Women’s State Pension Age

Debate between Chris Stephens and Mel Stride

Monday 25th March 2024 Commons Chamber

[Mel Stride]

We are considering the findings, which need to be considered in their entirety in order to come to a view.

[Chris Stephens (Glasgow South West) (SNP)]

I pay tribute to the WASPI campaigners in Glasgow whom I met on International Women’s Day at the Mary Barbour statue, including the great Kathy McDonald, a fantastic constituent. Surely, the Secretary of State accepts that it is unacceptable in 2024 that women continue to experience inequality in lifetime savings. Women would need to work an additional 19 years to have the same pension savings as men. Inequalities in lifetime savings, a gender pension gap and maladministration of state pension age changes: this is a triple whammy for 1950s-born women. When will they get justice and equal treatment?

[Mel Stride]

The hon. Gentleman concludes by asking the same question that has been asked many times. There will be no undue delay. We will look at the issues, including some of the points that he has raised, in the round, looking at the entirety of the report and all its points and conclusions. He will know that we have taken many steps to help to increase the pension amounts received by the women involved, including the auto-enrolment reforms that we have brought forward. In the private pension space, the reforms have shown a dramatic improvement in the level of pension provision for women up and down the country.

Budget Resolutions and Economic Situation

Debate between Chris Stephens and Mel Stride

Thursday 16th March 2023 Commons Chamber

[The Secretary of State for Work and Pensions (Mel Stride)]

This Budget and the measures it sets out for providing additional support and encouragement for millions of people to re-engage with the labour market spoke to the very heart of our Conservative principles of compassion, of incentive, of self-reliance and of collective responsibility. Above all, it spoke to that age- old truth that work matters: that work is the source not just of income or paying the bills, and not just of supporting businesses or growth, but of something arguably greater still—of individual pride, of self-worth, of better health, and of making a fundamental contribution to the whole of society. That is the Conservative way.

[Chris Stephens (Glasgow South West) (SNP)]

The Secretary of State talks about compassionate Conservatism; does he believe the measures in the Budget will increase or decrease sanctions over the next 12 months?

[Mel Stride]

Our policy and rules around sanctions have not been changed by the Budget, but it is important that where somebody can work and is offered support to work and decides to take benefits and not engage with the system, sanctions can under certain circumstances be appropriate. That is not to say that sometimes people will not have perfectly reasonable reasons for not engaging with the jobcentre, in which case no sanction will be applied. The hon. Gentleman seems so often to be suggesting that there is no scope or role for sanctions whatsoever within our benefit system, and that is not going to help the very people we are out to support.

This Budget will help break down the barriers stopping people moving into work or progressing within it, and it is most particularly a Budget for those who face the greatest employment challenges. It is a Budget for disabled people and those with health conditions, with new and extended employment support, better integration of work and health services, and, through our health and disability White Paper, the biggest reform to the health and disability benefits system for a decade. It is a Budget for older workers, with the removal of disincentives in the pensions tax system, and with more help to retrain and reskill and more tools to help people plan for the future.

--- Later in debate ---

[Mel Stride]

The right hon. Gentleman will know that hitherto we have indeed focused on a gap. The Department will come forward with something to say on that in the not-too-distant future, and he will have to wait until that point to know the exact kind of target, although I recognise that the current measure has value.

The measures we have set out in the Budget and in our health and disability White Paper will help to remove barriers, so that disabled people have the same opportunity as anybody else to thrive in work. Some 20% of those who have been assessed through the work and capability assessment as having limited capability to work and to look for work say that they want a job at some point in the future, but one of the barriers to work is the health and disability benefits system itself. For too many disabled people, the system feels like it focuses on what they cannot do, rather than what they can do.

Having listened to disabled people, the White Paper that we published at Budget yesterday sets out how we will fundamentally rewire the benefits system, changing it from a system that can often leave people feeling that moving towards work is too risky and that they might not be able to return to benefits if that work does not work out. I want to give people the confidence to try work without the worry that they will not be able to access benefits again promptly if a job does not last. Under our new approach, people will have the confidence that they will receive support for as long as it is needed. Our reforms will also provide additional support to those disabled and long-term sick who request it.

These reforms have been years in the making and follow the Green Paper that we published in July 2021. We have engaged widely on these changes, including with disability charities and disabled people’s organisations, as well as with disabled people themselves who have been through the current process and understand how and why it needs to change. Just as we have taken a measured approach to developing this way forward, so we will operationalise this approach with care.

[Chris Stephens]

The Secretary of State is being generous in giving way. A number of disabled charities are sceptical about the package that he is putting together because of the severe delays to the Access to Work scheme, which are blocking people from going into employment. How does he plan to tackle that in the coming year?

