Finance Bill (Ways and Means)

Meg Hillier Excerpts

Ways and Means resolution & Ways and Means resolution: House of Commons
Tuesday 19th May 2020 Commons Chamber

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

I think it is fair to say that covid-19 has shone a light on the different ways of working. Whether it be freelance work through personal service companies, which are often set up to deal with insurance and liability, or freelance work via short-term pay-as-you-earn contracts, many of these people are falling through the net. That does not even begin to embrace those who are in insecure, zero-hours work. Many in my constituency work four jobs over seven days just to make ends meet, while others earn enough to work a four-day week and can live quite comfortably.

Hackney South and Shoreditch is a microcosm of all the different ways of working, some of which the Chancellor has supported in his package, and some of which he has not. It is also a hub of innovation, particularly in the tech area in Shoreditch, in the creative industries. We are proud to be the home of many disruptor businesses that start off trying to change the way things work.

This motion brings to the fore a number of issues. Contractors providing a flexible, agile workforce allow many of the businesses in my constituency to buy in the skills they need when they need them. Those are typically high-cost skills that a business could not put on the payroll, especially at the start-up stage. Businesses have been in touch with me about this measure for that reason in particular. They would not be able to create a full-time job. They do not need this expertise full time, long term on the payroll. They need to be able to hire someone quickly, and if the company does not succeed, there is no direct impact on the careers of the people they have hired for that short contract because they go on to the next contract. It allows start-ups to get the help, support and technical skills they need as a fledgling business.

Since the Government announced the extension of IR35 to the private sector, many companies in my constituency have already taken the view that they need to move overseas, and many of the individual contractors are moving overseas. They often work in different countries anyway, so where they are physically based is less of an issue than it may seem.

Many of the companies that are employing those contractors are taking a very risk-averse approach, designating all contractors as needing to go under the IR35 umbrella. That is having a negative impact on those technically skilled individuals who would be available for work but will end up being employed for tax purposes only, with none of the perks. In pursuing the national insurance contributions of employers, the Government are in danger of throwing out the baby with the bathwater. No one wants to see tax avoidance on a huge scale, but this system has grown up and helped to generate a whole business sector that relies on this flexibility, and the employees caught up in this will have none of the benefits of employees but will be working alongside people who do.

The issue of national insurance contributions is really important in terms of the Government’s review. We need to know exactly what the timetable is for that review, who will do it and how they will calculate the tax take. Many businesses are presented with evidence, which I am happy to share with the Minister, about why the tax take will not actually increase for HMRC by going down this route. It is really important that we get those fundamental numbers right. Is the research commissioned yet? How will be people be able to contribute, and will it look at the overall tax rate? The delay of a year is welcome, but I completely agree with the right hon. Member for Haltemprice and Howden (Mr Davis) that we are going into an economic contraction, the likes of which this this country has never seen before, and a year is not long enough. We need to delay this further or we will lose these skills, and businesses will not replace these roles as employees, so we will have a double whammy in the economy.

Covid-19: Economic Package

Meg Hillier Excerpts

Tuesday 12th May 2020 Commons Chamber

[Rishi Sunak]

The scheme, as it is designed, does provide income support of 80% of those wages. Indeed, where those wages are variable the scheme allows an average to be taken to benefit the employee. We have also strengthened the safety net, as I mentioned earlier. Crucially, employees who are furloughed are then able to work elsewhere as well to supplement their incomes. That flexibility is often unnoticed, but it is very helpful. I know many people are taking advantage of that to boost their incomes during this time and I think the scheme, as it is designed, provides the required support especially to those on the lowest pay.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op) [V]]

The Chancellor has spoken about freelancers, who often work on short-term contracts or for personal service companies. In answer to the right hon. Member for Ashford (Damian Green), he talked about optimising the existing mechanisms for those people, but will he come forward today with the suggestion that there are concrete proposals in place? These are people with clear financial records and they often have accountants, so there is a track record. Will the Chancellor support these different types of self-employed people?

[Rishi Sunak]

They are being supported. The scheme to support them goes live tomorrow, ahead of schedule. Those who are self-employed whose returns and earnings we are aware of will be contacted, and are already being contacted. They are able to apply from tomorrow and will receive cash in their accounts for a three-month grant as early as next week. The scheme is one of the most generous in the world for those who are self-employed.

