Draft Major Sporting Events (Income Tax Exemption) (World Athletics Indoor Championships Glasgow 24) Regulations 2023

Nigel Huddleston Excerpts

Monday 11th December 2023 General Committees

[The Financial Secretary to the Treasury (Nigel Huddleston)]

I beg to move,

That the Committee has considered the draft Major Sporting Events (Income Tax Exemption) (World Athletics Indoor Championships Glasgow 24) Regulations 2023.

It is a pleasure to serve under your chairmanship, Mr Dowd. It will surprise nobody in the room to learn that I am particularly enthusiastic about this evening’s debate on the regulations, given that I was a sports Minister. These draft regulations are of great interest to many sports fans, because they provide an income tax exemption for overseas individuals approved by World Athletics who will participate in some way in the World Athletics indoor championships in Glasgow next spring.

[Sir Greg Knight (East Yorkshire) (Con)]

The instrument refers to “accredited persons” and “relevant activity”. Are “relevant activities” all on-the-pitch activities, or could, for example, a caterer coming from overseas to provide ethnic food be an accredited person carrying out a relevant activity?

[Nigel Huddleston]

The category is not broad, and specifications will be made by World Athletics. The exemption will apply to specified individuals only. I will provide my right hon. Friend with more information about that later, but there are restrictions on who is in the tax exemption category; as he will of course understand, the exemption needs to be narrow.

The exemption will apply to any UK income that an accredited individual receives for participating in the event, or for duties and services performed in connection with the championships. The Government recognise the great benefits and rewards that sport brings to this country. International championships and meets inspire the next generation of athletes, bring together people and communities, and provide a boost—often a significant one—to the economy. These benefits being evident, and with support from every corner of the House, World Athletics in October 2021 awarded Glasgow the right to host the championships. This is a first for Glasgow, and it is the third occasion on which the UK has been given this prestigious event.

The Government are committed to making the UK an attractive location for hosting world-class sporting events, and successive Governments have provided income tax exemptions for those hosting them. Indeed, granting a tax exemption was a mandatory requirement of the UK hosting this prestigious event. One of the most obvious benefits of the exemption is that it encourages and incentivises participation from foreign athletes in major sporting events.

The UK has a long track record of showcasing its ability to host major events. Statutory tax exemptions have been provided for other world-class events, including the UEFA men’s and women’s football championships in 2021 and 2022, the Birmingham 2022 Commonwealth games, and the 2023 women’s Finalissima football match, to name but a few. I am confident that hon. Members will agree that it is in keeping with the Government’s policy for us to provide a similar exemption for this exceptional event.

The draft regulations use powers in the Finance Act 2014 that allow a tax exemption to be provided for through secondary legislation. A tax exemption is reserved for only the most exceptional events, and I am positive that the Committee will agree that the World Athletics indoor championships Glasgow 24 meet that standard. The exemption from UK income tax will apply to non-resident participants, officials and individuals designated by World Athletics for income earned in connection with the championships. The exemption will run from 23 February to 4 March 2024; it applies for a short period before the event commences, to cover any duties performed in connection with the championships.

The exemption will reduce extra demands on designated individuals. Being exposed to taxes in two countries is administratively difficult to deal with, and would also mean consideration having to be given to issues such as withholding taxes, completing self-assessment tax returns, and double taxation treaties. The income tax exemption for the World Athletics indoor championships Glasgow 24 supports the Government’s ongoing commitment to making the UK a global leader in hosting world-class major sporting events. I commend the instrument to the Committee.

--- Later in debate ---

[Nigel Huddleston]

I am relieved to hear that. I thank hon. Members for their brief but supportive contributions. The hon. Member for Hampstead and Kilburn raised a really important point about tickets. When we host major sporting events, it is important that they be as inclusive as possible. Ticketing is primarily the responsibility of the organisers. The event is sold out, but more tickets are likely to become available. I am sure that organisers have heard her comments, and her wish for the distribution of tickets to be as inclusive as possible is perfectly valid.

The hon. Member for Paisley and Renfrewshire North also raised important points. This is an amazing opportunity for Glasgow, his constituents and others to celebrate a major sporting events, plus of course we should never underestimate the really important economic contribution of such events; we saw the contribution made by the Commonwealth games last year.

My right hon. Friend the Member for East Yorkshire asked who would be included in the measures. They are expected to impact about 1,100 non-UK residents. That includes the sportspeople competing, but also some officials and other designated individuals. The governing body appoints people to the list.

The smooth delivery of the World Athletics indoor championship Glasgow 24 will further support the development of, and participation in, athletics at home and abroad. It is a world-class event, showcasing some of the best athletes in the world. It will provide entertainment and top-level athletics to fans in Glasgow. Hosting the event will support and strengthen the UK’s sport and leisure industry by enhancing this country’s global reputation as a host of international sporting events. For those reasons, I commend this legislation to the Committee.

Question put and agreed to.

National Insurance Contributions (Reduction in Rates) Bill

Nigel Huddleston Excerpts

2nd reading
Thursday 30th November 2023 Commons Chamber

[The Financial Secretary to the Treasury (Nigel Huddleston)]

On behalf of the Government, I join the hon. Member for Hampstead and Kilburn (Tulip Siddiq) and the whole House in expressing our deepest sympathies to the family and friends of Alistair Darling. I know he had many personal friends in the House who knew him very well indeed. I never had the pleasure of interacting with him here, but what an incredibly calm and dignified gentleman he was. Perhaps that is something we can all reflect on.

Although the debate was somewhat one-sided, as most contributions came from the Government Benches, I thank all hon. Members for their contributions. This important Bill delivers tax cuts and rewards and incentivises work, while growing the economy in a sustainable way. I will respond to many of the points raised.

The hon. Member for Strangford (Jim Shannon) rightly pointed out the importance of looking after the lowest paid and having a fair tax system, which we are delivering on. Over the last 13 years, we have lifted hundreds of thousands of families out of poverty, and we have a progressive tax system where the top 1% of taxpayers pay 28% of all income tax.

My right hon. Friend the Member for Vale of Glamorgan (Alun Cairns) and my hon. Friend the Member for Gloucester (Richard Graham) highlighted the context in which the autumn statement was delivered and recognised the fact that we have faced not one but two global crises: the pandemic and the cost of living challenges. Those challenges are not unique to the United Kingdom and, despite the myths peddled by the Opposition, whoever was in Government would have faced those challenges. We do not remember the Opposition arguing against any of the intervention or support measures at the time—it is as if they have completely forgotten about that. Not recognising the context and the global circumstances speaks volumes about their inability to run the economy. We operate not in a vacuum but in a global system.

My hon. Friend the Member for Gloucester went on to highlight the remarkable progress made over the last 13 years, particularly in areas such as tax thresholds. Under Labour, the income tax threshold was £6,475, whereas it is now £12,570, and the NICs threshold was £5,715, whereas it is now £12,570. That is incredible progress. Together with the increases in the national living wage, that means people on the national living wage working full time are 30% better off in real terms than they would have been under Labour. That is a remarkable achievement and shows, despite the myths the Opposition peddle, that we look after the lowest paid in society. That will always be a priority of this Government.

My hon. Friend showed, yet again, his incredible insight, knowledge and commitment to his constituency by setting out a range of areas in which his constituents have benefited over the last 13 years, including by highlighting the importance of skills and apprenticeships. I could not agree with him more.

