Oral Answers to Questions

Mark Menzies Excerpts

Tuesday 9th May 2023 Commons Chamber

[Mark Menzies (Fylde) (Con)]

11. What progress he has made on reducing the rate of inflation.

[The Economic Secretary to the Treasury (Andrew Griffith)]

The Government’s three economic priorities this year are to halve inflation, grow the economy, and get debt falling. This will require patience and discipline. Countries around the world are facing rising prices and we will not be able to make that go away overnight, but by sticking to our plan, we will halve inflation this year and help to ease the pressures that people are facing.

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[Andrew Griffith]

As my hon. Friend knows, monetary policy is the responsibility of the independent Monetary Policy Committee and the Bank of England. We will continue to work closely with them to ensure that monetary and fiscal policy are well co-ordinated. The Chancellor reconfirmed the inflation target of 2% at the autumn statement and confirmed that this Government will not change the target.

[Mark Menzies]

While inflation is now heading in the right direction, the effect of the price rises is still being felt by Fylde’s older people. What steps is my hon. Friend taking and what conversations has he had with the Department for Work and Pensions to ensure that Fylde’s retired residents are well protected?

[Andrew Griffith]

I and my colleagues work closely with colleagues in the DWP, as my hon. Friend knows, on behalf of pensioners in Fylde. More than 8 million pensioner households will receive a cost of living payment of £300 this winter, but more than 12 million pensioners have benefited from a 10.1% increase to their state pension. That is the biggest percentage rise in the state pension for more than 30 years and its biggest-ever cash increase.

Oral Answers to Questions

Mark Menzies Excerpts

Tuesday 15th March 2022 Commons Chamber

[Mr Speaker]

Order.

[Mark Menzies (Fylde) (Con)]

T8. I thank my right hon. Friend the Chancellor for his swift actions to protect Fylde consumers from rising energy prices. However, we are all aware that emergency intervention is not sustainable in the long term, and undermines our need to end our reliance on foreign fossil fuels. Fracking is not the solution. What steps will my right hon. Friend take to invest in domestic renewable and nuclear energy—the fuel for which is manufactured in Fylde—as well as in improved energy efficiency?

[Helen Whately]

My hon. Friend has made an extremely good point. Now is the moment for us to go full steam ahead with our transition away from fossil fuels. We are investing in nuclear, we are accelerating our progress on renewables, and we are boosting energy efficiency in homes across the country. This is how we will bring bills down, improve our energy security and tackle climate change.

Oral Answers to Questions

Mark Menzies Excerpts

Tuesday 2nd November 2021 Commons Chamber

[Rishi Sunak]

With regard to a VAT cut for fuel, perhaps I should point out to the hon. Lady some of the remarks from independent commentators about what that would do. The Institute for Fiscal Studies said that the benefit would accrue “to higher-income households.” The Resolution Foundation said a VAT cut

“would not be targeted and would be quite expensive”.

Tax Research UK said:

“This cut will not help the poorest much…this plan is a subsidy to the best-off, not the least well off.”

Instead, we have provided £0.5 billion, targeted at those who need our help. The hon. Lady mentioned £108; the household support fund will be able to provide £150 to between 2 million and 3 million of the most vulnerable families in our country. Indeed, the national living wage is going up next year, which will ensure a £1,000 increase for someone who works full time on the national living wage, and because of the cut to the universal credit taper a single mother with two kids who works full time and rents will be £1,200 better off.

[Mark Menzies (Fylde) (Con)]

T2. I thank the Chancellor for his commitment of £75 million to preserve civil nuclear fuel manufacturing in the UK. As my right hon. Friend will know, Springfields site in Fylde is the only civil nuclear manufacturing site in the UK, and efforts are ongoing to diversify projects undertaken on the site to safeguard its future. Will he agree to look into proposals to support manufacturing on the site and help beat off international competition to bring those jobs and skills to Springfields?

[Rishi Sunak]

First, may I put on record my thanks to my hon. Friend, who raised this issue with me some months ago in the run-up to the spending review? I hope that he and his communities are pleased with the funding that was allocated, thanks to his and other interventions. I am of course prepared to work with him and the Secretary of State for Business, Energy and Industrial Strategy to consider all relevant proposals and assess the right options for the taxpayer in this country.