[Mel Stride]

As I just suggested, we will take a measured and appropriate approach to the delivery of a fundamental reform of how these benefits will work. It will involve primary legislation, most likely in the next Session next year, and it will be rolled out some time after that. There will be plenty of time to ensure that we have thorough engagement with stakeholders, disabled people and those who represent them, to ensure that we get exactly those matters right.

In addition, our new Work Well partnerships programme —delivered through the health system—will pilot a new model for delivering integrated work and health support in local areas, providing employment-based targeted health support to prevent people from falling out of work or to enable a return to work quickly. For those who need more intensive help, there will be universal support. We will work directly with employers to quickly match people with jobs and provide up to 12 months of personalised place and train support. This approach means that after helping someone into work, we will stay with them to ensure that they remain in employment.

We are also investing to expand the additional one-to-one support that work coaches are already providing to disabled claimants in one third of jobcentres. From the spring, we will start to make this extra support more widely available, so that it is in place across the entire jobcentre network by 2024. We will also work with the occupational health sector and employers to reform the market and improve access to quality occupational health services. That will include testing financial incentive and support models to help small and medium-sized businesses and the self-employed overcome barriers to occupational health services.

--- Later in debate ---

[Chris Stephens]

That is exactly what happens. What is also happening is that people who receive sanctions then miss out on cost of living payments, so they incur not just one punishment but a double punishment—and that, too, is pushing people into poverty.

[Mel Stride]

I have enormous respect for the hon. Gentleman, as he knows, but I genuinely wish to clarify one point. Is he at least saying that there are some circumstances in which a sanction is appropriate?

[Chris Stephens]

I will come on to that point, and yes, I will say that; but how can be it be humane to proceed with a ramping up of sanctions without knowing the basic facts, when Members are asking questions about, for example, how many children are living in households where a sanction has been applied? Does the Secretary of State not accept that with more people at risk of being sanctioned, now is the right time to roll out the yellow card benefit warning system for which many of us have been arguing, to ensure that misfortune does not lead to people being left destitute?

There are some things that the Secretary of State could do before sanctions are applied, and I believe that such a warning system is one of them and would help people into work. The Department did consider it, and we thought, when I was a member of the Work and Pensions Committee, that it was heading in that direction, but then it changed course. Perhaps the Secretary of State will want to look at the issue again. I would encourage him to look at the great work done by the Committee in this regard, and particularly at its suggestion that the yellow card system would be appropriate.

The fact remains that the measures in the Budget require those who are struggling on low incomes to jump through extra hoops, such as attending jobcentres even when they are working in what we all agree are vital roles, for example as teaching assistants or care workers. The earnings threshold has more than doubled in the space of just a year. This puts hundreds of thousands more people at risk of benefits sanctions, although we know sanctions do not work ethically, practically or economically. The Chancellor needs to understand that, no matter what he is promising for the future, far too many people are struggling to survive now.

There remains a large degree of scepticism about the employment support package, which the Secretary of State talked about today and the Chancellor referred to yesterday. Some believe that tighter sanctions will likely be a disaster for people on universal credit, and they will not help people into work, as my hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) said. The Federation of Small Businesses has said that the proposals to help people with poor health to get back to work are “ill-designed” and poorly thought out, and some “won’t happen for years”. Those with health conditions and disability have been let down by a Government who have ignored employers’ views on what can best help. The FSB continued:

“Small measures on subsidising occupational health are welcome but not the big bang needed.

“Measures on the over 50s are token efforts at best…The principle of what’s announced on childcare is positive—but this Government’s Achilles heel is in delivery”.

So, as the FSB says, we will believe it when we see it.

The Royal National Institute of Blind People has said:

“For those of working age, employment should be a route to coping with rising costs. “

But it remains of the view that urgent action is needed

“to fix the Access to Work scheme—a scheme where, right now, thousands of people are facing severe delays of many months to get the support and equipment they need to do their jobs”.

I hope that the Secretary of State will note its comments, because Access to Work is clearly not helping enough people and the delays are preventing people from getting into work.

Not everyone is convinced that the childcare reforms will help get people into work. Even if the money is there to pay for childcare, there is no workforce—the pay is very bad—to deliver it. The UC changes in the administrative earnings threshold will mean more Department for Work and Pensions staff caught up in in-work conditionality, as well as swathes of extra work for staff in jobcentres. There was no mention in the Budget about whether there are any extra staff to deliver what we believe will be huge amounts of additional work. The Secretary of State is saying that there will be, so while he is answering that question, perhaps he can say what pay rise he is going to give DWP staff as well. They took industrial action yesterday. [Interruption.] I am chair of the Public and Commercial Services Union parliamentary group, but my union is Unison, of which I am a proud member. I think that answers the question from the Exchequer Secretary. I would have thought he would have done his research to have known that. Perhaps there is a very real need for civil service pay to be addressed, and I will come on to that later.

