Spring Statement

Jim McMahon Excerpts

Wednesday 13th March 2019 Commons Chamber

[Mr Hammond]

I have heard of the campaign. We settled the issue a number of years ago. [Hon. Members: “What?”] Yes, we have. We were dealing with a very difficult set of challenges but did what we had to do. I know the campaign continues, but I have no further announcements to make.

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

The Government will know that, since they walked away from local councils, frontline services such as adult social care and children’s safeguarding have been massively underfunded, adding more and more pressure on low-income families and council tax. When will he eventually give proper funding for children’s services and adult social care?

[Mr Hammond]

At the risk of being repetitive: we will have a spending review later this year. The question of local government funding and how business rates retention interacts with other funding structures will be looked at, but in the meantime we have increased funding for local government by £1.3 billion, meaning that local government has a real-terms spending increase available this year. Labour Front Benchers voted against it.

Bus Services: Greater Manchester

Jim McMahon Excerpts

Monday 4th March 2019 Commons Chamber

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

I would first like to place on the record an interest, as a family member works for Transport for Greater Manchester, although not in the buses division. I bring to the House an important matter for debate and one that is as old as public transport itself: our bus services. I will speak about the impact of bus service reductions in Greater Manchester, the opportunities that arise through bus franchising and the need to bring about a new settlement for bus users in our city region.

For context, Greater Manchester’s bus services go back nearly 200 years to the original horse-drawn buses, but SELNEC—South East Lancashire North East Cheshire—brought together council transport departments from Manchester and its surrounding districts. In 1974, it became the Greater Manchester Passenger Transport Executive. In 1986, the bus operation was transferred to GM Buses, with its iconic orange and brown livery, which serviced communities across the city region and beyond until its employee buy-out in 1993, when it split services between the north and south of Greater Manchester. That was an important moment for the routes, services, pricing and quality of services we see today.

As a child growing up off Queens Road in Cheetham Hill, in the shadow of the imposing Queens Road bus depot, I would look at it as I walked to school each day, or to the Irish centre across the road, and the orange and brown livery was as powerful to me as the Coca-Cola or Heinz brands are to the whole population. It is a little-known fact—I am not sure that I should be saying this—that as a child playing on my pedal bike, I was so preoccupied with the plastic bottle that I had positioned against a rear wheel of the bike to try to make a motor engine noise that, as I went out on to Queens Road, I did not notice the passing vehicle and was struck by a bus driver. I am forever grateful that he was driving his car to work, and not his bus, at the time. I broke my collarbone and learned an important lesson about road safety. The local museum of transport housed in the depot would provide a staple visit. I made sure that each of my sons made their mandatory visit, whether they liked it or not, to take a photograph in the seat of a bus and a tram.

But it is not the past that occupies my time or my postbag today, but the state of public transport in Greater Manchester. By 1996, GM Buses South had been sold to Stagecoach and GM Buses North had been sold to First Bus, both of which are still operating from the depots that they inherited, basically splitting Greater Manchester in half. Rather than creating active competition, that created two, in my view, private sector monopolies with differential pricing and ticketing, and entirely different approaches to routes. Today, 82% of bus mileage in Greater Manchester is commercially operated and accounts for 90% of passenger journeys. Stagecoach operates the majority of routes in the south and First Bus operates the vast majority in the north, with very little mutual competition.

This was explored by the Competition Commission in a two-year investigation that found that nationally there were high levels of market concentration and a number of barriers to entry for new competitors—not least, the cost of establishing a depot, buying buses and creating routes. Its report found that head-to-head competition was uncommon and that the costs to passengers through the lack of competition was between £115 million and £305 million a year nationally.

The experience of many bus users is that bus services are being run for the benefit of the operators rather than bus users. Let us remember that when we say bus users, we are talking about those who need accessible, affordable and reliable transport to get to work, school or college within a system that is, at the moment, complex, expensive and too often not fit for purpose.

[Liz McInnes (Heywood and Middleton) (Lab)]

My hon. Friend is making an excellent speech. In my constituency, we are extremely reliant on the bus services. We have only two railway stations that serve only a part of the constituency. Complaints about bus services are a constant in my constituency emails. I am very grateful to him for raising these really important issues, which mean a lot to my constituents.

[Jim McMahon]

I thank my hon. Friend for her intervention. I congratulate her on the work that she does in supporting constituents for whom this is a real issue. Middleton and Heywood have First Bus as the main operator as we do in Oldham, with the main depot being based in Oldham for north-east Manchester. It runs the lion’s share of the routes, so there is no competition that would mean that the standard was raised. I appreciate that point being made.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

Is my hon. Friend and neighbour concerned, as I am, about the reliability of bus services? That is a constant cause of concern not just in casework but among my staff, one of whom had to wait over an hour for a bus tonight and was yet again late. Is my hon. Friend also concerned about the decrease in the use of bus services? There has been a decrease of 25 million journeys in the space of five years in Greater Manchester.

[Jim McMahon]

Over the past decade, we have seen 32 million fewer bus journeys a year as a result of poor services. I congratulate my hon. Friend and neighbour on the work that she does in fighting for access to rural services, where many people feel isolated. When the bus does not turn up on time when it is needed, particularly in the winter when it is dark, as at the moment, it can be very difficult for local people. She campaigns on that with real effect, and I congratulate her.

[Liz McInnes]

It is really important that we remember the role of bus services in addressing social isolation. A constituent came to see me about the cutting of a bus service, which meant she was unable to go out in the afternoons to shop and visit friends and family. She was an elderly lady. I wrote to the Minister for loneliness about it, who wrote back to me and said, “This is a matter for the Department for Transport.” Does my hon. Friend agree that there needs to be more joined-up working between Departments?

--- Later in debate ---

[Jim McMahon]

That is a really important point. By and large, someone living within 5 miles of Manchester city centre on a main road will probably get a reasonable bus service, and there will be quite a lot of competition for it. But for someone who lives off a main road, on an estate, the chances are that their route has been cut or cancelled completely. For many people—particularly those who live on estates on steep gradients—that can mean that they are completely cut off from access to good bus services and do not leave the house. People have experienced that in Royton and parts of Chadderton where bus services have been taken away. I thank my hon. Friend for her intervention.

The current system unfortunately sees Greater Manchester in a clean air crisis, with pollution causing around 1,200 premature deaths a year. That is across all transport, not just buses, but it is important that we try to get people on to sustainable, environmentally-friendly transport, not just to get to work and college but to save lives.

[Jim Shannon (Strangford) (DUP)]

I thank the hon. Gentleman for giving way. As I said to him before the debate, Translink has spent a substantial amount of money on new buses in my constituency. Those buses are environmentally friendly, but they are also disabled-friendly. It is so important that we give the opportunity of rural and urban bus travel to people who are not able to access normal buses. Does he see that as one of the things that the Government should pursue in his constituency?

[Jim McMahon]

Madam Deputy Speaker, I cannot tell you how reassuring it is in these crazy parliamentary times to have an intervention from the hon. Member for Strangford (Jim Shannon); it gives a lot comfort. That is a really important point. Disabled people find it difficult to leave the house, and they have to contend with not only buses but, when they get off the bus, the shops, department stores and supermarkets that are not accessible. What we can do as a public service is ensure that public transport is accessible, to connect them as much as possible with our towns, city centres and villages. I appreciate that intervention.

As I have said before, we cannot address the clean air crisis if we do not address the bus crisis. Over the past 10 years, we have lost 32 million bus journeys every year in Greater Manchester. That is a staggering number of journeys being diverted. I should say, out of balance, that that is partly because there has been significant investment in our tram system, so some people will choose to use the tram rather than the bus network, but that still does not account for the 32 million. We have seen a significant shift, and too many people rely on their private cars to get to work because bus services just are not good enough.

As a result of commercial decisions or because bus subsidies have been cut due to local councils having their budgets cut—of course, subsidised routes are funded by council tax through the transport levy, so if the council budget is cut, transport naturally gets cut, too—many communities have seen routes reduced or cancelled completely, cutting off entire communities. Many older and vulnerable people are now isolated. At the same time, we have seen the cost of travel increase. Ticket fares have increased by over 55% above the rate of inflation in the same period. How can it be right that we are losing 32 million bus journeys a year, but the cost has increased by 55% over the rate of inflation? People are paying from both sides—through increased subsidies to operators and through poor services, and they are then charged on top of that. I pay credit to the Better Buses for Greater Manchester campaign, which provided that data.

Given the north-south divide in Greater Manchester, it is more expensive generally to travel across the city. If someone needs to make a bus journey that requires more than one operator, they have to use what is called a system one ticket, which is a multi-operator bus ticket. That costs £5.80 a day or £19 for a weekly ticket, often for people who are on the minimum wage and struggling to get by. We should compare that to what we pay for bus travel in London. Someone who needs to use multi-modal transport—say, the bus and the tram—will pay £9 a day or £38 a week. If we compare that with the same ticket in London, where someone wants to use a bus and the tube, they will pay £21.20. It is £38 in Greater Manchester, but £21.20 in London, so weekly tickets are more expensive—179% more expensive—in Greater Manchester than in London. Quite literally, passengers in Greater Manchester are being taken for a ride.

[Liz McInnes]

Oh dear.

[Jim McMahon]

Well, I had to say it. Give me some credit, please.

In 2014, the devolution agreement was reached with Greater Manchester leaders. At the time, I was the leader of Oldham Council, and we agreed to bring forward plans to franchise bus services in Greater Manchester. This would allow greater power over routes, frequency, operating hours, fares and standards. There has been a great deal of concern that the big operators, such as Stagecoach and First Bus, would seek any legal challenge to prevent bus franchising from happening, and there is little doubt that that has in part accounted for some of the delay we have seen.

Funding has already been spent by the Greater Manchester combined authority and the Mayor: £6 million to date, with a further £3.5 million to come and followed by another £2.25 million for bus reform towards 2020, totalling £11.25 million. Incidentally, that is dwarfed by the profit Stagecoach made last year alone, when it had a £17.7 million profit margin for the year. That may account for some of the nervousness we have seen: when making that much in profit, it provides a decent fighting fund if it has to take legal action to protect that profit. However, it is a bad deal for taxpayers and bus users.

