Covid-19: Government Support

Catherine West Excerpts

Wednesday 7th July 2021 Westminster Hall

[Catherine West (Hornsey and Wood Green) (Lab) [V]]

It is a pleasure to serve under your chairmanship, Mr Mundell, and I thank the hon. Member for Midlothian (Owen Thompson) for securing the debate.

The increase in debt as a result of the coronavirus has been significant, and it has been particularly bad among groups of people who have fallen into the gaps of various furlough and other schemes. There seems to be an enormous lack of balance in who has been helped during the coronavirus pandemic. For example, if your name is David Cameron and you have a few handy phone numbers, you seem to have managed to do much better, by lobbying the Department for Business, Energy and Industrial Strategy eight times, whereas if you are a single parent living in Wood Green, you have been much more disproportionately affected by debt.

There are a number of options I believe the Government should look at to address some of the issues raised in this afternoon’s debate. First, they should review their decision, or impending decision, to take back the £20 per week top-up that they wisely gave to universal credit recipients earlier in the crisis. Now would be absolutely the wrong time. If we were to take a vote in this room, I am sure the answer would be that it was the wrong thing to do right now.

Secondly, the Government should take up the recommendations of the Excluded UK all-party parliamentary group, which the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) has already mentioned—he has very much led from the front on that. We have heard from a number of people, particularly in the creative sectors and in travel and aviation, about the uncertainty and the increase in rent. For example, in my constituency, a poor travel agent has been hit with a rent bill that has increased by 45% during this terrible time.

I would also like the Government to ensure that every single citizens advice bureau in the country is properly funded and that there are sufficient volunteers. I pay tribute to Daniel Blake, chief executive of my own CAB, and Lorna Reith, the chair. Other Members, too, will have excellent CABs.

Finally, the impact on many of the terrible ineligibility for schemes has led to an exponential growth in food banks and 1.3 million more children eligible for school meals—1,700 in my own local government area. We live for a future where there are no food banks. That rise shows the terrible situation for many who work in the informal economy and for small and medium-sized businesses. I look forward to the Minister’s speech.

[David Mundell (in the Chair)]

I call the SNP spokesman. Your time, Mr Grant, is trimmed to four minutes. We have been able to allow everyone to participate.

Economy Update

Catherine West Excerpts

Wednesday 16th June 2021 Commons Chamber

[Steve Barclay]

Yes, I agree with my hon. Friend. The key is that it will allow time for more second vaccinations, which is key in the step-forward decision on the road map.

[Catherine West (Hornsey and Wood Green) (Lab)]

My constituents will be very disappointed that the Chancellor has not bothered to come to this Chamber in such a week as this to answer my question relating to freelancers—particularly but not uniquely in the creative sector—who have been excluded from any package. So to pay for that, will the Minister have an urgent meeting with me and other Members who are worried about those who have been excluded from all packages of support, by the end of this week?

[Steve Barclay]

It is slightly odd to criticise me when I am literally in the Chamber answering the hon. Lady’s question. The point is that there has been a comprehensive package of support for those on the self-employment income support scheme, which has been further extended. Many of those who were of most concern to colleagues on both sides of the House in earlier debates have come into scope of those schemes as we have gone through extensions, and I understand that my colleague the Financial Secretary has met groups to hear representations on these issues.

0.7% Official Development Assistance Target

Catherine West Excerpts

Tuesday 8th June 2021 Commons Chamber

[Catherine West (Hornsey and Wood Green) (Lab)]

It is a pleasure to hear so many Members across the House joining together, looking at the progress that has been made on HIV/AIDS over the years and urging the Government to change their mind on this funding question. I know my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty), who chairs the all-party group on HIV and AIDS, which is cross-party, has also done an enormous amount of work on this.

I want to talk today about the impact on British science, but before I do I want briefly to mention the many wonderful experiences that we as Members, in different parties, had in, for example, Kenya or Nigeria, where so many children die from malaria. We know that, with the Commonwealth Heads of Government meeting this month, we are meant to be showing a very strong sense of leadership and I feel this kind of decision undermines that.

I was very pleased to hear the right hon. Member for Gainsborough (Sir Edward Leigh) talk about the waste of the in-year cut. When we cut budgets in-year, we may as well not spend the money at all; we just throw it away. So some medication that is being provided through programmes will actually be disposed of because of an in-year cut. It is a really bad way to manage programmes.

On British science, I declare an interest because my other half is a scientist and is very involved in malaria research. I understand that Dr Gilbert, who in Oxford invented the vaccine, invented it because she has a background in trying to find a vaccine for malaria. It is a very different kind of parasite from coronavirus—of course, coronavirus is much simpler, so it is much easier to get a vaccine—but the reason she is a vaccinologist and understands vaccines is that she worked in global health, and the UK is known for its excellence in that area.