Another issue that has not been tackled is deductions. One measure that would have cost the Government very little but could have resulted in many fewer people needing to use food banks would have been to ease significantly the rate of deductions from UC. Better still would have been to waive deductions resulting from official error, or to introduce a one-off amnesty on deductions. Why no action on that, the single biggest factor affecting people going to food banks? Despite almost half of all households on UC now facing a deduction, during the last six-month period, ending January 2023, just 14 cases were fully waived and a further five were partially waived. So will the Secretary of State revise the guidance to ensure every household subject to a deduction is automatically informed of their right to request a waiver?

On public sector pay, the Budget offered nothing. As the Prime Minister sorts out his swimming pool heating, it is incredible that public swimming pools were the only public services mentioned for support in the Budget speech. Although the pension cap cut might help our NHS to retain doctors, the measure could have been limited to medicine or the NHS, rather than being a lifetime tax cut for the wealthy. The only mention, without actually announcing more money, was that cutting public sector debt would lead to more money for public services. Public sector pay bodies have noted that only a 3.5% pay rise is affordable under current Treasury allocation; as the IFS said, that is a political choice. The TUC has said that the lack of support for public services and for public pay is the “elephant in the room”. The Budget goes nowhere near a high-wage, high-skills economy.

With strikes all over the country, it is striking that the Budget said nothing about them. Public transport, public health and even public sector TV hosts are on strike, but the Government seem to prefer to fight a culture war over Gary Lineker than pay attention to ensuring that our public services have the funds they need.

The Government are again scrambling to fix the economic problems of their own making. Yesterday’s Budget is a huge disappointment to people, businesses and charities left paying for the UK Government’s mistakes. They created a crash a few months ago—there is selective amnesia about that—and they have not yet said sorry for it. There is, however, one thing on which I agree with the Chancellor, who said:

“Independence is always better than dependence.”—[Official Report, 15 March 2023; Vol. 729, c. 844.]

We could not have put that better ourselves.

Labour Market Activity

Debate between Chris Stephens and Mel Stride

Tuesday 28th February 2023 Commons Chamber

[Mel Stride]

My right hon. Friend is absolutely right, and that is why we have stood up important programmes, such as sector-based work programmes, and it is why skills and apprenticeships are so important—[Interruption] —as are skills bootcamps, as an hon. Friend reminds me.

This motion is wrong on unemployment and employment, but it is also wrong on economic inactivity, because while it is true that economic inactivity rose during the pandemic, it is also true that, with the notable exception of the United States, in most countries it has gone back down to broadly where it was before the pandemic. That has not happened in the UK. It is not true to say that working-age inactivity rates have not been on a long-term decline. They have in this country, and the trajectory has been downwards. The level of economic inactivity in the UK is lower than in the United States, France and Italy. It is below the EU average, and it is below the average of OECD countries.

While there has been some softening in recent months on the level of economic inactivity in the United Kingdom, I accept that there is a lot more work to be done, which is why the Prime Minister has asked me to work across Government to review how we approach these issues, particularly in respect of disability, the long-term sick and those who are over 50 and have retired early.

Before I come to those cohorts, let me state clearly what lies at the heart of this Government’s success on unemployment and employment: the key Conservative belief that we should make work pay. The universal credit roll-out has been a huge success, despite the fact that the Leader of the Opposition suggested as recently as 2021 that it should be scrapped. We have enhanced universal credit by improving the taper, dropping it from 63% to 55%. We have increased the work allowance by £500. In terms of making work pay, for the very lowest paid we will be increasing the national living wage by 9.7% this April. We have stood up a number of important programmes that have helped to encourage people into work, among them Restart and our youth offer.

[Chris Stephens]

The Secretary of State says that the route out of poverty is work and making work pay, but the example I gave to the shadow Minister is one that came up when I was on the Work and Pensions Committee, of a lone parent not taking additional hours because they would lose state support. What are the Government proposing to fix those sorts of issues?

[Mel Stride]

I think the main point—I do not know the specific example to which the hon. Gentleman refers—is that under UC the whole driving principle is that work always pays. As someone gets into work, the benefit is tapered away, but none the less work always pays. That is why we are looking, in part at least, at these very low levels of unemployment and very high levels of paid employment.

Oral Answers to Questions

Debate between Chris Stephens and Mel Stride

Monday 31st October 2022 Commons Chamber

[Mel Stride]

I am in the process of reviewing just that matter and many of the others that we have discussed, so we will have to wait, but it is one of the matters that is under review.