Finance Bill

Meg Hillier Excerpts

2nd reading & 2nd reading: House of Commons & Programme motion & Programme motion: House of Commons & Ways and Means resolution
Monday 27th April 2020 Commons Chamber

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

It really is a pleasure to be back in this place today. I welcome the bold steps that have been taken by the Government since the Budget, which seems like aeons ago, and the subsequent support in the Coronavirus Act 2020 and in the Chancellor’s settlement. I particularly welcome the support for start-ups, of which my constituency has many, especially in the Shoreditch part of Hackney South and Shoreditch. They will be the engines of the future economy, so the move is very welcome. None the less, some very big issues obviously exist, so while those bold steps were necessary—I pay tribute to the Chancellor, to the TUC and to so many others who have contributed to this thinking—we do need to have some answers to some very important questions. I want to rattle through some of them before touching on a couple of other very important issues around the Budget.

Will the Minister today confirm that the coronavirus business interruption loan scheme does not require a personal guarantee by businesses? Only today, I spoke to a business in my constituency, which has been hampered in trying to get this loan because the bank has asked for a raft of personal information about the financial arrangements of every director of that company. This is a company that has praised the Government for the furloughing scheme, but that is struggling on this point. We have heard that that personal guarantee is not necessary, but really clear guidance is needed from the Government to make sure that those banks that were bailed out in 2008, as the hon. Member for Wellingborough (Mr Bone) highlighted, are going to support the economy now.

One of the big issues in my constituency relates to other forms of work. There are those who are self-employed, those who freelance and the many people on repeated short-term contracts who fall outside the employment support schemes. The self-employed and, in fact, most of those workers will often have an accountant or will have very clear financial records, so just as the PAYE scheme has been reverse-engineered to support furloughing, there must be a way that HMRC and the Government can work together with those people to make sure that there is a scheme in place to support them.

Many people are really scared. The emails in my inbox are not from people I normally hear from. They are from people who are about to lose their jobs. They are people who never thought that they would be in a position to have to consider claiming from the state, but they actually cannot even do that—they cannot even qualify for universal credit.

Another group caught up in this is sole directors, including those of personal service companies. I can relate an ironic example that really highlights this matter. An occupational therapist working in the national health service was told by the NHS that, for liability reasons, she had to set up personal service company. She is a frontline health worker supporting our NHS and yet does not qualify for any of the business and employment support schemes. That surely shows this up as a nonsense. The chickens are coming home to roost in this crisis: the economy has split in a different way, which means that people are working in different ways and that businesses are setting up in different ways. They are now being penalised because of a system that grew up like Topsy, with little thought for the consequences.

I want to touch on the huge demand on the hardship fund, which is the responsibility of local authorities. Those local authorities are already overspending on this. Everything that is not quite fitting has to come from the hardship fund, which is a huge problem. The overall cost to local government is enormous, with many councils now effectively bankrupt. Although the extra injection of cash the other week was welcome, it will not be enough. We may have to be very careful post-cv-19 to ensure that those very councils, which were going to be the engines driving the support that people will continue to need, are well resourced to do that.

I want to highlight an issue around housing. In 1992 and in 2008, under Governments of different political colours, money was given to housing associations to buy up unsold properties. In 1992, a housing market package was in place to buy up properties on the street, and in 2008, unsold properties from private developers were bought up. That money was there to buy those houses to create homes for homeless families. Many people in my constituency are living in severely overcrowded conditions, including a woman with a seven-year-old daughter who has had four years in a single hostel room with shared facilities, and a mother and daughter living with grand- mother—one family in one room and one in another. I have many other examples like that. Such a move would keep the housing market going and, crucially, give a fillip to the social housing market and give people a chance, in the long-term future we want to see, to support themselves.

The £1 billion announced in the Budget for cladding is about a tenth of what is needed, but will the Minister tell me when we will get the detail on how that £1 billion will be bid for? If not, perhaps the Treasury will write to me. It was supposed to come in June, but with coronavirus it is likely to be delayed. When we reach the day of reckoning on the pounds that we are spending now that will have to be paid back, that is just one of many issues that will need to be sorted. Many of my constituents are paying over the odds to support things such as waking watch while they wait for that money to come and, because of coronavirus, those who were already hit hard are being hit harder still.