These ODA cuts will have a massive impact on our regional universities. Of course, what we are trying to address are the regional inequalities within the UK. We know, for example—and the hon. Member for Winchester (Steve Brine) mentioned the trust in Hampshire—that there are 500 health facilities across Africa and Asia that work closely with the Liverpool School of Tropical Medicine. They teach medical science and medical research to Africans and in Asia as well. In particular, the concept is so good—this was one of the special things about many of the DFID programmes: it was a hand up, not a handout. Everybody wants to see these programmes where British scientists work closely with African scientists. They are equal scientists, and they work together and collaborate. It is not just handing out in a kind of philanthropic way to make us feel good; it is working on the global problems that affect each and every one of us. We are so far ahead in our vaccine project because of that background in global health.

This debate is taking place in the context of The Times rich list, where there are 23 more billionaires this year. Our economy has the potential, but we have to make our economy work harder so that we can afford this, because it is inequality that is going to bring down our society, which is going to cause even more problems, and we must tackle that difficult problem. Christine Lagarde has been saying it for years, and the IMF is saying it. Tackle inequality, and the rest will look after itself. We have to find a way for the 23 billionaires to help to pay for the £4 billion that we need to maintain this UK excellence across the world.

Finance Bill

Catherine West Excerpts

Report stage & 3rd reading
Monday 24th May 2021 Commons Chamber

[Catherine West (Hornsey and Wood Green) (Lab)]

Does the right hon. Gentleman agree that some well overdue changes to Companies House’s approach would be very welcome, and that the Government are taking an awful long time to get round to it?

[Mr Davis]

I have a lot of sympathy with what the hon. Lady says. There are many ways to attack the issue; I will mention one or two, including my proposals to build in some changes to that effect. There are many ways to make sure that these scams cannot happen, but we need to undertake some of them. To pick an example that I was not going to cite, we understand that something like 40,000 Filipino employees have been taken on as cheap frontmen for these companies as directors. Those sorts of things do not serve our economy or the contractors well.

--- Later in debate ---

I echo the right hon. Gentleman in calling for greater regulation of umbrella companies and the way that they offer their services. All the loan charge casework I have taken up in my constituency relates to people who, in good faith, took professional advice in the organisation of their tax affairs and the submission of their tax returns. It is entirely reasonable that people should instruct professionals and take their advice. It is up to the Government to regulate and legislate to ensure that professionals are clear about the legality of that advice and that innocent people are not held accountable for advice they took in good faith. It cannot be right that companies exist that offer services that have been proven in a court of law to be illegal.

[Catherine West (Hornsey and Wood Green) (Lab)]

I rise to speak briefly in support of Labour’s new clause 24. We are often told, are we not, that the boldest measures are the safest. Unfortunately, the Government seem to have done a bit of a U-turn, or failed to be bold, going from a promised 3% to 2% on their non-residence surcharge. That is a hugely missed opportunity. It could really have helped the London property market, holding to account the wealthy as opposed to so many of those who struggle to get on to the property ladder.

I also want to talk about the register of overseas entities. First, I echo the words of my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier), who talked so movingly about those in housing need in her constituency. That is something that many of us in London see, day in, day out, in our surgeries. In my case, I think of particular companies that, after properties are built, purchase a number of different apartments, selling them, for example, to the far east. Even people who have saved and saved cannot afford to purchase an apartment in that block, as opposed to those who buy an apartment to hold as an investment, even keeping it empty at a time when we have such desperate housing need. The Treasury should consider clamping down on this practice.

On the wider point that this measure could address if it were not so shy, consideration should be made of the cost of assets and the fact that the huge inflation of assets does not help savers or the young. There are so many young people in desperately insecure employment who will never get on to the housing ladder unless we start to address this terrible situation. We also know that with low interest rates it is almost impossible to save the amount of deposit that is needed. The Help to Buy scheme, which in some parts of the country has worked quite well, has not worked particularly well in many of our neighbourhoods. It simply has not been able to touch the sides of what is needed.

The second point I want to make on the amendment on the register of overseas entities is, once again, how disappointing it has been that we have failed to hold to account those abroad who seek, for various reasons, to hide their financial interests in the UK. We look at this in the context of the Sunday Times rich list from last Sunday, where we see 24 new billionaires in the UK while 4.3 million children in the UK are living in poverty. That desperately needs to be addressed, yet it is five years since David Cameron first promised, when he appointed his anti-corruption tsar, to actually do something about corruption and overseas finance. Instead we have this go-slow, whether on having proper credentials for registering businesses at Companies House, on some of the measures in the Bill or on going from 3% to 2%. Who stands to benefit from that? It is not our constituents; it is people abroad who clearly have some kind ear of the Government. That desperately needs to be addressed.

Having read Catherine Belton’s book “Putin’s People”, I hope the Minister is able dispel my fear regarding its allegation that £1 million has gone to the Tory party from Mr Temerko, who is a very wealthy Ukrainian businessman. That money is tied to a corrupt regime where the courts will do the bidding of the Government in Russia. That money is tied up. We should not be beholden to these people; we should be standing up to them.