Greater Manchester must now recognise that with every week, month and year that passes, it is the millions of people in our city region who will be paying the price of delay. That brings me to explore the willingness to do it Greater Manchester’s way. There is a reason why Greater Manchester secured the largest devolution settlement outside London and why Greater Manchester has attracted attention. It took things seriously; it made the evidence-based case; and it built partnerships and long-standing relationships to get things done. It is just not good enough that passengers and decision makers in Greater Manchester seem to be held to ransom by bus operators, which have taken hundreds of millions of pounds from routes, while routes have been lost and, year on year, the taxpayer subsidy is passed on. Unless a more balanced settlement is reached, that just is not a good deal, but it requires energy and determination to form a different vision.

While we wait for franchising to seek powers, we must use this time to secure any possible passenger advantage. It will come as no surprise that First Manchester was heading for difficulties because, after it secured an operating margin of 17.3% or £18 million in 2010, it lost ground with losses in 2016 and 2017 amounting to £11 million. When it became common knowledge that First Manchester was seeking buyers for its four depots in Greater Manchester, including in Oldham, together with its fleet of 500 buses and 2,000 employees, it was a once-in-a-generation opportunity to bring some order and sustainability to bus services covering some of the poorest communities in Greater Manchester. I took the opportunity to raise this in my letter to the Mayor of Greater Manchester on 6 February, and I still urge that action be taken.

A difference seems to arise from the Bus Services Act 2017 in relation to whether the restriction in the Act on setting up a new company means there is also a restriction on buying an existing operation. I am conscious of the time, so I will jump ahead in my speech. I sought the advice of the Library, and I was referred to a companies law specialist. They said that

“it is clear that acquiring an existing company does not constitute the formation of a new company and so, as I would understand it sits outside the restriction in the Bus Services Act”.

They also said:

“It is my considered opinion that buying an existing company does not constitute forming a company.”

Even if conflicting legal advice was received focusing on the letter of the law as outlined in the Companies Act 2016, rather than the implied spirit of the Bus Services Act, there would be other options. We must make sure that we do not miss opportunities. For instance, there is the opportunity to have other municipal bus operators expand into Greater Manchester, such as those in Warrington, Reading, and Nottingham, which are performing well. If that is not considered to be an option, we could look at the formation of mutuals or co-operatives to make sure that passengers are part of the shareholding, or we could look at Manchester airport buying the service as a going concern and holding it ahead of bus franchising. There are plenty of options around. Fortune favours the brave, and it is important that we see determination.

Unfortunately, we have learned that the Queens Road depot, together with its 163 buses, has been sold to Go-Ahead for £11.2 million, separating it from the three remaining depots, including Oldham. While I accept that the new operator will work with other operators through the OneBus partnership it is my belief that carving up the north of Greater Manchester with a range of new operators buying the depots individually will make franchising harder, not easier. It is hugely disappointing, to put it mildly, that we have not capitalised on an opportunity that rarely presents itself.

Greater Manchester has done a great deal to ensure that there is investment in public transport. For instance, it has spent £90 million on bus priority measures and £130 million on bus stations, with an additional £29 million to support clean buses. It is important that operators play the game. I had an unfortunate exchange with Stagecoach Manchester on Twitter, as it was criticising the Mayor and the Greater Manchester combined authority for introducing new powers to reduce air pollution, as though that was not a reasonable thing to do, and it was not taking into account the £29 million clean bus fund invested by Greater Manchester. There was more than just a stick—there was also a significant carrot.

Public transport is key to giving people across Greater Manchester access to jobs, including constituents such as mine in Chadderton, Oldham and Royton who seek employment at key employment sites such as Trafford Park and Manchester airport, but who are denied that option because buses simply do not run to meet shift patterns, or are unaffordable and complicated, which disadvantages people trying to hold down more than one job, or who have with caring responsibilities and for whom time is precious.

This matters—all public transport users across Greater Manchester care about it, as 76% of all journeys using public transport are by bus. We must grasp this opportunity. Two and a half million people in Greater Manchester deserve better, but it requires courage. Remember, faint heart never won fair maiden, and it certainly does not get the buses to run on time either.

[The Parliamentary Under-Secretary of State for Transport (Ms Nusrat Ghani)]

I thank the hon. Member for Oldham West and Royton (Jim McMahon) for bringing this important issue to the House, and I welcome the opportunity to debate it and to collaborate on how we can continue to support and promote buses. I was particularly touched by the throwback images and his first impression of a bus. We all had those back in the day.

Buses play a hugely important role in our transport system. As we heard, they connect our communities to the workplace and to vital public services. They support our economy, they help to tackle congestion and they have an important contribution to make in reducing emissions—I hope to come on to that. I share the hon. Gentleman’s concerns about bus passenger numbers, which vary across the country, but we must not forget that there are over 4.4 billion bus journeys a year and buses remain the most popular form of public transport.

It is interesting to know—this is why we are all here and championing buses—that passenger satisfaction remains consistently high, with 88% of passengers satisfied overall with their bus journey. I cannot think of any other public service that rates so highly. We should take a moment to thank bus drivers, who are key to good journeys, and good bus companies that operate a good service. The benefits of a reliable and innovative bus service are clear: greater productivity and communities that are connected, rather than apart. That is why the Government remain committed to improving bus services and expenditure on buses.

Each year, my Department provides about £250 million in direct revenue support for bus services in England via the BSOG—the bus service operators grant—scheme. Of that, about £43 million is paid directly to councils outside London to support buses that are not commercially viable but considered socially necessary. The rest goes to commercial bus operators. Without that support, fares would increase and marginal services would disappear. Government funding supports the approximately £1 billion spent by local authorities on concessionary bus passes every year. The Government have committed to protecting the national bus travel concession, so that about 10 million people get the support that they need to travel off-peak anywhere in England.

The hon. Gentleman raised the issue of younger travellers. The Government recognise that young people’s travel and the level of fares is a complex area. There is no statutory obligation to provide a discounted travel price to young people, but many commercial and publicly funded reductions are available. I was particularly pleased to see Transport for Greater Manchester introduce its Opportunity Pass, giving all 16 to 18-year-olds free bus travel. Since 2010, the Government have invested over £450 million in bus-related local authority transport schemes, including £32.5 million in the Manchester Cross City bus scheme, to deliver a range of bus infrastructure and congestion management measures. That was no doubt welcome in the hon. Gentleman’s constituency.

To support buses today and to help them into the future, the Government delivered the Bus Services Act 2017, which contains a range of options for how to improve local bus services in England. In addition to franchising, there are new and improved options to allow local transport authorities to enter into partnership with their local bus operators to improve services for passengers. Partnership working between local authorities and their bus operators achieves the best results. It is not always about funding. Bus passenger numbers are up 50% in Bristol, 36% in South Gloucestershire and 31% in Reading. In York, the city council and operators launched a customer charter setting out the standard of service passengers can expect, and have committed to a range of measures to encourage bus use. Those are just a few examples of how effective partnerships can work.

Partnerships may not be the best solution in all areas. The 2017 Act also gives local authorities the potential to use new powers to franchise bus services in their areas. Like the system in London, franchising will enable authorities to specify the services that passengers want and deliver an integrated network of services. Mayoral combined authorities such as Greater Manchester are provided with automatic access to franchising powers, reflecting the clear, centralised decision-making responsibility for transport they hold. All the powers needed for Greater Manchester to franchise its bus network are already in place. However, the Greater Manchester Mayor felt he needed additional powers to fully consider bus franchising for Greater Manchester. Buses fall under many Departments, so the order that will be debated in the House tomorrow to give the Mayor the additional powers he has requested is being managed by the Ministry of Housing, Communities and Local Government.

[Jim McMahon]

Just for the record, the additional powers the Mayor of Greater Manchester will receive through the statutory instrument tomorrow relate to precepting powers to pass the charge on. The Government have not provided the funding required to deliver bus franchising in Greater Manchester, so it now has to go on the council tax payers of Greater Manchester.

Communities: Charities and Volunteers

Jim McMahon Excerpts

Wednesday 13th February 2019 Commons Chamber

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

This has been an inspiring debate. The world is a cynical place at the moment, and all the Brexit debates highlight just how divided this House can be, but when we talk about the fabric of our communities and what makes them the places they are, there is a real glow from MPs.

I pay tribute to all Members who have spoken today, and in particular my hon. Friend the Member for Barnsley East (Stephanie Peacock), who talked about the great work in her constituency to support people with dementia, as well as the human cost of austerity and cuts, with children going hungry. My hon. Friend the Member for Makerfield (Yvonne Fovargue) is a champion for Citizens Advice, and her expertise in that field really adds value to this place.

My hon. Friend the Member for Clwyd South (Susan Elan Jones), as chair of the APPG on charities and volunteering, lives and breathes the charity sector and goes above and beyond; she shows that every day in this place. My hon. Friend the Member for Colne Valley (Thelma Walker) talked about the real price of austerity, how the cuts feel on the ground and how desperate it is that so many people are turning to food banks as a direct result of austerity and deliberate choices that the Government have made. My hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) has been a champion of volunteering for a long time, going up and down the country and building a network of volunteers with real commitment.

My hon. Friend the Member for Coatbridge, Chryston and Bellshill (Hugh Gaffney) talked about austerity and the direct impact of cuts on charities. It is not just that charities are picking up the pieces after public sector cuts. Charities themselves have faced cuts, and on top of that, when they are contracted by the Government, they are told that they cannot speak out on the issues that affect them and the reason they exist. He made that case passionately. My hon. Friend the Member for Warrington South (Faisal Rashid) talked about the importance of charities in Warrington and how they are part of the fabric of that community.

