Working People’s Finances: Government Policy
Mark Tami Excerpts(2 years, 7 months ago)
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Mick Whitley (Birkenhead) (Lab)
I welcome the opportunity to say clearly to the Government that their current pursuit of benefit cuts and tax hikes, their economic mismanagement of the energy sector and the housing market—to name but two—and their casual indifference to the spectre of soaring inflation in the price of basic goods and food are combining to inflict poverty, hardship and misery on working people. The other week, the Prime Minister responded to my question on the negative impact of the £20 a week universal credit cut by saying that his Government have always been ready to put an arm around the people of this country. I would contend that the Government’s policies will more likely lead to a hand being clasped around the throats of working people, the unemployed, the disabled and—tragically—their children. This is not levelling up; it is grinding down. This is not building back better; it is a new round of austerity designed yet again to make the poor pay for another fine mess of the Government’s own creation. People’s standard of living is not, as the Government claim, rising inexorably because of recent wage increases. Overall, it is declining because of the toxic cocktail of measures administered by the Government, which they pretend are medicine to make us better.
The Joseph Rowntree Foundation has found that more than 12,500 working-age families in my Birkenhead constituency will be hit by the cut to universal credit, including more than 6,000 working-age families with children. That is almost one third of such families in Birkenhead, and they are set to lose just over £1,000 a year. How can that be fair? In the run-up to the day of shame on 6 October when the axe is scheduled to fall, more people have written to me asking me to oppose the cut than on any other single issue. My mailbag on the cut far outstrips the previous record holder: Dominic Cummings’ emergency eye test at Barnard Castle.
One letter stands out. It is from the seven-year-old son of a constituent who told me how worried he is that this family will not be able to afford to feed to him because he heard that they were about to lose £20. This is a particular concern for children because, as of 2020, 33% of children in Birkenhead—more than 6,000—were officially classed as living in poverty.
This vindictive cut would be bad enough any day of the week, but look at its timing—it is like something straight out of “Hammer House of Horror”. The cut coincides with the increase in national insurance, the surging cost of gas, the prospect of transport costs going through the roof, rents being driven up by the housing crisis and basic foodstuffs costing ever more as the supply chain becomes more and more disrupted.
Let me tell the House what that means to ordinary people. One of my constituents—I will call him Gary—lost his job due to contracting covid-19. He was not furloughed and he rents from a private landlord. He is on universal credit and, with the £20 uplift, after rent he had £46 a week to meet all his expenses. When the cut comes in, he will be left with £26 to meet those same expenses, each of which is going up. Gary, like so many others, faces ruin. I know full well that the Government will respond with their usual refrain that universal credit will help Gary to get a job, but they conveniently forget that their measure, which will put an estimated 800,000 into poverty—including 300.000 children—will have an impact on the about 40% of universal credit claimants who are already in work.
Mark Tami (Alyn and Deeside) (Lab)
I intervene to make the point that my hon. Friend has made that there are many working families—those in work—who are on universal credit, which the Prime Minister does not seem to understand.
Mick Whitley
My right hon. Friend makes a good point. I made that point to the Prime Minister, who just did not give me an answer.
Those working people will be hit by both the cut and the increase in national insurance. They will number thousands of working hairdressers, shop assistants, street cleaners, hospital porters, farm workers and countless others who are paid peanuts and have no choice but to claim in-work benefits. I genuinely hope that Conservative Members will not cry TINA—there is no alternative—as a previous Government of their persuasion did. Rather I hope that they will withdraw their package of measures that will slash the standard of living for the majority, and adopt the progressive tax policies that my party stands for and that can ensure that those with the broadest shoulders and the most bloated bank accounts pay their fair share, so that my constituents are not forced into a life of poverty.
Mr Tanmanjeet Singh Dhesi (Slough) (Lab)
I express my gratitude to the Labour Treasury team for facilitating this opportunity to debate the devastating effect of Government policy on the finances of working people.
I know the British people have had a very difficult 18 months during the covid crisis, with the sorrowful loss of lives—inexcusably, the highest death toll in Europe —despite having our world-class NHS and our world-class public health systems, as well as an unforgiveable care home crisis, soaring unemployment, businesses closing, food bank usage skyrocketing and, most recently, the tragic debacle in Afghanistan, leaving many of us, especially my Slough constituents, and British Afghans in absolute despair. I do not think anyone in this Chamber could have foreseen the debilitating impact that a pandemic would have on our communities when we all had the honour of being elected as Members of Parliament.
I want to pay tribute to the extraordinary generosity and service of the Slough Council for Voluntary Service, the Slough Foodbank and other voluntary and faith groups within my constituency. But we as a nation should not have to rely so heavily on their good will. The Government should not be failing the most vulnerable, so as we emerge from what has been a very testing period for our economy, I despair at the direction this Government are taking us in. Instead of rebuilding, investing and stimulating our economy, it seems that they are more intent on ideological cuts to the very services and people that have kept this country going since March 2020.
There are the rises to national insurance, the universal credit cut, the upcoming freeze on the personal income tax allowance, inflation-busting rail fare increases and the highest petrol prices since 2013, as well as rampant waste, cronyism and corruption in the top levels of Government, the damage caused by the Government’s hard-line Brexit deal, and the supply chain and HGV drivers chaos leading to empty supermarket shelves. There is the Government forcing local authorities to raise council tax, and their unwillingness to outlaw the deplorable hire and rehire tactics of unscrupulous employers. There are some of the highest childcare costs in the world, a housing crisis worsened by a cladding crisis, and the absence of a sector-specific deal for our aviation sector, which at one point was world-leading, despite repeated pleas from the likes of myself and other hon. Members. There are the policing cuts leading to less safer communities, and the exorbitant increase in energy bills leaving many languishing in absolute despair.
This is all while we had a Tory Government asleep at the wheel and acting only when it is very late in the day. Make no mistake, although the Government may want to make it seem that way, these vital issues have not arisen solely because of the covid pandemic. These matters have been exacerbated by a decade of austerity and inadequate emergency support meeting a failing post-pandemic plan—a perfect storm that only leaves families worse off.