I also want, while I am talking about the register of overseas entities, to comment briefly on the terrible situation with Belarus in the last 24 hours. The Treasury needs to be much more campaigning. I know that working for the Treasury is all dry facts and figures, but look at how important its work has been in saving our economy and saving our workers. Well, let us now look at how revolutionary it could be in holding to account some of the corrupt regimes that have their money tied up in London’s economy. Will the Minister look at whether he can work with the Foreign, Commonwealth and Development Office to bring forward sanctions against state-owned enterprises—some of which continue to have UK subsidiaries, such as BNK UK, which is the UK arm of the Belarusian state oil company—and outline how the Government can plan to stop the Belarusian Government from using the London stock exchange to raise money and sustain Mr Lukashenko’s grip on power? Furthermore, how can the Treasury, working together with the Foreign Office, examine the evidence for further sanctions against individuals who support and help to sustain the regime, such as Mr Mikhail Gutseriyev, who was mentioned today in the urgent question? I hope that the Treasury will work together with the FCDO to right this wrong.

Finally, a statistic to finish these few words. Despite the sanctions imposed last year by the Foreign Secretary, with which I agree, there are fewer Belarusian entities sanctioned now than in 2012. Only seven entities are currently designated, compared with 32 under EU sanctions in 2012. In the space of 12 months, this dangerous regime has stolen an election, employed brutal repression against its own people and hijacked a civilian airliner. I feel as though our economy is facilitating that, and we simply cannot let that pass. I beg that with the mention of the overseas register, the Treasury will work hand in glove with the FCDO to bring these people to book, and to establish a genuine and committed economy that, at its heart, cares about human rights.

[John McDonnell [V]]

We are at a stage in the Bill’s progress that is almost like a wash-up. We are trying to make last-minute appeals to the Government for action on a number of key issues, and all the appeals to the Government so far by the right hon. Members for Haltemprice and Howden (Mr Davis) and for Chingford and Woodford Green (Sir Iain Duncan Smith), my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier), the hon. Members for Brighton, Pavilion (Caroline Lucas) and for Richmond Park (Sarah Olney) and others are on worthy causes that should be addressed, as are the amendments from the Labour Front Benchers.

We must remember the context of the Government’s surcharge policy. It was to spike the approach that the Labour party was making about a levy on overseas ownership, on exactly the grounds laid out by my hon. Friend the Member for Hackney South and Shoreditch about the desperate need for housing and to prevent housing from being used continuously as an investment asset for profit, rather than to put roofs over the heads of our families. I wholeheartedly support and welcome all those appeals, but even if with my Catholic upbringing I believe in the powers of conversion, I somehow doubt we have been able to convert the Minister to a sufficient level for him to accept the amendments. I hope to be surprised, but I doubt it.

I tabled amendment 23 not in the hope of converting the Conservative Government, but to enable me to express justifiable anger about the Government’s approach. The Government are attempting to legislate for a real-terms pay cut that will affect millions of low-paid workers through the freeze in the tax threshold. Those include many of my constituents who have had to make ends meet on 80% of their wages for much of last year. Yesterday—this has already been referred to—it was galling to see the other side of the coin. The Sunday Times rich list showed that during the pandemic more billionaires have been created in the UK than at any time in the past 33 years. The levelling-up policy that appeared last year was the levelling up of millionaires into billionaires.

The Chancellor should have used the occasion of the Budget and this Bill to level up capital gains tax to income tax rates, for example. It cannot be right that we tax work more than we tax income from wealth. Ahead of the Budget it was rumoured that the Chancellor was considering equalising capital gains tax and income tax. That would have been a much fairer way of raising revenue than increasing taxes for people on low and average wages, which the Government’s proposals on tax thresholds will do.

Child poverty has been mentioned, and in my constituency 42% of children are growing up in poverty—a figure that has sadly increased each year since 2015. Child poverty is often a consequence of low pay. The majority of children living in poverty in my constituency live in working households. We should be doing everything we can not just to protect but to boost the incomes of the low paid, not drag them into taxation or increase the taxes on them. The Bill will cut the income of someone working full time on the minimum wage. We know that 2 million workers rely on universal credit to top up their low pay, yet in a few months, the Government are going to cut universal credit by £20 a week.

Poverty has been rising in this country, and whether it is the £20 cut to universal credit, the stealth tax in the Bill, or this year’s paltry increase in the minimum wage, the Government’s actions will increase poverty still further, and increase suffering as a result. My amendment would ensure that the tax thresholds for the personal allowance and the higher rate were kept in line with inflation, as per the Income Tax Act 2007. I tabled it because I wanted to draw attention not to Labour party policy but to Conservative party policy, because in the last general election the Conservative manifesto pledged:

“We promise not to raise the rates of income tax”.

The manifesto continued:

“This is a tax guarantee that will protect the incomes of hard-working families across the next Parliament.”

I just hope that Conservative Members will have the good grace at least to acknowledge that clause 5 of the Bill breaches that pledge, and that incomes are not protected. More of people’s incomes will be hit by income tax, and that is especially harsh on the millions of public sector workers who now face from this Government a pay freeze, a 5% rise in council tax and now this stealth tax rise on their income tax.

