Asked by: Chi Onwurah (Labour - Newcastle upon Tyne Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to his Financial Statement of 15 March, what the evidential basis is for Research and Development tax credit changes helping 20,000 cutting-edge companies.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The Government recognises the value of R&D intensive SMEs to the UK’s wider innovation ecosystem, and at Autumn Statement 2022 committed to working with industry ahead of Budget to understand whether further support is necessary for R&D intensive SMEs.
It is the most R&D intensive loss-making companies that are most affected by the AS22 rate changes, and which the additional tax relief is seeking to target.
The Government has estimated around 20,000 SMEs will benefit from this scheme per year. This estimate and the estimated cost of the measure are based on HMRC administrative data. The costing has been independently certified by the Office for Budget Responsibility and the process to calculate the costing can be found here: https://assets.publishing.service.gov.uk/Government /uploads/system/uploads/attachment_data/file/1142824/Costing_Document_-_Spring_Budget_2023.pdf
Further detail on the economic impact of the scheme will be published in the tax information and impact note ahead of being legislated for in an upcoming Finance Bill, in the usual way.
The Government will keep the scheme design under review to ensure it is effective and delivering value for money.
Asked by: Chi Onwurah (Labour - Newcastle upon Tyne Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the Spring Budget, HC 1183, point 4.51, what analysis was undertaken by his Department when determining the qualifying criteria for the additional tax relief for small and medium sized enterprises; on what evidential basis this is estimated to cost (a) £40 million in 2023-24 and (b) £285 million in 2024-25; and if he will make an assessment of the potential impact of this policy on capital investment for small and medium sized enterprises that fall beneath the 40 per cent threshold.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The Government recognises the value of R&D intensive SMEs to the UK’s wider innovation ecosystem, and at Autumn Statement 2022 committed to working with industry ahead of Budget to understand whether further support is necessary for R&D intensive SMEs.
It is the most R&D intensive loss-making companies that are most affected by the AS22 rate changes, and which the additional tax relief is seeking to target.
The Government has estimated around 20,000 SMEs will benefit from this scheme per year. This estimate and the estimated cost of the measure are based on HMRC administrative data. The costing has been independently certified by the Office for Budget Responsibility and the process to calculate the costing can be found here: https://assets.publishing.service.gov.uk/Government /uploads/system/uploads/attachment_data/file/1142824/Costing_Document_-_Spring_Budget_2023.pdf
Further detail on the economic impact of the scheme will be published in the tax information and impact note ahead of being legislated for in an upcoming Finance Bill, in the usual way.
The Government will keep the scheme design under review to ensure it is effective and delivering value for money.
Asked by: Chi Onwurah (Labour - Newcastle upon Tyne Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether any (a) team in his Department, (b) Executive agency and (c) other public body had responsibility for assessing the (i) sustainability and (ii) viability of Silicon Valley Bank's (A) capital structure and (B) exposure to risk when Silicon Valley Bank UK was granted a banking licence; and if he will make a statement.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
Authorisation decisions are for the independent regulators to comment on. The Prudential Regulation Authority (PRA) is responsible for the supervision of financial institutions operating in the UK.
Asked by: Chi Onwurah (Labour - Newcastle upon Tyne Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the Supplementary Estimates 2022-23 published by his Department on 21 February 2023, if he will make an assessment with Cabinet colleagues of the potential impact of the unused funding for (a) Horizon and (b) Euratom on the Government's policies on support for research projects.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The Government is committed to ensuring the UK is a Science Superpower. This is why, despite the challenging fiscal circumstances, the Chancellor recommitted at Autumn Statement 2022 to increase R&D spending to £20 billion in 24/25, a 30% cash increase from 2021/22 (the largest ever increase over a Spending Review period).
At Spending Review 2021, the Government set aside funding for the cost of associating to EU R&D programmes as agreed in the December 2020 Trade and Cooperation Agreement (TCA). While the UK’s association has been delayed, our priority has been to support the R&D sector; this is why we introduced the Horizon Guarantee as well as £684m of additional support for the R&D, fusion and Earth observation sectors.
As is usual practice, departmental underspends are returned to the Exchequer at Supplementary Estimates.
Asked by: Chi Onwurah (Labour - Newcastle upon Tyne Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the Supplementary Estimates 2022-23 published by his Department on 21 February 2023, whether the unused funding for the Advanced Research and Invention Agency will be made available in the 2023-24 financial year.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The unused funding for the Advanced Research and Invention Agency in 2022-23 will be made available to ARIA in the 2023-24 financial year.