We in Slough have been impacted acutely by job losses and the inadequate Government support. With Heathrow and the largest singly owned trading estate, the Slough trading estate, on our doorstep, unemployment, furlough and food bank usage have all, sadly, increased. We must not allow a temporary crisis to unevenly and permanently change prospects across our country; we must assist those who have fallen on hard times through no fault of their own, not punish them further with ill thought-out Conservative Government policy.
Matt Western
My hon. Friend makes a very important point. We all have to understand that it is easy to talk about numbers and statistics in the abstract, but the reality for so many people, as he illustrates, is that they do not just have the uncertainty and insecurity of zero-hours contracts and the pressures of the cut to universal credit, but having so little money in the bank brings pressures on households. And here we have inflation about to rip into those households through the energy price increases I am going to come on to talk about.
I talked about the Chancellor and the Prime Minister. Those in corporate business and in senior positions in Government must know what is happening to inflation. They must know what forecasters are saying. When commodities are bought, all energy costs are forward priced—they know what is coming down the track—so the Chancellor could suggest only a 1% increase for nurses when he knew all along that there was likely to be a significant spike in inflation coming. Energy costs are a major issue, one that has perhaps been the driver to this particular debate, alongside the cut in universal credit. We have long known for months that there was going to be an increase in gas prices of 12% in October. That will have a significant impact on household bills. The average gas and electricity bill for customers will go up by £139 a year to just under £1,300. Now, we have to rely on the Government to get a grip to avoid further increases as a result of this unfolding crisis.
It is fundamentally a failure of long-term Government planning over the past decade that we, as a country, are so exposed and vulnerable to rising gas prices. We should have been building energy resilience, instead of being one of the countries most reliant on foreign gas. We should have been investing in domestically produced renewable energy. Instead, we squandered 10 years burning fossil fuels. When I was working on Warwick District Council as a councillor seven years ago, I proposed the Warwickshire energy plan to save people money, create energy resilience and address energy poverty. Sadly, there was not the gumption to follow through on that, and I am disappointed it never materialised.
Mark Tami
A perfect example of the point my hon. Friend is making is Wylfa nuclear power station in north Wales, in Anglesey. Building could have started on that and it would have been part of a growing nuclear programme, but the Government failed to support it. A spin-off would have been high-tech jobs, but the Government are not interested—they just step back.
Matt Western
I thank my right hon. Friend for that point. I think the important thing is that the Cameron-Osborne Government in particular became obsessed with fracking and took their eye off the ball with other energy sources. In Warwickshire, we had Algy Cluff come and visit; he was a significant donor to the Conservative party, I think, and he was really interested in having blocks under Warwickshire that he would frack. That undermined long-term planning for projects like the one that my right hon. Friend mentions.
If the Government had followed through, we could have been building zero-carbon homes since 2016. Instead, the Cameron, Osborne and—dare I say it—Liberal Democrat Government scrapped the regulations for housing developer donors. A million homes could have been built since 2016, but something like 10% of households in my constituency are in fuel poverty already and I can only see that figure rising. Several thousand homes in my constituency could have benefited from forward-thinking house building and zero-carbon homes, because we have seen such an explosion in house building across south Warwick and south Leamington.
Protection of Jobs and Businesses
Mark Tami Excerpts(3 years, 7 months ago)
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Mark Tami (Alyn and Deeside) (Lab)
The aerospace industry employs well over 100,000 people in the UK, in mainly very well-paid and highly-skilled jobs. Aviation has been one of the hardest hit sectors and will be one of the last to recover, taking years to get back to where it was before the pandemic started. At Airbus in Broughton, we are experiencing the consequences of that downturn, with 500 Guidant agency workers losing their jobs, to be followed by nearly 1,500 direct employees under a voluntary redundancy scheme. I pay tribute to Daz Reynolds, the Unite convenor, who has done an incredible job in very difficult circumstances.
That is a massive hit on the local economy. If we add in the calculation that, for every job lost in a prime such as Airbus, four or five jobs will be lost in the supply chain, we see that the scale of the crisis we face is stark. The furlough scheme has helped lessen the impact for now, but we need the Government to step up to the plate and bring forward a package of measures that will help to secure the sector not just now or in the medium term, but for the long term as well.
The French, Germans and Americans have all recognised the need to implement support longer term, and a key measure should be implementing a shorter working week, where the extra time freed up would be used to upskill the workforce. Government financial support would not only secure employment, but it would also deliver value for money for the taxpayer, because people would continue to work, spend and pay taxes.
Support for airlines should be linked to a requirement for them to update their fleets and scrap older, less-environmentally friendly aircraft. More than 70 aircraft that currently fly out of the UK are more than 15 years old, and they should be replaced. Suppliers and SMEs need the Government to support an investment fund to help them to restructure and face up to new challenges, and we must support apprenticeships, which are vital for the future. As I have said, other countries have recognised the need for a sector-specific scheme, and if we do not, the danger is that future investment will go elsewhere. The Treasury does not like sector-specific schemes or to pick winners, but aerospace is already a winner. We are a world leader, and if we do not protect that, we will lose our position in the world, and we could lose the jobs that go with it.
May Adjournment
Mark Tami Excerpts(5 years, 12 months ago)
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Ian Mearns (Gateshead) (Lab)
I beg to move,
That this House has considered matters to be raised before the May adjournment.
Earlier, I listened to Ministers saying that EU citizens’ rights would be defended robustly after Brexit, but I have also heard this week from Members of the European Parliament representing the north-east of England that EU negotiators are sceptical about such assertions because of what has happened with the Windrush situation.