The backdrop of this debate cannot be ignored, and it has been mentioned a number of times. The charities that do this fantastic work, that go above and beyond, that we all take inspiration from, that we all visit and that we all thank today are, by and large, picking up the pieces where the Government have decided that they are not responsible, walked away, taken the money and left communities to sink or swim.

Many examples have been given today, including food bank activity; the work that communities are doing to self-organise and respond to crime and antisocial behaviour in their area; people taking on the local library because the council money has been taken away, and to keep it open, they have to self-organise; and community volunteers on estates who are stepping up because they recognise that young people do not have the facilities they used to have to keep them out of trouble and give them a positive focus and hope.

We hear all these stories, and they are inspiring, but this is about transferral of responsibility. I remember a former Prime Minister, who I think is in a shed somewhere writing his memoirs, talking about the big society and this big idea of an emboldened civil society where charities are supported. The truth is that charities have just about kept their head above water. In the way that councils, the police service and the fire service have seen cuts, charities have also seen severe cuts.

In my town, we used to have an area-based grant, which was directed to areas of high deprivation, to support the community infrastructure that was so important. When the coalition Government came into power in 2010, they cancelled that with less than a year’s notice. The staff of community groups and charities that were set up to provide that support were just thrown on the scrapheap, as though the work they did in the community did not matter.

Given that it is customary for MPs to mention charities in their area, I want to pay tribute to the fantastic work of a range of charities in mine. There is a danger, when we do this, that we please a handful and really annoy a long list of people who we do not have time to mention. I want to mention Dr Kershaw’s hospice. Whichever community someone comes from in Oldham, they will be connected to that hospice at a time when they are at their most desperate, feeling pain that they never thought they would have to go through and not being sure how to cope when it hits. The hospice has given people who are nearing the end of their life the support, courage and confidence to get through that very painful time, and it is genuinely part of the community.

Like many places, however, we have community groups that, if we are honest, we would wish did not exist. I wish that Oldham did not need a food bank, and I wish it was not a thriving food bank, but it is. I wish that the Andy’s Man Club did not have to support people who feel suicidal, but it does. There are lots of other examples.

I could not help but notice that quite a big chunk of money was announced earlier, and we had a taste of some of the areas that are likely to receive some of the funding. Given the Members who have contributed here today and the work they have highlighted in their communities, I just hope that the funding, when the list is finally published, is fairly distributed by geography. I hope that it absolutely targets areas of need and deprivation, takes into account that some areas have been hit harder by public service reductions than others and really supports places where there is genuine working together across institutions.

This is not about good Government or bad Government, with charities over here and the community over there. When this works well, in the way we have heard about today, it is because everyone comes together. When a council works well, it is the community; when a charity works well, it is the community; and when a next-door neighbour checks up on an elderly relative—collects the post and does all the things we have talked about—that is the community. The fabric of our community is under great strain at the moment, and it really requires us to make sure that we begin to reinvest in it.

The Prime Minister made a promise that austerity was over, recognising that the pain had been very deep, knowing that it was a big factor in the referendum result and wanting to address that. Unfortunately, she was undermined by her Chancellor who had the opportunity in the autumn statement genuinely to end austerity and decided, “Well, to hell with it. Let’s just carry on.” They must have been quite enjoying the journey that they were taking. I would say that most people in this Chamber, if they are honest, are looking at their own local authorities, regardless of political complexion and geography—whether rural or urban, north or south—and wondering how on earth that council will be able to survive over the next couple of years.

Why is council funding so important? Because the council, which is democratically elected and of the community—people themselves elect who they want to be their voice in their town or city—comes together and brings people together, and it is often the first port of call. We cannot have thriving civil society if we have underfunded and starved local government; we cannot have thriving local government if we have not got thriving civil society; and none of that works if we have not got decent people. Whatever our view today, we should all be very proud of the country we live in. We are a mixed, diverse, vibrant country full of wonderful people who, every day, do amazing things.

HMRC Estate Transformation

Jim McMahon Excerpts

Tuesday 29th January 2019 Commons Chamber

[Mel Stride]

Rather like the question from the hon. Member for Rhondda (Chris Bryant), the suggestion is that we just do nothing and stay exactly as we are. That would not be to the benefit of the taxpayer. Frankly, that would not be to the benefit of the staff, either, who will have increased opportunities as a result of the changes we are bringing in.

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

Phoenix House in Oldham is due to close to relocate to Manchester city centre. The cruelty is that, when we asked whether a different site in Oldham could be considered, there was a categorical refusal to even shortlist a site, despite rents in Oldham being half the price of those in Manchester city centre. Does the Minister understand the anger felt in many of our towns, which are being cast aside in favour of our city centres by a Government who just do not care?

[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.

European Union (Withdrawal) Act

Jim McMahon Excerpts

Thursday 6th December 2018 Commons Chamber

[Mr Hammond]

This is not an economic forecast. It is a modelling of five different scenarios. Our economic growth rate in 2033 will depend on a raft of other issues, not only on the outcome of this debate.

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

Is it not the truth that there has not been time to consult with the organised trade unions because the Government have been consulting with the hard-line Brexiteers in the European Research Group instead of putting the national interest first?

My question is this: why did the Chancellor not support his Prime Minister in her pledge to end austerity in the Budget, which would have addressed many of the reasons for the divide in the nation he refers to?

[Mr Hammond]

I am not quite sure what the hon. Gentleman is referring to. In the Budget, I set out a clear plan for Britain’s future. I set out an indicative envelope for the spending review next year, which will show public spending increasing in real terms throughout the next spending review period. In most people’s definition, that is turning a very important corner for this country.

The economic analysis published by the Government last week clearly shows that, of the spectrum of outcomes for the future UK-EU relationship, the modelled White Paper scenario would deliver significantly higher economic output than the no-deal scenario, the FTA scenario, and even the EEA scenario. The proposed future UK-EU relationship is estimated to result in economic output around 7 percentage points higher than in the modelled no-deal scenario in the long run, once the economy has reached its post-Brexit equilibrium.

This is a deal that secures the rights of more than 3 million EU citizens living in the UK and around 1 million UK nationals living in the EU; a deal that takes us out of the European Union and sets a framework for an economic partnership with our European friends and neighbours that is closer than any other they have today, while allowing us to strike free trade agreements around the world; a deal that ends freedom of movement and regains control of our borders, not so that we can shut down immigration, but so that we can manage it in our own best interests, ensuring that our businesses and health service still have access to the skills they need—skills that we will need as we build on our fundamental economic strengths to give Britain the brighter future our citizens imagined when they voted in June 2016; a deal that delivers on the referendum result, while securing the achievements of the British people in rebuilding our economy over the past eight years; and, above all, a deal that can bring our country together again.

--- Later in debate ---

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

It has been a real privilege to hear the contributions by MPs today. We have got a real sense of just how different the issues are in each of our constituencies, just how varied our nation is and, in some cases, how divided our nation is. What there is absolutely unity on in this place is that this deal is nowhere near good enough. It is certainly not a deal that I am going to vote for when I am casting a vote for the people who live in Oldham West and Royton. That is not why I have been sent here. I have been sent here to try to secure the best possible economic and social advantage for the people I represent and live among in my community.

I have to say that throughout the negotiations no effort has been made to reach across and create a consensus—not necessarily about the future relationship with Europe, although that is important, but to address the underlying tensions that led people to vote leave in the first place. Those include the mass deindustrialisation that left many communities without the decent, well-paid and secure jobs to provide a future for themselves and their families; and the hollowing out of public services that has meant people have been left with 1% of the cake and are now fighting for the crumbs among increased competition. They cannot get a decent house. They are fearful of the education in the local schools. They cannot get access to the local GP or hospital. Why? Not because of Europe, but because of deliberate, targeted choices by the Tory Government who then wonder why they lost the EU referendum. That was a shock. That is why, in the document published by the Government that was sent to every house, there was no mention of what an alternative deal would be. There was lots of concern and caution applied, but no alternative was offered.

Another thing missing in that document was a single mention of Northern Ireland—not a single mention of Northern Ireland in the official booklet that went to every household in this country. Let us be honest: had it not been for the foolish calling of a general election in 2017, we would not even be discussing Northern Ireland today. It would be an afterthought. The only reason it is important now is that the Tories need the Democratic Unionist party to secure them in government—and that has now completely fallen apart. Thank God for the people of Ireland—both the Republic and the north of Ireland. We are now discussing this. We have seen such a cavalier approach to that hard-won peace in Northern Ireland for every community who lives there. It seems to be like a token that can be traded away, as if it is not important. I really wonder what condition this Parliament is in if it is so willing to cast aside those legitimate issues.

When I speak to people in Oldham about the things that matter to them, they want to know what the future holds for their communities and families. Is that not the cruelty of Brexit so far? At a time when we needed leadership and for the Prime Minister and the Government to say, “This is what Britain can be,” there has been nothing but absolute soundbites. Who has it been left to? Nigel Farage, Boris Johnson and Jacob Rees-Mogg, claiming to be the voice of the working class. How ridiculous is that? The only time you see them lot on an estate is when there are hunting rights at stake. Meanwhile, communities are being left and exploited and they will be exploited again unless this Parliament gets a grip.

I voted to trigger article 50 because I respected the referendum, but the way that this has been handled has been a national disgrace. The Prime Minister will lose this vote. She has not been able to unify this House, so what lessons can be learnt? The first, fundamental lesson is, “Don’t divide, but unite. Reach across the Chamber and secure a better deal.” I believe that there is a better deal, but I tell you what: it requires better negotiation than we have seen so far.

--- Later in debate ---

[Dr Fox]

The Government have the best interests of the whole Union at heart, which is why, for example, when we negotiate trade agreements, they are for the whole United Kingdom and not partial. The question was raised yesterday at the International Trade Committee whether the Government would implement during the backstop any trade agreement with the rest of the United Kingdom but not Northern Ireland. That would be very difficult to justify, exactly on the terms that the hon. Gentleman mentioned.