[Rehman Chishti]

The Minister is talking about apprenticeships, opportunities and skills, and in Gillingham and Rainham, we have seen over 8,000 apprenticeships. Does he agree that the concept of the Bill and the autumn statement is that if people work hard and do the right thing, they keep more of the money they earn? If they work hard and then retire, they get dignity through the pension triple lock—I know my residents from Darland, who are in the Gallery, very much appreciate that. If it were left to the Labour party, there would be more borrowing, spending and debt. We saw what happened before and we do not want to go back to that.

[Nigel Huddleston]

I could not agree with my hon. Friend more. He has given me the opportunity to leap swathes of my speech, because he has put those important points incredibly well.

My hon. Friend the Member for West Worcestershire (Harriett Baldwin), who is my constituency neighbour and the Chair of the Treasury Committee, highlighted the importance of the autumn statement as a turning point, as articulated by the Chancellor, and the all-important supply-side measures in it that will help spur on business, create employment and generate incremental economic activity. As a result of the spring Budget and the autumn statement, the OBR has said that the economy is likely to be 0.5% larger. When we are talking about an economy of over £2 trillion, that is a huge incremental value to the UK economy.

Unfortunately, the spokesperson for the SNP, the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry), failed to recognise that we have addressed the cost of living to the tune of £100 billion in support. He also forgot that in the autumn statement we had an increase not only in the living wage but in benefits, aligned with inflation; in pensions; and in the local housing allowance rate, to the 30th percentile. That means 1.6 million families will be better off, gaining an average of £800 in support. It is not true to say that there were no cost of living support measures in the autumn statement.

My hon. Friend the Member for Ruislip, Northwood and Pinner (David Simmonds) recognised the considerable impact of those measures and the fact that they make a meaningful difference to his constituents. He raised issues about visas and students, which I am happy to discuss with him further.

As always, my right hon. Friend the Member for Witham (Priti Patel) articulated core Conservative values incredibly well. The autumn statement recognised the importance of spending every penny of taxpayers’ money incredibly carefully and responsibly, as well as ensuring that we are there to support people through the tax system wherever we can. She is right to be passionate about small businesses and entrepreneurs. Small Business Saturday takes place this weekend and I am sure many of us will be out supporting small businesses, not only on Saturday but in the run-up to Christmas and beyond.

The Opposition spokespeople peddled so many myths and untruths, I do not know where to start. [Interruption.] We addressed many of them in previous debates, so I will not hear from them. The way they react speaks volumes.

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. The Minister did not mean to say “untruths”, did he?

[Nigel Huddleston]

I take back that comment, Madam Deputy Speaker. There were some presumed facts that require challenge, as we saw earlier in the week. At one point, the shadow Chancellor claimed that the forecasts were going to be £40 billion smaller. The shadow spokes- people know full well, because it is stated by the OBR, that economic growth by the end of the forecast period is higher than it was in the spring forecast. [Interruption.] I am sorry if I have to explain that to Opposition Members—if a number is bigger than the previous one, then that means growth and not decline. We could possibly forgive that mistake if it were not made by the people trying to become the Chancellor of the Exchequer. It is extraordinary incompetence—a £55 billion difference is not something we can easily ignore.

As my hon. Friend the Chief Secretary to the Treasury pointed out earlier, we are pleased that the Opposition are supporting the national insurance cuts, but to combine that with their commitments on spending, to the tune of £28 billion, and then claim that there will not be an increase in debt is farcical. It is not true; we know that will happen, and we are seeing the same old Labour. As Margaret Thatcher said:

“The problem with socialism is that you eventually run out of other people's money.”

That was true then, and it is true now.

I thank hon. Members for their contributions. The Bill delivers a tax cut for 29 million working people, and I am pleased that it will be getting support from across the House.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I join the two Front Benchers in saying how deeply sad it is to hear the news that Alistair Darling has died. He was an incredibly well-respected, thoughtful and kind man who was devoted to public service. I know all Members will want us to send their condolences to his family.

Question put and agreed to.

Bill accordingly read a Second time; to stand committed to a Committee of the whole House (Order, this day).

Further proceedings on the Bill stood postponed (Order, this day).

National Insurance Contributions (Reduction in Rates) Bill: Money

King’s recommendation signified.

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),

That, for the purposes of any Act resulting from the National Insurance Contributions (Reduction in Rates) Bill, it is expedient to authorise the payment out of money provided by Parliament of any increase in the sums payable under any other Act out of money so provided that is attributable to:

(a) reducing the main primary percentage for Class 1 primary national insurance contributions to 10% (and reducing the percentage specified in regulation 131 of the Social Security Contributions Regulations 2001 to 3.85%),

(b) reducing the main Class 4 percentage for Class 4 national insurance contributions to 8% from tax year 2024-25, and

(c) removing the requirement to pay Class 2 national insurance contributions from that tax year.—(Mark Jenkinson.)

Question agreed to.

National Insurance Contributions (Reduction in Rates) Bill

Nigel Huddleston Excerpts

Committee of the whole House
Thursday 30th November 2023 Commons Chamber

[The Financial Secretary to the Treasury (Nigel Huddleston)]

Thank you, Dame Rosie, for that timely reminder. I shall briefly outline the clauses in the Bill. Clause 1 amends the Social Security Contributions and Benefits Act 1992, which applies to Great Britain, and the Social Security Contributions and Benefits (Northern Ireland) Act 1992 to reduce the main primary percentage of class 1 national insurance contributions paid by employees from 12% to 10%. That is a tax cut worth an average of around £450 per annum for employees. Clause 2 amends the Social Security Contributions and Benefits Act 1992, which applies to Great Britain, and the Social Security Contributions and Benefits (Northern Ireland) Act 1992 to reduce the main class 4 NICs percentage paid by the self-employed from 9% to 8%. That is a tax cut worth an average of around £350 per annum for the self-employed.

Clause 3 amends the 1992 Acts that apply to Great Britain and to Northern Ireland to remove the obligation on persons to pay class 2 obligations when their earnings exceed the lower profit threshold of £12,570 per annum. The small profits threshold is retained, with the result that self-employed persons with profits from a trade, profession or vocation above that level will be treated as having paid class 2 NICs and will continue to gain entitlement to contributory benefits.

Clause 4 introduces the schedule, containing transitional and consequential provisions. The schedule to the Bill includes changes that are consequential on clauses 1 to 3 of the Bill. The principal changes are the introduction of a blended rate of primary class 1 national insurance contributions for directors for the 2022-23 tax year and consequential repeals arising from clause 3 that removes the requirement to pay class 2 NICs. Finally, clause 5 gives the short title as the National Insurance Contributions (Reduction in Rates) Act 2023.

[The First Deputy Chairman]

I call the shadow Minister.

--- Later in debate ---

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Before I come to my point, may I add my own condolences and those of my party to the family and friends of the former Chancellor, Alistair Darling? Clearly, we were on very different sides of the fence, particularly on independence, which was heavily contested nine years ago, but he was a towering intellect and a very important figure in Scottish public life. As I say, we pass on our condolences to his family and friends.

My question is also on the operation of clause 1. HMRC has stated to the Treasury Committee that it is unable to cope with inquiries either in writing or by phone at the moment, and that it is under severe pressure. I, too, would like to know how the clause will be given effect by 6 January, and what measures the Government are taking to ensure that that happens.

[Nigel Huddleston]

I thank hon. Members for their questions. I can assure them that HMRC is engaging with industry and providing relevant guidance to support it to deliver the changes on time. We expect the majority of companies to be able to do so, particularly in this era, when many of the changes can be made on various systems. The Government are confident that the majority of software developers will be able to make changes to their payroll software in time for the 6 January deadline.