I am currently dealing with a case of an EU citizen who is being denied benefits, despite the fact that she has been resident in Gateshead for 27 years. Kim Voogel came to the United Kingdom from the Netherlands in 1991. She has never been back to the Netherlands since then, and the Dutch Government have confirmed that they have no record of her ever going back to the Netherlands over the entirety of that period. She has worked on and off over that time, because her ex-husband was the main breadwinner in the family, and she has given birth to and raised three children, all of whom are still resident in Gateshead. Following a head injury after falling from a ladder, which has given her some mild brain damage, she had to reapply for universal credit, having transferred from employment and support allowance. In the transition between benefits, she has been refused universal credit because the Department for Work and Pensions said that she could not prove that she had been resident continuously in the United Kingdom for 27 years.
Mark Tami (Alyn and Deeside) (Lab)
My hon. Friend is making a very powerful case. Does he agree that these sorts of cases affect not only the individual involved, but the whole family, particularly the children?
Ian Mearns
I could not agree more with my hon. Friend.
Despite the fact that this lady has three children, only one of whom is now in his 20s; despite the fact that she has been receiving child benefit for those children throughout the entire period; and despite the fact that she also has a work record, having worked in between having her children, she has been refused universal credit. Part of the reason for the refusal is that the online application form asked when her children came to the United Kingdom with her. Of course, they did not come to the United Kingdom; they were born here. Therefore, she has failed the permanent residency test and been refused universal credit, despite living here for 27 years.
With such cases occurring now, the assurances that have been given by Ministers about the rights of EU citizens following Brexit sound really quite hollow. There is a big job of work to be done. It is not just the Home Office that needs to recognise the rights of EU citizens; other Government Departments, such as the Department for Work and Pensions must do so too. This lady’s case needs to be resolved, and resolved quickly and positively. She deserves nothing less than that.
Last Saturday, 28 April, we celebrated Workers Memorial Day. It is an important day for us all to celebrate; I and dozens and dozens of people attended a very moving service in Saltwell park in my constituency. There is a permanent memorial for Workers’ Memorial Day in Saltwell park, and I congratulate not only Gateshead Trades Council, but Gateshead Council, on erecting it.
The whole point of Workers Memorial Day is to help people realise that many workers die, receive injuries, or develop life-threatening illnesses owing to circumstances at work. I am glad to say that the number of people who die owing to injuries at work has dropped dramatically over the years since we have introduced a plethora of health and safety legislation. However, when I hear Members on the Government Benches talking about freeing up the labour market and getting rid of red tape, I do honestly wonder whether that actually means getting rid of vital health and safety regulations that keep our workers safe.
Financial Guidance and Claims Bill [Lords]
Mark Tami ExcerptsTuesday 24th April 2018
(6 years ago)
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Crispin Blunt
I am grateful to the hon. Gentleman, and I agree. He will note the very distinguished role that his predecessor played in the whole business of promoting equity release. It ought to be a really major option given the construction of people’s resources and where they sit on the scale of property ownership in the UK. We need to be clear about how important an asset it is and how important it is to make sure that this industry has the opportunity to give the best possible service to people in their life plans.
Consumers must obtain qualified financial and independent legal advice before they confirm their decision to go ahead and purchase any equity release product. Guarantees include the right to remain in the property for life or until moving into long-term care. Another key safeguard provided by members of the Equity Release Council is the “no negative equity” guarantee, whereby the repayment of the loan is never greater than the value of the home.
A major reason why the single financial guidance body signpost should include housing wealth is the growth in the equity release sector. Homeowners released £3 billion worth of equity in 2017, with 37,000 new customers signing up for equity release products for the first time.
Mark Tami (Alyn and Deeside) (Lab)
The hon. Gentleman keeps saying that this is about releasing equity. What people are actually doing is borrowing against the perceived wealth of the property.
Crispin Blunt
They are not borrowing against the perceived wealth of the property—it is the actual wealth of the property. If someone is in a position of planning for their retirement and they do not have an adequate pension pot, and given the scale of the imbalance between people’s assets in property as opposed to the pension provision they have made, it is obvious that, in making the assessments for their retirement, they should consider accessing the wealth they have accrued that is in their home.
With 37,000 customers signing up for equity release products for the first time in 2017, the number of these products has also risen enormously over the last decade—by 225%—and 78 product options with the necessary range of flexibilities are now available. This can only improve and grow as the industry develops. Consumers utilise equity release for various reasons, such as paying off a mortgage, making adaptations to the home, boosting retirement income, or as a means of providing deposits to children and grandchildren to enable them to take their first step on the housing ladder. Equity release can help in meeting some of the challenges in social care and in housing.
We should be more ambitious, ensuring that the new body signposts solutions such as equity release to all those we represent who might really benefit from unlocking the main source of their wealth overall, which will be the equity in their home. I look forward to hearing from the Minister how we are going to make a reality of that in practice through the guidance.
Jack Brereton (Stoke-on-Trent South) (Con)
I am pleased to be called to speak in this debate, Madam Deputy Speaker, because the issues are of particular interest to me as a member of the Work and Pensions Committee. I want to reflect on some of the evidence the Committee has heard in its inquiry into pension freedoms and choice, as it relates to some of the changes proposed in the Bill.
While I am extremely supportive of the work the Government have done to increase the freedom of our constituents in respect of their pension savings, it has undoubtedly created new challenges that must be addressed. I am pleased that the Bill has been brought forward as an opportunity to address them. The first challenge is advice. It was apparent from our sessions on the British Steel pension fund that those who find themselves needing to switch often struggle to get the advice they need. There were mixed experiences, with some people receiving very good local advice and others receiving very bad advice or none at all.
Jack Brereton
That issue certainly came up in our evidence. Those who saw our evidence sessions will know that there was quite a significant grilling of the FCA.
Those experiences show that some irrational decisions—often described as “emotional” decisions—were made in the moment. Sadly, those short-term decisions were not the best investment decisions for the longer term. Unfortunately, this vulnerability—the vulnerability of immediacy or a form of panic, one might say—allowed predatory vulture companies to take advantage of an emotionally charged situation, with people reinvesting their pension pots without the full, impartial advice that is needed. Those vultures exploited scheme holders, framing what they were doing as giving impartial advice, when it was nothing of the sort. Many people felt that they were not fully informed of the consequences of the complex investment decisions they were having to make.