One of the most interesting speeches of the day was that of the shadow Chancellor, the right hon. Member for Hayes and Harlington (John McDonnell). In reply to the hon. Member for North Antrim (Ian Paisley), he said that the backstop would not be needed under Labour’s plans because there would be a customs union. That is patently untrue. The regulatory gradient that would exist would not remove the need for a border and would address neither the anxieties of the Irish Government nor those of us in the United Kingdom who believe in the integrity of the Union.

The right hon. Gentleman said that Labour would negotiate a “comprehensive customs union”, with a say in future trade agreements. Let me tell him what nonsense that is. Under EU law, the EU has exclusive competence over its common commercial policy, which includes trade agreements under article 207. The EU treaties set out clear provisions for concluding EU FTAs that provide a role for EU member states and the European Parliament. Those treaty provisions do not permit a non-EU member state—even one in a customs union with the EU—to play a decision-making role in concluding EU trade agreements. That was nonsense. It was another piece of ill-conceived Labour fantasy.

What we have heard today from those on the Labour Front Bench is an ill-researched, ill-understood, unrealistic and incredible policy. As we all know, Labour—to the great irritation of their socialist allies across Europe—are simply playing politics with this issue, at a time of great national decision making. They are out of their depth and not up to task.

[Jim McMahon]

On the backstop issue—the Secretary of State seems to have skirted it when challenged on it a number of times—the letter from the Attorney General, which has been sent to Members, was very clear that

“the Protocol, including Article 19, does not provide for a mechanism that is likely to enable the UK lawfully to exit the UK wide customs union without a subsequent agreement”,

and that remains the case even if negotiations have broken down. The points that have been made are accurate and the Secretary of State has managed to skirt around that without answering it directly. So answer it directly.

[Dr Fox]

No, I answered the question. What I was concentrating on was excoriating the Labour party for the policy that it has set out today—a policy that is delusional because it does nothing that it actually claims it does. To the irritation of the European Union, the shadow Chancellor and his team do not even appear to understand the European law that they are praying in aid for their own ridiculous case.

--- Later in debate ---

[Dr Fox]

If I may, I will continue.

In the Select Committee yesterday, my hon. Friend the Member for Yeovil (Mr Fysh) raised an issue that I would like to address specifically. He was concerned that the backstop rules would bind the UK to EU state aid rules. I understand that he was specifically concerned about the defence sector, which has a major role in his constituency. Having taken advice, I am happy to inform him that, under the backstop, the UK would still have an exemption from state aid rules in respect of defence measures.

One of the themes today that I really feel I have to deal with is the constant refrain from Labour Members about the causes that led people to vote leave. They talked about everything except that people were unhappy with membership of the European Union, and we got the same condescension and the same patronising attitudes. People voted to leave the European Union because, after 40 years of experience of moving from the Common Market into the European Union with greater and greater politicisation and moving away from the concept of an economic union, they did not like it. They did not like someone having legal authority over them. They did not like someone else determining how to spend their money or someone else determining their borders.

We need to be clear about some of the alternatives being put forward.

[Jim McMahon]

rose—

[Mr Betts]

rose—

Leaving the EU: Economic Analysis

Jim McMahon Excerpts

Wednesday 28th November 2018 Commons Chamber

[Mel Stride]

I am afraid that the hon. Gentleman’s question is predicated on a train that has left the station, because we are leaving the European Union on 29 March—we are going to honour the will of the British people as expressed in June 2016—but I can reassure him that of the various scenarios that these papers review, this Government’s hard-won deal with the European Union is by far the best of all the alternatives for his constituents.

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

I should say, with a background in local government, that had our cabinet been expected to make such an important decision without any financial information and without the legal advice being made available to the decision makers, the council would be in special measures by now. Let me just put the Government on warning: Members of this House will not accept this as fulfilling their responsibility when casting such important decisions. Does the Treasury accept that part of the reason why the economic shock will be felt in our regions is the chronic under-investment and the stubbornness, through austerity, in hitting those economies right at the heart of their communities?

[Mel Stride]

No. If the House agrees to this deal, and we proceed to get a deal with the European Union that does all the things that I have many times in response to this urgent question outlined to Members, it will provide confidence. It will provide further investment. It will support jobs. It will seek growth. It will see unemployment, which is already at a 45-year low, nice and low, where we want it to be. So I would urge the hon. Gentleman to support the deal and to do so on behalf of his constituents.

Finance (No. 3) Bill

Jim McMahon Excerpts

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

[Patricia Gibson]

I rise to speak in support of new clauses 14 and 15. The need for improved transparency over UK public finances is urgent and the case is compelling, which is why I was keen to speak on those new clauses. I note the other provisions dealing with tax avoidance that have been put forward and about which much has been said today.

There has been far too little consultation on the Bill with stakeholders, but what we do know is that we desperately need greater transparency over the UK’s public finances. I am deeply disappointed that amendment 24 was not selected, as there are particular issues of transparency around those companies that deliver public buildings at public expense. Particularly those engaged in public-private partnership projects need to be more open. There would have been cross-party support for that amendment, but the SNP was not asked to support it, which is a shame.

PPP projects need to be transparent and more accountable to the public in order to protect the public finances. They are a perfect demonstration of why that accountability and openness are so essential. So I have concerns about what is not in the Bill. We cannot talk in any context about openness in public finances without talking about the private finance initiative, and I believe that there is cross-party support to have that conversation. This was a Tory policy embraced by Labour. Indeed, George Monbiot has called the PFI situation:

“A racket, the legacy of 13 years of New Labour appeasement, triangulation and false accounting.”

The scheme was so enthusiastically embraced by the previous Labour Administrations, it was like a grand love affair. Scotland was not just the testing ground for this disaster—the first PFI project in Britain was the Skye bridge project—it also has a far higher proportion of such projects than anywhere else. Writer Gerry Hassan has pointed out:

“Scotland has 40% of PFI schools with 8.5% of the population.”

Why is that? Could it be that, like the poll tax, Scotland became the testing ground for the PFI nightmare? It certainly looks that way, although if anybody wants to contradict that, I am quite happy to hear what they have to say.

It is unacceptable that PFI companies often inhabit the shadows. Their tax arrangements need to be sufficiently transparent and open so that we can have proper transparency in our public finances and we can be confident that those being paid very lucrative sums—way over the odds for public buildings—are in turn paying their due in taxes and have financial arrangements that are transparent and open to the public. That is why these new clauses are important and why they need to be included in the Bill.

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

Is the hon. Lady aware that, in England, PFI schools under the control of local authorities can be taken away from the local authority and forced to academise, but the debt—the liability—stays on the books of the local authority? Does she believe that that is transparent and fair?

[Patricia Gibson]

It is absolutely not transparent and it is yet another example of how PFI has been nothing short of a disaster. It is our local authorities, our schools and our hospitals that are paying the price.

--- Later in debate ---

[John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)]

I want to discuss the clauses in the Bill that seek to tackle tax avoidance and evasion. Combined, these measures will seek to raise billions of pounds for our public services by further clamping down on this serious matter. My hon. Friend the Member for Walsall North (Eddie Hughes) identified clearly that these measures will raise much needed extra money for our public services.

Rather than raising taxes for businesses, this Government are focusing on making sure that tax liabilities are paid. They have a strong track record of clamping down on those seeking to avoid paying their fair share. This Budget builds on that track record, with no fewer than 21 measures to protect revenue and bring in more tax by tackling fraud, avoidance and unfair outcomes.

On a related point, I very much support the introduction of a new digital services tax, which is not technically a measure designed to tackle tax avoidance, but which will nevertheless make our tax system more fair and fit for purpose in the digital age. The Chancellor is right to try to find a global solution, but in the meantime this measure is a step in the right direction that will make the tax system fairer for small businesses in high streets in my constituency in the Scottish borders that are struggling to compete with the likes of online giants such as Amazon. Of course, in Scotland, these businesses are also struggling with the high tax regime imposed on them by the SNP Scottish Government in Holyrood.

Other clauses in the Bill, such as those to ensure that HMRC is a preferred creditor in business insolvencies, that more tax is paid to the public purse and that we crack down on insurance companies routing services through offshore territories, are certainly welcome.

[Jim McMahon]

Does the hon. Gentleman accept, though, that the trade-off with the digital sales tax and the relief being offered to some premises in town centres just is not enough? Take, for instance, the former Textiles Direct unit in my local shopping centre, which has been empty for some time, but has a rateable value of £500 per square metre. Compare that to the Amazon warehouse near Manchester airport that pays just £44 per square metre. How can it be right that the gap is so large?

[John Lamont]

Clearly, I cannot speak about the circumstances in the hon. Gentleman’s constituency, but these measures are clearly a step in the right direction. I know the number of businesses in my constituency that contact me. They are competing with online businesses and other digital platforms to provide the same or similar types of services. It is just not fair when businesses are able to run very profitably, making a big turnover from a garage or attic, when at the same time the same service or shop on the high street is paying significantly higher business rates. Of course, in Scotland, we have the additional challenge of the additional taxes that businesses are having to pay through the Scottish Government’s high-tax agenda.

--- Later in debate ---

[Luke Graham]

I appreciate that; I am sure that it will be well recorded in Hansard.

I, too, was an active participant on the Sanctions and Anti-Money Laundering Bill, and I agreed with the hon. Member for Oxford East on many points, especially about looking at the actions taken on overseas territories and Crown territories. In accepting some of the amendments, the Government committed to a course of action, and I am sure they will be pushing that through.

Tax collection is one of the most important duties of the Government. Whether in central Government, the devolved Administrations among the nations or, indeed, down in local authorities within the devolved Administrations and right across the United Kingdom, tax collection and record keeping are incredibly important. I welcome some of the measures introduced by the Government to increase the resourcing to HMRC. I would hope to see from right hon. and hon. Members the sharing of best practice and that we ensure that some of the people working for our tax collection authorities around the United Kingdom are going right around the United Kingdom. A number of local authorities need additional support and help with tax collection, and the sharing of best practice in technology, to ensure that they are actually collecting the tax revenues they are due.

