Covid Fraud
Lord Watts Excerpts(4 weeks ago)
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Lord Livermore (Lab)
I thank my noble friend for his question, and I agree with the underlying point he makes. In his report, the commissioner recommends that small companies and micro-entities be required to file profit and loss accounts with Companies House under the Economic Crime and Corporate Transparency Act 2023. I said before that the Government have only partially accepted four of his recommendations, and this is one of them. While small businesses and micro-entities will be required to file profit and loss statements, as announced in June 2026, this requirement will come into effect in April 2028—one year later than initially anticipated—to give companies and businesses time to prepare. Small companies and micro-entities will have the option to opt out of publishing their profit and loss information on the public companies register. These changes reflect the Government’s consideration of concerns raised by stakeholders following the June announcement. The opt-out option addresses legitimate concerns about the commercial sensitivity of profit and loss information for smaller companies. Publishing this data on a public register carries privacy and competitive risks that are disproportionate for businesses of this size.
Lord Watts (Lab)
My Lords, the company owned by the noble Baroness, Lady Mone, owes the taxpayer £120 million. People who defraud the benefit system by £100 or £200 end up in jail; why is she not in jail? Why do the Opposition not say anything about this type of fraud, which brings disgrace on this House?
Lord Livermore (Lab)
The Government have been clear that we expect robust action to be taken to protect the taxpayer, and we have fully supported the appropriate legal and insolvency processes being followed. As I understand it, PPE Medpro Ltd is now in liquidation, and matters related to the recovery of funds are therefore for the liquidators to pursue in line with their statutory duties. Any recoveries that can be made will be determined through those independent processes. It would not be appropriate for me to comment on those proceedings.
Higher Earners: Emigration
Lord Watts Excerpts(2 months ago)
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Lord Livermore (Lab)
The new residents-based regime is more competitive for new arrivals than the previous rules. It is more attractive than the previous approach. They can bring their foreign income and gains into the UK without attracting an additional tax charge. These changes will encourage individuals to spend and invest these funds in the UK.
Lord Watts (Lab)
My Lords, is it not the case that if you are a patriot you are obliged to pay your fair share of tax and that people who do not want to do that are not patriots?
Lord Livermore (Lab)
We must ensure that the wealthiest pay their fair share of tax towards the public finances. Equally, successful businesses and entrepreneurs who create jobs and wealth are the engine of economic growth in this country and we must do all that we can to support them.
VAT Relief: Business Donations
Lord Watts Excerpts(2 months, 1 week ago)
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Lord Livermore (Lab)
I have to apologise to the noble Lord, I am afraid, because I do not know the answer to his question about the applicability of this relief to Northern Ireland under the Windsor Framework. I will investigate that and write to him.
Lord Watts (Lab)
My Lords, the banks have opened hubs in some very poor communities. Would it be a good idea for the supermarkets to do the same and put food hubs in decent locations in some of these areas where people find it difficult to get good food?
Lord Livermore (Lab)
The location of supermarkets is largely a commercial decision for the supermarkets themselves and not one for me, but I believe that that is exactly what the social supermarkets that the Question relates to are trying to do.
Online Challenger Banks
Lord Watts Excerpts(3 months ago)
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Lord Livermore (Lab)
The noble Lord will know that the money laundering regulations rightly mean that, for new customers opening an account, banks are required to take due diligence measures to verify the customers’ identity, assess the intended purpose of the account and flag any suspicious transactions to law enforcement. The regulations are not prescriptive in setting out specific steps that banks should undertake to satisfy customer due diligence, but instead require them to take a proportionate approach, which I think is what the noble Lord is asking for. Each bank will therefore have its own policies and procedures, and those policies should be informed by each bank’s own assessment of the risk faced by its services and customers, based on sources such as the national risk assessment of money laundering and terrorist financing.
Lord Watts (Lab)
My Lords, this year has seen a massive increase in offshore unregulated betting. Are these challenger banks following the same procedures and checks as the normal high street banks?