The accessibility of free independent advice in such situations has, in some cases, been woefully limited. More generally, the often perplexing nature of pensions leaves many people making decisions about their investments that are not necessarily in their best interests. Evidence presented to the Select Committee by the Association of British Insurers from the FCA’s “Financial Advice Market Review: Baseline report” suggests that not even one in 10 UK adults—just 6%—had received regulated financial advice. Worryingly, 25% of people who needed advice about their finances did not access it.
There are a number of reasons why our constituents are not accessing the advice they need, but what has been demonstrated is that not enough people are currently accessing the free independent advice that is available. The Association of British Insurers suggested that although 44% of people who are approaching retirement had access to some sort of advice, only 10% used the Pensions Advisory Service and only 7% used Pension Wise. The lack of clear advice combined with confusion about who to trust for independent advice has made it too challenging for those making investment decisions. Not enough people are getting the advice that they need to make properly informed judgments.
Secondly, we also found that very limited numbers of people are making the active decision to shop around and switch providers. Often, the tendency of those changing schemes is to stick to the same provider, so switching—active consumerism—is another challenge. There are, of course, a number of reasons why people might find it difficult to switch providers, not least the lack of good information and advice about the choices available, as I just related. It is also a major barrier to consumer activity, so I am pleased that part of the Bill proposes to create a single guidance body. That will make it much clearer for our constituents to see where they can turn for the right advice to make informed decisions and manage their finances for the future.
Palace of Westminster: Restoration and Renewal
Mark Tami Excerpts(7 years, 3 months ago)
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Chris Bryant (Rhondda) (Lab)
I beg to move,
That this House has considered restoration and renewal of the Palace of Westminster.
The motion is the formality, but I do not think that by the end of this one and a half hours we will have considered the matter properly. The Government should be tabling a motion so that the whole House and, for that matter, the House of Lords, can do so. It is now 19 and a half weeks since the Joint Committee on the Palace of Westminster produced its report. At the rate we are going, it will be six months from the delivery of that report to the moment when we start debating it properly and coming to a decision. That is verging on the irresponsible.
I want to lay out the nature of the problem that we have in the building. Many people think it is falling down—it is not falling down, although the Clock Tower does incline a little. The mechanical and electrical engineering systems that keep the place lit, heated, cooled, drained and dry are already well past their use-by date. The risk of a catastrophic failure such as a fire or a flood rises exponentially every five years that we delay. We should be in absolutely no doubt: there will be a fire. There was a fire a fortnight ago and there are regularly fires. People patrol the building 24 hours a day to ensure that we catch those fires.
Some of the high-voltage cables in the building are decaying and doing so deep inside the building in the 98 risers that take services from the basement past all the rooms in the building up to the roof. They are so blocked up with additional services that access to them is virtually impossible. That is why a fire in any one of them could spread very rapidly from floor to floor and take the whole building with it.
Mark Tami (Alyn and Deeside) (Lab)
I am very pleased that my hon. Friend secured this debate. Does he agree that anyone who has any doubts about the problems that we face would do well to go on a tour of the basement and see the wiring, the plumbing and the risers that are key to the risks?
Chris Bryant
Yes. I have done about 30 of those tours now, with different members of the public, broadcast outlets, newspapers and other Members of Parliament. Everybody has been struck by the fact that 75% of the work that we have to do is on the mechanical and electrical gubbins of the building. This is not about a fancy tarting up of the building—it is about whether the building can function.
Chris Bryant
There is a very serious point here. Some people are arguing—I will come on to this point later—that we should stay in the building while the work is being done. That incurs a very significant risk to our safety and that of the people who work here. If we were to take the measures necessary to protect people properly while removing asbestos, that would dramatically increase the cost of and the risk to the project and the public.
Water is penetrating much of the stonework and doing lasting damage. Many of the 3,800 bronze windows, which were a wonderful idea when first installed, no longer work properly and have to be refitted.
We should be thoroughly ashamed that disabled access in this building is truly appalling. It is phenomenally difficult to get around the building for someone in a wheelchair or who has physical difficulties. The roundabout routes that many have to take to make an ordinary passage through the building are wrong. We still expect members of the public to queue for more than an hour in the pouring rain, which is not acceptable in the 21st century.
We have to act because this is one of the most important buildings in the world. It is part of a UNESCO world heritage site. The walls of Westminster Hall date from 30 years after the Norman conquest, the ceiling dates from the time of Richard II at the end of the 14th century and the cloisters date from the time of the Tudors. Every single tourist who comes to this country wants to be photographed in front of this building, and every film, Hollywood or otherwise, that wants to show that it is set in the UK or in London shows this building.
The people of this country have a deep affection for the building. One poll—I am very sceptical about polls, but none the less I am going to use this one—showed this week that 57% of the public want us to do the work and 61% think that we should move out to allow it to be done more effectively, more quickly and more cheaply.
Today’s MPs and peers hold this building in trust. It is not ours—we hold it in trust. Our predecessors got it hideously wrong in the 19th century. They kept on delaying necessary work. That delay made the fire in 1834 not only possible but inevitable, and so we lost the Painted Chamber, St Stephen’s Chapel and what was reputedly the most beautiful set of medieval buildings in the world. They then insisted on staying on site while the new building was built around them and constantly complained about the noise and the design. The result was long delays and a massive budget overrun. They started in 1840, but it was not completed until 1870, by which time Barry and Pugin were dead and their sons were battling about the ongoing design issues. If we do the same today, we will not move back in until 2055 at the earliest.
Of course we have to be careful about money, which is why the Joint Committee, which started with a very sceptical point of view on the project, recommended what we believed to be the cheapest and best option, which is a full decant. I say “cheapest” because, however we cut the numbers that have been put together on a very high-level basis for the two Houses, the option of full decant comes in at £900 million less than trying to stay in the building.