I have two local authorities in my constituency, Perth and Kinross Council and Clackmannanshire Council, both of which face very extreme council funding issues in terms of raising local funds and cuts imposed by Edinburgh. When we look at the local services that have had to be cut as a result of the reduction in funding from Edinburgh, despite the increase in the Scottish block grant, we see that it is having a significant impact on education services, health services and local street services in my constituency. I would hope that even SNP Members could put pressure on the devolved Administration to make sure that they focus on proper tax collection, and also on proper tax expenditure.

As I have said, action taken by this Government has helped to bring in over £185 billion of additional tax revenue that we would not otherwise have been able to collect. Corporate tax revenues have also increased.

A key point has been raised—many Labour Members have spoken about it—about inequality when talking about absolute and relative poverty. This is important to note, because I think that the House should look at more objective statistics. In last night’s debate, I talked about strengthening the OBR to make sure that we can have credible statistics that Members on both sides of the House recognise, acknowledge and accept.

One key aspect of that is to look at the Gini coefficient, which has been recognised as a measure of inequality for a long time. If we look at the Gini coefficient in 2010 compared with where we were in 2016-17, we see that there has been a reduction in the coefficient, which means an improvement in the living conditions of people in the United Kingdom. Inequality has actually reduced according to the Gini coefficient.

[Jim McMahon]

rose—

[Luke Graham]

I think that is a good thing that should be welcomed, as I am sure the hon. Gentleman agrees.

--- Later in debate ---

[Jim McMahon]

Statistics can always be massaged to fit the agenda of the person citing them, but what cannot be escaped is the fact that increasing numbers of people are queuing up to use food banks because they cannot afford to feed their families and put food on the table. That is my measure of whether this country is doing well. How does the hon. Gentleman respond to that?

[Luke Graham]

The hon. Gentleman proves my point. He disregards an objective Gini coefficient statistic, which is accepted worldwide, and instead puts forward a subjective view on food banks that is widely contested across the House.

I would say that the increase of food banks is a major issue that we have covered extensively in debates in the House. However, taking those on the lowest incomes out of income tax altogether, getting more people into work and introducing the national living wage are the kind of measures that really do improve things for the poorest in society, and they are exactly what the Government are delivering. Our Budget has not only prioritised expenditure elements—I welcome a city deal in my region, the Tay region, with £150 million of extra expenditure—but focused on how to get more tax collected.

As I said at the outset, it is important that we have a low-tax system that is also a fair system, and that the people who should pay tax are paying the right amount.

Oral Answers to Questions

Jim McMahon Excerpts

Tuesday 6th November 2018 Commons Chamber

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

In truth, this is very small beans for high street stores. It is correct that some people will benefit, but also correct that many of our town centres and shopping centres have vacancies that this will not even touch, so what more can Government do to address the fundamental unfairness in the system?

[Mel Stride]

The hon. Gentleman is right inasmuch as he points to the fact that high streets need to reinvent themselves—to transition—in order to adjust to the growth in online marketplaces. That is exactly what our future high streets fund is all about, with £675 million going out via local authorities, following competitive bids, to make sure that we reshape those high streets in exactly the way that he would like them to be reshaped, get rid of the shops that are shut down and reinvigorate and rejuvenate the very centres of our communities.

Finance (No. 2) Bill

Jim McMahon Excerpts

Committee: 2nd sitting: House of Commons
Tuesday 19th December 2017 Commons Chamber

[Bim Afolami]

I believe that all policy in this area, or, frankly, in any area, should be set to make sure that we are trying to generate as innovative, dynamic and successful an economy as possible. The hon. Member for Walthamstow (Stella Creasy) mentioned cutting corporation tax in her speech. She thought that that effectively benefited more men than women because men are more likely to be shareholders than women. The way we should deal with that, in my view, is to encourage more women to be entrepreneurs. We should work to make sure that women have access to being shareholders and that women have more ability to reap the benefits of that—

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

Will the hon. Gentleman give way?

[Bim Afolami]

If I may, I would like to make a bit of progress.

As the evidence has shown, cutting corporation tax increases, rather than decreases, the tax take going to the Exchequer. If that shows this country to be a better and more dynamic place in which to set up and start a business, that will benefit all people in this country. That is the approach that the Government should take. If we want to improve the performance of the British economy and if there happen to be more men than women who are shareholders, it is no answer to say that we should therefore not take action to improve the activity of the British economy.

--- Later in debate ---

[Bim Afolami]

I will conclude my remarks by saying that it is important when we talk about these issues—in this House or outside—always to remember that improving the performance of the health service, the economy or anything relating to Government policy will benefit everybody in this country, if we make the right judgments and the right policy.

[Jim McMahon]

Well, well, well. When it comes to naivety, there is a very fine line; it can often be endearing before it eventually becomes quite offensive. And I did find the speech of the hon. Member for Hitchin and Harpenden (Bim Afolami) offensive. It began in the spirit of naivety. I could see that he was nervous at the beginning of his contribution—quite rightly, it turned out, towards the end—because he did not have the data that was being presented.

The debate went on and Labour Members presented the data, but rather than actually taking account of it, the hon. Gentleman continued, in a very odd way, to try to defend what most reasonable people would say is a quite indefensible position. He was essentially saying, “Listen—if men are doing okay, surely women will eventually do okay too.” I am not sure whether the solution he came up with to the shareholder conundrum was for women to find wealthy husbands who are shareholders, as if that might somehow lift them out of poverty and allow them to be the beneficiaries of the cuts in corporation tax.

[Ian Mearns]

We have discovered a new phenomenon: it is called trickle-down gendernomics. It is going to be the resolution to all the problems of poverty and the disparity in earnings between men and women in all our communities up and down the country—I don’t think so.

[Jim McMahon]

That is a fair point.

[Stella Creasy]

Obviously, having had two women Prime Ministers, that is quite enough women earning a serious level of income—the 33 million other women in this country do not deserve equal care and attention. This data would help us to find out just how much inequality there is and what we could do about it. Does my hon. Friend agree that facts should override fiction?

[Jim McMahon]

I think that where the hon. Gentleman was trying to get to—I will be generous—was that these things are symbolic and that symbolism in politics is quite important. However, to me, it is more symbolic that 46% of women have to skip a meal so that their children can eat. It is quite symbolic that women continue to be underpaid compared with men, and it is symbolic that the decisions the Government are taking disproportionately affect women on low incomes—the people who are trying to keep households together and who are raising the next generation of young people, who, because of this Government, will not have better life chances than the generation that went before them.

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

Will the hon. Gentleman confirm that it is also important that it was women politicians and women workers who campaigned and argued for the Equal Pay Act 1970? Will he also confirm that outstanding equal pay cases are at an all-time high?

[Jim McMahon]

That is absolutely right, but let us be honest: the Government are not in listening mode. They do not want to take into account what could have been constructive new clauses—new clauses 6 and 7. What they want to do is to maintain their stubbornness and their silence. They think that if they ignore this issue, there is not a problem in society, when we know that there is.

In terms of the pressures on income that many people in our communities face, the new clauses go beyond just gender inequality, and talk about disability and race as well. The Prime Minister has been clear that she wants to address the discrepancy in terms of opportunity, incomes, housing and the criminal justice system with members of the ethnic communities in this country. However, when we look at the way the Government have approached the Budget, the evidence just does not support that. If we look at the public sector, for instance, little effort is being made to widen participation in public sector jobs to members of the ethnic minority communities. In my constituency, a third of residents are predominantly Pakistani and Bangladeshi, but they are nowhere near properly reflected in the make-up of public services. In towns such as Oldham, where industry has, by and large, been hollowed out, the public sector is the place where people go for decent-quality, well-paid and, previously, quite secure employment. If people are restricted from entering those jobs, for different reasons, that has a material impact on their ability to lift themselves out of poverty, to get on in life and to do well.

When the coalition Government came into power, it was interesting that one of their very first acts of many that devastated towns such as Oldham was to cut the funding that went to Remploy. Remploy had a network of factories across this country that used to support people into supported employment. Those were not sympathy jobs, in the way I heard people say they were at the time; they were real jobs, and they produced goods of quality that people wanted to buy. In Bardsley, in my constituency, that meant a full factory employing 114 people making windows that they would sell to industry, housing associations and the private market.

[Sarah Champion]

The reason we want the equality impact assessment is not handouts; we are looking for a level playing field so that everybody can reach their economic potential and Government policies are not hampering that. Does my hon. Friend agree?

[Jim McMahon]

That is absolutely right. This is really odd from my point of view, because I have come from local government. In local government, when people are setting their annual budget, they have a legal responsibility to make sure that these audits are carried out and that proper consideration is given to the impact on protected groups. The Government now seem to believe that legislation passed in this House is good enough for one part of the public sector but not the other, but I am afraid that that just does not hold water. A lot of public bodies—whether it is the NHS, local government, a police force or anywhere else in the public sector—will be looking at the Government and thinking that there is a lot of hypocrisy in the laws passed here, which the Government do not seem to apply to themselves.

[Justin Tomlinson (North Swindon) (Con)]

Specifically on Remploy, yes, there were some great practices there, but the Government made that decision because very few were able to progress into work, and we wanted to create more opportunities so that more people can benefit. That is partly why we have seen an extra 600,000 disabled people find work, which is a great thing.

[Jim McMahon]

How dare the hon. Gentleman suggest that the 114 people working in that factory in Oldham were not in proper employment? They were producing, they were manufacturing, they were selling, and people wanted to buy the goods because they were of a high quality. It was not a handout or a giveaway. They were not sympathy cases: they were people who were working hard in a supported environment to produce something that people wanted to buy.

In some ways, this is the problem that we face. When the problem is so disconnected and not part of the everyday experience of Conservative Members, it is easy for them to ignore it. I cannot ignore it. When I go back to Oldham West and Royton, it is my community. I see the impact of cuts, of austerity, and of suppressed wages. I see the hollowing out of our employment structure. All right, people at the top are doing very well, and there are more jobs at the bottom, but the middle has been completely taken out. People talk about an economy that will support people into better employment, while 8 million adults and children are living in poverty in working households.