Question put and agreed to.

Clause 1 accordingly ordered to stand part of the Bill.

Clauses 2 to 5 ordered to stand part of the Bill.

New Clause 1

Review of effects of Act

“(1) The Treasury must lay before the House of Commons on the day on which this Act is passed a report which sets out forecasts of—

(a) the changes to the amount of national insurance contributions deducted from the annual income of a full-time worker earning the national living wage as a result of the measures in this Act over the period 2023/24 to 2027/28, and

(b) a comparison with the changes to the amount of national insurance contributions deducted from the annual income of a full-time worker earning the national living wage as a result of the thresholds for payment of national insurance remaining frozen over the period 2023/24 to 2027/28, rather than rising in line with CPI.

(2) The report in subsection (1) should also set out the costs to (i) businesses, and (ii) government , of implementing the changes in this Act, and compare them to the costs of—

(a) implementing a 1.25% point increase in national insurance contributions in April 2022, and

(b) implementing the reversal of the increase in paragraph(a) in November 2022.”—(James Murray.)

This new clause would require a review of the effects of the Bill if enacted over the period 2023/24 to 2027/28, on someone earning the national living wage, compared with the effect of national insurance thresholds being frozen, and a comparison of the expected implementation costs of this Bill with those of implementing and repealing the Health and Social Care Levy Act 2021.

Brought up, and read the First time.

[James Murray]

I beg to move, That the clause be read a Second time.

Thank you, Dame Rosie, for the chance to address our new clause 1. Before I do so, may I ask whether the Minister would commit to writing to me with detailed responses to the questions that I raised in our debate on the previous group? We did not get them in his response just now, so perhaps he will commit to writing to me with them as soon as possible.

Our new clause would require the Government to be honest about the impact of the changes made by the Bill when considered not just in isolation but in the wider context. Subsection (1) would require the Treasury to explain how the taxpayer or someone earning the national living wage would be impacted by the combined effects of the changes in the Bill and the freezing of national insurance thresholds at their 2022-23 level over the period 2023-24 to 2027-28.

We asked for confirmation of that, because our analysis shows that a full-time worker on the national living wage will pay an estimated £70 more in national insurance next year, even with the cut in the Bill, as a result of the thresholds being frozen. What is more, the full impact of the Government’s freezing of national insurance thresholds will be that by 2027-28—again, even with the cut in the Bill—a full-time worker on the national living wage will pay £160 more a year in tax. Can the Minister confirm whether he accepts our calculation? If he does not, I assume that he will accept our new clause and publish the data; otherwise, people will rightly be left wondering what it is the Government have to hide.

Should the Government choose to accept our new clause, subsection (2) would require them to come clean on some of the implementation costs to businesses and the Government of what the Chartered Institute of Taxation described last week as the “national insurance roller-coaster” in recent years.

If the Government are not prepared to accept our new clause, perhaps the Minister will again commit to writing to me with details of the implementation costs of the changes made by the Bill, of the 1.25 percentage point increase in national insurance contributions in April 2022, and of the reversal of that increase in November 2022. If he will not, I would be grateful if he could explain why not, again to prevent people from wondering what it is the Government have to hide.

[Nigel Huddleston]

I hope that I can give the hon. Member some assurances. A worker on the national living wage will save £165 next year from the national insurance cut, and thanks to above-inflation increases in the NIC starting threshold since 2010, a full-time worker on the national living wage will pay £400 less in national insurance contributions next year than they otherwise would have. That includes the historical increase to the national insurance contributions starting thresholds in July 2022 by this Government—the largest ever increase to a personal tax starting threshold. The national minimum and living wage rates are set on advice from the independent Low Pay Commission. Rates for 2025-26 and beyond will be set in future years.

The cost to HMRC of implementing and reversing the health and social care levy was £5 million. The cost to implement this rate reduction is not yet known as the project to deliver the change is in delivery, though HMRC does not expect it to be significant. In answer to the hon. Gentleman’s previous question, I will be delighted to write to him.

[James Murray]

I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

Schedule agreed to.

The Deputy Speaker resumed the Chair.

Bill reported, without amendment.

Third Reading

[Nigel Huddleston]

I beg to move, That the Bill be now read the Third time.

This is a short and relatively straightforward Bill, but it is an important one, as it will make a meaningful difference to many households by putting money in the pockets of millions of people in every constituency in this country. I thank the Treasury officials, Clerks and everyone involved in getting the Bill to this point so speedily. I sense the enthusiasm in the House to pass it, and for us to get back to our constituencies and spread the good news. I will therefore end my comments there and commend the Bill to the House.

Oral Answers to Questions

Nigel Huddleston Excerpts

Tuesday 14th November 2023 Commons Chamber

[Rachael Maskell (York Central) (Lab/Co-op)]

6. What recent assessment he has made of the potential merits of introducing a wealth tax.

[The Financial Secretary to the Treasury (Nigel Huddleston)]

Of course, the UK does not have a single wealth tax, but it does have several taxes on wealth and assets, and those generate substantial revenues. The Government are committed to keeping taxes low so that working people keep more of what they earn. The Government’s approach to delivering fiscal sustainability is underpinned by fairness, with those on the highest incomes paying a larger share.

[Rachael Maskell]

But the burden of tax is increasingly falling on working people’s incomes, while the richest 50 families in the UK have alone accumulated a combined wealth equivalent to that of half the population. Research from the University of Greenwich shows that a wealth tax could generate £70 billion for much-needed public services, so will the Government at least put forward a commission to investigate the matter and introduce a fair taxation policy?

[Nigel Huddleston]

I am not sure whether the hon. Lady is lobbying me or Opposition Front Benchers with her comments, but she will be well aware that we do have a progressive tax system in the UK. It is important to remember that the top 5% of taxpayers are projected to pay nearly half of all income tax in 2023-24; and the top 1% as much as 28%. Compared with what we inherited from Labour in 2010, when the top 1% of income tax payers paid 25% and the top 5% paid 43%, the tax system is fairer and more progressive under the Conservatives.

[Vicky Ford (Chelmsford) (Con)]

Those who live in homes with driveways pay just 5% VAT when they charge their cars from their home electricity, but those who live in terraced houses have to pay 20% VAT to charge commercially. Given that those who live in terraced houses are often less wealthy, will the Minister, whom I congratulate on his new role, meet me and other members of the Conservative Environment Network to look at how we might level out that anomaly?

[Nigel Huddleston]

My right hon. Friend is a great champion of such issues in her constituency and beyond. I am aware that she has already spoken to the Chancellor about this issue, but I would be delighted, as always, to meet her and discuss it further.

[Mr Gregory Campbell (East Londonderry) (DUP)]

The Government have done a lot to raise personal allowances, for which our party has advocated for many years. However, given that that is an improvement for people at the bottom end of the income scale, will the Treasury now turn its view towards hard-working, middle-income families, who also want a reduction in their tax burden?

[Nigel Huddleston]

We appreciate the support for taking 3 million of the lowest-paid people out of paying income tax altogether since 2010—an important and significant change. I understand the hon. Gentleman’s comments, but I cannot comment further, especially this close to a fiscal event.

[Richard Fuller (North East Bedfordshire) (Con)]

I welcome my hon. Friend to his new post. Does he share with me the humour that Opposition Back Benchers have proposals for new taxation that the Opposition Front Benchers are trying to bat away, while those of us on the Government Back Benches are telling the Government to cut taxes, and our Front Benchers keep batting that away?