The Earl of Lincoln, the first commissioner of works, told MPs in 1844 that
“if I had been employing an architect in the construction of my private residence, I should have a right to fool away as much of my money as I thought fit; but in the case of a public building, I consider myself acting, to a certain degree, as guardian of the public purse, and to have no right to sanction any expenditure, either for the gratification of any pride, or the indulgence of any fancy I might entertain, as to the proper and efficient construction of the building.”
We should adopt that same attitude today. We should be going for the cheapest option—our constituents would expect that of us—but not a cheap option that does not do the job properly.
Our argument in Committee did not hinge entirely on the money. Three Members in the Chamber were on the Committee—my hon. Friend the Member for Alyn and Deeside (Mark Tami), and the hon. Members for Airdrie and Shotts (Neil Gray) and for North Antrim (Ian Paisley). They would agree that, when we started our consideration, we all assumed we would come up with some kind of plan that meant we stayed in the building—a kind of half-and-half solution. We consulted widely, but every single person we asked told us that that was simply not workable. “Not workable, unfeasible, impracticable, foolhardy, risky and dangerous” were the sort of words people used. We should listen to them.
I want to deal with some of the things that other people have been suggesting. First, something I have heard often, though not so much in the Commons or Parliament, is that we should move to elsewhere in London or outside the capital. I disagree. This is the home of Parliament and should remain the home of Parliament, but there are good reasons beyond the romantic association. If we were to leave the Palace forever, we would still have to do the work to protect it because it is a world heritage site, and we would not save a single penny. If we moved elsewhere in London, we would have to find a space that can accommodate everyone not only in the Palace but on the rest of the parliamentary estate—Portcullis House, Norman Shaw North, Norman Shaw South, Parliament Street, Millbank and all the Lords’ offices—which would be a considerable piece of prime estate to find. If we moved outside London, we would have to move the whole of Government as well, because all Ministers are Members of the Commons or the House of Lords. That option is impracticable and very expensive.
The second thing I hear—this is the most common—is that, if we leave we will never come back. I have been told that by four Members of Parliament today alone. They argue that the Commons should sit in the House of Lords, and the Lords should sit in the Royal Gallery. That is basically the proposal of the hon. Member for Gainsborough (Sir Edward Leigh)—he is not right hon. but he should be, and learned and gallant and all sorts of other things as well. I have discussed the issue with him many times and we can be friendly about it, but there are lots of problems with his proposal.
That proposal would add £900 million to the cost—I have already quoted the point made by the Earl of Lincoln in 1834. Furthermore, public and press access would be very restricted under the hon. Gentleman’s plan, and it would be difficult to have any kind of fully functioning Public Gallery in his scheme, whether for the Commons or the Lords. His plan would rely on keeping a large part of the building open around the work, because of the need for Whips Offices, rooms for Doorkeepers, police officers and Ministers, and—who knows?—some people might even want a Tea Room.
Mark Tami
Not actually on the Tea Room itself, however vital that is. Some Members who may think that proposal a good idea do not realise that there is one system for the plumbing and all the electrics. The House of Lords is a separate House, but it does not have a separate supply system. We would have to build some great structure outside to ensure that one part of the building could carry on working.
Chris Bryant
My hon. Friend makes a good point. Basically, there is one electricity system, one drainage system, one central heating system, one cooling system—the building is a unity. If we want to keep part of it open, especially a whole corridor, we would have to put in temporary services to accommodate everything. That is an expensive and, I would argue, risky business.
Chris Bryant
The hon. Gentleman is absolutely right: we should have started some considerable time ago.
About 10 years ago, when I was Deputy Leader of the House for five minutes, we were already arguing that we needed to get this work on the road. The Committee was asked to delay publishing its report until the local government elections were done, until the referendum was done, until we had a new Prime Minister, and so on, and still there has been no debate. We have to get a move on.
Chris Bryant
My hon. Friend is absolutely right. In addition, when all that minor work is going on, which still costs millions of pounds, there is further risk in the building. There is building work going on. Indeed, a few weeks ago, the House of Lords decided that it could not bear the noise that was going on and had to suspend its sitting. I think that if we tried to sit in the building while work was going on, we would do that every single day. I can just see the hon. Member for Gainsborough standing in the Chamber in 15 years’ time—if he gets his way—saying, “I can’t even hear myself think, let alone speak!”
Another thing that has been said is: “What about giving up on the September sittings?” That is quite popular with quite a lot of colleagues, especially when they are asked in September. That was specifically factored into the rolling programme option in the independent options appraisal. It was termed “scenario E1A”, because it would be enabled by longer recesses and what the IOA called an acceptance by MPs of considerable disruption for three decades. That option also assumes that there will be alternative Chambers for use during an unexpected recall of Parliament. It is worth bearing in mind that recalls are a simple fact of life. During the last Parliament alone, we were recalled twice in 2011, twice in 2013 and once in 2014, and of course we were, horribly, recalled last year after Jo Cox’s murder. There will be recalls—that is just a fact.
I have heard one other argument: “We need to put on a good show in times of Brexit. We can’t just meet in a car park.” Let me be absolutely clear: the temporary Chamber will not be some cardboard cut-out. It will be a properly impressive Chamber with full access for the public and the press. Moreover, any half-and-half proposal will delay our full return to the building and keep the scaffolding up for another decade or two.
But there is a much bigger point. The last thing we want as we leave the European Union is to look as if we are hanging around in an old ancestral mansion like a dowager duchess, running with buckets from one dripping ceiling to another. Nor can we risk a catastrophic failure, such as a flood or major fire. That really would give the world the worst possible impression. We want to show the world that we can take tough decisions—that we value our heritage but have a strong, modern, outward-looking vision for the future. What better way is there of showing that than taking this 1,000-year-old building, restoring what is beautiful and historic about it, and renewing it so that it really works for the 21st, 22nd, 23rd, 24th and 25th centuries?