That is the economy we have in this country, because the routes of progression in employment simply do not exist. We are happy to be the bargain basement employment capital of Europe in this new relationship—let us be honest. Providing that the bankers and the insurance services are all right, we really do not care what it means for the rest of the economy as long as there are people working at Costa Coffee to serve the coffee in the morning. That is what the Government really believe. It is okay hon. Members shaking their heads, but where has the investment in our key industries gone? We need investment in manufacturing and engineering, creating jobs that produce things that people want to buy, pay decent wages, and support people into a lifelong career so that at the end of it they have a decent pension.

Speaking of pensions, what did the Government do in the autumn statement for the WASPI women? These women have worked and contributed all their lives, doing everything that was asked of them by Government. At the last minute, planning for their future, they were left cut adrift, and when they came to the Government to ask for support, the Government turned away.

[Bim Afolami]

rose—

[Jim McMahon]

I absolutely give way to the hon. Gentleman if he can justify that.

[Bim Afolami]

Would the hon. Gentleman welcome anything at all in the Government’s recently announced industrial strategy, which was, in many respects, targeted towards some of the poorer communities in this country?

[Jim McMahon]

I am going to give the hon. Gentleman a real answer on this point and not just grandstand, because it is important. I will explain the problem with the industrial strategy as it stands. For a town like Oldham, it is absolutely critical that the UK has an industrial strategy that holds water—that is forward thinking, ambitious, and has a framework of funding to support growth. I would welcome an industrial strategy that did that, and I think that when it started, that is what it tried to do. The problem is that something fairly dramatic has happened in the meantime, and that is Brexit. What I would have expected the Government to do in the context of the referendum result is not just to dominate Parliament’s time with the transitional and transactional relationships with Europe now and when we leave. I would have expected the Government of the day to produce a real, compelling vision of what type of Britain there is going to be when we leave the European Union. That has not taken place. The domestic legislation coming through this place is non-existent. Money is being taken out of vital public services that would be the foundation for the type of industrial strategy that is being talked about. Money is being taken away from our education and skills system, which would be the starting point for any investment strategy in our economy, particularly in manufacturing and engineering.

So would I welcome anything in the industrial strategy? I would simply welcome the principle of an industrial strategy, but it cannot be done on the cheap. We have seen—let us be honest about this; it transcends different Governments—a complete turning away from UK manufacturing and engineering, at the cost of the communities that people in this place represent. In order to replace that with a forward-thinking industrial strategy, the resources then have to follow, and we have not seen that—we have seen the opposite. Money has been taken away from our Sure Start centres and from our schools. Our colleges are chronically underfunded, with many on estates that are crumbling, struggling to keep up even with basic maintenance. Our apprenticeship system is in tatters since the introduction of the apprenticeship levy. All these things matter if we have a forward view about what type of country Britain can be.

The new clauses are important in that context because if we want to create, after Brexit, an inclusive and fair Britain that allows everybody to benefit, we have to make an honest assessment of where Britain is today. We are not in a good place. Our economy is shot. Our job market has been hollowed out, and the good, well-paid jobs in the middle have been taken away. Our housing stock is not fit for purpose and we are investing £9 billion a year into the pockets of private landlords, although we know that 40% of that stock does not even meet the decent homes standard. Those are the really important issues that Members need to think about. If they do not take proper account of what the information tells us, how on earth can we collectively make informed decisions that send us in a different direction?

--- Later in debate ---

[Stella Creasy]

My hon. Friend is making a powerful case. Whether Members on either side of the House agree with the policies, having good data to enable us to understand their impact helps us to make or dispute an argument. I am struggling to understand why any MP would be against having the facts about the impact of policy, which is all that the new clauses will do. If we had that information, Government Members could confidently tell us what great proposals they are making to improve the country’s prosperity, rather than using anecdotes—or two women.

[Jim McMahon]

I believe it comes down to priorities. If the Government were determined to do something about this, having the evidence base would be of great benefit to them. They do not want to do anything about it, so the evidence base is a hindrance because the Opposition can use it to attack the Government about the fact that progress just is not being made. That is the real reason why the Government are not making progress, and why they are determined not to support the new clauses. It would be far better for the country if the Government were to step up, to be honest and to recognise that the country has some really ingrained challenges that we need to face. Understanding the scale of the challenge from day one is important in making sure that we get into a better position.

My challenge is this: why not? If the Government believe that they are doing the right thing, and that by virtue of their second female Prime Minister they are the party of gender equality and the champions of all that is equal, now is the time to prove it. Members have two choices: they can go through one or other of the voting Lobbies. Perhaps they have a third choice, which is to stay away completely. They can get behind the new clauses and support our request for the data set, which will inform decisions; they can shirk responsibility entirely and stay away from both voting Lobbies; or they can keep their heads down and maintain their own position on the Government Benches, and vote against new clause 6 because it happens to have come from the Opposition. I would say that that is not putting the interests of the country first.

[Kirsty Blackman (Aberdeen North) (SNP)]

I would like to start by correcting an omission that I made yesterday. I should have said that our thoughts are with the Chairman of Ways and Means and his family at this time. It sounds like a really horrendous thing for a family to go through, particularly at Christmas time.

I thank the shadow Minister, the hon. Member for Brent Central (Dawn Butler), not just for tabling new clause 6, but for the way in which she engaged with us in advance of the debate. I appreciate the time that she took to speak to us about the new clause so that we could discuss how it looked. I think it is absolutely brilliant; it is one of the best new clauses that we have seen when considering a Finance Bill, and I have tabled a few in my time. I want to speak in favour of the new clause and state our support for it.

I will start by covering why we need the new clause. Although there has been a bit of discussion, we have not talked about what it means in its widest sense. Subsection (2) talks about

“the impact of those provisions on households at different levels of income”,

as well as on protected characteristics, the public sector equality duty and

“equality in different parts of the UK and different regions of England.”

A lot of the debate today has focused on women, which is completely reasonable, but the new clause captures several other things that could have been more fully discussed.

Why do we need an assessment of the impact on various groups, particularly those mentioned in new clause 6? We need it because people in the protected groups or at the lower end of the income spectrum have been disproportionately hit by the actions of this UK Government, as can be seen in a number of ways. It can be seen in the fact that we have young people in jobs on zero-hours contracts. We have those jobs, and the Government say it is wonderful to have so many people in employment, but despite that, we are not seeing an increase in household disposable income because people are not receiving the wages they should receive for such employment. They are in precarious jobs and they are not receiving enough money, and the benefits freeze has been a major added factor. It means that people are earning even less, because the benefits freeze has hit them doubly.

The Government have caused another issue by reducing disability payments. The UN has said that the UK has not done enough to ensure that the UN convention on the rights of persons with disabilities is being met, and no Government in any developed country or nation should seek to be in such a position. We have not had a proper assessment of the impact on disabled people of the changes that this UK Government have made.

The UK Government have also not taken seriously their responsibility to young people in society. We have a living wage that people cannot live on: it is not calculated as something that people can live on; it is a pretendy living wage put forward by the Government. It is not applicable to people younger than 25. Therefore, we have a living wage that people cannot actually live on, but the Government somehow think that the labour of people under 25 is worth less than that of those over 25, even though they may be in exactly the same job and should therefore be earning the same amount.

As has been pretty widely covered, the Budget and successive policies of this UK Government have a disproportionate impact on single parents, the majority of whom are women. We see a disproportionate number of them coming through the doors at our surgeries. Do you know what, Mr Owen? It is absolutely and totally ridiculous that we are seeing a rise in rickets in this country. We are seeing people who cannot afford to eat or to give their children nutritious food because of the decisions of this UK Government.

HMRC Closures

Jim McMahon Excerpts

Thursday 2nd November 2017 Westminster Hall

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

This is a really important debate. To provide some context, the HMRC office in my constituency closed in 2014, with staff relocated to Manchester, so I can give the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Stuart C. McDonald) two ends of the perspective: I can tell him about the conversations that took place before the closure and about the impact on the town, after the closure.

If the plans are about value for money, we have to ask ourselves why HMRC head office still occupies some of the most expensive real estate in Europe, at the Treasury. That building would make a fantastic five-star hotel, I am sure. The plans are not about value for money but about a fixed view of government, which is, “To hell with towns!”

If all we do is focus on our city centres, we will not be able to realise the true potential of our country. If all we do is to think that what matters is to have our cities thriving, at the expense of the surrounding towns, this country will not move on and make progress—we will not address that very real anger that I felt during the Brexit campaign. People were saying that they were sick of the settlement they have been given, they are sick of industry and well-paid, decent jobs going, and they are sick of seeing their town centres in decline. Those who are in a position to do something about that seem completely indifferent to the impact on their communities.

[Imran Hussain]

My hon. Friend makes his point, as always, very eloquently. He mentioned Brexit, and another angle of that is that many of the HMRC proposals were decided before the European Union referendum. Does he agree that once the Brexit negotiations reach a settlement—if we ever get one—that will inevitably cause issues for HMRC, not least the customs union and related areas? Is that not enough to put the HMRC proposals on pause at least until we get to that stage?

[Jim McMahon]

That is a good point. One of the biggest gaps in the whole Brexit conversation is not only the transactional relationship with Europe and what our future relationship will be but the biggest deficit in all our debates—what type of United Kingdom will we be at the end of Brexit? What type of Britain do we want? What will our communities look like? How will our economies be framed in the future? It strikes me that there is a complete absence of a direction and a vision for what type of Britain there can be after Brexit. I feel that in Oldham.

The frustrating thing about the HMRC relocation from Oldham to Manchester is that there was no value-for-money assessment. A wider review was done, which said, “If you close x number of offices, you will save money for the public purse”, but no financial assessment was made of the decision to relocate from Oldham to Manchester. That was admitted by the Minister in a February written answer to me.

