Levelling-up Agenda

Catherine McKinnell Excerpts

Wednesday 15th September 2021 Westminster Hall

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

Thank you, Mr Robertson. I thank my hon. Friend the Member for Barnsley Central (Dan Jarvis) for securing this important and timely debate. He set out very comprehensively why levelling up matters so much and cannot be left as a slogan. It must become a reality, because the communities that we represent all rely on it.

The Government tell us that one of their key priorities as we emerge, hopefully, from the pandemic, is that we do so as a healthier country. For the levelling-up agenda—the hon. Member for Stoke-on-Trent North (Jonathan Gullis) touched on this—that must mean tackling health inequalities. It is one of the glaring indicators of inequality between cities and regions, but I worry that over the last 18 months we have seen a pattern where health and leisure facilities in areas with the biggest pre-existing health inequalities have been the ones at greatest risk of closure.

According to ukactive, more than 400 sports and leisure facilities have closed permanently since March 2020, including the much valued and loved West Denton pool in Newcastle North, which has sadly not reopened due to the devastating financial impact of the pandemic. According to the 2019 indices of deprivation, the neighbourhood where that pool is located is already in the top 10% in the country for health deprivation challenges. Much of the surrounding area has similar issues. Combined with the overall decline in physical activity during lockdowns over the last 15 months, I am really concerned that its closure will lead only to the worsening of long-term health outcomes for the communities that I represent.

When I met with the Minister for School Standards yesterday alongside water safety and swimming campaigners, they emphasised to him that children’s swimming ability varies hugely by socioeconomic status. According to Sport England, 84% of children and young people from the most affluent areas can swim the statutory 25 metres required by the national curriculum when they leave primary school, whereas only 41% from the least affluent families do the same. Water safety is about a lot more than just being able to swim, but I worry that the pool closures in disadvantaged areas—not just Newcastle—will create a problem of children from less affluent backgrounds disproportionately failing to meet those minimum standards. Therefore, potentially they will find themselves in much greater danger when near the water. Access to affordable local swimming pools is central to helping children in less affluent areas not only keep fit but be safe.

We need to level up health inequalities. The Minister could make a great start by backing Newcastle City Council’s bid to the fund to develop a new state-of-the-art net-zero-carbon swimming pool and leisure development in outer west Newcastle. The Chancellor is a keen swimmer, having recently decided to add a 12-metre pool to his own grade II listed north Yorkshire manor. I hope that when the Government come to consider bids to the levelling-up fund, the Minister will agree that Newcastle North’s constituents in the outer west of Newcastle should have access to a pool, too.

I will speak briefly about High Speed 2. Like many colleagues in the north of England, I have been concerned by reports that Ministers are again considering the cancellation of phase 2b, which runs from Leeds and connects to other major cities via the east coast main line. Committing to the eastern leg of HS2, alongside Northern Powerhouse Rail and east coast main line upgrades, are all essential to make HS2 work for the north. It is not just about speed; it is about providing that connectivity and capacity that we so badly need. The Government have created a lot of uncertainty over its future, seemingly reopening the question of phase 2b time and again, even though the Oakervee review concluded that it should go ahead. If the Government are serious about HS2 being a project for the north, which is how it has been sold, it cannot be just for London and Birmingham. In the upcoming integrated rail plan, they must commit to integrate and build all phases of HS2, along with Northern Powerhouse Rail and badly needed upgrades to the east coast main line.

Enough talk about levelling up—the Government need to walk the walk on this issue. That means investing in our communities, our health inequalities and our transport infrastructure, so that we can genuinely level out not just between north and south but between and within our northern communities.

Health and Social Care Levy

Catherine McKinnell Excerpts

1st reading
Wednesday 8th September 2021 Commons Chamber

[Rachel Reeves]

The truth is that the Tories are all tax and no strategy. When it comes to the NHS and social care, last year the public clapped them; this year the Tories tax them. There are far too many outstanding questions, with no detail published yesterday. What other tax rises on working people are set for further down the line, given that the Prime Minister refused to rule them out yesterday? Will council tax have to rise to make the sums add up? How will the Government relieve the burden on councils and care homes? Again, there was no detail on that yesterday, and there is no detail today.