Asked by: Chi Onwurah (Labour - Newcastle upon Tyne Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the surrender of unused funding for Horizon and Euratom association set out on page 295 of the Central Government Supply Estimates 2022-23, HC 1133, whether his Department has made an assessment of the potential merits of carrying over that funding under the Budget Exchange Scheme.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
At Spending Review 2021, the Government set aside funding for the cost of associating to EU R&D programmes as agreed in the December 2020 Trade and Cooperation Agreement (TCA). To mitigate the impact of delays to the UK’s association, we introduced the Horizon Guarantee as well as £684m of additional support for the R&D, fusion and Earth observation sectors.
As is usual practice, departmental underspends are returned to the Exchequer at Supplementary Estimates to ensure spending plans are taut and realistic. We welcome the Windsor Framework agreed by the UK and the EU on 27 February, which delivers for the people and businesses of Northern Ireland. We look forward to working constructively with the EU on a range of issues. We will now take stock of our future cooperation under the TCA and the financial implications of any such cooperation. If we are not able to associate, we will ensure that UK researchers receive at least as much funding as they would have received if the UK were associated to Horizon.
Asked by: Chi Onwurah (Labour - Newcastle upon Tyne Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he plans to reallocate the £1.6bn of funding allocated to Horizon and Euratom association for the financial year 2022-2023.
Answered by James Cartlidge - Minister of State (Ministry of Defence)
The Government is committed to ensuring the UK is a Science Superpower. This is why, despite the challenging fiscal circumstances, the Chancellor recommitted at Autumn Statement 2022 to increase R&D spending to £20 billion in 24/25, a 30% cash increase from 2021/22 (the largest ever increase over a Spending Review period).
At Spending Review 2021, the Government set aside funding for the cost of associating to EU R&D programmes (Horizon, Euratom Research & Training and Fusion 4 Energy, and Copernicus), which was agreed with the EU in the December 2020 Trade and Cooperation Agreement (TCA). Unfortunately, the EU has delayed the formalisation of the UK’s association due to the Northern Ireland Protocol.
Our priority has been to support the UK R&D sector during this period of uncertainty. To mitigate EU delays, we have introduced the Horizon Guarantee as well as £684m of additional support for the R&D, fusion and Earth observation sectors.
The UK remains open to association to Horizon based on fair and reasonable terms and that the UK will only pay for the period of association to a programme. Any funding required for association in future years will be made available when there is clarity on UK association to EU programmes.
Asked by: Chi Onwurah (Labour - Newcastle upon Tyne Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment he has made of the potential benefits of relating research and development tax credits to research and development employment rather than research and development activity.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The Research and Development (R&D) tax reliefs take account of companies’ expenditure on R&D employees. For staff working directly on an R&D project, companies can claim relief for salary costs, Class 1 National Insurance contributions, and pension fund contributions.
However, other costs are also important and support relief, for example materials used in the R&D. From April 2023, data and cloud computing will be included as new qualifying costs within the R&D reliefs.
Asked by: Chi Onwurah (Labour - Newcastle upon Tyne Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, pursuant to the Answer of 17 January 2023 to Question 119000 on Plastics: Taxation, if he will make an estimate of the proportion of recycled content in plastic that is overclaimed as a result of using the mass balance approach.
Answered by James Cartlidge - Minister of State (Ministry of Defence)
The mass balance approach for plastics follows a similar model to that used in other industries, such as biofuels. It is an industry-led certification scheme, with independent auditors to ensure compliance.
Businesses are currently required to calculate the actual amount of recycled plastic in packaging, for the purposes of the Plastic Packaging Tax.
Asked by: Chi Onwurah (Labour - Newcastle upon Tyne Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, pursuant to the Answer of 18 January 2023 to Question 120109 on Affordable Housing: North East, how many and what proportion of sold residential properties met the Stamp Duty Land Tax threshold before any relief was applied in Newcastle upon Tyne Central constituency in the period between January 2019 to January 2023.
Answered by James Cartlidge - Minister of State (Ministry of Defence)
HM Revenue & Customs do not publish information on the number of residential property transactions above the nil rate threshold for Stamp Duty Land Tax by parliamentary constituency.
The number of residential transactions with a total consideration of £40,000 and above in the Newcastle upon Tyne Central parliamentary constituency is available in table 8a of the ‘UK Stamp Taxes statistics’: https://www.gov.uk/government/statistics/uk-stamp-tax-statistics.