Let us think about this: if the relocation was meant to be about value for money and about saving money for the taxpayer of this country, why would HMRC relocate from a town where the average office cost is £70 per square metre to a city centre where the average cost is £120 per square metre? Why would HMRC not do an assessment? If we need to rationalise the number of offices in a conurbation, surely we assess the cheapest and most efficient place to put the ultimate office when all the others have been merged into that one. However, that did not take place.

I am pretty sure that part of the reason why that did not take place is the same reason why we have seen the county court closed and relocated from Oldham to Manchester, and why we have seen our magistrates court closed too. It is because the people doing the assessment, or the people who are making the decisions, do not live in Oldham; they do not even live in the north of Greater Manchester. The people making the decisions live in the affluent suburbs, closer to where the offices will ultimately be located when the decision is made. That is fundamental: what voice did staff have in the conversation?

[Chris Stephens]

The hon. Gentleman raises an important point. Does he agree that local knowledge is vital and that in terms of minimum wage compliance, an office in Oldham would know who the rogues were in Oldham, not elsewhere in the country?

[Jim McMahon]

The hon. Gentleman makes a very fair point. The relationships among other local service providers are equally important—the local authority and the local police in Oldham know what is going on in the community. Those localised conversations can no longer take place because the facility is not in the town as it used to be. It is ridiculous that Phoenix House, where HMRC was based in Oldham, is right outside the Oldham Central stop of the Metrolink tram line that takes just 18 minutes to get to Manchester city centre. It would have been very easy to make Phoenix House the new regional hub if there was a desire to do that, but the truth was that it was not even on the list for consideration because it was assumed that the regional hubs had to be in the city centre, at the expense of the town. That is shameless.

The Government tell us that times are hard, austerity bites and we have to live within our means, so surely there is a greater onus on them to maximise every bit of public investment where there is capital or revenue, and to provide proper scrutiny of where the investment goes, to make sure that the money is spent in the most efficient way for the taxpayer. The Government themselves have said that they did not do that. At best, that is approaching bad administration. The very basic things that I would expect a Government to do when spending public money—ensuring that it has the best effect—have not taken place.

What does that mean for a town such as Oldham? The loss of 2,000 staff by the local authority, on top of staff losses at the county court, the magistrates court, the police service and a range of other public institutions in the town, means that there are fewer people going out at lunchtime to buy a sandwich and supporting the local retail environment. There are fewer people going out shopping and using the bars and restaurants after work. There is less footfall in the town generally of people supporting the local economy. None of that was taken into account. We ask what was the local economic impact assessment; the answer is “there wasn’t one”.

If the Government are serious about having a stronger Britain after Brexit, about ensuring that public money is used to the best effect and about ensuring that our towns can be as strong as our cities, it is important to have a new approach. That new approach has to be to ensure that central Government decisions take into account the economic decisions at a local level. We also need to ensure that there is joined-up government. Government Departments that do not talk to one another are doing estate reorganisations in HMRC, the Department for Work and Pensions, local authorities and sub-regional government. No one has asked the basic question, “If we’re being forced to reduce staff and to reconfigure office accommodation, would it make sense to come together in Oldham and share office provision in that town, to support the local economy?” The conversation is not taking place.

It is too late for Oldham. That callous, reckless decision has been made; it has not provided value for money to the taxpayer and it has kicked Oldham when it was already struggling to get up from the ground. But there is still a chance to do the right thing for the towns that have not yet seen their office closed. I urge the Government to do the right thing.

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[Imran Hussain (Bradford East) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Davies. May I put on the record my appreciation of your work in this area? You, like me, have made a case for Bradford, and you continue to do so.

I thank the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Stuart C. McDonald)—I have failed miserably to pronounce that—for securing this important debate. Hon. Members from across the House have made forceful and persuasive arguments, and I hope that the Minister really listens and tries to understand Members’ genuine concerns about these ill-thought-out proposals. I am also grateful to my hon. Friends the Members for Keighley (John Grogan), and for Oldham West and Royton (Jim McMahon), both of whom made very good points, some of which I will try to elaborate on. In particular, the point about value for money that they both made eloquently needs to be looked at much further, certainly in the case of the Bradford district and the negotiations that have led us to where we are.

Let me set out the impact of the proposals for the Bradford district. The closure of the HMRC offices would have huge financial consequences for Bradford. As well as potentially putting 2,300 high-wage jobs at risk, it would mean a £110 million reduction in the district’s gross value added, and the loss of around £10.5 million of district retail spending. The local authority would lose out on £1.2 million in business rate receipts, and there would be a £2.5 million increase in public spending costs. Put together, those things would be disastrous for the Bradford district.

I mentioned fairness and inclusion in an intervention. Two thirds of our civil service jobs come from HMRC. The Bradford district is already at the bottom end of comparable towns up and down the country in terms of high-wage, high-skill Government jobs. It really is unfair to impose this closure on the district. I absolutely accept that Leeds, where it is proposed the regional hub should be, is a great place for business, but my hon. Friend the Member for Keighley made the pertinent point that there is a real danger that putting more civil service jobs in Leeds will overcrowd the private sector there, so this may not be a good thing for Leeds, either.

Let me come back to value for money and the economic case that hon. Members eloquently set out, and use Bradford as an example. The case put forward by Bradford would have saved £30 million, compared with the current proposals. That is a huge figure. As my hon. Friend the Member for Oldham West and Royton pointed out, there would have been lower accommodation costs per square metre, shorter commuting distances and lower redundancy and relocation costs, so why was that case not considered?

[Jim McMahon]

Does my hon. Friend agree that the consistent message that value for money reviews were not carried out when offices were relocated probably warrants a referral to the National Audit Office?

[Imran Hussain]

As always, my hon. Friend is absolutely right. These issues are arising with increasing consistency and, frankly, I believe that more needs to be done about them.

I come on to the workforce. The hon. Member for Ochil and South Perthshire (Luke Graham) made the good point that these decisions have to be about more than just value for money; they have to be about community, too. That point should not be lost. In Bradford, we have one of the most diverse and vibrant workforces, and one of the youngest populations. We have 84,000-plus work-ready people with degrees. We have Bradford University, which is a centre of excellence for MBAs. We have many things to offer, and those frankly have just been ignored.

Much has been made of the argument that Bradford is not the right location and does not have the same connectivity as Leeds. We may not have the same connectivity, but we have suitable connectivity. We have real proximity to the M1 and the M62. Although we may not be where Leeds is, we are certainly not far away from connections, so that argument does not persuade me.

The powerful business case for Bradford was completely rejected. We have heard from hon. Members from across the House that all the cases that have been put forward have fallen on deaf ears. We have shown today that no economic case—no value for money case—has been established for these proposals. That makes me wonder whether they are the result of decisions by individuals sat in ivory towers, who chose places that were better for them to work and live in. That is the real question, and I urge the Minister to answer it.

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

It is a pleasure to see you in the Chair, Mr Davies. Like other hon. Members, I thank you for your guidance and support and your interest in this area. First, I refer the House to my entry in the Register of Members’ Financial Interests and my position as chair of the Public and Commercial Services Union parliamentary group. As you are aware, Mr Davies, we have been here debating HMRC office closures many times, and each time I and other Members have asked HMRC to think again and pause for thought.

The debate was opened superbly by my hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East (Stuart C. McDonald), who rightly thanked HMRC staff for their contribution. I will give some statistics to back that up. He rightly mentioned the low staff morale in HMRC as a result of the way in which management have handled the issue.

What was most telling in the contributions so far—it is the common thread—was the social and economic impact that the closures will have in towns and cities across the UK. We heard from the hon. Member for Keighley (John Grogan), and my hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron) talked about East Kilbride being Centre 1 for tax collection services in Scotland and the UK, and the lack of consultation by HMRC with parliamentarians. We also heard from the hon. Members for Oldham West and Royton (Jim McMahon), for Stockton South (Dr Williams) and for Bradford East (Imran Hussain), who continued the theme of the social and economic impact that the closures will have in their communities.

The starting point was 12 November 2015, when HMRC announced plans to close nearly every office—approximately 170 in the HMRC estate—and replace them with 13 regional centres and four specialist sites, mostly based, as we have heard, in major UK cities. The plans were titled “Building our Future” and if implemented in full would involve vast areas of the UK being left with no local HMRC office, including restricting the department to two offices and one specialist site covering the entirety of Scotland; two offices and one specialist site covering the entirety of the midlands; two offices and two specialist sites covering the entirety of London and the south-east of England; two offices covering the entire north-west of England; two offices covering the north-east of England and the great region of Yorkshire, Mr Davies; one office covering the entirety of Northern Ireland; one office covering the entire south-west of England; and one office covering the entirety of Wales. Like many hon. Members, I am gravely concerned that, if the plans are not halted, they will leave vast areas of the country with no nearby HMRC office. I am also concerned that, more than 15 years on from the troubled private finance deal that HMRC entered into with the contractor Mapeley, significant risks remain in the handling of the contract. The Department has learnt nothing. A National Audit Office report draws attention to the fact that HMRC has not negotiated

“any break points in the 25-year leases it has signed so far for regional centres in Bristol and Croydon.”

Of course, there have been some changes to those plans—not all of them for the better. Let us go through them in turn. The original proposals meant there would be no physical presence in East Anglia. HMRC has subsequently decided to retain a presence in Ipswich, first as a specialist site but potentially to include broader work streams. Plans to close the only Welsh-language unit have also been dropped, with staff now co-locating with the Department for Work and Pensions—that is a point I will develop later in my contribution.

The estate negotiations on the location and buildings for the proposed Manchester regional centre are taking longer than HMRC initially anticipated, meaning that the regional centre will now open at least a year late, and possibly even later than that. When it eventually opens, it will do so in two phases. The overall capacity of the regional centre is in a state of flux, forcing the Department to extend the existing leases of three major sites in Manchester.

There have also been problems in Northern Ireland; the opening of the Belfast regional centre has been subject to significant delay. In other areas, closures have been brought forward, including at Blackburn, Bolton, Netherton and St Helens in the north-west; Derby, Worcester and two sites in Solihull in the midlands; and York in the north. Those closures, with point-blank notice, cause significant stress, upset and practical difficulties. That is not an efficient way to run a Department.