As a Labour Member, I think that we should see this as an opportunity. The Committee was advised repeatedly that the workforce in this country does not actually have all the skills to complete this project. After Brexit, we may have even fewer qualified builders. We should see this project as part of our industrial strategy today, and use it to show that this country can deliver a massive infrastructure project on time and on budget. We should train youngsters now in the craft and high-tech engineering skills of the 21st century, so that young people from every single one of our constituencies can work on what is the best-loved building in the world—an icon of British liberty, democracy and the rule of law.
Sir Alan Haselhurst (Saffron Walden) (Con)
It is an honour to serve under your chairmanship, Mr Flello. I congratulate the hon. Member for Rhondda (Chris Bryant) on securing this debate and on his telling opening.
I understand that there is enormous attachment to this home of Parliament. That attachment has led to a drift; for at least 20 years, to my knowledge, people have known that something has to be done and have been thinking about what we should do. Every time someone has been brought in, the report has shocked people and they have said, “We can’t do that,” so things have been left for a while. More experts have then been brought in two years later and said, “It’s worse,” and people have said, “Oh, no, we can’t tackle that.” This problem has been getting steadily away from us. It is to the credit of the current administration and those in the House who support it that work is now being done to come to a decisive conclusion. I believe that some of my colleagues are blinded by their attachment to the place into supposing that the problem is not really all that bad somehow, and we can work around it.
During the last Parliament, when I was Chairman of the Administration Committee, I was privy to some of the work that was going on, and I came rapidly to the conclusion that has been reached in similar circumstances by the Parliaments of Austria, Canada and Finland: if a major exercise of this kind has to be done, the only sensible thing for us to do is to get out of the building and let the work be done. Some 12 months of study were undertaken by our colleagues in the other place and in the House of Commons, and having gone into the detail and consulted independent experts, they are persuaded that that approach is right for us, too. Colleagues can rake over the independent options appraisal—they can look at it and play with the figures and estimates as much as they like—but it is crystal clear that option 3 would take less time than option 2, option 2 would take less time than option 1, and in each case, less time means less cost.
The hon. Gentleman mentioned some of the objections, and I will refer to some of those and perhaps others. I have been told that our leaving would deprive some Members of ever serving in this building. There is in fact now a way around that. The timescale is such that it is possible for the work to bridge two Parliaments, so if that is a real problem, it can be overcome. But the honour and responsibility of being elected as a Member of Parliament lies first in doing the job, not in carrying out the job in a particular place or building.
The hon. Gentleman mentioned the argument that if we leave, we will not come back. I have heard level-headed people say, “They won’t let us.” Who are the “they” in all this? We are sovereign. We can decide that. Frankly, it is unthinkable that we would not come back to this Palace at the first opportunity. It has also been said that Westminster Hall might be needed for a major state event. I think that we can rely on the fact that the royal household has been consulted and has not blocked what is recommended.
It has been said that an appalling message would be sent out to the world during Brexit, but I think an even more appalling message would be sent if we soldiered on in this place in difficult conditions and there was a catastrophic failure. That really would make it look as though this country and this Parliament were breaking down.
It is said that too much public money is involved. However much we look at them, the alternatives to option 1 are more expensive, but the fact is that the public are solidly behind us on this matter. They love this place and believe it is an important symbol of our democracy. They have been very understanding, as has the press, so if we are responsible about this, we should not worry on that front.
Another objection—in contrast to some of the others—is: “If there is a risk of catastrophic failure, why are we waiting and not getting on with it?” The reason we are not getting on with it is that people have baulked at doing so every time a report has been produced since the 1990s. There has been delay, delay and delay. The risk is mounting. That is the problem. We will do the work as soon as we can, but there have been difficulties to overcome to make the arrangements for it to be approached logically.
I cannot help feeling that the distrust that has manifested in many parts of the world has also manifested here; people want to kick the establishment at every point and think that experts cannot be trusted, so we must take their advice with a large pinch of salt. Frankly, if I feel ill I want to get the advice of my doctor. If I want to have a legal instrument drawn up I go to a lawyer. If I want help with my accounts I go to an accountant. That is a normal thing to do. It is always possible, of course, to have a second opinion. We have had a second, third, fourth, fifth and sixth opinion—and still there are those who distrust those opinions and say, “Oh, well, they would say that, wouldn’t they? They are in it for themselves; they will line their pockets.” I do not think that that is fair to the Royal Institute of British Architects or the Royal Institution of Chartered Surveyors, which have given unbiased advice to our colleagues on the Committee.
Mark Tami
The right hon. Gentleman has reminded me of a previous employer of mine: when we got legal advice that he did not like he would always say, “Get another lawyer.” That is the argument that some people are putting forward, when they do not like the expert advice they are given.
Sir Alan Haselhurst
I agree; that is the problem. At some point we must make a decision. Continually putting it off is causing the bill to rise and the dislocation to increase.
If the Palace is loved as much as I believe it is by almost every person elected to Parliament—it is certainly loved by the staff who serve us here, and the hundreds of thousands of visitors who clamour to come here and take great pleasure from being in the Palace and standing on the Floor of the House of Commons where great names of the past served—it is our duty to put safety before romance. The alternative suggestions magnify risk, perpetuate inconvenience and threaten security. It was when we came back for sittings one September and work was going on in the Committee corridor, with builders all over the place, that intruders got in masquerading as builders. It will be an enormous security threat if we are prepared to have hundreds of workers here at the same time as we try to do business.
I am astonished that some colleagues seem keen to work here while unquantified amounts of asbestos are removed, intrusive noise is unabated and an army of workers operates in our midst, and while any one of several vital services could fail at any moment. I am not surprised that some colleagues recoil from a total decant, but we must look at things in a hard-headed, not emotional, way. We must do the right thing and choose the option to which the evidence overwhelmingly points, and which has persuaded our colleagues on the Committee. I believe that it will then be all the sooner that the Palace, which we see as the symbol of parliamentary democracy, can be restored to its full glory and effectiveness and serve the nation and people for a century, or centuries, more.
Mark Tami
The key issue about asbestos, with which my hon. Friend rightly says the building is riddled, is that we do not know where it is. When there is drilling, or when things are taken out, the starting presumption must be that there is asbestos there. That would add massively to the cost of working in a fully occupied building.