Oral Answers to Questions

Mark Menzies Excerpts

Tuesday 27th April 2021 Commons Chamber

[Gordon Henderson (Sittingbourne and Sheppey) (Con)]

What fiscal steps his Department is taking to help young people into work.

[Mark Menzies (Fylde) (Con)]

What fiscal steps his Department is taking to help young people into work.

[The Chief Secretary to the Treasury (Steve Barclay)]

Our plan for jobs will help young people find employment opportunities, including through our youth offer and the £2 billion kickstart scheme, where 180,000 kickstart vacancies have already been created.

[Steve Barclay]

I agree with my hon. Friend that young people should have access to the skills and training opportunities they need to access great jobs. That is why my right hon. Friend the Chancellor has provided £126 million for traineeships in England to enable an additional 40,000 places over the next academic year, and why he has incentivised apprenticeships, with up to £3,000 for employers who hire new apprentices of any age.

[Mark Menzies [V]]

Measures such as the kickstart scheme are a fantastic way to help young people into work and reduce the risk of long-term unemployment. Many young people will have taken part-time or casual work to support themselves through the pandemic, such as in Fylde’s hospitality and leisure sector, and may not be claiming universal credit. What steps will my right hon. Friend be taking to help young people get the skills and industry experience to help them move from casual employment and launch full-time careers?

[Steve Barclay]

My hon. Friend raises an important point, and that is why, as well as the fantastic kickstart scheme, which he points out, the plan for jobs also expands existing programmes with proven employment outcomes, including traineeships, sector-based work academies and incentivised apprenticeship hiring. At the spending review, my right hon. Friend the Chancellor announced £138 million for the lifetime skills guarantee to fund free advanced technical courses for adults without A-levels or equivalent and to expand employer-led skills bootcamps.

Oral Answers to Questions

Mark Menzies Excerpts

Tuesday 9th March 2021 Commons Chamber

[Greg Smith (Buckingham) (Con)]

What fiscal steps his Department is taking to support businesses affected by the covid-19 outbreak.

[Mark Menzies (Fylde) (Con)]

What fiscal steps his Department is taking to support businesses affected by the covid-19 outbreak.

[The Chancellor of the Exchequer (Rishi Sunak)]

The Government are providing over £407 billion-worth of support for the UK economy over this year and next. Contained within that is considerable support for business, through discounted loans, cash grants, VAT reductions and tax deferrals, all designed to help business get through this crisis and protect as many jobs as possible.

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[Rishi Sunak]

I thank my hon. Friend for shining a spotlight on this important industry; he is right to do so. I know that he will be talking to the Department for Transport about regulations for the industry, but I can tell him that we will be providing local authorities with discretionary funding of around £425 million to sit alongside the restart grants. That money, at the discretion of local areas, can be used to support businesses such as coach businesses in their areas.

[Mark Menzies [V]]

I just want to take this opportunity to thank the Chancellor for the way in which he has engaged with me and other Members representing coastal communities throughout the lifetime of the pandemic. I know the extensive measures he has put in place, particularly for the hospitality sector, will make a huge difference to those businesses surviving. Can my right hon. Friend assure me that he will continue to monitor and work with me to ensure that local businesses get all the support they need for their continued recovery?

[Rishi Sunak]

My hon. Friend has been instrumental in providing on-the-ground information to me and my team about the particular situation facing hospitality businesses in coastal communities like his. He is an absolute champion for them and rightly so. They are an important part of his local economy and I am glad that this Budget supported them. He has my assurance that we will continue to work with him and them to get them the support that they deserve.

Economic Update

Mark Menzies Excerpts

Monday 11th January 2021 Commons Chamber

[Rishi Sunak]

If I follow the question correctly, I think the guidance has already been clarified. It was already in place that childcare was a reason people could be furloughed. With regard to supply teachers, I will have a look at what the guidance says.

[Mark Menzies (Fylde) (Con) [V]]

I welcome the continuation of the unprecedented support provided by the Chancellor throughout this crisis. While looking forward to economic bounce back, may I call on my right hon. Friend to extend the business rate holiday and VAT reduction, which have been absolutely critical to the tourism and hospitality sector in Fylde?

