Asked by: Lord Jones of Cheltenham (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government whether they made an assessment in 2020 of whether limiting their support of UK airlines through access to furlough funding would have an impact on the airlines’ staff numbers and post-pandemic capacity.
Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)
The economic impact of the pandemic was widespread across large parts of the economy. It was right that the Government made support available for all businesses that needed it for the whole of the UK. To clarify, any entity with a UK payroll, including airlines, was able to apply for the Coronavirus Job Retention Scheme (CJRS).
When designing and implementing the scheme, the Government carefully considered its impacts on individual sectors and on the economy as a whole, and adapted its approach in response to the changing health and economic context.
In addition to CJRS, the Government provided unprecedented support to the aviation and aerospace sectors throughout Covid-19, with over £12 billion made available through loan guarantees, support for exporters, the Bank of England’s Covid Corporate Financing Facility, and grants for research and development.
Asked by: Lord Jones of Cheltenham (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government what progress they have made in negotiations with the EU regarding a carnet waiver for creative artists.
Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)
ATA Carnets are not a requirement for anyone temporarily importing goods between the UK and EU. They are an optional facilitation which allow goods to be imported temporarily without the normal customs formalities (i.e. customs declarations) and import duty being paid. They allow a single document to be used for multiple countries’ customs controls.
The use of an ATA Carnet is subject to an issuing fee and a requirement to provide a security. It is therefore a commercial decision for businesses and individuals whether a Carnet is the most suitable option for temporarily moving their goods. The Government is not currently having any discussions with the EU to negotiate a waiver of ATA Carnets for creative artists.
An alternative option to an ATA Carnet is the Temporary Admission (TA) procedure. The UK and EU both operate a similar TA procedure which allows goods to be imported temporarily with relief from customs duty and import VAT, subject to certain conditions being met. If TA is used in conjunction with the UK or EU Returned Goods Relief scheme (for returning goods), goods can be moved temporarily between the UK and EU without having to pay import duties.
Asked by: Lord Jones of Cheltenham (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government which public sector contracts have been awarded to Infosys in the last five years for which figures are available; and what was the cost to the taxpayer of each of those contracts.
Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)
HM Treasury does not hold contractual data for other departments, but it can confirm that it has not awarded any contracts to Infosys in that timeframe.
Asked by: Lord Jones of Cheltenham (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government what assessment they have made of the viability of the funeral plans industry following the financial collapse of Safe Hands; and what plans they have, if any, to assist plan holders to recover the amounts they have invested.
Answered by Baroness Penn - Minister on Leave (Parliamentary Under Secretary of State)
Safe Hands Funeral Plans has recently gone into administration. I am aware that the current situation will be distressing for customers of Safe Hands and can assure you that the Treasury continues to monitor the implementation of regulation in this sector closely.
I welcome the commitment from Dignity to provide funerals to Safe Hands’ customers for four weeks.
It is regrettable that bringing a previously unregulated sector into regulation – whatever form that may take – creates a possibility that some providers are not able to meet the threshold for authorisation. However, a well-regulated market should promote effective competition and drive better outcomes for consumers.
Where a provider is unable to obtain FCA authorisation because of underlying issues, it is important to understand that this is not an issue created by bringing the sector into regulation. Rather, bringing the sector into regulation exposes these unsustainable business models and prevents these problems from getting worse and impacting more consumers.
The Government’s legislation has allowed for an 18-month transition period before the new regulatory regime comes fully into force on 29 July 2022; one of the aims of creating this transition period was to give existing providers sufficient time to prepare for the new regulatory requirements. The FCA’s guidance is clear that providers who are not seeking or not able to obtain authorisation should either transfer their existing plans to a provider which is seeking authorisation, or wind down in an orderly way before regulation starts.
Asked by: Lord Jones of Cheltenham (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government, following the introduction of Plan B COVID-19 restrictions, what plans they have, if any, to provide 100 percent Business Rate Relief to the end of 2022/23 for all music venues.
Answered by Lord Agnew of Oulton
Our support for the music industry through the £2 billion Culture Recovery Fund throughout the pandemic has been unwavering.
The Government has provided unprecedented business rates support, worth £16 billion, for the retail, hospitality, and leisure sectors since the start of the pandemic. Eligible retail, hospitality, and leisure properties paid no business rates for 15 months from 1 April 2020, and thanks to the current 66 per cent capped relief which took effect on 1 July 2021, over 90 per cent of eligible businesses will see a 75 per cent reduction in their business rates bill across this entire financial year to April 2022.
In recognition of longer-term challenges facing the high street, eligible retail, hospitality, and leisure businesses will receive a new temporary relief worth almost £1.7 billion in the year 2022-23.