Mr Winnick
My hon. Friend certainly makes a powerful case for a full decant.
It should not be forgotten that, as has been mentioned, every year the cost of maintaining the building goes up. The figure given in the report for 2014-15—the latest figures, unless the Deputy Leader of the House has further information—is nearly £50 million. That is public money that is essential just so that the building can be in some kind of working condition. I agree that full decanting is essential. I understand why some feel that for historical and ceremonial reasons, and so that people can come to this building, there is a case for partial decanting, but in practice and when we consider the amount of work involved on what would be a huge building site, how on earth could we continue to debate in the present Commons or Lords Chambers, or the Robing Room? Imagine the constant pleas to the Speaker or Lord Speaker: “It is impossible to hear. Can the work stop for a while?” and the rest of it. It is not practical—and I do not understand how anyone could argue otherwise—to work with the constant noise and disruption and constant changes of location between the two Chambers. That is not the way to proceed, even if it was done after the 1834 fire. I think we have made some progress since then.
Fixed Odds Betting Terminals
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Jim Shannon
As always, I thank the hon. Lady for her intervention—she is an hon. Friend, too. She speaks with heart and compassion, and she speaks for me as much as everyone else here.
Our Prime Minister told Parliament more than 12 months ago that FOBTs are a serious issue, and that he would act as soon as there was more evidence. Since then, two tragic cases of suicide have been linked to the machines, and there are numerous reports of the terrible impact they are having on the most vulnerable, but the Government are yet to act. The Minister is here to respond to the debate, and we look forward to hearing the ideas that he will put forward in response to what we have to say. There is no place for £100-a-spin games on the high street in bookmakers that have little or no supervision. There is a simple answer to protect the vulnerable, as the hon. Lady said, and that is to reduce the stake.
Mark Tami (Alyn and Deeside) (Lab)
While a lot of us have worries about what is going on in betting shops, does the hon. Gentleman agree that we do not know enough about the people who gamble at home on their phones and on the internet? There is no control over that at all, and they are being equally affected.
Jim Shannon
The hon. Gentleman is absolutely right. We have many concerns. Today’s debate is fixed primarily on the fixed odds betting terminals, but I accept that control is needed elsewhere.
The lack of regulation of FOBTs has meant that they have clustered in areas of high social deprivation. They can prey on the young and vulnerable. There is strong evidence that the high stakes on FOBTs in the low-supervision environment of a bookmaker have led to increased problem gambling. Recent Responsible Gambling Trust research on FOBTs showed that 37% of players exhibited signs of problematic gambling. At stakes of more than £13.40 a spin, that rose to 80% of players exhibiting problem gambling behaviour. One third of problem gamblers calling the national problem gambling helpline cited FOBTs as their issue. Let us be clear that the debate is about fixed odds betting terminals and the blight they cause on society.
Tax Avoidance and Evasion
Mark Tami Excerpts(8 years ago)
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James Cartlidge
That is an excellent point. It was a fundamental injustice, and we dealt with it. In the latest Budget, we announced a series of measures to tackle tax avoidance on matters such as hybrid mismatch, VAT evasion through online sales and the general anti-abuse rule. We will introduce a new penalty of 60% of tax due in all GAAR cases that are successfully tackled. We have brought in a long list of measures on matters such as serial tax avoidance and offshore avoidance.
On the broader point about the wider economics, I founded a small business in 2004—a mortgage broker specialising in the shared ownership sector—and it was obvious to me in the build-up to 2008 what was coming down the track. I believe that the then Government were trying to tackle inequality through debt. In those days, two potential homebuyers, one of whom was relatively wealthy and well educated, and the other who had less good skills and was less able to command such a salary, could both obtain similar levels of mortgage through the extraordinary measures that existed at the time, such as self-certified and sub-prime mortgages. We all know where that led.
In terms of public debt, the then Government’s main measure to deal with inequality was tax credits, which led to a £30 billion increase in in-work benefits. We paid for that increase in benefit spending on the national overdraft at a time when the country was doing pretty well and the world economy was relatively strong.
Mark Tami (Alyn and Deeside) (Lab)
Will the hon. Gentleman clarify something? He seemed to be saying that less intelligent people should not be allowed to have mortgages. Is that what he was saying?
James Cartlidge
I think that the hon. Gentleman should withdraw that remark. I find that genuinely offensive. What I said was that the rules were very lax, and self-certification meant that someone on a low salary could get a very large mortgage, just like someone who earned a large amount. That is exactly the point that I was making. We all know that that led to a huge crash in 2008.
We have one fundamental question to answer. How, in the current economic context, do we go about trying to deliver a fairer economy, which we all want, where more people share in the growth that we have been able to deliver? We need strong measures to counter tax avoidance. We need the public to feel as though we are all in this together, and that we are all paying our fair share.
Overseas Voters Bill
Mark Tami Excerpts(8 years, 2 months ago)
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Mr Chope
Fraud is rife in most electronic transactions, but despite that, a very large number of people are prepared to trust their banking arrangements to being dealt with online. Her Majesty’s Revenue and Customs is now going to make it more or less compulsory for small businesses to do their tax returns online on a quarterly basis. My hon. Friend makes a perfect reasonable point: there is always scope for fraud. That is why I would not suggest massive internet voting on a universal basis from the outset, but it would be sensible to start off with a reasonable experiment. For example, we could perhaps start with members of our armed forces who are serving overseas. We might be able to develop a secure system for dealing with them.
Mark Tami (Alyn and Deeside) (Lab)
Does the hon. Gentleman not think it odd that he wants to make it a lot easier for people living abroad to vote, but this Government want to make it a lot more difficult, through individual registration, for people to register to vote in this country?
Mr Chope
I do not accept the hon. Gentleman’s premise. The Government are keen to ensure that we have individual voter registration so that there is less identity fraud at polling stations and through postal votes. I supported that when I was a member of the Political and Constitutional Reform Committee in the previous Parliament.