[Chris Stephens (Glasgow South West) (SNP)]

We look forward to the Secretary of State appearing before the Work and Pensions Committee. Can he give us an assurance before he does so that the Department will publish the systematic evidence-based review of food bank use that it promised to publish and place in the Commons Library two years ago, so that we can debate the policy issues required to eliminate hunger across these islands?

[Mel Stride]

I look forward to appearing before the hon. Gentleman and his fellow members of the Committee. He raises a specific point, and I will look into it and come back to him.

Business of the House

Debate between Chris Stephens and Mel Stride

Thursday 27th June 2019 Commons Chamber

[Mel Stride]

My hon. Friend raises an extremely important point. He has campaigned on this issue for a considerable period of time, and I congratulate him on being instrumental in bringing forward the Homelessness Reduction Act 2017. I believe he also has an article on homelessness in The House magazine this week. He asks specifically about the Vagrancy Act, which is indeed well over 100 years old and its fitness for purpose is highly questionable. If he would like to have discussions with me, I will have a look at what possibilities there may be along the lines he has suggested.

[Chris Stephens (Glasgow South West) (SNP)]

These proceedings are being watched live by the pupils of Hillington Primary School, who invited me last Friday to see the outcome of their school project on the keys to unlocking education, which is about ensuring that young people across the world receive education, particularly in poverty-stricken and war-torn nations of the world. May we have a debate or a statement from the Government about how we, as Members of Parliament, on behalf of pupils like those at Hillington Primary School, can advance this cause to ensure that young people across the world receive access to education?

[Mel Stride]

The hon. Gentleman has raised an extremely important point about the importance of education. We often focus on that in the context of our own country, but it is also extremely important globally in terms of raising young people and families, and people generally, out of poverty. The hon. Gentleman and Hillington Primary School are to be thoroughly congratulated on the excellent work they have done on the keys to unlocking education. I am delighted that the pupils are all watching at the moment. May I say to each and every one of them, thank you for all you have done?

Business of the House

Debate between Chris Stephens and Mel Stride

Thursday 20th June 2019 Commons Chamber

[Chris Stephens (Glasgow South West) (SNP)]

Tails never fails, Mr Speaker—thank you.

On a more serious note, two of my constituents were in the House on Monday as part of a Red Cross event for Refugee Week. One of them has a letter from Serco telling them to leave their accommodation—written to them two weeks ago, not this week as Serco is publicly suggesting. So can I ask, for the second week in a row, for the Home Office to make a statement or hold a debate on asylum seeker evictions in the city of Glasgow by Home Office contractor Serco?

[Mel Stride]

Serco has not enforced eviction in Glasgow and continues, at its own expense, to house the group that the hon. Gentleman rightly refers to. It estimated that the number of people not leaving their properties had grown to over 300 and that was impacting on its capacity to house new asylum seekers. That is the background to this matter. It is a Home Office matter, as he indicated. I would be very happy to facilitate whatever discussions he feels that he needs with Ministers there.

Business of the House

Debate between Chris Stephens and Mel Stride

Thursday 13th June 2019 Commons Chamber

[Mel Stride]

That would be a very good question to ask on Monday 17 June at Housing, Communities and Local Government questions.

[Chris Stephens (Glasgow South West) (SNP)]

May we have a statement or debate on the actions of the Home Office contractor Serco, which yesterday announced that it will go ahead with 300 lock-change evictions of asylum seekers before its contract ends in September? Does the Leader of the House recognise the anger and disgust of many Glaswegians at the actions of Serco, and does he agree that the Home Office should instruct Serco to halt that policy, especially given that there are live legal proceedings brought by a Glasgow South West constituent, who is appealing this decision in the Inner House of the Court of Session?

[Mel Stride]

I believe the hon. Gentleman tabled an urgent question on this matter that was not granted, so I recognise how important it is to him. If he writes to me in more detail, I will make sure that appropriate Ministers are engaged on it.

HMRC Estate Transformation

Debate between Chris Stephens and Mel Stride

Tuesday 29th January 2019 Commons Chamber

[Mel Stride]

HMRC has stuck to very clear, very fair and balanced guidelines on how to make the assessments—the eight location principles we have been discussing this afternoon—and I have absolutely no doubt that it was rigorous in adhering to that process. The individuals impacted by this decision are central to the approach HMRC is taking, in the way I have described.

[Chris Stephens (Glasgow South West) (SNP)]

Will the Minister publish an economic impact assessment for each HMRC office closure—in many towns, the largest employer is leaving? Will he publish an equality impact assessment, so we can see the impact on staff, particularly those with disabilities, who are being asked to travel over 100 miles to their new workplace?