Better Jobs and a Fair Deal at Work

Catherine West Excerpts

Wednesday 12th May 2021 Commons Chamber

[Catherine West (Hornsey and Wood Green) (Lab) [V]]

This is a thin Queen’s Speech that fails to grasp the nettle of the challenges we face and is an example of a Government short on ideas and low on energy. While President Biden is demonstrating bold policies in the US, lighting the way for a green-focused recovery with investment in new industries, technology and research and development, this Government are tinkering around the edges, with 11 years of austerity leaving the country unprepared and underfunded to deal with the pandemic. We need transformative action to ensure that our economy works for the whole country. I want to focus on two issues: green jobs and a sustainable social care sector.

We all know that we have less than a decade to make the bold changes demanded by the UN’s climate body to limit temperature rises, but this Queen’s Speech is bereft of any programmes or resource allocation to implement the green jobs plan we need to meet the target. In fact, the Government completely scrapped their only green jobs scheme, the green homes grant, after it was outsourced to a private American firm which botched the roll-out. Ministers will trumpet the newly announced national infrastructure bank, which we have been calling for for a long time now, but the Office for Budget Responsibility has said that the new bank will provide less than half the funding we used to receive from the European Investment Bank and offer a fraction of the funding recommended by the National Infrastructure Commission to tackle the climate emergency.

With an ageing population, the social care sector is vital to our social and economic health. Successive Conservative Governments have starved local authority budgets by £8 billion in real terms since 2010. We now have a welfare state in the 2020s built on the life expectancy of the 1940s. With the unlocking of society, now must be the time to deal with the social care challenge, not the time to kick it into the long grass. When he entered office in 2019, the Prime Minister promised on the steps of Downing Street that the Government would fix social care. Instead, we have the wet proposal in the Queen’s Speech. This failure has a real impact every single day in constituencies such as mine, with undervalued and poorly paid social care workers, no security or protection for residents from questionable care home owners, and families worried sick about the quality of care of elderly and disabled family members.

It does not have to be like this. We need to tackle unemployment with a new jobs promise; we need a 10-year plan for investment and reform to provide security as we emerge from covid; and we need green investment to be brought forward to create 400,000 jobs. A better future is possible—somewhere we can feel proud to grow up in and safe to grow old in—but it will not happen with the Government’s lack of a comprehensive plan for green jobs and a sustainable care sector. After the pandemic we have been through, this is the least we can expect.

Finance (No. 2) Bill

Catherine West Excerpts

Committee stage & Committee of the Whole House (Day 2)
Tuesday 20th April 2021 Commons Chamber

[James Murray (Ealing North) (Lab/Co-op)]

I will speak to new clause 29, tabled in my name and the names of the Leader of the Opposition and other right hon. and hon. Friends. It is timely to consider what the Government are doing to tackle tax avoidance and tax evasion today, with this month marking five years since the publication of the Panama papers. Those papers revealed the true global scale of tax avoidance and tax evasion and the need for comprehensive and effective action to tackle them. Of course, the clauses we are considering are far more limited in scope.

The Minister set out that clause 30 relates to the abuse of the construction industry scheme rules, clause 36 makes amendments to the corporation tax rules for hybrids and other mismatches and clause 41 amends the anti-avoidance rule when claiming relief for gifts of business assets. More widely, clauses 115 and 117 to 121 relate to other measures, including penalties for the promoters of tax avoidance and giving HMRC new powers to obtain information. We will not oppose those measures today.

However, our concern about the Government’s approach is centred not so much on what those clauses cover but what the Bill, and the Government’s approach more widely, fail to do. Our concern is that, faced with the challenges of tax avoidance and tax evasion, and with the public clearly wanting to see definitive action from the Government, Ministers have presented a Bill of measures that are relatively minor and technical. Indeed, as the House of Commons Library analysis of the Bill concluded, it would seem that the Exchequer impact of these changes will be minimal as they are not included in the Budget report costings.

The truth is that three Conservative Prime Ministers and five Conservative Chancellors have failed to tackle tax evasion and aggressive tax avoidance. The Government have repeatedly promised to act, but their proposals in the Bill fall far short of the change we need. That is why our new clause would require the Government to review the impact of provisions in the Bill relating to the levels of tax avoidance and tax evasion and the size of the tax gap, and to publish regular reports setting out their findings. The Government must not be allowed to hide behind warm words on this matter. They need to be transparent about the impact, or lack thereof, that their proposals will have.

We also welcome the amendment in the name of my right hon. Friend the Member for Barking (Dame Margaret Hodge), which seeks to treat promoters of tax avoidance schemes which are abusive as acting dishonestly for the purposes of criminal prosecution of tax offences. This kind of change is crucial if we are to shift towards more criminal prosecutions for the promoters of tax avoidance schemes, and to shift the gear of the Government’s approach.