[Nigel Huddleston]

I thank my hon. Friend for his comments. I am afraid that what we are probably seeing is “same old Labour”—we have heard this all before. What they are proposing did not work in the ’70s and it will not work now. We are very proud of our tax record, particularly taking the lowest paid out of income tax.

[Mr Speaker]

I call the shadow Minister.

[Mr Tanmanjeet Singh Dhesi (Slough) (Lab)]

I welcome the Minister to his place. The Government have the opportunity next week to right an historical wrong by abolishing non-dom tax status. The Chancellor could use that money to get our NHS back on its feet and to provide free breakfast clubs for all primary-age children, just as Labour has called for. Is the abolition of non-dom tax status under consideration, or has the Prime Minister ruled it out again, for personal reasons?

[Nigel Huddleston]

The hon. Gentleman is well aware that there are real dangers that what he is proposing would make the UK a less attractive destination—that is a very important issue. The City pays for a huge amount of our NHS, for example, and non-dom taxpayers were liable to pay £8.5 billion in UK income tax in 2021-22 and invested more than £7 billion in the UK.

[Wendy Chamberlain (North East Fife) (LD)]

7. If he will have discussions with the Secretary of State for Work and Pensions on the potential merits of uprating benefits in line with inflation.

--- Later in debate ---

[Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)]

18. Whether he plans to change the tax status of non-domiciled residents in the UK.

[The Financial Secretary to the Treasury (Nigel Huddleston)]

The Government want the UK to have a fair and internationally competitive tax system, designed to bring in talented individuals and investment that contributes to the growth of the UK economy. Non-domiciled individuals play an important role in funding our public services through their taxation contributions, and they pay UK tax on their UK source income and gains in the same way as everybody else.

[Luke Pollard]

The non-dom tax status allows people to dodge millions in taxes. Germany, France and Canada have closed their non-dom tax loopholes. Can the Minister explain to taxpayers in Plymouth and across the country why he thinks it is fair that people who live here do not pay their taxes here?

[Nigel Huddleston]

As I said in the answer I gave some moments ago, non-dom taxpayers make a significant contribution to UK tax, worth £8.5 billion in 2021-22, with £7 billion more invested. The City, for example, pays half the cost of the NHS.

[John Mc Nally (Falkirk) (SNP)]

19. What recent assessment he has made of the implications for his policies of trends in the level of mortgage interest rates.

Dormant Assets Bill [Lords]

Nigel Huddleston Excerpts

2nd reading
Monday 6th December 2021 Commons Chamber

[The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport (Nigel Huddleston)]

I thank all hon. and right hon. Members for their valuable contributions in the debate today, many giving examples of the huge impact that dormant assets funding has had in their constituencies, and we see that right across the country. I am pleased that the Bill has such obvious support across the House and in the other place. It is clear that we all share the ambition to ensure the scheme’s continued success in unlocking dormant assets for public goods.

I would like to address some of the points raised today. Time will not allow me to give full details, and we will be debating the issues and details of this Bill in its later stages. I am also happy to discuss with colleagues across the House issues raised today ahead of the Committee stage, should there be an appetite to do so.

Members have raised a wide range of issues, in particular regarding future spend considerations. Clause 29, as mentioned by the hon. Member for York Central (Rachael Maskell), enables the Secretary of State to launch a public consultation on the social or environmental purposes of the English portion of the dormant assets funding, as the hon. Member for—[Interruption.]—as the hon. Member for Ochil and South Perthshire (John Nicolson) pointed out. Sorry, this is what happens when Members change constituencies. We do not have the flexibility in England that they have in the devolved Administrations, and that is something we would like to correct, as my hon. Friend the Member for Solihull (Julian Knight) mentioned.

The Government plan to launch a consultation that will last for 12 weeks after the Bill receives Royal Assent and clause 29 is commenced. We anticipate that summer 2020 is the earliest that that will be possible. The consultation will enable the public to have their say on how the impact of the scheme can continue to be felt by the people and communities who need it most. We are committed to ensuring that the process is broad and inclusive.

As the consultation is dependent on the Bill passing with the measure included, it is too early to speculate on the causes that may be included, and I would not want to pre-empt the conclusions of the recommendations. As we have heard this evening, however, many suggestions are being put forward by hon. Members in this place and the other place about vehicles or future causes that could be included, and we are certainly open to hearing them.

We are not opposed to considering, for example, community wealth funds, as articulated by several hon. Members. My hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) mentioned alternative measures involving mutuals and credit unions. My hon. Friend the Member for Grantham and Stamford (Gareth Davies) mentioned alternative measures too. We will consider them all in the consultation.

As outlined by the Economic Secretary to the Treasury in his opening remarks, the Bill is designed to ensure that we continue to have the core principles in mind, such as additionality, as raised by several hon. Members. It is important that that underpins the success of the scheme, as it has for the last decade. The 2008 Act describes additionality as

“the principle that dormant account money should be used to fund projects, or aspects of projects, for which funds would be unlikely to be made available by…a Government department”

or devolved Administration. I reassure hon. Members that that principle will remain, which will ensure that funding is directed to causes that fulfil the scheme’s objectives while being additional to central or devolved Government funds.

I reassure the hon. Member for Bethnal Green and Bow (Rushanara Ali), my hon. Friend the Member for Devizes (Danny Kruger) and others that that means that the Government do not have direct access to dormant asset funding and cannot influence it. The money must go to the appropriate causes, as defined in legislation, which have a continuing focus on social and environmental purposes, which is pivotal. As I said, several hon. Members have mentioned alternative measures and we look forward to continuing the dialogue with them about where the funding should go, but the core principles will continue to apply.

We will continue the debate in the future stages of the Bill, but I reiterate that its key purpose is to present the opportunity to significantly expand the scheme—we are talking about hundreds of millions of pounds of additional funding—while protecting participating institutions and rightful owners. We want to continue to make sure that, where possible, money goes back to those who own the funds or are rightful owners of the money.

As a result of the Bill, we hope to release hundreds of millions of pounds of additional funds for social and environmental causes across the nation. I look forward to working together to pass this important piece of legislation, so we can proceed with that expansion as soon as possible to ensure that the UK remains a world leader in deploying dormant assets at scale to society’s benefit across the country.

Question put and agreed to.

Bill accordingly read a Second time.

Dormant Assets Bill [Lords] (Programme)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),

That the following provisions shall apply to the Dormant Assets Bill [Lords]:

Committal

1. The Bill shall be committed to a Public Bill Committee.

Proceedings in Public Bill Committee

2. Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 13 January 2022.

3. The Public Bill Committee shall have leave to sit twice on the first day on which it meets.

Consideration and Third Reading

4. Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which those proceedings are commenced.

5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.

6. Standing Order No. 83B (Programming committees) shall not apply to proceedings on Consideration and Third Reading.

Other proceedings

7. Any other proceedings on the Bill may be programmed.—(Steve Double.)

Question agreed to.

Dormant Assets Bill [Lords] (Money)

Queen’s recommendation signified.

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),

That, for the purposes of any Act resulting from the Dormant Assets Bill [Lords], it is expedient to authorise the payment out of money provided by Parliament of sums required by the Treasury for the purpose of making loans to, or in respect of, an authorised reclaim fund.—(Steve Double.)

Question agreed to.