Asked by: Lord Jones of Cheltenham (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government, following the introduction of Plan B COVID-19 restrictions, whether they will cancel the planned VAT rise on cultural exhibition and event tickets.
Answered by Lord Agnew of Oulton
The temporary reduced rate of VAT was introduced on 15 July 2020 to support the cash flow and viability of around 150,000 businesses and protect over 2.4 million jobs in the hospitality and tourism sectors. As announced at Spring Budget 2021, the Government extended the 5 per cent temporary reduced rate of VAT for the tourism and hospitality sectors until the end of September. On 1 October 2021, a new reduced rate of 12.5 per cent was introduced for these goods and services to help ease affected businesses back to the standard rate. This new rate will end on 31 March 2022.
All taxes are kept under review, but there are no plans to extend the 12.5 per cent reduced rate of VAT. This relief has cost over £8 billion. Applying a reduced rate of VAT for a longer period would impose additional pressure on the public finances, to which VAT makes a significant contribution.
Asked by: Lord Jones of Cheltenham (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government what assessment they have made of the impact of removing air passenger duty on the UK's carbon emissions.
Answered by Lord Agnew of Oulton
Aviation accounts for around 8% of the UK’s total greenhouse gas emissions. International aviation is responsible for the vast majority of this contribution and accounted for 37 MtCO2e in 2019, whereas domestic aviation was responsible for 1.5 MtCO2e – equivalent to less than 1% of the UK’s total emissions in 2019.
At Budget, the Government announced that, from April 2023, it will introduce a new reduced domestic band of Air Passenger Duty (APD), covering flights between England, Scotland, Wales and Northern Ireland, in order to support connectivity across the UK.
In addition, the Government will introduce a new ultra long-haul band, which will ensure that those who fly furthest, and have the greatest environmental impact, will pay the most.
Asked by: Lord Jones of Cheltenham (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government what plans they have, if any, for a permanent cut in Value Added Tax for the hospitality and tourism sector.
Answered by Lord Agnew of Oulton
In order to support the cash flow and viability of about 150,000 businesses and to protect over 2.4 million jobs, the Government has applied a temporary reduced rate of VAT (5 per cent) to goods and services supplied by the tourism and hospitality sectors, which will now end on 30 September 2021. On 1 October 2021, a new reduced rate of 12.5 per cent will be introduced for these goods and services to help affected businesses manage the transition back to the standard rate. The new rate will end on 31 March 2022.
The reduced rate of VAT has been designed as a temporary measure. As restrictions are lifted and demand for goods and services in the tourism and hospitality sectors increases, this relief will be reduced and eventually removed in order to rebuild and strengthen the public finances. This policy will cost the Exchequer over £7 billion. While the Government keeps all taxes under review, there are no plans to make the reduced rate of VAT permanent.
Asked by: Lord Jones of Cheltenham (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government what estimate they have made, if any, of the cost of reducing Value Added Tax for the hospitality and tourism sector to five per cent.
Answered by Lord Agnew of Oulton
In order to support the cash flow and viability of about 150,000 businesses and to protect over 2.4 million jobs, the Government has applied a temporary reduced rate of VAT (5 per cent) to goods and services supplied by the tourism and hospitality sectors, which will now end on 30 September 2021. On 1 October 2021, a new reduced rate of 12.5 per cent will be introduced for these goods and services to help affected businesses manage the transition back to the standard rate. The new rate will end on 31 March 2022.
The reduced rate of VAT has been designed as a temporary measure. As restrictions are lifted and demand for goods and services in the tourism and hospitality sectors increases, this relief will be reduced and eventually removed in order to rebuild and strengthen the public finances. This policy will cost the Exchequer over £7 billion. While the Government keeps all taxes under review, there are no plans to make the reduced rate of VAT permanent.
Asked by: Lord Jones of Cheltenham (Liberal Democrat - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government what assessment they have made of the impact of the UK–EU Trade and Cooperation Agreement on the UK's economic performance.
Answered by Lord Agnew of Oulton
The UK-EU Trade and Cooperation Agreement (TCA) is the first free trade agreement based on zero tariffs and zero quotas and the largest bilateral trade deal in the world, by volume of goods trade. Alongside the TCA’s other provisions, this helps businesses to continue to trade smoothly.
The Treasury does not prepare forecasts for the UK economy and public finances, as this is the duty of the independent Office for Budget Responsibility (OBR). The latest forecasts from the OBR were published alongside the Budget on 3 March 2021,[1] and include an assessment of the impact of EU exit.
[1] https://obr.uk/efo/economic-and-fiscal-outlook-march-2021/