[Mel Stride]

There has already been an equality impact assessment. It is in the public domain, but I would be very happy to share it with the hon. Member.

Finance (No. 3) Bill

Debate between Chris Stephens and Mel Stride

Committee: 2nd sitting: House of Commons
Tuesday 20th November 2018 Commons Chamber

[Mel Stride]

My hon. Friend makes an important general point about taxation. As we know, very high taxation has a number of undesirable impacts, not just on individuals and businesses, but on the economy and, through that, the general tax take and our ability as a society to fund our public services, and one of those impacts is that which he rightly raises: the disincentive to go out and produce and create the wealth upon which we all depend. It is the duty and mission of this Government, generally across the piece, to keep taxes as low as possible.

Since 2010, the Government have introduced more than 100 measures to combat avoidance, evasion and non-compliance, but this alone is not enough. To support these measures, it is vital that HMRC be well funded and well staffed. That is why we have invested an extra £2 billion since 2010 in HMRC and why we have 24,000 members of HMRC staff dedicated to tackling avoidance, evasion and non-compliance.

[Chris Stephens (Glasgow South West) (SNP)]

How many of those 24,000 members of staff are employed in the HMRC’s wealthy unit, which, as the Minister knows, is the key driver in tackling tax avoidance?

[Mel Stride]

It is one of the key drivers in tackling tax avoidance and the tax gap—the tax gap occurs not just with individuals but with large corporations and small businesses. I do not have the precise number, but I am happy to write to the hon. Gentleman with that information. What I can tell him is that, at any one time, about 50% of the largest 200 businesses in the country are under investigation, not necessarily because they have done anything wrong but because, logically, HMRC should be looking particularly carefully at the businesses that are making the largest profits and generating the most.

This investment is paying off. In 2017-18 alone, HMRC secured and protected more than £30 billion in additional tax revenues which otherwise would have gone unpaid. That was a year-on-year increase of £1.4 billion.

We know that some large multinationals have been able to avoid tax by exploiting gaps and mismatches in the international tax system. International leadership was required to address the situation, and that is exactly what the Government have provided. We were at the forefront of the OECD’s base erosion and profit shifting project, which agreed major reforms to the international tax system, and we have taken the lead in implementing these recommendations in domestic legislation. We have also been a strong supporter of the EU anti-tax avoidance directive, and we have helped to shape the common approach that it provides for tackling avoidance in the European Union.

--- Later in debate ---

[Chris Stephens]

The Minister gave me a written answer yesterday to a parliamentary question about higher rate Scottish taxpayers who register themselves elsewhere in the United Kingdom. He responded by saying that Her Majesty’s Revenue and Customs holds no data on that. On reflection, does he not think that HMRC should be tackling those trying to avoid tax, specifically the higher rate tax in Scotland?

[Mel Stride]

The hon. Gentleman will, of course, be very aware of the devolution of various elements of our tax system to Scotland, and the issue he identifies is fundamentally driven by the different relative rates of taxation in Scotland and in the rest of the United Kingdom. I would argue that it is incumbent upon the Scottish Government to do as the UK Government do where these matters are reserved, which is to keep taxes as low as possible. I know that Conservative Members representing Scottish constituencies are most keen to deliver that for their constituents.

As we announced at the autumn Budget in 2017, the Government are legislating in this Bill to tax income from intangible property held in low-tax jurisdictions to the extent that it is income that relates to UK sales. Today some large multinationals are able to unfairly reduce their tax bill by arranging to hold their intangible property in offshore entities. That is unacceptable, and we are now going further to level the playing field. Clause 15 requires multinationals that continue to earn intangible property income in low-tax jurisdictions to pay UK income tax on the proportion of that income that relates to UK sales.

Tax avoidance is not limited to large multinationals of course; businesses of all shapes and sizes attempt to unfairly shift UK profits to jurisdictions where they expect to pay less tax or perhaps no tax at all, so clause 16 introduces carefully targeted anti-avoidance rules to prevent these UK businesses from avoiding UK tax by shifting their profits to lower-tax jurisdictions. The clause targets contrived arrangements that, in broad terms, aim to avoid tax by transferring the profits of a UK’s business offshore in a way that would not be agreed between independent parties.

Finance (No. 3) Bill

Debate between Chris Stephens and Mel Stride

2nd reading: House of Commons & Programme motion: House of Commons
Monday 12th November 2018 Commons Chamber

[Mel Stride]

This debate is not the place to make pronouncements about the Taylor review. The Government are considering the Taylor review and the way in which people are working. There are a number of aspects in the Budget that relate to the taxation elements of the way that people work, but we will come back in the fullness of time with a full response to the Taylor review.