Mike Padgham of the Independent Care Group said:

“It’s not clear how the money is going to…the front line.”

That means that providers will be squeezed, and working conditions and pay impacted. This just does not add up.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

We all recognise the significant crisis in the social care system, but is that not just another broken Conservative manifesto promise? They pledged to approach this in a manner of cross-party consensus. The manner in which they are bringing forward these out-of-the-blue taxation measures on some of the poorest working people in this country does nothing to build that consensus; it just broadens the gap that we know many families face in meeting the costs of social care.

[Rachel Reeves]

My hon. Friend is exactly right. The Conservatives walked out of cross-party talks in 2010, and despite offers from my hon. Friend the Member for Leicester West (Liz Kendall), they have never resumed.

So much for the plan; what does this mean for ordinary people funding it? The Chancellor’s tax on jobs does not just let down those needing care or working in the care sector; it is a tax on all those in work. As daily covid cases continue to climb, the only shielding that the Government are interested in is protecting the wealthiest few from paying more tax. As I said, a private landlord owning and renting out multiple properties will not pay a penny more, yet their hard-working tenants who work for a living will be hit hard. It is deeply unfair.

UK-EU Future Relationship Negotiations and Transition Period

Catherine McKinnell Excerpts

Monday 7th December 2020 Commons Chamber

[Penny Mordaunt]

I thank my hon. Friend for his comments, and I absolutely can give him those assurances. His question also affords me the opportunity to pay tribute to not just to the negotiating team and Whitehall civil servants, but the very many individuals, politicians and civil servants in the devolved Administrations, the Crown dependencies and elsewhere, who have worked incredibly hard to get us this far. It is because of all those efforts that I want to ensure that we get this over the line. All the encouragement that my hon. Friend and others can give in that respect is gratefully received.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab) [V]]

The north-east region has consistently exported more than it imports, and the Government promised the people of the north-east an oven-ready deal with no tariffs, fees, charges or quantitative restrictions—a deal that would safeguard workers’ rights, consumer and environmental protections and keep people safe through a comprehensive security agreement. With the negotiations now going late in the day, and those promises looking increasingly overcooked, what are the Government doing to ensure that businesses and individuals in the north-east are able to properly prepare for and manage these changes to come?

[Penny Mordaunt]

The hon. Lady raises a very important point. I reiterate that we are working to get a deal. We will continue to negotiate until that becomes an impossibility, but I am hopeful that we will get a deal. We have invested a huge amount in ensuring that businesses are ready. Most of the things that businesses and citizens will need to do are already known and are not contingent on the final negotiations. I stand ready to assist if the hon. Lady’s constituents or businesses have particular issues, but an enormous amount of support is available—not just information but webinars and dialogue with experts and officials—to ensure that people have all the information. There is also, of course, the substantial campaign, which has been running for many weeks, to ensure that people are fully informed about what they need to do before the end of the year.

Draft Restriction of Public Sector Exit Payments Regulations 2020

Catherine McKinnell Excerpts

Monday 21st September 2020 General Committees

[Steve Barclay]

I was going to come to local authorities, but to address the issue of senior civil servants, that flowed from the decision to split the role of the Cabinet Secretary and the head of the civil service with that of Sir Mark’s other role as National Security Adviser, which meant that he was stepping down before the end of his tenure. It was therefore appropriate that Sir Mark was compensated in line with the civil service compensation scheme, and the sum is in line with the normal rules governing civil service pensions and compensation. Since 2015, in anticipation of the introduction of a cross-public sector cap on exit payments, any civil service exit costing more than £95,000 requires approval by Cabinet Office Ministers to ensure that it provides value for money to the taxpayer. As someone who worked with Sir Mark, particularly in my role as Secretary of State for Exiting the European Union, I place on the record what a fine public servant he was and how much I valued working with him during his time in office.