At the moment, where tax avoidance has occurred, the system lands liabilities on the tax payers, who are usually not tax experts and may have been falsely told that a tax avoidance scheme is lawful. In contrast, the promoters of tax avoidance schemes are allowed far too often to get away with it. We therefore welcome any efforts to strengthen penalties for the promoters of failed tax avoidance schemes. But we have seen nothing from the Government today to raise the stakes and to make greater use of the powers HMRC already has to bring criminal prosecutions against the promoters of fraudulent tax schemes.

We know that HMRC recognises its power to use criminal investigation approaches to tackle the promotion and enabling of tax avoidance schemes, but in a letter the Financial Secretary sent me in January this year, he admitted that, since the formation of HMRC’s fraud investigation service in 2016, only 20 individuals have been convicted for offences relating to arrangements that have been promoted as tax avoidance. An average of around four people a year does not feel like a concerted effort.

[Catherine West (Hornsey and Wood Green) (Lab)]

My hon. Friend is making a great speech. Does he agree that it seems disproportionate that more people, in an adjusted sense, tackle benefit fraud than tackle big business or dodgy individuals who are taking money from the public purse?

[James Murray]

I very much agree. My hon. Friend makes an important point about the Government’s priorities, and about the lack of priority they give to going after the promoters of tax avoidance schemes and those who evade paying tax, in comparison to other actions in Government. We are seeking to put pressure on them today to address that imbalance.

HMRC’s criminal investigation policy states:

“Criminal investigation will be reserved for cases where HMRC needs to send a strong deterrent message”.

However, we know that fraud through the promotion of tax avoidance continues at scale, involving at least an estimated £20 billion in 2018-19, so it is hard to imagine why Ministers would not support a stronger deterrent message being sent by the greater use of criminal prosecutions.

Part of the answer may be the understaffing of HMRC. In a response on 11 January this year to a parliamentary question, the Financial Secretary admitted that the number of full-time equivalent employees at HMRC had fallen since 2010 from 67,553 to 58,467. That is a reduction of more than one in seven. The question of capacity in HMRC and the impact that that may have on its ability to tackle tax abuse must not be ignored. The Tax Justice Network refers to the fact that a member of staff in the compliance business stream at HMRC brings in on average over £900,000 a year on a £30,000 salary. It has pointed out that the Chancellor’s additional investment in HMRC staffing is directed towards tackling fraud related to covid spending, while previous funding increases have supported HMRC’s Brexit capacity. Its view is that the Chancellor must invest further in HMRC’s core compliance capacity.

Furthermore, beyond the questions around tackling the promoters of tax avoidance, the Bill is also silent on other important areas that need to be pursued, such as efforts to set up a register of overseas entities. Legislation is needed to establish a register that would show exactly who owns the foreign companies buying up British property. This would serve as a key part of any clampdown on money laundering.

The then Prime Minister, David Cameron, first announced plans for this in 2015, yet more than five years later, the legislation is nowhere to be seen. I bet he has not been in touch with Ministers for action over that. I would welcome the Minister using his speech at the end of this debate as an opportunity to explain whether the promised deadline of introducing legislation to set up a register of overseas entities by 2021 will be missed. If he is silent on this matter, we will take that as a yes.

I would like to use the opportunity of a discussion on tax avoidance to ask the Treasury ministerial team again to confirm whether the Chancellor backs plans for a global minimum corporate tax rate, as proposed by the US President. When I asked the Minister’s colleague, the Exchequer Secretary, to address this point during the Bill’s Second Reading last Tuesday, she did not respond, which I am sure was an oversight. I would therefore welcome the Financial Secretary addressing this question directly in his closing speech, to avoid any misperception that he and his colleagues are deliberately avoiding the question.

Our criticism of the Government in relation to tax avoidance and evasion centres not so much on what the measures in the Bill would achieve but rather on the ways in which the Bill and the Government’s wider approach fall short. The Government lack a tough and comprehensive approach to prosecuting the promoters of tax avoidance, to going after international money launderers and to pursuing those who seek to evade tax. We know that the impact of the measures in the Bill will be relatively minor and technical. The public deserve to have the Government present clearly and transparently what effect the measures in the Bill will have, and our new clause simply requires that their impact on tax avoidance, tax evasion and the size of the tax gap should be reviewed and laid in public before this House.

Throughout the Minister’s statements and comments, there is a clear pattern that the Government favour minor technical amendments to legislation on this matter, rather than upping their game and truly calling time on the practices that the public clearly want to see ended. Today they have an opportunity, by supporting our new clause, to show that they understand the need to be clear with the public, to recognise the need to strengthen their approach on this matter, and to commit to coming back with the resources and legislation that are needed to truly make a difference.

--- Later in debate ---

Although I particularly welcome the strengthening of the anti-avoidance rules in this Bill, I think we need to focus on the link that we have created in the last 12 months between what people pay into the system and what they get. People realise that the state is there and, if they pay in the right amount of corporation tax or pay-as-you-earn, it will look after them. As much as I think we should focus on cracking down and using enforcement and prosecution, as my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) said, we should also look to sustain that link in the next couple of years. To ensure that people continue to pay into the system, we should encourage them to remember the support that the Government have been able to give. That will enable us to continue to close that gap and go from 95.3% to 100%.