Coronavirus: Employment Support

Meg Hillier Excerpts

Thursday 19th March 2020 Commons Chamber

[John Glen]

My hon. Friend makes a very good point about the resilience required in banks at this difficult time. I discussed that with the heads of the banks last night and over the previous two days. We need to ensure that the terms of these loans are effective in allowing people to access them swiftly and we need to ensure that the banks can ramp up the accessibility of their specialist advisers. I have been given assurances that that will be in place.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

So many of my constituents are caught up in this, like those of other hon. Members, and I have constituents who have no recourse to public funds, so when they are unable to work they cannot claim benefits. Many are freelancers and people who are self-employed and running small businesses. None of the packages the Government have announced help them so far. The Minister has had to be dragged here to answer an urgent question and has nothing he can say that will comfort our constituents. I think we all recognise that it is difficult, but could he not even give us a clue about the general direction of thinking from the Government? Will he raise the local housing allowance? Will the Government ensure that those with no recourse to public funds get funded? Will they stop this ridiculous loan system, which will never get paid back? Businesses will go bankrupt before they can pay it, and they are laying off staff now.

[John Glen]

The hon. Lady raises a number of sensible points. We are looking at many of them. I reassure her that we will make further announcements very soon. Yes, we are looking at the ideas raised. We are looking at other jurisdictions. But in some cases we have a very different set of processes and IT systems behind some of these Government Department distribution mechanisms. I know that that is very technical, but the bottom line is that we need to ensure that when we introduce something, it delivers.

Economic Update

Meg Hillier Excerpts

Tuesday 17th March 2020 Commons Chamber

[Rishi Sunak]

I thank my hon. Friend for his comments and am happy to look at what he is saying.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

Many of my constituents are freelancers. One wrote to me unable to pay his rent or bills in the next couple of weeks. That is how urgent the situation is. Can the Chancellor give any comfort tonight for people who are very worried? They have been laid off today, have no ability to pay the bills and their freelance work has dried up. We are told that we have to wait for an answer from the Housing, Communities and Local Government Secretary. The Government have known that this was coming. Where is the planning? What answer does the Chancellor have now?

[Rishi Sunak]

For those people, the measures that we took last week will already start to help from day one. The Work and Pensions Secretary has already put in place support to make sure that access to the security that they need is both faster and more generous than it was.

Oral Answers to Questions

Meg Hillier Excerpts

Tuesday 11th February 2020 Commons Chamber

[Rishi Sunak]

The local government pension scheme is fully funded, which means that all local authorities contribute on an annual basis. It is right that that is taken into account when setting annual budgets. I am pleased that the Government have outlined a three-year school settlement, which will take school funding up by £4 billion in real terms over the forthcoming spending period. Those extra resources will allow schools to deal with the pension pressure and invest in our classrooms, which is where the money needs to go.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

It was extraordinary to hear the Treasury Minister talk about the biggest year-on-year increase in funding after a decade of major cuts. He knows, because he can do the maths, that that is nowhere near making any recompense. The Public Accounts Committee looked in detail at local government spending and we concluded that in simple terms, it was being squeezed massively, particularly for children’s and adult’s social services. When will he acknowledge that for many things that his Government purport to want to deliver, local government is key and that it needs sustainable and increased funding to make up for the cuts of the previous decade?

[Rishi Sunak]

Local government deserves enormous praise for the hard work that it did in helping to restore this country’s public finances to a sustainable state. We all know why we were in that situation a decade ago, but we can now look forward with confidence. Local government is benefiting from a very significant increase in spending power this year. The hon. Lady is right to highlight the pressure on social care, which is one of the largest areas of spend, which is why the Government have just committed an extra £1 billion in social care grant to help local authorities to alleviate that pressure this year and into the future.