[Rishi Sunak]

I know how important the tourism and hospitality sector is to my hon. Friend’s constituency and what a fantastic champion he is for it. I know how important those initiatives have been. Of course, future decisions of that magnitude will be for the Budget, but I will take what he says into consideration.

Economy and Jobs

Mark Menzies Excerpts

Monday 20th January 2020 Commons Chamber

[Mark Menzies (Fylde) (Con)]

It is a pleasure to congratulate you, Madam Deputy Speaker, on your election to the Chair and to say that it is the first time in almost 10 years in this place that I have heard the time limit go up for a debate. New Members should not regard this as the normal practice.

It is also a pleasure to follow the hon. Member for Glenrothes (Peter Grant), who speaks passionately about some of the issues facing Scotland, and to have heard the maiden speeches, including the two from my hon. Friends the Members for Loughborough (Jane Hunt) and for Stoke-on-Trent Central (Jo Gideon). I am my very own doughnut tonight. The way in which they spoke with passion about their constituencies and communities left no one in any doubt about why they are in this House.

I want to focus on my constituency and some of the issues raised in the Gracious Speech, particularly aerospace, nuclear and trade opportunities. My constituency is at the heart of the military air manufacturing and design industry in the UK. BAE Systems provides just shy of 7,000 jobs at Warton and another 4,500 up the road at Samlesbury. We currently manufacture Typhoon and Hawk and export them to many countries across the globe. More significantly, we do a lot of development work in cutting-edge technologies—work that is then rolled into other aircraft platforms in many corners of the world. The apprentices and the men and women who make those products have to be recognised and celebrated. The people who talk about the northern powerhouse need look no further than some of the technologies being developed in constituencies such as mine.

One thing that I would like to say to those on the Treasury Bench is that we should not only be recognising the work that we are doing at the moment, but always looking to the future. At the last Farnborough air show the former Prime Minister, my right hon. Friend the Member for Maidenhead (Mrs May), announced the Government’s clear commitment to supporting the future fighter programme and, indeed, Team Tempest. That benefited not just BAE Systems but the likes of Leonardo and Rolls-Royce, to name but a few.

Many thousands of jobs will depend on the future independent UK manufacture of a military air platform. When the Treasury is considering support for Britain’s manufacturing sector, will it please continue to support programmes such as Team Tempest? In the future, not just thousands but tens of thousands of jobs will depend on such programmes. The solution is not buying in expensive technology from overseas, particularly from the United States, but growing our own technology, which we are very, very good at.

As I said earlier, the other issue on which I want to focus is nuclear. Much attention is rightly given to decarbonising the economy and building a low-carbon future, and, yes, renewables are central to that, but so too is nuclear. My constituency has the only nuclear fuel manufacturing facility in the UK, Springfields, which provides just over 1,000 jobs. This is about how we look to the future for nuclear fuel and, indeed, nuclear energy production in the United Kingdom. It is not just about building the big, very expensive power plants with which we are familiar, but about investing in modern technology such as that being driven by Rolls-Royce. I am, of course, referring to small and advanced modular reactors. This is technology that is UK-developed and UK-owned; it can also be UK-manufactured and UK-exported.

As I have said, we are very good at that, particularly in the north-west of England. There is an arc from Warrington to Preston and up into Cumbria, which, as we know, is at the heart of the whole reprocessing industry, and is represented by my hon. Friend the Member for Copeland (Trudy Harrison). However, we will be able to do it only with the continued support of Her Majesty’s Government. If we are ambitious about a low-carbon future and about earning our way in the world, we need to get behind the technologies that are UK-born and bred and owned and built and developed, and are sold abroad, such as nuclear and aerospace.

Finally, let me say something about trade. Far too often, we are passive when it comes to global trade—we are relaxed about inward investment—but I think that Brexit gives us an opportunity to be much more aggressive and bullish: to go out there and get it. I say that as a trade envoy. I see the work that our embassies do across the world, and they do fantastic work, but in my view they are under-resourced. They do not have enough support, be it in London or in country. The Germans and the French, let alone the Americans or the Canadians, will outmatch us every step of the way. However, we have a great story to tell. We are a fantastic exporting country. We are good at what we do.