The hon. Member for Bermondsey and Old Southwark, who made a number of interventions—I hope that comment is not untoward—also raised a legitimate point about local authorities. As I say, it is something I looked at in particular. Local authorities’ ability to restructure should not be dependent on six-figure taxpayer-funded payouts. Councils will still be able to restructure and exit staff in any way they wish, provided the sum of any exit payment does not exceed £95,000. The Government accept that there might be instances where it is in the interests of urgent workplace reform to relax the restriction imposed by the regulations, so there is flexibility within the system.

Finally, the hon. Member for Ilford North raised the issue of index-linking. The point is that we want to retain the flexibility to revalue the cap both upwards but also downwards. If one looks at the economic consequences of coronavirus, ensuring that there is flexibility in the system is a prudent way to manage the public finances.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

I have listened carefully to everything the Minister has said. I appreciate the arguments that he has put forward, but we should remember that, in the time of covid, many of the people who will be affected by the proposed changes are on relatively moderate salaries and have given years of their lives dedicated to public service, and will be giving everything to help get through this covid crisis. I want to put on the record that it is vital that the Government keep the measure index-linked so that it does not erode over time and vital that all the promises that the Minister has made today do not become meaningless within a few years.

[Steve Barclay]

I acknowledged earlier that in a previous speech the hon. Lady accepted the principle of capping excessive payments, but raised concerns to which I listened intently. I join with her in paying tribute to the work that so many have done across the public sector, but at the same time it is important to get value for money. For that reason, I commend the regulations to the Committee.

Question put.

The Economy

Catherine McKinnell Excerpts

Wednesday 8th July 2020 Commons Chamber

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

There is no doubting the magnitude of the economic challenge that we face as a country. The north-east too often gets the worst deal when trouble hits, with lost jobs, declining investment and public sector cuts. Our region went into this crisis with the highest level of unemployment in the country, and I can only see things getting worse. The northern TUC estimates that almost a third of jobs in our region are currently supported by Government schemes, so there are a huge number of jobs at risk. With 71% of children living in families with little or no savings, the impact could be devastating.

Today, I was hoping for reassurance that things could be different. There are certainly measures to welcome. The kick-start scheme, like Labour’s future jobs fund, should hopefully help young people starting out in their careers. The green jobs drive should help to deliver skilled, well-paid, sustainable jobs. However, I fear that the Government’s ambition simply does not meet the scale of the challenge. Just as they were too slow to act on public health in the early days of this crisis, leading to many more devastating deaths than we should ever have seen, I am concerned that this is just not enough now to ensure that we can grow out of this crisis.

It is the poorest households that have seen the greatest loss of income already. The jobs that are most at risk are in the sectors with lower pay where young people and women make up most of the workforce. We cannot let this crisis entrench regional, intergenerational and gender inequalities even further. It is crucial that the Government do more. We need short-term support for businesses that will continue to struggle. A one-size-fits-all approach is leaving too many people falling through the gaps. The package for the creative sector is welcome, but we also need a longer-term strategy as venues remain shut and capacities limited.

Transport investment will be vital to unlocking the potential of the north. A commitment to get Northern Powerhouse Rail, High Speed 2 and upgrades to the east coast main line shovel-ready and started in the north would unlock thousands of good-quality jobs. The kick-start scheme for young people is welcome, but we need to see reskilling opportunities for older workers and action to address poverty and income inequalities, including a real living wage and reforming social security. The long-promised review of business rates and online taxation is desperately needed for our high streets and town centres, because their long-term transformation has been accelerated by this crisis. I want to put in a special plea for business rates relief for our regional airports. It is a major fixed cost that is simply not reflected in the current passenger numbers or the projected numbers for quite some time.