Business of the House (Today)

Ordered,

That, at this day’s sitting, the Speaker shall put the Questions necessary to bring to a conclusion proceedings on the Motion in the name of Mr Jacob Rees-Mogg relating to the Parliamentary Partnership Assembly not later than one hour after the commencement of proceedings on the motion for this Order; such Questions shall include the Questions on any Amendments selected by the Speaker which may then be moved; proceedings on the motion relating to the Parliamentary Partnership Assembly may be entered upon and continue, though opposed, after the moment of interruption; and Standing Order No. 41A (Deferred divisions) shall not apply.—(Steve Double.)

Lotteries Regulation

Nigel Huddleston Excerpts

Tuesday 16th July 2019 Commons Chamber

[Mims Davies]

As I said earlier, it is important to use this opportunity to work with the sector to ensure that those playing charity lotteries in their local communities get the transparency that they would expect and see from the national lottery—something that the national lottery and its distributors have raised strongly. That is why we have been looking at this and why the Gambling Commission is looking at the sector more widely to support these changes to ensure that anybody playing a society lottery or the national lottery is clear where the money goes and which good causes are supported.

[Nigel Huddleston (Mid Worcestershire) (Con)]

The £2 billion raised each year by lotteries helps to fund charities, sports and heritage initiatives in my constituency and across the country. I recognise that the Minister must strike a balance, and I know that some of the society lotteries might be disappointed at the limit not being £1 million. Will she confirm that the growth in society lotteries has not been, and will not be, to the detriment of the national lottery?

[Mims Davies]

This goes back to the prudent—I love that word—decisions that I believe I have made today. We had a huge response to the consultation, alongside the report from the Select Committee on Digital, Culture, Media and Sport, and we have had up-to-date information and advice from the Gambling Commission. In the broader landscape, this change clears the space for the fourth licence, but more importantly gives the national lottery a chance to celebrate its 25th birthday, with a clear differentiation in the sector and clear transparency about where the money for good causes is going and how the sector can thrive on both sides.

Social Mobility: Treasury Reform

Nigel Huddleston Excerpts

Tuesday 11th June 2019 Westminster Hall

[Justine Greening]

I will set out my wider strategy on why I think the Treasury in its current form is not fit for purpose. I hope in holding the debate that some of the arguments will get cut-through. If we are here to improve lives, for young people in particular, and to connect those young people to opportunity, things have to radically change, including in government. We need fundamental change in how the Government look at and invest taxpayers’ money, and that means the Treasury.

[Nigel Huddleston (Mid Worcestershire) (Con)]

I congratulate my right hon. Friend on securing this debate and on her work on social mobility over many years. I think, like me, she was comprehensively educated—like many on the Conservative Benches—and joined the Conservative party precisely because we are the party of opportunity and aspiration. On the point raised by the hon. Member for East Londonderry (Mr Campbell), does she agree that we need to put pressure on the Conservative candidates to make sure that investment in education, which is a key enabler of social mobility, is a hot topic and something that every single one of them should have as a top priority should they become leader?

[Justine Greening]

I agree. I am setting out how to fix the underlying problem of why we are underinvesting in people in our country and their potential. That starts with the Treasury. In my view, the Treasury has a twofold problem—first, how it operates across Government and, secondly, its policy approach.

On how it operates, it starts going wrong with the Treasury—UK plc’s finance department—having its own separate strategy from the Prime Minister, the chief executive. We have seen this down the years. It is traditional to see Chancellors at loggerheads with their Prime Ministers. We would never see a finance director able to countermand the CEO and undermine their strategy in any other organisation, yet that is exactly what we see, year to year and day to day. It has happened under Governments of every colour with the Treasury, as it is currently set up. Time and again, we end up with a Prime Minister, who is meant to be running the country, with one strategy, and a Chancellor with a different one, and both at loggerheads and going nowhere fast. It is no wonder that Prime Ministers do not get to deliver their strategies when the finance Department has an entirely separate one.

Parliament has a Budget speech every single year; it is essentially the Government’s strategy statement to Parliament and MPs for the year. It is not, however, the Prime Minister who delivers the strategy statement; it is the Chancellor. That does not make sense at all. Of course, these Budget statements are traditionally packed with politically driven, willy-waving, “look-at-me” projects for the Chancellor. Most are not even Treasury ideas. The best ideas are hoovered up from every other Secretary of State running Departments across Government, and they are generally not even the Treasury’s. Worst of all, most of these excellent policy announcements—for example, the one that we made a couple of years ago on vocational education and T-levels—are held up in order to wait for the Chancellor to announce them in a Budget statement. That is entirely dysfunctional, and it has to stop.

We should abolish the Budget statement in its current form, as delivered by the Chancellor. By all means, let us downgrade it and have it as a very important, but functional, annual presentation of the nation’s finances. Why do we not replace it with a Queen’s Speech update? This could be a proper strategy speech for Parliament every year, delivered by the Prime Minister. There is no reason why a Queen’s Speech update—a strategy speech—could not introduce a Finance Bill. I have listened to enough Chancellors effectively introduce other Departments’ Bills on social care and all sorts of things over the years. There is no reason why a Prime Minister giving an annual update on the Queen’s Speech progress could not set out the key terms of a Finance Bill. The Chancellor could fill in the details later.

I will move on to the spending review, which is also a hugely dysfunctional process—that is assuming it happens, which I will come to in a second. The spending review is essentially a strategy process for the Government, yet it is not led by No. 10 and the Prime Minister; it is led by the Chancellor and a finance Department that potentially micro-manages a wholly separate strategy from that of the Prime Minister of this country. Through this process, the Treasury has other Departments totally over a barrel. I think there would be less of a problem with how spending reviews are approached if the Treasury actually approached them effectively, but it does not. Right now, the UK has budgets set to 2020, which is next year. The country has no budgets in place for any of its spend after next year, which is wholly unacceptable.

Look at how this plays out on the ground. Last week I was up in Bradford to meet the opportunity area team, who are doing some absolutely fantastic work on the ground by connecting improvements in schools, businesses, the local authority and communities. This is a long-term—probably a decade-long—project to get structural change in a community that has bags of potential but needs its schools to do better and its businesses to connect with and develop the talent coming out of those schools. However, the team does not even have a budget after next year. How can we expect to get long-term change in our country, if budgets do not even extend beyond the next 12 months? It is entirely disconnected from the real world of how change happens on the ground. I have talked about opportunity areas, but it is writ large across virtually every single Government-delivered project that is happening on the ground to change things and improve lives.

The Treasury has just cancelled the spending review. From what I read in the papers, we will simply be rolling budgets forwards. At such a crucial time, I cannot think of a less strategic way to manage the UK’s public finances and invest in the future.

[Justine Greening]

Indeed I do. Of course, not being able to plan ahead is a hugely inefficient way to manage resources. We spend efficiently when we can get long-term deals from suppliers and contractors, and when we can plan into the future. The inability of any of us to do this is absolutely an inefficient, sub-optimal way to manage finances. If we were to have the spending review, it would be a three-year spending review, but even a three-year or five-year spending review is not long term for a country. The companies that I spent 15 years working in did three-year to five-year spending reviews, but they were not Britain, which needs to invest for the long term.

How on earth are we going to invest long term in people and unlock social mobility if we will not even look beyond the next two or three years? If we will not even look beyond the next 12 months, it is absolutely impossible. This is a failing strategy, and a functioning department or ministry of finance should know that. The fact that the Treasury does not know that tells us everything about why it is not fit for purpose and should, as it stands today, be abolished.

