support for our universities is absolutely critical. That is why we are doing things on the immigration side. We are seeking to get the balance right to attract the right kind of talent. Equally, we are underwriting the Horizon 2020 programme, such that any Horizon 2020 projects agreed by the European Union prior to our departure will be underwritten by the UK Government, irrespective of whether that money is being spent at the time that we exit.

[Alison Thewliss]

Some of the money for Strathclyde University is coming through the European Regional Development Fund, rather than Horizon 2020. Will ERDF money also be guaranteed?

[Mel Stride]

The hon. Lady knows that we are reviewing that specific point in the context of the negotiations. Those are decisions, among others, that we will have to take in future. My point is about that critical flagship programme, Horizon 2020. The hon. Member for Bootle suggested that we have not treated universities in the way that we have the agricultural sector, to which guarantees have been provided, but this is a clear example in the universities sector of where we are doing precisely that.

I will not dwell on those matters; I am aware that they are more directly related to R and D tax credits, but the patient capital review is a commitment that we put a lot of money, effort and research and development into. The intellectual property issue was mentioned in the debate. There is the patent box, which provides a lower rate of taxation for those businesses that develop intellectual property, so that we make sure that that is developed and exploited in this country.

The hon. Member for Aberdeen North quite rightly mentioned the North sea, which is absolutely critical to her part of the United Kingdom. There are measures in the Bill that we will come to shortly that further ease tax pressures in that sector, and certainly there were measures in the last Finance Bill, when she and I both served on the Committee.

Finance (No. 2) Bill (Fourth sitting)

Debate between Alison Thewliss and Mel Stride

Committee Debate: 4th sitting: House of Commons
Thursday 11th January 2018 Public Bill Committees

[Alison Thewliss (Glasgow Central) (SNP)]

The Minister will be aware that the insurance industry has raised concerns about the impact of the clause on fairly small savers, such as people with endowments that were sold door to door. There is a report on the BBC website that quotes Steve Webb, a former Minister who now works with Royal London, on the impact that the clause will have on Royal London’s savers. Standard Life is also reported to have concerns. We are therefore not entirely content with the clause. We will not oppose it at this stage, but we reserve the right to look at it again on Report.

We would like the Government to address the industry’s concerns, and I have a few questions for the Minister. It is estimated that the clause will affect 11.6 million policyholders, most of whom are basic rate taxpayers, and the industry estimates that the impact will be in excess of £250 million per year—double the figure implied by the Chancellor at the Treasury Committee in December. Individual life insurance policyholders may pay an average of £21, and in some cases up to £150, per policy per annum. That is a considerable impact given that such people have relatively small savings.

The Chancellor said in December in response to my hon. Friend the Member for Dundee East (Stewart Hosie), who sits on the Treasury Committee, that the change will have a “modest impact”, but that is not a modest impact for those savers—it is significant. The policies that the clause will affect include non-pension unit-linked, non-pension with-profits and whole-of-life policies, as well as endowments, which I mentioned. On what basis did the Government reach the conclusion that the change will have a modest impact and affect a relatively small number of policyholders? We are talking about 11.6 million people—not a small number by any manner or means. Those policies may represent a relatively small amount of money to the Government, but the change will have a significant impact for those people.

Have the Government made an assessment of the number of policies affected? Have they produced a detailed impact assessment that can be shared with members of the Committee? Will the Minister commit to providing further information on the impact of the policy on individual savers? The coverage in newspapers at the time of the Budget and since raises concerns that more policyholders will be affected than the Government at first assumed.

I would like as much clarification as the Minister can give us today. If he could write to me later with more detailed information, that would also be welcome. We want to put on record our concerns about the impact there might be; perhaps there will be unintended consequence, and maybe the impact has not been fully considered. Given the concerns that the industry is raising, it would be good get a commitment from the Government on how those will be addressed.

[The Financial Secretary to the Treasury (Mel Stride)]

The clause freezes the indexation allowance—a relief for inflation—for a company’s chargeable gains for disposals on or after 1 January 2018. It may be useful for the Committee if I set out the background to the clause, although other Members have touched on it, before I turn to amendment 48 and the questions posed by the hon. Member for Glasgow Central.