As a direct result of staff leaving the Department because of the office closures, HMRC is losing a vast amount of irreplaceable experience. Based on data provided to the Public and Commercial Services union by HMRC, in 2017 alone the Department will lose the equivalent of more than 17,000 years of staff experience, and the vast majority of that comes from customer compliance work.

We believe that the “Building our Future” proposals are completely driven by the deadlines within the STEPS contract of 2021 and that those are flawed. The existing proposals should be put on hold until appropriate parliamentary scrutiny, public consultation and socio- economic impact assessments are carried out.

[Jim McMahon]

Does the hon. Gentleman agree with my suspicion that the end was decided before the criteria that support it?

[Chris Stephens]

I do, and I think it has been driven by cost. One other area is that while I and my hon. Friends were campaigning in our constituencies to get re-elected, HMRC, during purdah, was signing contracts, and it did not wait until after the election to inform the House of those changes. I sympathise with the point that the hon. Gentleman made. Of course, during the process, we had the Concentrix disaster. HMRC had to terminate its contract early because Members of Parliament from right across the House had major complaints about how Concentrix was dealing with its business.

In the National Audit Office’s report, the key findings stated that:

“it will be longer until HMRC starts to realise savings. In the long term, it still expects its new estate to reduce its running costs. It now estimates cumulative efficiency savings by 2025-26 of £212 million, reduced from the £499 million estimated in its strategic outline case in November 2015. By 2025-26, HMRC expects its annual running costs to be £83 million lower than they are now”.

Whether it is £83 million, £212 million or even £499 million, those are drops in the ocean compared with the Government’s own accepted figure for the tax gap of £36 billion. The figure researched by the Tax Justice Network and PCS puts the tax gap at £119 billion. A major reorganisation and rationalisation of the most vital Government Department, putting at risk the very ability to carry out the tax collecting function for savings that are not properly costed, is irresponsible management and governance.

The Scottish Government are consulting today on the Scottish approach to taxation, to accompany gradual increases in its taxation powers. HMRC’s plans could well result in the severe limiting of HMRC expertise based in Scotland, which will become even more important as the Scottish Parliament debates increases in taxation.

--- Later in debate ---

[Peter Dowd]

The hon. Gentleman is absolutely right. Some of them cost an arm and a leg. The Minister should take on board the question of perception. In a democracy, when we are in the middle of an election, it might be technically, legally and administratively okay to do this, that and the other.

[Jim McMahon]

I am afraid that I do not buy the Minister’s explanation at all. The delays to the lease being confirmed for the Manchester office meant that additional costs were already being incurred. The incurred costs for one scheme were because of commercial and development reasons. The Government say that they could not wait for purdah to complete, but that would have given a new, incoming Government the freedom to change that decision. The situation is very odd.

[Peter Dowd]

My hon. Friend makes an excellent and valid point. The Government should think those sorts of things through.

As I was saying, there is, at the very least, an issue of perception about whether this is all above board. Even if it is above board, it has to be seen to be above board. The issue is that people do not feel that that is the case. We all feel that something is not quite right. In a democracy, we have to be seen to be above board. That feeds into the concern that some of us have that Parliament is being ridden over roughshod on a whole range of issues. For example, we did not have Opposition day debates for months on end. When we did get them, the Government virtually did not turn up to respond, and they continue to take that approach. It feeds into the perception that they are developing contempt for the views of Members in this Chamber and, specifically, the main Chamber.

There is a perception—and in this case, it is a reality—that the Government treat people with contempt. A briefing on the civil service compensation scheme feeds into that narrative:

“On 18 July 2017 the High Court held that the Government had failed to comply with the duty to consult prior to amending the CSCS, in that it had imposed conditions on union participation in the consultation process.”

That seems to be saying, “You either agree with us in advance what we want you to discuss, or you’re going to be brushed aside and not considered.” The briefing continues:

“As such, the 2016 amendments were unlawful.”

There is getting to be a pattern of unlawfulness with the Government—for example, the issues on tribunal fees and in relation to social security. It goes on:

“The Court’s decision is at the time of writing subject to appeal to the Court of Appeal.”

I have no doubt that the Government will do that. That is dated 26 October—just a few days ago.

We are not the only ones making this argument. The Public Accounts Committee said:

“We do not believe that it will save as much money as HMRC has predicted”—

that is the understatement of the decade—

“and we are concerned that it has not thought through all the negative costs to the wider economy of its approach and the impact on local employment”.

That is another understatement, if ever there was one. Many people and communities will be dreadfully affected by this.

Let us talk about service issues. The Institute of Chartered Accountants in England and Wales said:

“Service standards are deteriorating with taxpayers having to spend longer and longer on the phone trying to get through or waiting for their letters to be answered.”

My hon. Friend the Member for Stockton South (Dr Williams) alluded to that. To boot, the National Audit Office says that this has cost £600 million more than first thought. That is the situation we are in. Why the Government are persisting with this dog’s dinner is absolutely beyond me.

Members today have made fantastic contributions that were forensic, surgical, factual, objective and mixed with a bit of humanity, which seems to be completely missing from the Government’s approach. I ask the Government to take these proposals back, give them further consideration and think about the communities and people affected.

--- Later in debate ---

[Mel Stride]

The hon. Gentleman makes two points. One is a general point about the economic sense, or otherwise, of locating the services in larger hubs. The arguments on that are, broadly, extremely strong. They are that we can have larger groups of people and more collaborative working and can ensure that the infrastructure and technology are there. HRMC operates very differently today from how it operated some decades ago. We take a risk-based approach to chasing down tax that should be paid and is not being paid. That involves a lot of data and analysis. Frankly, the idea—if anyone here is entertaining it—that for the last few years people have been able to walk into their local tax office or have appointments there is just not correct. We need centres of excellence that can work in the manner that I have described.

The hon. Member for Easington (Grahame Morris) raises the issue of long-term leases, and he is right to say that in some cases there are no break clauses. I make three points on that. First, we get a much more competitive rate if that is the basis on which we enter into a lease. Secondly, that of course does not mean that leases cannot be broken at some future point by way of negotiation. That is quite typical in the commercial property market. Thirdly, we have flexibility within those leases, such that other Government Departments and employees would be able to use the buildings as well. There are therefore at least three very good reasons why that approach has been taken.

Let me now make some progress. We need a tax system that offers digital services in an age in which people increasingly expect and rely on them, that makes use of technological developments to deliver as efficient a service as possible, and that is suited to the dynamic and fast economy of today.

[Graham Stringer in the Chair]

I hope that the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East would agree that just dispersing employees across a wide area is not an efficient way to run any organisation, let alone one with responsibility to the taxpayer.

[Jim McMahon]

I am not sure whether the Minister’s tactic is to talk at length about matters on which there is agreement. There is agreement on the move to digital services, the need for those to be fit for purpose, and the need to take as much tax as possible to fund decent public services, but the majority of today’s debate has been about the financial assessments of the deals done and the decisions on the locations of the head office and the regional hubs. I would appreciate it if the Minister would focus on that, because as far as I can see, the evidence base to support those decisions is at best very weak.

[Mel Stride]

The hon. Gentleman is right: much of the debate has focused on the matters to which he refers. I am not seeking to avoid those other elements of the debate at all and was coming on to them, but I shall deal with them now, as he has raised them. HMRC has had eight very sensible criteria by which to judge where to locate the new hubs. He will know that we are looking at sustainable large sites, with the capacity to hold all HMRC’s requirements for the region in a single building. The talent pipeline, which has been mentioned, is extremely important.

--- Later in debate ---

[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.

[Jim McMahon]

Is the Minister seriously suggesting that Manchester city centre, 7 miles away from Oldham town centre, meets the criteria relating to the talent pool, throughput of staff and the economic case any better than Oldham town centre would have done? If it does, why do the Government refuse to publish the internal documents that would make the case?

[Mel Stride]

The hon. Gentleman will appreciate that I have not come here prepared with all the precise details of exactly how that decision was arrived at, but I am confident that HMRC has, with due diligence and in a very objective and dispassionate—no, objective—way, looked at which locations meet the eight criteria, and made a balanced decision at the end of that. I am very confident that it has come to the right conclusions.

--- Later in debate ---

[Jim McMahon]

On that basis, can the Minister confirm today that the Department will release that location assessment?

[Mel Stride]

No. I am not going to commit to bringing forward all sorts of reports and things that various hon. Members may or may not call for. I understand why the hon. Gentleman may call for those things, but I can reassure him that we have published the criteria on which the decisions were made. They are in the public domain. There are eight criteria, and they are very clearly available.

--- Later in debate ---

[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.

[Jim McMahon]

I thank the Minister for giving way. According to my time, we have an hour and 10 minutes of interventions if Members have questions to ask. The Minister is being generous with his time. Let us stop this dance that we are taking part in here. The truth is that no assessment was made of the suitability of sites for the relocation. Oldham was not considered as a site for the relocation, but Manchester was. That is the truth. If I am wrong, simply publish the assessment of sites that shows that Oldham was considered at the same time as Manchester. Ultimately, it is not protected under any of the exemptions in the freedom of information legislation. Let us cut out the time delay that would be initiated by our making that request under the Freedom of Information Act 2000 and let us have it here today.

--- Later in debate ---

[Mel Stride]

Thank you, Mr Stringer. I should agree with the hon. Member for Bootle if the premise of his assertion were true. In reality there has been an assessment. Of course, in each and every case, HMRC looked at the criteria and applied them to the various options in the various regions, and came to a conclusion as a result of the assessment. That is the logical and sensible way in which such matters move.

[Jim McMahon]

On a point of order, Mr Stringer. The Minister has said a number of times that an assessment has been made of the various sites and location options. If it transpired that the assessment had not been carried out, what remedy would the House have?

[Graham Stringer (in the Chair)]

That is a matter of fact, not a point of order relating to the debate.