Oral Answers to Questions

Meg Hillier Excerpts

Tuesday 7th January 2020 Commons Chamber

[Sajid Javid]

My hon. Friend will know that the NHS is this Government’s No. 1 spending priority. I just wish that it was the same for the Labour Government in Wales, who have let down Welsh people time and again, especially when it comes to healthcare. In the recent spending round in September, the Welsh Government received an additional £600 million, much of which can be put to good use in the NHS system in Wales. I hope that they are wise enough to help the Welsh people and, in particular, to look again at resurrecting Flint Community Hospital.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

One of the major crises is the recruitment of GPs, so it is not just money that needs to be thrown at the issues. What steps is the Treasury taking to ensure that when money is provided, it is spent well and, crucially, that it is not stop-start funding, so that the NHS can properly plan for the long term, particularly in the recruitment of frontline staff?

[Sajid Javid]

It is worth reminding Members that one of the reasons the NHS has so many problems, including with the recruitment of GPs and in hospitals, is the PFI policies of the previous Labour Government, which have cash starved many NHS trusts for far too long. We are now putting that right with our historic settlement. The hon. Member is quite right about the importance of recruiting more GPs to have more appointments, and that is why we set out in our manifesto exactly how we are going to do that.

Spending Round 2019

Meg Hillier Excerpts

Wednesday 4th September 2019 Commons Chamber

[Sajid Javid]

I want to take this opportunity to thank my hon. Friend for his campaigning and for the way in which he has worked with the Treasury and the Department for Education on this. I think he is referring to the f40 campaign, with which I am very familiar as a constituency MP. I am pleased that we have been able to make this huge step change in school funding, which I know has been welcomed across the country.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

After all the announcements over the summer, I had hoped for more detail today. The Chancellor and his Department might have a laser-like focus, but he can rest assured that the Public Accounts Committee will be delving through these figures and holding him to account.

As others have said, the Chancellor has indicated that he is going to change the fiscal rules. We already have an 85% ratio of debt to GDP. Can he advise us of the tolerance level that he would go up to in that debt level, and is he considering increases in taxation?

Leaving the EU: Economic Impact of Proposed Deal

Meg Hillier Excerpts

Wednesday 20th February 2019 Commons Chamber

[Mel Stride]

My advice, although I doubt very much that the Scottish National party will take much advice from me, is, first, get behind the deal and let us get certainty and increase investment; and secondly, accept the result of the 2014 referendum, stay with the United Kingdom and do not end up in a situation that creates a border between the country of Scotland and the rest of the United Kingdom.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

In response to the Chair of the Exiting the European Union Committee, the Minister said that it would be reckless of the Government not to plan for no deal. However, the detailed work of the Public Accounts Committee has clearly shown that the Government are not prepared for no deal and are woefully prepared for a deal. Would not the responsible thing be to delay any exit or extend the transition period and take stock, and make sure that the D-minus-37 uncertainty that is hanging over our country is resolved? It is too late just to pass the deal—uncertainty is now built in.

[Mel Stride]

I do not accept that we are not adequately prepared or are not deeply preparing for the possibility of no deal. This work has been going on for many months, and in far greater depth than many people appreciate. In my area of ministerial responsibility, Her Majesty’s Revenue and Customs and borders, we have staffed up, and we have 4,500 more personnel ready for this work. There will be over 5,000 in place by 29 March. We have engaged with stakeholders across the piece by making sure that we have the most facilitated possible customs arrangements in place, particularly in respect of the short straits crossing—Dover and Calais—and so on. An immense amount of work has been carried out.

HMRC Estate Transformation

Meg Hillier Excerpts

Tuesday 29th January 2019 Commons Chamber

[Mel Stride]

As a former tax inspector, my hon. Friend is probably about as popular as I am as a tax Minister, which is never the most popular job in the world. The answer to his question—in a short and pithy response, Mr Speaker—is that we have to move to the more digital-based, data-based and inspection-based system that is facilitated by the very hubs I have been describing.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

This has already cost more; the projected savings have gone down; there are no break clauses in most of the 20 to 25-year leases; and there is little buy-in from other Departments. The Minister has said that the DWP and NHS Digital—interestingly, he picked only two small examples—are buying into a couple of the hubs. Will he list the other Departments that are buying in by locating in these regional hubs?

[Mel Stride]

There has been a series of discussions right across Whitehall, led by the Cabinet Office, in the area in which the hon. Lady has framed her question. The hon. Lady levelled the charge of cost, but she then very quickly went on to talk about savings, and there will of course be net savings from this approach of some £300 million by 2025.