I also want to touch on support for new parents. I know that it is not hard-hat and shovel-ready stuff, but frankly, thousands of new mums have been left completely overlooked during this crisis. Their maternity leave period has seen isolation, with a lack of health visitor, mental health and medical support and peer group and family help at this vital time. If not addressed, that could impact them and their children for years to come. They are now having to go back to work—many without access to childcare—and they risk being targeted for redundancy. That is no way to treat new parents or the children they are bringing up in this world. I implore the Chancellor to look seriously at the Petitions Committee report on these issues and at the reasonable request for the additional support that new parents now desperately need.

The cost of doing nothing now will be far greater than that of providing the right support. People have made huge sacrifices to get us through this health crisis. The north-east is now looking for the Government to deliver on their promises in return.

Economic Update

Catherine McKinnell Excerpts

Tuesday 17th March 2020 Commons Chamber

[Rishi Sunak]

Most charities are already eligible for 80% charitable rate relief, but they will benefit from the new enhanced retail rate relief at 100%.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

The Chancellor has talked about courage, but I will tell him what takes courage: fighting this pandemic on the frontline without adequate protective clothing. Will he commit right now to doing whatever it takes to ensure that every single frontline healthcare worker has the protective clothing they need if they are working exposed to this virus?

[Rishi Sunak]

My right hon. Friend the Health Secretary is working around the clock to support our healthcare workers to have everything they need to do the vital job that they are doing for us. They will get whatever support that they require.

Netflix: Tax Affairs

Catherine McKinnell Excerpts

Monday 3rd February 2020 Commons Chamber

[Dame Margaret Hodge]

I entirely support the hon. Member on that.

Netflix takes out of the public purse more than it contributes in corporation tax. While Her Majesty’s Revenue and Customs fails to collect money from it in corporation tax, the US Government is extracting tax from the same profits that it earns here and then hides in unknown tax havens.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

I congratulate my right hon. Friend on securing the debate. While austerity has seen billions of pounds taken out of our public services, with £300 million gone from the economy in Newcastle, is it not absolutely vital that we get this tax policy right so that we have that money to fund our vital public services? Multinationals such as Netflix should make their fair contribution.

[Dame Margaret Hodge]

Not only should they be making their fair contribution, but they use the services that other people’s tax pays for.

Netflix creates its content here, supported by grants that it receives here through our tax credit system, yet it pays tax on the profit that it makes here in the USA. Frankly, I say to the Minister: you couldn’t make it up. The situation is scandalous, intolerable and unfair. It is the sort of behaviour that really winds up the British public, most of whom are law-abiding taxpayers who never try to avoid their duty to pay taxes.

Let me explain the Netflix situation in detail. Netflix is the world’s biggest video-streaming service, with 167 million subscribers. The California-based company is the online home of popular shows such as “The Crown” and “House of Cards” and films such as “Marriage Story” and “The Irishman”, but while we all binge-watch Olivia Colman’s portrayal of the Queen Netflix has deliberately constructed a devious financial structure that has no other purpose than to avoid paying its tax.

The Netflix strategy is to be the biggest player in the online video streaming market, to buy out or undercut any rivals and to release a sea of content to attract a truly global subscriber base. For many years, the service ran at a loss to secure this dominant market position, but it is now operating in the black. Netflix’s global operating profit rose by an enormous 61% last year to £2 billion. By 2019, Netflix had 11.62 million UK subscribers, who generated a £1.08 billion income for the company, but under the ruse it employs any UK citizen who subscribes to Netflix is billed not in the UK but from a subsidiary company in the Netherlands.

The most recently published Netflix accounts for 2018—the only earnings declared here—amount to a very small proportion of its billion-dollar UK revenue. Money declared by Netflix in the UK is paid by the Dutch subsidiary to a much smaller subsidiary based in Britain, which makes up just a trivial proportion of the services the company provides. Tax Watch UK estimates that the actual profit Netflix made in the UK was close to £70 million in 2018, so the company should have paid over £13 million in corporation tax.