I appeal to the Government not only to devise new strategies but to resource them properly, and to make people feel empowered to go out there and aggressively pursue the opportunities of foreign direct investment. We talk with great alacrity about going out and building a global Britain and bringing home the bacon, but we must ensure that we understand what a foreign direct investor wants from this country. What skills are required, and how can we work in partnership with our colleges and universities to secure them? In what areas of the country can we locate them? If we are free from European state aid rules, are there things that we can do involving tax policy or various other incentives to attract that foreign direct investment? Above all, we need to add value to the UK and its supply chain, and help to transform communities for generation upon generation to come.

That is one area in which the Department for International trade will play a role. This is not just about striking trade deals—which, in some respects, is an easy thing to do—but about building long-term relationships with countries and organisations across the globe. It is about being ambitious, and having the right people to fulfil our ambition. Let us aim high, and get a fair share of that.

If we include those elements in the northern powerhouse network, and if we help to transform towns and cities throughout the country but particularly in the midlands and the north, there will be a huge economic dividend, but also a social dividend, for the people who benefit from such life-changing opportunities. It is my great pleasure to support the Gracious Speech.

[Madam Deputy Speaker (Dame Rosie Winterton)]

It is a great pleasure to call Nadia Whittome to make her maiden speech.

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[Mr Fysh]

My hon. Friend makes a good point. The Government have some interesting judgments to make. I would not want to gainsay, but there is a strong rationale for investing throughout our country that needs to be put before Ministers. I hope he will do the same for his area.

It is important that we get proper skills development into our regional areas, and I want to mention our further education colleges in Yeovil. Yeovil College is a particularly good example of a top-performing college that is able to improve the life chances of people in regional areas. Often, when there is not a university in an area, further education colleges are the only opportunity that people have to change their skill level and skill type, so that they can change jobs and take advantage of job creation.

The helicopter industry is very important to the Yeovil sub-regional area. Leonardo, based in my constituency, is a military helicopter manufacturer and the only end-to-end aerospace manufacturer left in the UK. It supports more than 10,000 jobs in the supply chain, which is incredibly important. The Government have said that they want to reform defence procurement. When we are looking at value for money, we must consider the holistic impact on a community of having such a big employer with such big projects. It makes a huge difference. We cannot just look at the headline costs; we have to look at all the consequential costs and the value throughout the community.

[Mark Menzies]

My hon. Friend makes the point well, and that is something I touched on in my speech. It is also about the technologies that emerge from investment in the helicopter sector, which can be reinvested in future programmes.

[Mr Fysh]

My hon. Friend is right. It is important that we keep these sovereign capabilities in our aerospace sector, whether it is fixed-wing aircraft, such as in his constituency, or rotary-wing. There is an interesting opportunity at the moment to review whether the AW149, which is a Leonardo product, could replace the Puma fleet, which is ageing and a little unsafe. That is a perfect opportunity to militarise a civil product that is produced in Italy and allow the factory in Yeovil to become a military centre of excellence for Leonardo worldwide. I know that the company is keen to pursue that, but we need the Government to play their part.

I want to say a bit more about trade. The helicopter industry is one of our big exporters, and it is one of the reasons why Yeovil exports more than anywhere else in the south-west apart from Swindon and Bristol, so our trading conditions are of particular importance. We owe it to people to make good on our manifesto promises on trade. We need to ensure that we take a holistic approach to our trade negotiations. We need to ensure that we are negotiating with not only the EU but the US and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership countries. It is by being able to have flexibility in our intentions for regulation and tariffs that we can do different deals around the world and get the best out of all of them.

I am a firm believer that unless we put the potential deals on the table, the EU will prove a very hard negotiator, and it is only by doing these things simultaneously that we can get the best out of all our trade opportunities. Trade—free trade—is so important not just for the opportunities it can create for more exports, but for massively reducing costs for our domestic industries. Getting goods into our economy more cheaply is how we can improve our export growth, our domestic economic performance and our job creation.