[Chris Stephens (Glasgow South West) (SNP)]

Just on wages, there was a lack of clarity in the Budget in relation to the public sector pay cap. Can the Minister confirm that every Department is budgeting for 1.5% this year?

[Mel Stride]

As the hon. Gentleman will know, we have made, within this year, more finance available to various Departments, and the Chancellor was very clear about that in the Budget. He was equally clear that there will be a number of decisions to be made in the spending review next year relating to all the Departments across Government.

Tax Avoidance and Evasion

Debate between Chris Stephens and Mel Stride

Tuesday 14th November 2017 Commons Chamber

[Mel Stride]

I will get back to the hon. Lady on that.

We know that tax is important for our public services, and we know, as the right hon. Member for Barking rightly stressed, that it is important that the Government act, and be seen to act, when we come across aggressive tax avoidance and evasion. As my hon. Friends on this side of the House have eloquently pointed out, we have a very strong track record in that respect. We have raised £160 billion in additional revenues as a consequence of clamping down on tax avoidance, evasion and non-compliance since 2010. We have also brought in £2.8 billion by tracking down those who have sought to inappropriately hide their finances in overseas tax jurisdictions. We have brought in £28.9 billion in additional compliance yield in the last 12 months alone, too.

The right hon. Lady is rightly critical of the performance of the last Labour Government; she raised that this afternoon and raised the same point in last week’s Adjournment debate. The tax gap is the difference between what we could potentially bring in by way of tax and what we actually bring in, and it currently stands at 6%, which is a historical low—a world-beating figure. If the average tax gap today was the same as under the last Labour Government, there would be £45 billion less in our Exchequer—£45 billion not there for those vital public services that the right hon. Lady is keen to discuss.

[Chris Stephens (Glasgow South West) (SNP)]

On the Government’s record, can the Minister confirm that HMRC informed the Public and Commercial Services Union that in 2017 the equivalent of 17,000 years of staff experience is leaving the department? How will that help the Government’s record going forward in dealing with tax evasion and avoidance?

[Mel Stride]

I am pleased that the hon. Gentleman has raised the issue of investment in HMRC, because we have a very good record in that respect. Some £1.8 billion of additional money has been invested in HMRC since 2010, of which £800 million will relate to the period after 2015, bringing in £7.2 billion by 2020-21. We will also be trebling the number of investigations of the wealthy to ensure they are paying their appropriate level of tax, as a direct consequence of all that additional investment.

[Mel Stride]

I challenge those figures: a far larger number than the hon. Gentleman suggests are engaged in clamping down on tax evasion and avoidance. About 50% of the 2,100 largest corporations in this country are under investigation at any one time—not necessarily because they have done anything wrong, but because they have complex tax affairs. So we are investing in that.

[Chris Stephens]

Can the Minister confirm to the House that he answered a question to me yesterday by saying that 522 employees were in the high net worth unit on 31 March 2017, and that that compares with 4,045 full-time equivalents in DWP chasing social security fraud?

[Mel Stride]

This Government have an exemplary record on the tax take from the wealthiest in this country. The wealthiest 1% pay about 28% of all income tax. Under the last Labour Government that figure was below 24%, so I will not take any lectures from the Opposition parties on this.

Paradise Papers

Debate between Chris Stephens and Mel Stride

Monday 6th November 2017 Commons Chamber

[Mel Stride]

The accounts of the Duchy of Lancaster are readily available, transparent and audited in the normal fashion, and there has been no suggestion to date, as far as I am aware and certainly not in the television programme last night, of any mischief related to any aspect of its dealings.

[Chris Stephens (Glasgow South West) (SNP)]

Will the Minister confirm that according to the latest figures available there are 420 employees in HMRC’s high net worth unit and 3,765 employees in the Department for Work and Pensions chasing social security fraud? Does he agree with many of us in the House—if those figures are correct—that if the same resources were applied to tax evasion we would have billions of pounds more for our vital public services?

[Mel Stride]

I can confirm that in 2015 an additional £800 million was made available to HMRC for the purposes of bearing down on tax avoidance and evasion, and that that is expected by 2021-22 to bring in more than £7 billion in additional revenue.

HMRC Closures

Debate between Chris Stephens and Mel Stride

Thursday 2nd November 2017 Westminster Hall

[Mel Stride]

I do not accept that point. We could take it to its logical conclusion and assume that everyone could work from home, and we could then have a very disparate workforce. There may be some attractions to that, but there is huge value in bringing people together in a single building, where there is a critical mass of individuals: collaborative working and the sharing of experience and ideas can take place, meetings can be held, and the technology is all in one place. I would have thought the hon. Gentleman would recognise that. Let us face it: if we went back to 2005, we might be debating whether we should shrink the number of offices from 600, which is what it was at that point. There will always be arguments about whether we should do things and the local impacts and so on, but this overarching direction of travel, it seems to me, has to be right.