World Economic Outlook: UK Growth and Inflation
Lord Watts Excerpts(3 months ago)
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Lord Livermore (Lab)
The noble Baroness is absolutely right to point to the need for economic resilience. As she knows, we must do more on economic security so that the UK does not continue to be more exposed to energy price shocks than our counterparts are. Since the election, we have invested in clean homegrown energy—renewables and nuclear. Yesterday, the Chancellor announced steps to go further, harnessing our domestic supply of oil and gas production from the North Sea, further removing barriers to new renewables investment, and reforming our energy system by further weakening link between high gas prices and electricity prices. The noble Baroness asked specifically about BICS; she will know that the consultation on scheme design and eligibility was published last week.
Lord Watts (Lab)
My Lords, is it not the case that inflation, economic growth and living standards were improving until we had the problem with Iran? Is it also not the case that, as soon as that problem has gone, the Government have the policies to drive the economy?
Lord Livermore (Lab)
My noble friend is absolutely right. The economy, at the time of the spring forecast, showed that we are well placed going into this conflict. Inflation was at 3% and is set to fall to target—a much lower starting point than when Russia illegally invaded Ukraine. Borrowing was set to fall more over this Parliament than in any other G7 economy. We had increased headroom for over £23 billion, giving us the buffer to respond to these shocks, and GDP per capita was forecast to rise. Therefore, my noble friend is absolutely right. Outturn data for February, the final month before this conflict began, showed that the economy grew faster than anyone was expecting.
Reducing Government Spending
Lord Watts Excerpts(4 months ago)
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Lord Livermore (Lab)
As I said at the outset, of course UK markets are affected by global developments but it is a long-standing convention that the Government, as an issuer in gilt markets, do not comment on specific market moves. The noble Lord will be aware that the full economic impact of the conflict will depend on its severity and duration, but we enter this period of uncertainty with the fundamentals of our economy strong. The spring forecast showed that this year borrowing falls by almost 1 percentage point to its lowest level for six years, 4.3%. That is the largest fall in the deficit since 2016. Borrowing as a share of GDP will then fall in every year of the forecast, from 4.3% in 2025 to 1.6% in 2030. Borrowing will fall more than in any other G7 economy. This year, for the first time since 2004, we will be borrowing less than the rest of the G7 on average.
The noble Lord asked about welfare. It is right to point out that in the last five years of the previous Government, spending on welfare increased by £88 billion. No one believes that the system we inherited is working: it abandoned too many people to a life on benefits, it wrote off too many people as too sick to work and it condemned too many children to be too poor to eat. That is exactly why we are reforming the welfare system.
Lord Watts (Lab)
My Lords, I have a suggestion for saving money in the public sector. At the moment, billionaire farmers who do not pay any tax in the UK can claim farming subsidies. Is it right that we all pay them extra money at a time when they have not paid money into the system?
Lord Livermore (Lab)
I am sure my noble friend makes a very interesting point. It is notable, though, that the party opposite’s first instinct is to cut spending at a moment of instability such as this. That is precisely the stop-go pattern of investment that got us into the problems that our economy is now in. Cutting investment at this point and returning to austerity would be the very worst thing that we could do for growth—the very definition of short-termism—yet that is precisely what previous Chancellors with previous fiscal rules have done. In the years following the financial crisis, austerity took demand out of the economy when it was needed most, undermining investment in critical infrastructure, weakening productivity and choking off growth. Unlike today’s Conservative Party, we will not repeat the mistakes of the past.
Small Businesses: VAT Threshold
Lord Watts Excerpts(4 months, 3 weeks ago)
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Lord Livermore (Lab)
I fully understand that, and I am grateful to the noble Lord for reminding me of it. Last year, the Government published their plan for small and medium-sized businesses, setting out support for smaller firms. We are partnering with industry to unlock productivity growth through the adoption of digital technologies. We are legislating to tackle late payments, which cost the UK economy £11 billion a year. We have launched a new Business Growth Service to make it easier to access advice and support. We are making SMEs a national priority in our new procurement policy system. We are expanding the UK Export Finance capacity by £20 billion and creating a small export builder insurance product. I assure the noble Lord that we are very aware of the points he raises.