Clearly there are some challenges when it comes to trade. We need to make sure that intermediate products we import do not have tariffs put on them. Interestingly, when the Government do the review of tariff schedules that we would have in the context of any deal, it is massively important that we do not automatically think we should keep our tariffs high and then have to cut them again. We could have an agreement that we might apply a lower tariff, even if our bound tariff rate is higher, for a period of time at a zero rate, and tell our trading partners and prospective ones that if they want that situation to continue, they need to finalise a trade deal with us.

There are many other things that we need to talk about on trade. We have heard a lot about level playing field provisions and what the Government might or might not do with them in the context of the EU negotiations, but we need to make sure that we do not just give that up. These are normal provisions that would come into pretty much any trade agreement, and most of them are modelled on the existing WTO agreements on the technical barriers to trade. We should not be afraid of signing up to them, but we must not have dynamic harmonisation of our regulations. We must co-operate and look for equivalence in what we do, but we must not be a rule-taker. It is only by being independent and able to do our own thing that the people of this country will maintain their confidence in us and in our ability to pursue our own destiny. They backed us; we now need to back ourselves to do the best for our people and improve opportunities throughout the country.

Oral Answers to Questions

Mark Menzies Excerpts

Tuesday 11th December 2018 Commons Chamber

[Mr Hammond]

There are a couple of points there. First, I should just say to the hon. Gentleman that I was actually congratulating him the other day on his display of synthetic anger, which is one of the best in the House. On the wider point, the high street is facing challenges because of the uptake of online retailing across the UK at a faster rate than in any other large economy. That means that our high streets will have to adapt. The Government cannot save the high street from the need to change. What they can do is support it as it goes through that process of change.

[Mark Menzies (Fylde) (Con)]

22. I am currently working with Fylde Borough Council and St Anne’s Town Council on a package of measures to regenerate the town of St Anne’s in my constituency. Will the Chancellor of the Exchequer meet me briefly in order to talk through how we can best take advantage of the excellent package of measures that he put forward in his Budget?

[Mr Hammond]

I would be very happy to meet my hon. Friend. My hon. Friend the Exchequer Secretary is the expert on this matter and he might find a meeting with him more fruitful, but either one of us is very happy to meet him.

Taxation (Cross-border Trade) Bill (First sitting)

Mark Menzies Excerpts

Tuesday 23rd January 2018 Public Bill Committees

[Peter Dowd]

Q Finally from me, in relation to the appeals process, you identify in paragraph 6.1 of your evidence:

“We are concerned that taxpayers’ rights in relation to an effective appeals process are retained. This Bill could be”—

you do not say “will be”—

“a backwards step in relation to an effective appeals process, because it affords such wide discretion to HMRC. We wish to see the adoption of clear unambiguous legal requirements for customs matters, which minimise commissioners’ discretion.”

Could you tease that out a bit more? That is in paragraph 6.1 of the Chartered Institute of Taxation’s evidence.

Jeremy White: A thorn in the flesh of the people who contributed to that section was clause 23, and in particular where certain results—particularly approvals—are treated as never having been granted if HMRC considers that approval would not have been granted if a deficiency was known at the time it was granted. That is just one example. There are a number of parts of the Bill where this construction is used whereby one authority—an administrative authority, a parliamentary authority or a Minister—considers that kind of discretion.

Yes, that is a useful construction in English for granting a power to make an instrument, but when it comes to affecting a trader’s relationship and whether they can be in business or not because they have got an authorisation, it should then be subject to the ordinary appeal to the simple, low-cost traders’ tribunal that we have learned to admire. All of the other authorisation-type decisions that HMRC could make are subject to appeal, and they are preserved properly by the Bill. The trouble is the Bill then adds in a few more, using a construction such as “considers” and “discretions”. It is bad enough now that sometimes we have to tell a client, “Sorry, you’re going to have to pay the money to go to the High Court and challenge the Ministers or HMRC on the basis of judicial review,” which is very expensive, discourages litigation and often discourages people from obtaining a remedy for their dispute.

This should not be controversial. It should be, “Yes. That is the right thing to do.” If we were able to add to a shopping list, we would say, “Can we please have all of the current disputes going on in the High Court in customs matters dealt with in a tribunal as well, please?” but that may be asking too much. If the scope of the Bill is wide enough for that and you could amend it to get that in, that would be good. We should not really have customs issues going to the High Court at all. They should all be dealt with in the first-tier tribunal tax chamber.