[Catherine West]

How delightful it is to see you in the Chair, Ms McDonagh. I am very pleased to speak to amendment 77 and new clause 29, and to have listened to the excellent speech by my hon. Friend the Member for Ealing North (James Murray). I pay tribute to Members from across the parties who have stood up for those who have been so badly affected by the loan charge scandal, and I was particularly pleased to hear my hon. Friend the Member for Brentford and Isleworth (Ruth Cadbury) speaking so eloquently on Radio 4 on Sunday evening. We are getting these important messages across.

I also wanted to pay tribute to the important work that is being done by the all-party parliamentary group on anti-corruption and responsible tax, led by the right hon. Member for Sutton Coldfield (Mr Mitchell) and my right hon. Friend the Member for Barking (Dame Margaret Hodge), on simplifying things and making the basics better, for example by improving the Companies House regulations. I understand that some of that is coming forward shortly, but the general picture is that things are quite slow.

It was lovely to listen to the hon. Member for Burnley (Antony Higginbotham) speaking about the importance of taxation. Once upon a time, I am sure that would have been quite a tricky topic for certain Conservative Members to talk about, but there is a new wind blowing. It is great to hear President Biden talking about the global minimum corporate tax level and the importance of an online sales tax, and even to hear our own Government leading the charge across Europe on the importance of introducing a digital sales tax and simplifying things to bring in the important public funds that we all need to keep our society going.

The scale of tax offences is clear, with a recent TaxWatch report finding that between 2009 and 2019, the UK prosecuted 23 times as many people for benefits offences as for tax offences—that theme has been echoed in today’s speeches—despite the fact that the value of tax fraud is nine times higher than that of benefit fraud. We know that American research has shown that for every $1 the Internal Revenue Service invests, it gets back $10 of benefit for the public purse, and I wonder what the consultation the Treasury ran said about incentivising officers based in HMRC so that the more money brought back, the more colleagues come on board to help them in their important work.

We know that a lot of this work is about priorities, and we need to prioritise criminal prosecutions so that there is not a decrease in taxation, as there has been of 39% since 2015. We need to look at the balance of the DWP employing 3.5 times more staff in compliance than HMRC. We know that we have to improve that balance, because quite simply there is much more money to be found in illicit finance and among tax avoiders than from those eking out a living on universal credit or personal independence payments.

The Minister will I am sure make it clear in his remarks that the Bill is intended to tackle some of these issues and to amend that imbalance, and I look forward to hearing that. However, I make the case for quicker progress so that we can move forward as fast as possible, particularly given the fact that, as the hon. Member for Burnley mentioned, the furlough scheme and some of the other schemes are quite expensive, and therefore the need to find more in this way from tax evasion is ever more pressing.

I want briefly to mention the importance of the provisions on freeports and the corporation tax super deduction, which do not appear to come with sufficient tax avoidance and evasion safeguards. I hope that during the debate—perhaps not right at this instant, but over the course of today—we will get some reassurances on that matter. In March, the Financial Secretary was unable to say how many additional staff HMRC plans to recruit to deal with taxation, duty, excise and customs issues pertaining solely to freeports, but I hope that that information is forthcoming. Given the attention and focus the Government gave to these announcements, we would have expected them to get the basics right, but we still have some questions that are outstanding.

While the Government are bringing forward—perhaps deliberately, some of us would say—a weak set of measures in the Finance Bill, other tools that we need to tackle evasion and avoidance, such as the draft Register of Overseas Entities Bill, could well sit gathering dust, since they were initially announced quite some time ago. Will the Minister use today as an opportunity to outline his views on that particular Bill?

On the question of illicit money, do not forget that our own Intelligence and Security Committee called London a “laundromat” for illicit and dark finances, often coming from Russia. I would hope that the Minister will redouble his efforts to understand how to clamp down on the facilitation of those finances through the UK financial system. We would have expected such a description of our capital city to force action from the Government, but we are still waiting to see exactly who owns some of the foreign companies buying up British property. Can someone still walk in and purchase a £1 million property in cash, and does the Minister believe such a way of purchasing expensive properties in London is appropriate?

[Kevin Hollinrake]

I draw the Committee’s attention to my entry in the Register of Members’ Financial Interests. Is the hon. Member aware that there are very strict requirements for people involved in the property market to check the identity and the source of funds of those she has just described?

[Catherine West]

I thank the hon. Member, and it is always lovely to have an accountant in the room. If there are some improvements, we are very grateful for them.

[Ruth Cadbury]

If I may intervene, London is one of the few cities that has no residency or nationality rule for owning residential property, and many very high-cost cities for residents to live in, such as Vancouver and Auckland, have such rules. Could this Government consider such rules, because this issue has helped to trigger the explosion in housing prices, particularly in London, but also in our other large cities?