The way in which that failing extends, operates and works on policy in practice—I speak as a former Secretary of State who ran three spending Departments—is that unless a departmental policy area is demonstrably and critically failing on the ground, the Treasury’s attitude is to turn a blind eye and hope that it all gets better. The Treasury’s technical explanation for this is that it hopes that that will drive efficiencies; that the system will have to work harder and deliver the same for less money. That might be true in some cases, but we are set up to fail because the Treasury has no way of understanding when that point has been long passed, and we do not have enough resources to deliver the Government’s plan—possibly the Prime Minister’s plan, but often it is the Chancellor’s plan.

Problems are not fixed early and are simply left. By the time the Treasury finally understands that it is a crisis, it is more expensive to fix it. Alongside a total lack of long-term planning, the Treasury does not fix problems early, which is hugely expensive. Departments’ spending—be it on prisons, schools, healthcare, local government or children’s and adults’ services—ends up in crisis, needing last-minute funding. That is a hugely expensive way to run the nation’s finances. Most importantly, it leads to real hardship on the ground, which is the exact opposite of what Governments of all colours try to achieve.

In my area of education, it was blindingly clear in early 2017 that, although the schools funding formula was broadly the right approach—levelling up schools that had traditionally been underfunded—more money needed to go through the formula, and the money should have come from the Treasury. That was clear to me from talking to colleagues and MPs in the House, and from talking and listening to teachers and parents, yet it was only after the election that we could take any action on that obvious problem. In fact, as everyone knows, I ended up doing my own mini-budget to release £1.3 billion to put into frontline funding. One might have expected that the Treasury would welcome a Secretary of State doing its job for it, but I had to haggle to get that agreement through the Treasury and be able to announce it. I fear that the Treasury yet again is making a similar mistake on school funding and repeating the process.

Reviews are another classic Treasury ruse. The recent Augar review managed to waste well over a year coming up with obvious conclusions about additional funding for further education, but no doubt the Treasury is delighted that it can kick the issue into the long grass for another 12 to 18 months. However, if the substance of the point is that FE needs additional funding, the Treasury has not done young people in the FE system any favours by turning its face away from the need to fund the system properly. It simply cannot be allowed to continue operating in this way.

I have talked about my experience of how the Treasury interacts with other Departments, but what about its policies? It should be managing the nation’s finances to maximise long-term value by unlocking the potential of its most crucial, precious resource—its people. It should set taxation and public investment policy to deliver that strategy for the long term. That is how to reduce the deficit sustainably. It needs to be a finance Department with policies to tackle weak access to opportunity.

For example, how do we recapitalise a generation of young people who do not have access to capital and therefore are not only disconnected from the fact that Britain is a capitalist society but cannot access opportunity? The Government and Parliament decided that they are willing to give young people access to capital if they want one kind of opportunity—a degree—but other opportunities are a wholly different matter. If young people want resources to move across the country to get the apprenticeship opportunity that they really want, to start a business, to put down a deposit on a house, or to rent a place somewhere where they can get on with their career, we do not capitalise them to do that. We should be doing that, and a functioning Treasury would look at those sorts of strategic measures to unlock a structural change in access to opportunity and social mobility in our country.

My hon. Friend the Member for Mid Worcestershire (Nigel Huddleston) asked a good question about the leadership candidates. At the moment, we are hearing only simple, tactical taxation suggestions that, frankly, would not strategically or structurally shift the dial on social mobility.

[Nigel Huddleston]

My right hon. Friend is being very generous in giving way. Does she agree that enabling young people to reach their full potential is a core responsibility not only of the Treasury but of the Government? I suspect it is one of the key reasons why we got into politics in the first place. Will she join me in appealing to the Prime Minister, before she leaves office, to make a strategic and big move on education and education funding, which would ensure that the future leader, whoever it is, is obliged to deliver incremental, significant increases in funding for education in order to deliver on the key promise that she made when she first entered Downing Street three years ago?

[Justine Greening]

If the Conservative party is to be taken seriously as the party of opportunity, it is important that it has a clear, articulated and well-funded strategy on developing our nation’s talents, and of course that means investment in schools. One of the problems is that, because the Treasury does not have an approach on valuing human capital, it does not understand how to look at valuing investment in schools alongside investment in physical capital. It does not have any sense of how to invest in human capital, which is perhaps the most powerful form of capital, but it is all over how to value the long-term returns on physical capital infrastructure projects, such as High Speed 2. The reality is that it is the capacity and talent of the people who get on those trains, log on to the broadband, get on the tube—like my constituents—or get into the cars that go on those roads that will determine whether Britain is successful in the future.

A functioning Treasury would understand that that is how to maximise long-term tax receipts and the effectiveness of public investment, because of course improving lives is the best way to take the pressure off public spend, so much of which is invested in lives that have gone wrong. Instead, the Treasury effectively just manages cash flow year to year—I am a chartered accountant with 15 years of experience in business, so I am as qualified as anyone to comment on this. We see reports saying that tax receipts and growth have been a bit better, so the Chancellor has a bit more money in his pocket. That is cash flow management, not managing the nation’s books for the long term. It is the polar opposite of a long-term strategy.

The fiscal rules should be scrapped and reworked on the basis of debt and deficit, how we deliver and measure long-term value and whether policy measures are creating or destroying it. In Cabinet, I regularly pointed out to the Chancellor the Treasury’s inadequate approach to valuing investment in people. An example of that is that we spend literally hundreds of thousands of pounds on the children and young people who end up in alternative provision and out of mainstream school. About 6% of them come out of alternative provision with a credible, strong or standard score in GCSE maths and English. That is no sort of strategy. A functioning Treasury would insist that it be reworked to deliver not only better lives but a smarter approach to spending. Those are some of the most challenging and vulnerable young people in our country, and they are often dealt with by children’s services. Those are the kids who have had the toughest starts and often face the bleakest futures. There is an opportunity cost to them in the failure that lies ahead of them in their lives if we do not help them get on track, and to the public finances, too. I have met lots of those young people. I have been up to the Beacon of Light—a fantastic place in Sunderland that helps young people to get on track and works with local businesses to slot them into careers. It turns their lives around and gets them on track. That is transformational not just for them but for Britain’s long-term public finances. Those young people generate more tax, which contributes to our economy and our society. The spend on welfare, the justice system and health due to continued family breakdown is less.

As Secretary of State for Education, I had those discussions regularly with the Chancellor, the Chief Secretary and the Treasury. A Treasury sensibly managing public finances for the long-term would run towards a business case that would improve those lives, but it was like pulling teeth. If the Treasury continues to see spending on health, education and prisons only as a cost, it will always try to minimise it. Instead, it should see that spending as an investment that generates a return. Changing the way the Treasury works so that it looks at early intervention and fixing problems before they become bigger would deliver long-term, sustainable and optimised public finances.

The Treasury’s strategy on taxation and spending should be looked at through a very simple lens—does it deliver improved social mobility in our country or not? Every policy should have a clear test: does it level the playing field on opportunity in the short and long terms? If the answer is no, the Treasury ought to ask whether and why it is wise to put taxpayer money against that project.

I know that the Treasury has under way some Office for National Statistics work on valuing human capital—I am pleased about that—but it is about how that capital is accounted for, and I am afraid that the work just scratches the surface of the issues that I have raised. I am talking about far more than the ONS project. I am talking about a Treasury that, in its present form, is clearly incapable of doing the job that it needs to do to manage Britain’s public finances, unlock social mobility and, dare I say, reform itself, which it will not do to itself.