Removing this outdated allowance supports the UK’s competitive rate of corporation tax by removing a relief that is not available consistently across corporation tax to individuals, as the hon. Member for Bootle pointed out, or in most major comparable economies. In doing so, the Government recognise the importance of being fair and proportionate. As companies may have factored in relief for inflation before the autumn Budget, relief will remain available for inflation before January 2018. However, it will no longer be available from 2018 onwards.

Companies pay tax on the capital gains they make on the disposal of certain assets, such as property. In most circumstances, the capital gain is based on the rise in value of the asset over the period of ownership. Indexation allowance relieves a proportion of that gain from the charge to tax, based on the rise in the retail prices index, during the same period. Companies therefore pay tax only on the gains they make over and above inflation.

The economy and tax system have changed substantially since the allowance was introduced in 1982, when the rate of corporation tax was 52%; inflation in the preceding decade had been in double digits. While I certainly take on board the hon. Gentleman’s point about the current level of inflation owing to the depreciation of the pound and other factors, the Office for Budget Responsibility projects that inflation will peak at 3.1% and tail off towards 2% across the period. While there used to be a rationale for such an allowance, it has become something of an anachronism.

The amount of indexation allowance due is calculated by multiplying the purchase price of the assets by the indexation factor. As I set out, that is currently based on the increase in the retail prices index over the period an asset is owned, from the date it is acquired to the date it is disposed of. Going forward, the allowance will no longer be calculated by reference to the date an asset is sold; instead, it will be calculated by reference to the final month before the relief is removed—in other words, December 2017. That means that, where a company acquired an asset before 2018, relief from inflation will be available from the date the asset was acquired up to December 2017. The indexation allowance will not be available for assets acquired from January 2018 onwards.

I turn to the questions posed by the hon. Member for Glasgow Central. I recognise the points that she makes. While these changes affect corporation tax, they do, in the context of life assurance policies, have potential impacts on individuals and their income net of tax. I do not recognise the large number of 11 million policyholders that she mentioned. I am not sure what the source of that figure was. However, as she requested, I am happy to hear from her, speak to her or have a letter from her on any of the aspects she may have an interest in.

Finance (No. 2) Bill (First sitting)

Debate between Alison Thewliss and Mel Stride

Tuesday 9th January 2018 Public Bill Committees

[Mel Stride]

I thank the hon. Member for High Peak for speaking so thoroughly to her new clause. While I recognise many of the challenges she has rightly raised, which families up and down the country are facing— nobody belittles those—I do not recognise the picture she paints of eternal gloom and night of what this Government have achieved with our economy and for hard-working families. We have done a great deal to help those who are less well off. The hon. Lady herself raised the issue of the increase in the personal allowance, which has rocketed since 2010 to over £11,000 today. Indeed, that has taken 3 million low-paid workers out of tax altogether. They pay no income tax at all. Those are 3 million low-paid workers who paid income tax under the last Labour Government and are no longer paying that tax under this Government.

We have just had a Budget in which we took a number of specific measures to help those who are less well off. We froze fuel duty for the eighth year in a row. We increased the personal allowance for the seventh year, as the hon. Member for High Peak pointed out, taking even more people out of tax. We will increase the national living wage, a measure that this Government have brought in, by over 4% in the coming April.

[Alison Thewliss]

Does the Minister accept that the national living wage is not a real living wage, as set by the Living Wage Foundation, and it is not available to those under the age of 25? How will they be helped?

[Mel Stride]

I would say to the hon. Lady that it was not available to anybody under the last Government. That is the point—it is available now. One of the consequences of these measures and others the Government have introduced in our stewardship of the economy is near-record levels of employment. That is a staggering statistic: we have the lowest level of unemployment since around 1975, or for over 40 years. We have more women in the workforce than at any time in our history. While the hon. Member for Bootle would say that we do not believe we are all in it together, we do. There is clear evidence for that, as under this Government, the wealthiest 1% pay almost 28% of all income tax. Under the last Labour Government, that figure was lower and that is a demonstrable fact: it was around 23%. There has been a huge proportional increase in the burden carried by the wealthiest in this country.