Lord Watts (Lab)
My Lords, are the Government concerned about what seems to be the growth of cash-only businesses? They are not there for the customers’ benefit but, in some cases, for the business to avoid tax and other things.
Lord Livermore (Lab)
Yes, absolutely, the Government are very aware of the points that my noble friend raises. HMRC has recently engaged in increased enforcement activity around those exact points.
Business Rates
Lord Watts Excerpts(5 months, 4 weeks ago)
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Lord Watts (Lab)
My Lords, is it not the case that the previous Government wrecked the economy and gave us Brexit, which reduced our ability to pay for public services? The Opposition now seem to be calling for greater public expenditure and tax cuts. It sounds as though they have found not just one money tree but an orchard. Can the Minister explain how someone can call for more expenditure and less tax?
Lord Livermore (Lab)
I very much agree with everything that my noble friend said. Among the long litany of the previous Government’s failures, their failure on growth was one of their most significant. We saw Brexit and the Liz Truss mini-Budget, and we know what business thought of that. We saw business investment across the whole economy fall to the lowest level in the entire G7. My noble friend is also absolutely correct to point out that, every time we debate the economy in the Chamber, the noble Baroness opposite supports every single piece of spending that we announce but opposes every single piece of revenue raising. It is quite clear that those two things do not add up.
On the Tory record more widely, we should note that 7,000 pubs have closed in the past 14 years, and that the previous Government’s plans were to scrap entirely the temporary Covid retail, hospitality and leisure relief in 2025. Their plans show that they would have ended it overnight. We have chosen a different path by extending that support with the help of £4.3 billion of additional support.
Lord Watts (Lab)
My Lords, has the Minister noticed that the Opposition say that the private sector does not like U-turns, they say they do not like U-turns, and then they call for more U-turns? What is their strategy for dealing with our current problems?
Lord Livermore (Lab)
I cannot answer for the strategy of the party opposite—I am sure we would all like to know—but what matters most is that we get to the right policy and I believe that we have done so in this case.
Business Rates: Retail, Hospitality and Leisure
Lord Watts Excerpts(6 months, 1 week ago)
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Lord Livermore (Lab)
The noble Baroness is absolutely right about the important role that those businesses play in giving young people their first jobs, and I agree with her. We are taking significant measures to help the UK hospitality sector, which employs more than 2 million people and is vital to high streets across the UK. Based on recommendations from the licensing taskforce, we published a new National Licensing Policy Framework for the hospitality sector at the time of the Budget. We are exploring planning reforms to help pubs and hospitality to expand, and the hospitality support fund has helped pubs in rural areas to diversify, ensuring that they can continue in their role as vital community hubs.
Lord Watts (Lab)
My Lords, on pub companies, there is no doubt that the tenants are facing major problems in the UK, but does the Minister agree with me that, although those pubs are struggling, brewers and pub companies are making record profits? Is it not time they passed that on to the pubs themselves?
Lord Livermore (Lab)
My noble friend is correct to say that pubs have been struggling in this economy for a long time. In the previous 14 years under the last Government, 7,000 pubs closed in the UK, so this is a long-standing issue. On his wider question, I am more than happy to look into that.
Agricultural Property Relief and Business Property Relief
Lord Watts Excerpts(6 months, 3 weeks ago)
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Lord Livermore (Lab)
I do not have that data to hand, but I am more than happy to write to the noble Lord.
Lord Watts (Lab)
My Lords, if there is now a shortfall in resources for the Government, can the Minister look at trust funds? These are the major weapon used by very rich people to avoid tax on inheritance.
Lord Livermore (Lab)
It is right that everybody pays their fair share towards the public services and that the tax system is based on fairness. I am confident that we have announced measures in the previous two Budgets to make sure that the tax system is fairer.