Finance (No. 4) Bill

Glyn Davies Excerpts

Wednesday 18th April 2012 Commons Chamber

[Mr Graham Stuart (Beverley and Holderness) (Con)]

It is my pleasure to follow the other speakers. Like all those who have spoken so far, apart from those on the Front Bench, I shall speak to new clause 6 and the proposal that the Finance Bill should set out that this House will not approve, in a future statutory instrument, the imposition of VAT on static caravans. So much has already been said, but I must point out that my constituency contains ABI, a major manufacturer in the heart of Beverley; companies in the immediate area that are part of the supply chain; and a series of parks along the Holderness coast that depend for their profits on the sales of static homes, as we discover when we speak to the owners.

The Treasury’s assessment of the impact of introducing the VAT is that there would be a 30% reduction in sales. When we think about the employers in the various constituencies in Hull, in my constituency and in those of my right hon. Friends the Members for Haltemprice and Howden (Mr Davis) and for East Yorkshire (Mr Knight), we find that so many companies are involved. More than 90% of the production of static caravans in the UK is concentrated in east Yorkshire and, as has just been said, so successful is this industry in the UK that nearly all the caravans that are bought and installed in the UK are built there. So my constituency has a great concentration of all those who may suffer from a 30% reduction in demand—manufacturers and all the people who work in that area, suppliers, and the parks themselves.

[Glyn Davies (Montgomeryshire) (Con)]

I associate myself with the concern that my hon. Friend is showing and that many of my constituents also show. Does he share my concern about the disruption around the introduction date that will be caused to the manufacturing side of the industry? Does he share my hope that in the intervening period Ministers will examine ways in which they can limit that disruption?

[Mr Stuart]

I am grateful to my hon. Friend for his intervention, but I am not looking for Ministers to limit that disruption; I am looking for them to remove that disruption altogether. However, he is right to mention the date. We are talking about a major manufacturing business. We are talking about businesses with 700 staff involved in tooling up, buying in the resources and planning their production, yet we are facing the introduction of this VAT on 1 October. Let us imagine the impact on the supply chain; imagine the impact on ordering; imagine the eddies of people looking to beat the deadline and at the same time destock to make sure that they do not hold stock on 1 October when whatever product they have will be 20% more expensive and potentially unsaleable.