[Catherine West]

My hon. Friend makes a very important point. I am sure it has not escaped the Treasury’s attention that prices of the top 1% of properties in the country—mainly in London—have been skyrocketing, when everybody else’s house prices have been going up by a little. That differential is quite frightening. In this terrible time when our economy has shrunk by 11%, who can afford to buy properties worth several million pounds, and do we know enough about these individuals? We know that there are big gaps in the way that Companies House operates, in terms of simply understanding who owns what, and simplifying that is the sort of thing that would make the work of HMRC much more streamlined.

I would also like to put on record the wonderful work being done by civic society groups to spread information and education about the importance of understanding taxation, what it does and what it purchases. It is through these campaigns—often outside this House—that we can understand how to change things.

Aside from our international reputation often being questioned on the issue of Russian oligarchs, we know that the lack of action on questioning some people’s contacts with the Kremlin is costing us over £30 billion every year in lost revenue from taxes. That is a lot of money, and it would be better used to pay for the furlough, eliminate child poverty, vaccinate more children in the third world, or pay and equip our NHS staff for the heroic job that they do every single day.

The Government must act without delay and begin by supporting amendment 77 and new clause 29, which are a significant improvement on the weaker proposals put forward by the Government. That would send a signal that the UK will no longer be silent in the face of tax evasion and tax avoidance and is no longer a welcome home for the oligarchs and agents who see the UK as the destination of choice for their ill-gotten gains. I urge the Minister to do the right thing.

[Ruth Cadbury]

I speak in support of new clause 29 in the name of Her Majesty’s Opposition and cross-party amendment 77. I congratulate my hon. Friend the Member for Ealing North (James Murray), my right hon. Friend the Member for Barking (Dame Margaret Hodge) and the right hon. Member for Sutton Coldfield (Mr Mitchell) on their speeches.

Addressing tax avoidance and evasion is, of course, an important objective of the Treasury, and Finance Bills and other legislation are the vehicles to do that, but as with all tax changes, Government must assess and respond to the unintended consequences of any changes. This Government have a terrible track record on tackling tax evasion and aggressive tax avoidance. They have consistently stood in the way of Labour’s calls to clamp down on loopholes and have failed to collect over £30 billion in taxes every year. They have promised to legislate on these issues, but the proposals in the Bill fall far short of any substantive change. Instead, they have been responsible for an increasingly complex system of payment, fraught with difficulties and risks for the unsuspecting worker.

A growing number of working people need to work on a contractor basis, either for personal reasons or because it is the only way of getting work in their sector or with their professional skillset. Increasingly, the alternative to being a contractor is to be a PAYE freelancer—to pay tax in full but without any of the rights of being an employee and all the costs of being self-employed. This is zero-rights employment, and it is unfair.

We need an effective tax avoidance policy that criminalises those promoting tax avoidance, rather than going for the workers inadvertently caught up in them, as this Government and HMRC have been doing with the loan charge in particular. That is the wrong target. While ordinary people who are victims of mis-selling are facing ruin and bankruptcy, the Government have done too little, too late to go after those who promoted the schemes.

I acknowledge that the Bill contains measures to tackle the promoters of tax avoidance and changes the system of penalties, but those measures are extremely limited in scope. Indeed, those changes are not even included in the Budget report costings, which suggests that their financial impact must be minimal. IR35 was enacted 21 years ago to stop the practice of those who, in reality, were permanent, generally full-time workers being paid as contractors through personal services companies, as many were paying much less tax than if they had been employees. It was right to address that tax avoidance, but the Government must address the unintended consequences for workers and the labour market that have followed since then.

Spending Review 2020 and OBR Forecast

Catherine West Excerpts

Wednesday 25th November 2020 Commons Chamber

[Catherine West (Hornsey and Wood Green) (Lab)]

The Chancellor has spoken well today of the scars that are felt by so many in society due to the triple whammy of covid, climate change and Brexit. Will he outline how he will manage to ring-fence money for mental health within the health spend? Mind, the charity, has said that phone calls have doubled, with many young people experiencing debilitating anxiety, depression and self-harm. Will he urgently look at mental health and ring-fence money for workforce changes, which are desperately needed, and for a decent revenue spend to bring mental health up into line with physical health?

[Rishi Sunak]

The hon. Lady makes a good point, and I am pleased to tell her that of the £3 billion of extra money for the NHS that we have announced for next year to help recover from coronavirus, half a billion pounds of that is specifically earmarked to address waiting times in mental health services, to give people the support they need and to invest in the workforce that she rightly identified. I hope that gives her some reassurance. That is incremental to the existing NHS plans.

Areas with Additional Public Health Restrictions: Economic Support

Catherine West Excerpts

Tuesday 6th October 2020 Commons Chamber

[Steve Barclay]

As I have said in reply to a number of colleagues, we will continue to listen and evaluate the circumstances, including as applies to London. The Chancellor has set out a comprehensive package of support that applies to businesses within the London community, assisting them in their ability to retain what is most prized within a business, which is the talent of its own staff, and in addressing particular cash-flow pressure. We responded very much to the feedback that we have received from business leaders, including business leaders in London, as the winter package was shaped.