[Mark Menzies (Fylde) (Con)]

Q I would like to return to the point made by Helen Dennis on fair trade. Do you agree that it is very important that the Government have a wide remit within the scope of the Bill? Some of the current rules regarding EU regulations and tariffs are detrimental to fair trade. I will cite one example. Colombian coffee producers export low-value green coffee into the EU for the value to be added, usually in Germany and in some cases in Italy. Massive value is added here in the EU to the benefit of German manufacturers and large German brands, which therefore has huge detriment to the coffee producers back in Colombia. That is one example. There are many. Having a wide scope in the Bill will give the Government, in the fullness of time, the ability to make sure that free trade arrangements work as consumers in this country think they work, as opposed to how the EU has currently drawn them up.

Helen Dennis: A lot has been said about value addition and its potential post-Brexit. Our view is probably that the tariffs are not the key issue here. We already have duty-free, quota-free access for the least developed countries. If we take a country such as Colombia, or a GSP-plus country such as Bolivia, it is able to access the market with roasted coffee as well, duty free, but as I said before, with the free trade agreements, they may not all transition over necessarily. The biggest issue in terms of trade policy and development continues to be subsidy rather than EU tariffs. There are other issues, such as rules of origin or just getting the investment in roasting and processing facilities, that are more of an obstacle to moving into that kind of value-added activity.

Having said that, there is still scope for improving the tariffs. That goes back to the point about how we and the Government do that. Do we say that the Secretary of State has that power and authority, every three years or so, to revise the preference scheme to extend product coverage and potentially country coverage, and so on? Is that a conversation that happens through regulations under delegated powers, or is it something that a Committee of the House or another grouping, or Parliament in its entirety, would want to discuss, debate and have a vote on? There are lots of issues to unpack. I would certainly agree with the premise of your question, but some of the detail on that particular issue around coffee roasting does not impact as many countries as is sometimes talked about.

[Mark Menzies]

Q But those people that it does affect, it affects in a great way. That is why it is really important to have a wide scope in the Bill, so that we can get into the detail in the fullness of time, and get it right.

Helen Dennis: I agree with you on that. There are certain products that we work with, such as bananas and sugar, that are not covered by the GSP. There may be products that we would want to include within a new preference scheme, and we would want to have the opportunity to bring those proposals forward. The Bill certainly does that, by granting the power to the Secretary of State to make those decisions.

The one thing I would want to flag up is that a decision about tariffs affecting one country impacts on other countries. It is important that when those matters are being brought forward, a thorough impact assessment is done of the impact not only directly on that economy but on neighbouring or other competitor countries. If we go back to Colombia for example, it is a big exporter of cut flowers. There is competition between east Africa and some of the Latin American countries. There is no right or wrong answer, but if we are going to make tariff changes, we need to make sure that we have thoroughly considered the potential impacts.

When the Bill lists the things that the Secretary of State or Chancellor must have regard to, at the moment there is nothing that relates to development impact. From our perspective, we would like to see something added there, so that we are thinking about UK interests and consumers, of course, but we are also thinking about development impact when we make changes.

[Douglas Chapman (Dunfermline and West Fife) (SNP)]

Q I would like to ask an additional question. In the previous session we heard that, for example, in terms of SMEs, 130,000 small businesses would be affected by this kind of legislation for the very first time. Does the panel have a view on the particular challenges that the Bill might bring to small business and its impact, especially if Mr White’s book has to be trawled through every time some decision has to be made? What is the panel’s view on that?

Barbara Scott: I work a lot with SMEs who currently find it very hard to understand the Community legislation on customs and international trade law. It is complex and there are a lot of different strands to it. Trade is complex. Things are different depending on what you are doing, whether coffee from Colombia or bicycle parts from China. The legislation and the effect on business is very different, unlike other laws, such as VAT or corporation tax, which generally impact in the same way on most businesses.

This is a huge step change for SMEs and particularly for those who have only traded within the EU. It will be a tough challenge for HMRC to reach out to those people, get them involved and explain how the new legislation will work. There is clearly going to have to be a lot of propaganda and information out there. It is a huge challenge for the state.