We should consider breaking up the Treasury, perhaps splitting it into a Ministry of Finance and an Economics Ministry, while merging the former with some elements of the Cabinet Office and having it report properly to the Prime Minister, so that it genuinely delivers a Prime Minister’s strategy for our country. This morning, I have not had much time to do anything more than scratch the surface, but if we really want Britain to be the first country to achieve equality of opportunity, a significant part of that solution starts right at the heart of Government, by fixing the dysfunctional Treasury.

Unless we grasp that nettle, we should not be surprised to get the same day-to-day cash flow management that prioritises political pet projects, sets No. 10 and No. 11 at loggerheads with each other, which is dysfunctional for the nation, and, in the end, achieves the exact opposite of what we all want—for our children, young people and communities to have equality of opportunity, access to opportunity on their doorstep and the chance to be the best version of themselves. That unlocks the chance for our country to be the best version of Britain, too.

Discrimination in Football

Nigel Huddleston Excerpts

Thursday 11th April 2019 Commons Chamber

[Mims Davies]

I thank the right hon. Gentleman for his kind words—if we all worked together on this issue we could make a huge difference. I think social media has not been helpful, as it has been a platform on which people have been able to ply racism and hate and disguise who they are. I hate to say it, but if that has crept into the stadiums, perhaps social media is part of the issue. The Online Harms White Paper mentions a new duty of care regarding social media, because too many cowards out there think that football is a cloak to cover their intolerance. We need no more of that.

[Nigel Huddleston (Mid Worcestershire) (Con)]

I thank the Minister for her robust statement—remarkably, she has managed to unite the House. There is a lot of money in football, including £4.5 billion in the Premier League alone. Is enough of that money flowing to stamp out abuse and promote equality, and are the fines harsh enough to help with that?

[Mims Davies]

I thank my hon. Friend for raising the money issue. Ultimately, we can put more into this and show leadership, and the two should go together. Everything should be on the table, including heavy fines for people who do not react. Above all, we should show leadership, top and bottom, at every level, and money should be no object.

Puppy Smuggling

Nigel Huddleston Excerpts

Tuesday 2nd April 2019 Westminster Hall

[Nigel Huddleston (Mid Worcestershire) (Con)]

I beg to move,

That this House has considered the matter of puppy smuggling.

It is a pleasure to serve under your chairmanship, Mr Hollobone. I am grateful for the opportunity to introduce the debate. I extend my thanks to the many organisations and bodies that have been campaigning on the issue for a long time, not least the Dogs Trust. It has one of the country’s largest rehoming centres in my constituency and it is a pleasure to work with it.

This is the second time that I have introduced a debate on the topic, and I am pleased to be joined again by hon. Members from across the House. That is hardly surprising, given that there are 9 million dogs in the UK—probably more; we do not know exactly—and many more dog lovers. I also have here a book that contains the pledges of 137 Members of Parliament who are committed to stopping puppy smuggling. I hope that that conveys to the Minister how deeply concerned we are about puppy smuggling. I am not the only person in the House who has concerns about the issue being raised by a significant number of our constituents.

In the previous debate on the topic, I told the Chamber that puppy smuggling was a multimillion-pound underground—

[Chris Evans (Islwyn) (Lab/Co-op)]

On a point of order, Mr Hollobone. There is no Minister present. Is that in order?

--- Later in debate ---

[Mr Philip Hollobone (in the Chair)]

The sitting is resumed and I invite Mr Huddleston to restart his speech.

[Nigel Huddleston]

I beg to move,

That this House has considered the matter of puppy smuggling.

Thank you, Mr Hollobone, and it is a pleasure to serve under your chairmanship. Once again, I am grateful for the opportunity to introduce this debate today. I also extend my thanks to the many organisations and bodies that have campaigned on this issue for many years, in particular the Dogs Trust, which has one of the country’s largest rehoming centres in my constituency. It is a pleasure to work with it.

This is the second time that I have secured a debate on this topic, and I am pleased to be joined again by so many colleagues of different parties from across the House. That is not surprising, as there are 9 million dogs in the UK and many more dog lovers.

I also have with me today a book containing the pledges of more than 137 MPs, and I think more MPs will be signing today, showing that they are committed to stopping puppy smuggling. I hope that that conveys to the Minister, just how deeply concerned we are about puppy smuggling, and I know that I am not the only Member of Parliament who will say that this issue is also of great concern to my constituents.

In the previous debate that I secured on this subject, I told the House how puppy smuggling was a multi-million pound industry—an illegal trade. Hundreds of puppies are intercepted at our ports and borders each and every year. I will come on to some of the issues surrounding security at our borders a little later, but it is likely that thousands more puppies slip through the net and remain unidentified.

[Maggie Throup (Erewash) (Con)]

I thank my hon. Friend for giving way and also for securing this really important debate. He talked about measures being put in place at the borders. However, does he agree that it is not only important for us to put measures in place in the UK but that we need international co-operation as well, to stamp out this horrendous practice?

[Nigel Huddleston]

My hon. Friend makes an important point, and I will come to some of the recommendations later on. Although much of the focus of my recommendations will be on what the UK Government can do, we also need to lobby internationally to ensure that there is fair treatment and awareness across countries.

[Emma Little Pengelly (Belfast South) (DUP)]

On that specific point, there is a particular issue with the Irish border; it is estimated that about 30,000 puppies cross it every year. So, although we can secure the borders of the United Kingdom, we also need to co-operate with other countries, including the Republic of Ireland, to see what can be done to ensure that the likes of that land border, which is very difficult to put checks along, can still have checks in operation, and it is also particularly important to have checks at ports in the Republic of Ireland as well.

[Nigel Huddleston]

The hon. Lady is making another very important point. Of course, there are particular sensitivities around the border between Ireland and Northern Ireland that we are all aware of. Her point is very important, and it deserves very careful consideration, so I thank her again for raising it.

[Andrea Jenkyns (Morley and Outwood) (Con)]

Does my hon. Friend agree that unscrupulous dealers are now taking advantage of the pet travel scheme and that that scheme needs to end after Brexit?

[Nigel Huddleston]

I thank my hon. Friend for making that point; indeed, I am just about to come on to it. I think we are suffering from the unintended consequences of some changes in schemes and programmes.

Of course, puppy smuggling at heart is an industry perpetrated by people who are motivated purely by money. They can make up to an incredible £35,000 per week by illegally transporting puppies through our borders, to be sold to unsuspecting dog lovers in the UK. The root cause of puppy smuggling seems, indeed, to be the ease with which gangs can abuse the pet travel scheme that operates across Europe, which is otherwise known as PETS.

[John Spellar (Warley) (Lab)]

I thank the hon. Gentleman for giving way; he rightly identifies the large sums of money that can be made either by individuals or by organised crime gangs. These criminals appear to make a very fine cost-benefit calculation, which reinforces the need, expressed by a number of animal charities, to increase the penalties for maltreating animals. There should also be confiscation of vehicles, so that this business is no longer a paying business.

[Nigel Huddleston]

I thank the right hon. Gentleman for making that point. Indeed, many and various recommendations have come out of this debate, and of course disincentivising this really despicable trade in every way we can is very important. Penalties, fixed fines and indeed criminal sanctions are, of course, the things that we all need to consider.

