Spending Review 2020

Lord Haskel Excerpts

Thursday 3rd December 2020 Grand Committee

[Lord Haskel (Lab) [V]]

My Lords, I would like to speak up for the one group largely excluded from government support in this Statement: the 3 million to 4 million self-employed and the many directors of small, limited companies who failed to qualify because of their accounting structure. Let me declare an interest: this was me many years ago, when I started in business. Then, it was prudent to become a limited company because this was the way to manage the risk and the inevitably unpredictable cash flow of a new business. It is not a tax dodge. By not paying income tax and national insurance, you hardly save after paying corporation tax, VAT, dividend tax and other taxes—and you are supporting other jobs.

The lack of assistance to these small companies means that they are massively overborrowed, which puts at risk the many millions of jobs that they are creating and supporting. Such businesses create the competition that keeps prices low. On Monday, the Competition and Markets Authority reported that the most profitable tenth of our companies enjoyed the least competitive pressure over the last 20 years. This, of course, is yet another contributor to the growing inequality that this Government say they are trying to tackle.

Fortunately, I am not alone in speaking up for these businesses. Others have done so in this debate, and the Mayors of Manchester, Liverpool and London have also spoken out, criticising the Government for sending a message that they are not with you if you start up on your own.

So I ask the Minister: is this a message the Statement is intended to give? Do the Government really want to limit competition and encourage inequality? Or is this yet another example of the Government’s incompetence and poor management, which has put us among the worst-off for economic damage caused by the pandemic?

Northern Ireland Protocol: Implementation Proposals

Lord Haskel Excerpts

Thursday 19th November 2020 Lords Chamber

[Lord True (Con)]

My Lords, to say that the Government are wholly committed to the future security and prosperity of business in Northern Ireland is not “warm waffle”; it is the truth of the matter. We are providing extensive support through the trader support service. I have referred to other measures, including the £150 million that has been put into IT systems, and we are working at pace to deliver all that is necessary. I hope that agreement can be reached in the joint committee and that any uncertainties there can be resolved.

[The Deputy Speaker (Lord Haskel) (Lab)]

All the questions have now been answered.

Finance Bill

Lord Haskel Excerpts

2nd reading & Committee negatived & 3rd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords & 3rd reading (Hansard) & 3rd reading (Hansard): House of Lords & Committee negatived (Hansard) & Committee negatived (Hansard): House of Lords
Friday 17th July 2020 Lords Chamber

[Lord Haskel (Lab) [V]]

The Minister has talked about the digital services tax. That is a small step on the long road to properly taxing the digital economy, as called for by the noble Lord, Lord Blencathra. The noble Lord, Lord Bruce, told us that in this financial year, the digital services tax will raise £279 million. That is a small but welcome step in the right direction. In directing this tax at large companies, the Government are rightly aiming it at those which have long practised so-called “tax optimisation”, which, translated, means choosing where you pay tax. The IMF is constantly pointing out the revenues lost through these activities, so the Government are right to separate out these multinationals from domestic companies which have much less opportunity to optimise their tax.

The 2% tax will be paid by businesses that provide online marketplaces, search facilities or social media services in the UK to residents and other users. The definitions are fairly detailed, but some companies operate both online and offline. Are the Government satisfied that these can be properly identified? Part of tax optimisation can mean that digital and non-digital activities are separated, and the digital element located outside the UK. A study by Oxford University in 2019 showed that more than 50% of the subsidiaries of foreign multinational companies active here reported no taxable profits in the UK. Yet a third of the companies that received coronavirus loans under England’s largest scheme are substantially owned in a tax haven. Some of these companies have also been in receipt of job retention funds, grants and emergency loans. This is perceived by the public as unfair and is yet another example of the unfairness brought to our attention by the pandemic. Surely the quid pro quo must be a commitment to better behaviour in matters regarding tax.

I do see a glimmer of hope. There has been quite a shift—companies are acknowledging that public opinion requires them to recognise that they also have a social purpose. Indeed, only last week, HSBC reported some evidence to show that companies which focus on these strategies are weathering the consequences of the pandemic better. I welcome the digital services tax, but it is only an early step. Do the Government have further steps in mind?

Covid-19: Public Wealth Investment Fund

Lord Haskel Excerpts

Tuesday 9th June 2020 Lords Chamber

Asked by

[Lord Haskel]

To ask Her Majesty’s Government what plans they have to establish a public wealth investment fund to support those businesses affected by the COVID-19 pandemic.

[The Minister of State, Cabinet Office and the Treasury (Lord Agnew of Oulton) (Con) [V]]

My Lords, the Government have announced unprecedented support for public services, workers and businesses to protect them against the current economic emergency. Our interventions have been targeted to protect UK jobs while also protecting the taxpayer. Our aim is to protect the productive capacity of our economy and to enable a strong and sustainable recovery from this crisis. As we move through this crisis, the Government will continue to keep our economic response under review.

[Lord Haskel (Lab) [V]]

To rebuild our economy, the Government should listen to the many calling for our recovery through investment instead of paying down debt, which is where they seem to be concentrating. These are debts which some may never repay. Since I tabled my Question, investment ideas such as Project Birch have been floated, but will the Government make it clear that, in return for equity, firms should work towards our social objectives of responsible company behaviour, local levelling up and ensuring that all benefit?

[Lord Agnew of Oulton [V]]

I agree with the noble Lord that social benefit is an extremely important part of the recovery. To that end, we are consulting on our rules for public procurement at the moment to include social values as part of the scoring system.

Covid-19: Economy

Lord Haskel Excerpts

Thursday 4th June 2020 Lords Chamber

[Lord Haskel (Lab)]

Noble Lords are right: the pandemic has clearly shown how the economy does not work for everyone and lacks resilience. Take the resilience of care homes. The largest group has a complex offshore ownership that receives excessive related-party payments, resulting in a debt level of £56,000 per resident. With the declining occupancy due to excess deaths, they are looking for rescue. Empty beds do not pay interest.

Similarly, as a result of non-payments and their excessive debt, some cut-price electricity suppliers have raised the possibility of groups of customers being cut off unless the regulator steps in with money. Their lack of resilience is a danger to us all.

I do not know what the Government are going to do, but as a condition will they introduce and accelerate a new industrial strategy to help deal with this—one based on purpose? I put it to the Minister that the Government would be pushing at an open door. Before the pandemic this idea was well developed, with institutions as diverse as BlackRock and the Local Authority Pension Fund Forum calling for it. We need a purpose that calls on companies to behave responsibly in employment, investment, risk, environment, taxation, training and research.

Will the Government use this opportunity to remove the risks I spoke of and stimulate a more purposeful economy that would create the fairer and more equal economy that many noble Lords have called for?