HMRC Office Closures
Mark Tami Excerpts(8 years, 5 months ago)
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Rob Marris (Wolverhampton South West) (Lab)
I salute the Minister’s efforts to make a good fist of things, and the efforts of this Government, and the previous coalition Government, to clamp down on tax avoidance. More should be done, but they took good steps. We need a well-functioning HMRC because we need taxes to pay for the goodies that we and our constituents want. We need a well-functioning HMRC to assist business and to maintain the confidence of taxpayers. We need a well-functioning HMRC for effective anti-money laundering steps, to clamp down on tax evasion, and to protect revenue.
It is desirable for HMRC to act efficiently, and technology is changing what it and other large organisations do. For example, 80% of self-assessment returns are now done online, and that availability of information from HMRC—including specialist knowledge—is greatly aided by the internet. There is a difficult balancing act for HMRC between providing information and guidance to businesses and individual taxpayers, and not providing tax advice, and sometimes that is difficult for staff. Like other Members, I pay tribute to the overwhelmingly hard-working and skilful staff at HMRC around the United Kingdom. It is no criticism of them that we still have a considerable tax gap. Having more staff is likely to help close that gap.
The National Audit Office estimates an 18:1 return on employing extra staff—that means that £1 more in salary means £18 more in revenue. There is, of course, a law of diminishing returns in that scenario. HMRC itself, through its chief executive, estimates a return of 11:1.
Mark Tami (Alyn and Deeside) (Lab)
My hon. Friend mentions valued staff. Does he agree that, as the Minister said, thousands of valued and very experienced staff will not be able to relocate and will therefore be lost to the Revenue?
Rob Marris
I agree, and I will come on to that in a moment. We have to look at the debate, and at what is happening with HMRC, in the context of the economy overall and the Government’s finances. In the past five years, national debt has gone up 55%. Instead of it taking five years to sort out the deficit, the Government’s own estimates say it will take 10 years. GDP per capita has stalled. The balance of payments deficit is at the highest it has been in peacetime, at 5% of GDP. Productivity has stalled. Home ownership is markedly down. It is now said that we have the fourth lowest rate of home ownership of any European Union member state. Correspondingly, net household debt is rising alarmingly. That is the economic context; we need to protect revenue.
There are problems, of course: the tax gap, to which I referred; an insufficient number of collectors; and an insufficient number of staff dealing with evasion and artificial avoidance measures. There is the difficulty—created, I have to say, by the previous Labour Government —of the disastrous contract with Mapeley, which is based, I think, in the Bahamas. The ownership of the leases of HMRC offices was transferred to Mapeley in 2001. As far as I am aware, the proposals we heard on 12 November do not address that issue in any way, except to say that we are dumping all the offices. Nothing has been said about what will happen to the leases and so on. Perhaps the Minister, in closing, could tell us a bit more about the intersection between the plans and the wretched leases with the wretched Mapeley.
Staff numbers are markedly down in recent years. According to the Office for National Statistics, between 2007 and 2010, under the previous Labour Government, the number of HMRC staff went down 9%. Under the five years of the coalition Government it went down a further 24.4%—a cumulative drop of 31.4%.
Finance Bill
Mark Tami Excerpts(9 years, 10 months ago)
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Catherine McKinnell (Newcastle upon Tyne North) (Lab)
I beg to move, That the clause be read a Second time.
New clause 11 relates to the Government’s employee shareholder scheme, more commonly known as “shares for rights”. It seeks to probe the Government on the scheme’s performance to date and the costs to the Exchequer in the form of capital gains tax exemptions. We have debated the subject at some length, so I thought that it would be helpful to give some background to jog hon. Members’ memories before setting out the reasons why the Opposition tabled the new clause.
The concept of employee shareholders was introduced under section 31 of the Growth and Infrastructure Act 2013, which was part of the Chancellor’s desperate attempt to kick-start growth after three years of a flatlining economy and rising unemployment, particularly youth unemployment. To get more businesses hiring, he created a status of employee known as employee shareholders. They are expected to give up several fundamental employment rights in return for tax advantaged shares in the employer’s company or parent company, issued under an employee shareholder agreement. Those shares would be tax advantageous to employees because up to £50,000 of the shares would be exempt from capital gains tax on disposal.
In exchange for those tax advantageous shares, employees would be expected to waive some of their fundamental employment rights, including the right not to be unfairly dismissed, the right to a redundancy payment, the right to request leave for study or training and the right to request flexible working, and they will have to give 16 weeks’ notice, rather than the usual eight weeks, before returning to work.
Of course, the right to request flexible working and the ability to give just eight weeks’ notice after maternity or adoption leave have been assessed by the Government themselves, in their tax information and impact note, to affect women disproportionately. They acknowledged that when they legislated for this last year. These reduced rights for female employees, in particular, are in addition to the Government’s real-terms cuts to statutory maternity pay—the mummy tax—the scrapping of the health in pregnancy grant and the significant restrictions on the Sure Start maternity grant. That begs the question that many of us are asking ourselves: just what do this Government have against women and families?
The shares for rights scheme has been widely criticised from across the political spectrum—particularly by the business world because of its impact on employment rights and grave concerns about the opportunities that it presents for tax avoidance.
Mark Tami (Alyn and Deeside) (Lab)
Does my hon. Friend agree that rights are rights—not something to be bought and sold? If we give people rights, they should not be able to be sold to whoever.
Catherine McKinnell
My hon. Friend hits on a key point. Rights are rights and should not be up for sale. I will go into some of the concerns expressed about the policy. The TUC, for example, has said:
“We deplore any attack on maternity provision or protection against unfair dismissal, but these complex proposals do not look as if they will have very much impact, as few small businesses will want to tie themselves up in the tangle of red tape necessary to trigger these exemptions.”
Not only do the proposals send out completely the wrong signals about employment rights—I have focused on women’s employment rights, but those rights are affected across the board—but they have been so badly thought through that the general feeling is that they will not have much impact, as most people would not want to enter into the arrangements.