[Catherine West (Hornsey and Wood Green) (Lab)]

The International Monetary Fund has encouraged Governments to spend on infrastructure. In London, the infrastructure is the west end and the suburban theatres. What urgent plan will the Government put in place to protect the workers—whether the technicians, the actors, the divas or the stars—to keep our desperately loved theatre going?

[Steve Barclay]

On the specific point about the theatre, it is sector championed by my right hon. Friend the Secretary of State for Culture, Media and Sport and I referred earlier to the £1.57 billion package that the Chancellor has set out. I agree with the hon. Lady about the importance of infrastructure as a whole. Theatre is one aspect, but there is a much wider piece that includes Crossrail, High Speed 2, the acceleration of our road schemes, and broadband in particular to areas of poor connectivity. There is a huge agenda for infrastructure, and delivering that at pace is a key focus of the Chancellor and the Treasury team.

Protection of Jobs and Businesses

Catherine West Excerpts

Wednesday 9th September 2020 Commons Chamber

[Catherine West (Hornsey and Wood Green) (Lab)]

I think most of us agree that we are facing a triple whammy at the moment, with a public health crisis in the guise of covid, an economic crisis in which Brexit has already cost our economy billions of pounds, and climate change, which will eventually cost us a lot and is currently costing lives as well as other things that the Treasury may not be making a record of. That is certainly an expensive project as well. We are in a recession. We know that GDP fell by 20.4% in the second quarter of 2020—that is 20.4%, not 2.4%—which is the largest confirmed fall of any economy in Europe and the G7, so we are facing really tough times.

I spent the summer visiting food banks—like many other Members, I am sure—and I would like to put on record my praise for the volunteers who run the Campsbourne Primary School food bank, which is providing desperately needed food for many families in Hornsey. I also want to mention another fantastic service, which is an innovation I hope others can look to. It is called Connected Communities, and it is local authority-based but works closely with the voluntary sector to pick up hard-to-reach groups of people who are not digitally aware.

[Danny Kruger]

I want to echo my support for those sorts of organisations and to follow on from what the hon. Member for York Central (Rachael Maskell) said about the charity sector. I sympathise very much with what both hon. Members are saying about support for these organisations. Does the hon. Member for Hornsey and Wood Green (Catherine West) acknowledge that the Government made £750 million available for small grass-roots charities to help them to get through the covid crisis?

[Catherine West]

Indeed. No one on this side of the Chamber is saying that any of that money was not very much called for. There was a tiny bit of wastage, according to the Select Committee findings that I read yesterday, but I hope that, over time, the Treasury will get rid of the £3.5 billion wastage.

I have some asks for my constituency and I have my figures here. I am a London MP, and many Members who know London will be aware that Muswell Hill ward is not considered to be a low-income place. Unfortunately, however, it has seen an increase of 300% in jobseeker’s allowance and universal credit claimants. The neighbouring Fortis Green ward, which is also considered quite an expensive and well-to-do part of my constituency, is facing a 234% increase in the number of people signing on. Alexandra ward is home to the famous and beautiful Alexandra Palace exhibition hall, the former home of the BBC, and it is a lovely part of my constituency. It has seen a 220% increase in the number of people claiming jobseeker’s allowance and universal credit. The difference between this recession and the 2008 global financial crash is the impact that this one has had across the economy.

Lots of people are very well paid when they are in work, but because they are self-employed, they are suffering exponentially. What are my asks? First. I am asking for sector-specific schemes for workers, so that we can look at the self-employed and particularly those in the creative sector. Secondly, I am asking for specific help for people who, for example, have a small business and are helping several of their employees to manage but have not had anything back for themselves. In conclusion—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. We must now go to the wind-ups.

Economic Update

Catherine West Excerpts

Wednesday 8th July 2020 Commons Chamber

[Rishi Sunak]

I know that my hon. Friend has been working very hard on behalf of his local businesses and young people, and I am glad that he welcomes today’s initiatives. He is right about unlocking the housing market. The intervention today will mean that almost 90% of people buying a main home in this country this year and until March next year will pay no stamp duty. It is a strong catalyst for people to get moving—to get buying and selling—and, importantly, to get renovating, all of which will create local jobs in Darlington and beyond.

[Catherine West (Hornsey and Wood Green) (Lab)]

Given the emergency nature of the statement, will the Chancellor lay out exactly what kind of impact assessment will be made of each of the funding pots, so that we can ensure value for money, look at the impact of each measure on the environment and avoid any corruption or fraud?

[Rishi Sunak]

I assure the hon. Lady that all relevant impact assessments are conducted at the time that they are required by legislation. As for the environmental impact, I gave a flavour of it earlier. The sum total of the green homes grant scheme and public sector decarbonisation fund will mean that about half a megatonne of carbon will be saved every year, which is the equivalent of about 270,000 cars taken off the road, and there will be about 140,000 new jobs. I hope she will welcome that.