[Chris Stephens]

Could I ask the Minister two questions, then? First, on the criteria for where to locate the offices, was a social-economic impact assessment made for the towns and cities whose HMRC offices are closing? Secondly, given that he has mentioned homeworking, can he confirm whether the Department has published the information from the homeworking pilot in Wick?

[Mel Stride]

On the latter point—the specific query— I will have to get back to the hon. Gentleman, but on the general point about impacts, HMRC has looked extremely closely not just across the eight criteria, which I was working my way through, but at the impact on the individuals working at the existing offices. I know for a fact that that has gone right down to literally every single employee, plotting where those people live, and working out travel-to-work times and so on.

[Chris Stephens]

rose—

[Mel Stride]

Could I just make one other point? The relocation does not necessarily mean that all the employees who worked at the previous office, for want of a better expression, will no longer be working for HMRC. Many of them—about 90%—will either work through to retirement at that office or migrate to working at the new hub.

[Chris Stephens]

I thank the Minister for giving way again. Can he confirm whether the Department will publish an economic impact analysis of staff moves? If people based in, for example, Inverness or Wick will be working in Glasgow or Edinburgh, I would think it would be very difficult for them to travel to their work every day.

[Mel Stride]

We are not publishing the kind of impact assessment that the hon. Gentleman suggests, but my point is that it is not the case that HMRC has not very carefully looked at those individuals who will be affected—at where they live, the travelling issues and so on—to ensure that it is as helpful as it possibly can be to all the employees in those circumstances. We heard in the debate about providing assistance with travel costs, for example. There is also relocation assistance. All that is being very carefully looked at and engaged with by HMRC.

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[Mel Stride]

The hon. Gentleman raises the issue of crowding out private sector investment, but I am primarily concerned about the possibility of crowding out tax collection. If we do not have hubs that are fit for the 21st century, that are bristling with new technology, talent, and well-qualified, well-trained individuals working collaboratively from those units, we will be less effective at bringing the money in.

The tax gap was mentioned; it stands at 6%, a record low. Under Labour in 2005 it was around 8%. If it was 8% today, we would have £11.8 billion less coming into the Treasury, which is enough to pay for all the police forces in England and Wales, so these things matter. I understand why Members here are vexed about their constituency—I totally get it—but we cannot allow that to trump the really important job of bringing our tax collection into the 21st century, and making sure that it is effective, so that we keep our public services going.

[Chris Stephens]

Can the Minister explain how closing HMRC offices, with a lack of local knowledge, helps to bridge the tax gap? I am genuinely confused, so perhaps he can explain.

[Mel Stride]

The corollary to that argument is that we might better close the tax gap by opening another several hundred offices. I do not think anyone would argue with that. It does not necessarily follow that more offices mean more tax collected. I think quite the reverse, as I have explained. We need centres of excellence with a critical mass of people who are well trained and where there is good access to the labour market and the skills that we need; where people work collaboratively and all the technology is right; and where they operate, as we do in this country, a risk-based approach to clamping down on tax avoidance, which involves a lot of data and analysis from the centre. That is much better done from a well-resourced organisation of critical mass than by a larger number of smaller offices, many of which operate in a manner that is more manual, for example, than computer-driven, and that needs to be changed.

[Mel Stride]

The answer is similar to the one I gave the hon. Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron) a moment ago. Nobody is suggesting that Bradford is not a superb location in many different ways for many different business activities—absolutely not. I do not have the figures to hand, but I would probably agree with the hon. Gentleman that in terms of office space, the cost per square foot is probably less in Bradford than in Leeds. However, we have a series of criteria, and the overarching objective of those criteria is to collect tax and to have access to the best available within the region—the best talent pool and the best digital and physical connectivity. On balance, the decision is that Leeds fits that bill better than Bradford, but that is not for a moment to suggest that Bradford is not a wonderful place to run businesses.

[Chris Stephens]

The Minister is being more than generous. Can he confirm that there are currently 400 employees in the high net worth unit dealing with tax evasion? Does HMRC intend to increase or reduce that figure over the coming years?

[Mel Stride]

It depends. The hon. Gentleman’s question begs another question, which is what exactly he means by the high net worth individuals he refers to.

[Chris Stephens]

It is a specific department.

[Mel Stride]

If it is a specific department—I am sure it is—I am happy to get back to him on that point. I will move to another point relating to what the hon. Gentleman said earlier in his speech. When he talked about clamping down on tax avoidance, he very much started to drift into—understandably so—complex tax avoidance. He mentioned the Cayman Islands. I do not think he mentioned trusts specifically, but I suspect that would be a part of the mix of his thinking, which is exactly my point. If we are going to start targeting that kind of tax avoidance, it is far better to be in a well-resourced hub, the nature of which I have described already, rather than to have myriad other offices around the place. That is the nature of the tax challenge, so we have to have a configuration that is appropriate to meet it.