Jeremy White: And there is a cost. The SMEs will have to employ agents, because they will not be able to employ in-house staff. I have been told that SMEs will sell out to someone who does have the assistance. The only frictionless trade known to man is customs union. Anything else is costly and can only be managed—just—with all the simplified procedures of the UCC in operation, plus all the information systems that are there to support them. That is big money.

Barbara Scott: When we talk to customs about this, we are constantly hearing, yes, they are being given more resources and will be employing more staff, but can business afford to do that—suddenly to employ new people and understand these new processes? It is a huge cost. People ask, “What is that cost?” It is very difficult to measure. I do not think anyone has attempted to do so yet. It will be a very difficult time for SMEs in particular.

Sue Davies: I cannot comment on SMEs but I want to make the point that if there are additional costs for businesses, they will feed through and lead to increased prices for consumers. That is why it is really important that we have as efficient a system as possible, which still maintains the right level of protection for consumers.

Taxation (Cross-border Trade) Bill (Second sitting)

Mark Menzies Excerpts

Tuesday 23rd January 2018 Public Bill Committees

[Mark Menzies (Fylde) (Con)]

Q This is specifically for Rosa. You mentioned that you had concerns over the lesser duty rule. I wonder whether you could give us some specific examples of where you feel the lesser duty rule currently is not working.

Rosa Crawford: This is something that the trade remedies alliance, which Ben from Unite mentioned, has been working on with manufacturers associations. We have produced evidence on that and we could supply it to the Committee.

I know there has been specific research on the use of the lesser duty rule in the case of solar panels. We have been in discussion with officials on that. There is an argument that the lesser duty rule applied to the import of solar panels allowed a balance with affordable solar panels. The specific discussion was on social housing and allowing those panels to be provided to social housing, but there was also a measure of action taken against unfair trade practice. Talking to colleagues working in the glass associations and other manufacturer associations, they saw those solar panels as being of a lower quality. I am not speaking from a technical point of view, but they had enough information to judge that those solar panels were of a lower quality.

When we think about the importance of using high-quality materials in social housing—obviously in the shadow of the Grenfell disaster—with solar panels just one aspect of that, that judgment always needs to be made about the low price and the quality of the product. Obviously, there is an implication for support for British industry and what you do to the British industry that could have made a higher-quality panel, and for investment around skills and training to bring in those panels.

[Mark Menzies]

Q Do you have any other examples of the lesser duty rule that we should be aware of?

Rosa Crawford: There will be other examples that I can supply to the Committee. The trade remedies alliance will be happy to provide those.

Ben Richards: On specific cases, that is why we are working collectively with the employers organisations. The trade unions and employers are working together because our interests are combined here. Particularly in relation to the lesser duty rule, it is very interesting that very few other World Trade Organisation members use such a rule as this. Indeed, the European Union in its trade remedies regime is moving towards making the use of the lesser duty rule much more conditional, because it has seen weaknesses in having a mandatory lesser duty rule. In the changes that are taking place at the moment in the EU trade remedies regime, there are some important developments in relation to the lesser duty rule over there.

Kathleen Walker Shaw: May I add a supplementary point on the concern for the lesser duty rule? The problem with that particular form of remedy, because you are creating a sort of cap on the level of remedy, is that it is based on the assessment of injury, which is a difficult thing to do accurately. The difficulty that we have, as I say, particularly with industries that are working on moderate profit margins, is that those industries could be put out of business by the fact of the injury being assessed at a perhaps inaccurate level.

A lot of these fledgling industries that we are looking at, such as clean energy—solar panels is a good example—are new forms of industry that we want to see develop in the UK, and the Government have on more than one occasion identified them as being great growth industries. However, China also likes the look of that market, as does Vietnam. If we are not prepared to protect British industry to grow those new industries, then by overuse of the lesser duty rule we are cutting them up before the roots have started to take in the ground. It is a consideration for us more widely to look at the lesser duty rule in terms of our economic ambitions for UK manufacturing industry into the future, because we are in a position of “cake and eat it” there on a lot of young industries.

[The Chair]

I think the Minister would like to ask a question at this point.