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[Mel Stride]

I shall get back to the hon. Gentleman on precisely what that means. I suspect it is a travel-to-work time, but it will probably vary depending on location.

[Chris Stephens]

Can the Minister confirm that the original criterion for reasonable travel distance that was used, and that was put to the trade union and staff, was 100 miles?

[Mel Stride]

I shall give the hon. Gentleman the same answer I gave to the hon. Member for Stockton South (Dr Williams); I am certainly happy to look into it—although I have now had some divine inspiration, and I believe that the criterion is an hour’s travel time. St Matthew has come to my aid.

Let us not lose sight of the bigger picture. As I have said, the programme is underpinned by the aim of making HMRC a more efficient and effective tax authority. I want to dwell briefly on our record in that area, because what we are doing is part of a broader drive to transform HMRC that has been going on for some years. Its performance has been improving considerably. I have already mentioned that the tax gap is the lowest in our history; it is also one of the lowest tax gaps in the world.

The hon. Member for Bootle bemoaned the Mapeley PFI deal. As I said, it was a Labour Government who put us into that deal, but he is right that there will be considerable savings from not having to continue with the deal, as a consequence of pursuing the current programme.

HMRC has improved customer service. Almost all its business customers now choose to deal with it online, and more than eight out of 10 self-assessment returns come in digitally.

[Mel Stride]

The cost savings are for an investment of £552 million over 10 years. Firstly, they arise through the avoidance of future costs that would be incurred in the event of our not going ahead with the programme. Those would be the costs of the PFI deal, were we to continue with it. That cost is £75 million per annum—obviously from 2021, when the contract for strategic transfer of the estate to the private sector comes to an end. There is a cost saving of £300 million in the 10 years to 2025. That gives an annual cash saving, as compared with 2016-17, of £74 million in 2025-26, rising to about £90 million in 2026-27.[Official Report, 27 November 2017, Vol. 632, c. 2MC.]

[Chris Stephens]

On cost savings, can the Minister provide an explanation of why, during purdah, a contract was signed in relation to an office in Edinburgh, which was the most expensive office to rent not just in Edinburgh but in Scotland? How does that lead to cost savings?

[Mel Stride]

As the hon. Gentleman knows, the criteria applied in taking the decision were not simply about cost. As to his assertion that the decision that has been taken is an exceptionally high-cost option, I cannot comment, because I do not have access to that level of detail at this precise moment; but the decisions are taken in the round, using eight different criteria, of which cost is but one. As I have repeatedly stated, the overarching objective must be the effective and efficient collection of tax, which provides all the funding for our public services. That is the basis on which the decisions are taken.

HMRC is now open to take calls from customers and engage in webchats seven days a week, so people can contact the Department at times to suit them. This year, more than 987,000 tax credit customers renewed online using the digital service. It would simply not be possible to continue to drive improvements without transforming the offices from which HMRC staff work.

The changes are an integral part of HMRC’s transformation into a smaller, more highly-skilled organisation—one that has modern digital services and a data-driven compliance operation, which will deliver more for the taxpayer, at lower cost.

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[Mel Stride]

We can go round and round this for some time, but HMRC has a very clear set of criteria. It has looked extremely carefully. As I explained earlier, when it comes to travel distances to work and journey times it has mapped every single employee within its employ, to make sure that that aspect of that particular decision is taken as rigorously and robustly as possible. I am afraid I do not recognise the hon. Gentleman’s suggestion that this is somehow just a case of putting a finger in the air and a pin in a map. It has been well thought through.

To conclude, raising taxes is vital to our public services.

[Chris Stephens]

It is a pleasure to see you in the Chair, Mr Stringer. The Minister has not yet mentioned the minimum wage compliance, which was mentioned in the debate. Does he have some words to say about that?

[Mel Stride]

It is the duty of HMRC to ensure the minimum wage is adhered to and that it is rigorous and robust in its approach to that. It does not hesitate to go after those who break the law and do not pay the minimum wage. It has the ability to go after those companies or individuals for back tax and penalties, and it does that with vigour. I would argue that under a more modern system with large numbers of people working collaboratively in the way I have described, it would be even more effective in doing that.

I think we have given this matter a good, broad and wide airing. I am grateful to all hon. Members for their contributions. I take all the issues raised seriously, even though we disagree on a number of matters, and I am particularly grateful for what is probably a record number of interventions in a Westminster Hall debate.