[Damian Green (Ashford) (Con)]

I am grateful to my hon. Friend for giving way. Is it not also the case that as well as increasing penalties, which I strongly agree with, it is important that those penalties are available against a wide range of offences? There has been some argument that the specified offences in the current draft of the Act are not wide enough to cover all the offences that will be committed in the process of smuggling puppies.

[Nigel Huddleston]

I thank my right hon. Friend for raising that point; I am sure that the Minister is listening to it and to other points, and will respond to them. As I have said, there are many things we need to focus on. Of course, changes in the law are being considered. For example, the animal cruelty sentences will not just be specifically for puppy smuggling; they will cover a wider range of offences, and we need to make sure that the range is as broad as possible.

I had said that there were some unintended consequences to PETS. In an effort to harmonise travel between European countries, PETS was relaxed in 2012. Among the changes were the removal of the requirement for a puppy to have had a rabies blood test and a lowering of the minimum age for travel from 10 months to just 15 weeks. Since the relaxation of the PETS rules, there has been a considerable rise in the number of puppies entering the UK. In 2011, just 85,000 puppies legally entered Great Britain, but by 2017 that figure had more than trebled.

[Marsha De Cordova (Battersea) (Lab)]

I congratulate the hon. Member on securing his second debate on this vital issue. My constituency is home to Battersea Dogs and Cats Home, which is incredibly concerned about this particular issue. Does he agree that, rather than a reduction in the market, there needs to be a wholesale ban on the smuggling of all puppies?

--- Later in debate ---

[Nigel Huddleston]

I thank the hon. Lady for that intervention; indeed, I also pay tribute to the Battersea Dogs and Cats Home for what it has done. And she makes a very valid point. All of these options need to be carefully considered.

Hundreds of puppies are intercepted at our ports each year, and although we cannot accurately assess the scale of the puppy smuggling trade—it is, after all, illegal and therefore difficult to assess fully—it is likely that the true number of puppies being smuggled into the UK reaches into the thousands and not just the hundreds.

The most recent report into puppy smuggling by the Dogs Trust has also uncovered an alarming new trend of puppies from non-EU countries, such as Serbia, being taken to EU member states, given fraudulent EU pet passports and then smuggled to the UK from there.

[Alex Sobel (Leeds North West) (Lab/Co-op)]

I recently spoke to a constituent who had driven 200 miles to pick up a French bulldog puppy. It was meant to be the perfect family pet, but after its first check it emerged that it had both heart and kidney problems, as a result of bad breeding practices at what turned out to be a puppy-farming operation. I wholeheartedly support the hon. Gentleman’s call for better regulation of puppies entering the UK.

[Nigel Huddleston]

I thank the hon. Gentleman for making that point and I will be coming on to that issue in a moment.

Through good will and because they want to enjoy and care for an animal, families are sometimes led into doing something that is not appropriate for the animal. The animals’ circumstances can be horrible and they are not always in a great condition, which is extremely alarming.

[Tracey Crouch (Chatham and Aylesford) (Con)]

I am grateful to my hon. Gentleman for giving way and I congratulate him on securing this debate. I know that he is desperately trying not to mention the “B word” in this debate; I think we can all appreciate that. However, does he agree that one of the advantages of leaving the European Union will be that it will offer an opportunity to introduce far-reaching animal welfare regulations that go beyond the existing framework, including the reintroduction of tests for rabies?

[Nigel Huddleston]

I thank my hon. Friend for her intervention; indeed, one of the recommendations that I will come to in a moment is to introduce a test for rabies. We cannot do so at the moment, because we are in the EU, but that is an opportunity that we could take once we have left the EU. I also thank her for raising the “B word”.

Puppies should be at least seven months old before travelling to an EU member state from a third country, but the Dogs Trust found that in Serbia puppies as young as 10 weeks were given fake documentation, so that they could gain entry to the UK.

It is worth reflecting on the truly awful conditions that some of these poor animals have to endure. To evade detection, puppies are sometimes squashed into the hollow of backseats or covered in blankets and bundled under a front seat. They are often sedated to prevent them from making any noise or moving around. The Dogs Trust has told me that it has intercepted at the border puppies that have been given such heavy doses of sedative that it has taken them several days to come to. Travelling to the UK by car from countries such as Lithuania, Latvia and Serbia can take up to 30 hours, during which time puppies are given no toilet breaks, no time to exercise and very little, if any, food and water.

One case that exemplifies just how awful the trade is, is that of Lola, a French bulldog who was transported hundreds of miles from Lithuania, with temperatures in the van she was smuggled in reaching more than 40° C. She was heavily pregnant and it is illegal for a travelling pet to be pregnant. Shortly after being taken in by the Dogs Trust, she gave birth to four puppies, but it was such a difficult birth and she had been through such a traumatic experience that two of them were stillborn.

Lola has since had a number of health issues, ranging from infections to respiratory diseases, with some requiring surgery, but the Dogs Trust has managed to arrange treatment and she has been successfully rehomed. However, had Lola not been detected at the border, she and her puppies would have been advertised online and sold to an unsuspecting family who had no knowledge of the state of their health. Imagine someone bringing a new puppy home to their family, to very excited children, only to discover that it was unwell, possibly diseased and requiring treatment that could cost thousands of pounds.

The trauma of the journeys these puppies are forced to endure often leads them to develop behavioural issues and some, unfortunately, do not recover from their health issues and end up being put down. After rescuing 39 puppies from one commercial dealer, the Royal Society for the Prevention of Cruelty to Animals found that six needed to be put down immediately and two thirds had congenital defects. The RSPCA has also cited an investigation that found that about 20% of puppies bought on the internet died within six months.

What can be done to put an end to this trade? There have been many suggestions and, as has been mentioned, some of the changes can be made once we have left the EU. I wish to acknowledge and show my appreciation for the fact that the Government take animal safety and welfare seriously—for example, all the work that they have done on the banning of ivory sales and third-party sales of puppies. But they could, and should, go further. For instance, I urge them to bring before Parliament as soon as possible the already promised increase to five years of the maximum sentence for animal cruelty. That would apply to puppy smuggling.

I also ask the Government to consider introducing on-the-spot fines for those caught illegally importing dogs, and I encourage them to improve the presence of border officials at our ports, to carry out more visual checks at all hours of the day, every day of the week. The current disparity in the border presence between office hours and weekend and evening slots can all too easily be exploited by smugglers.

Post-Brexit, the Government could reintroduce a requirement for dogs to have a rabies blood test and set a restriction on how soon after the test they could travel. That could increase the age at which dogs could legally enter the country to six months, say. The benefits of that in tackling puppy smuggling are twofold: it is much easier for officials to assess accurately the age of puppies once they have reached six months, and the incentive to smuggle puppies in the first place would be reduced because they are less desirable to the public once they are that bit older.

I know that the Minister is familiar with the issues we have raised; he and I have had many conversations in the past. Colleagues wish to bring up many other points, so I will finish my speech. I know that the Minister will listen carefully, and I look forward to his response.

[Mr Philip Hollobone (in the Chair)]

The debate can last until 5.40 pm. I am obliged to call the Front-Bench spokespeople no later than 5.17 pm, and the guideline limits are five minutes for the SNP, five minutes for Her Majesty’s Opposition and 10 minutes for the Minister, and then Nigel Huddleston will have a few minutes to sum up the debate. Until 5.17 pm, it is Back-Bench time, and nine Members are seeking to contribute. I want everyone to be able to do so, so I am afraid there will have to be a time limit of two and a half minutes to ensure that everyone can get in.

--- Later in debate ---

[Nigel Huddleston]

I just briefly say a very big thank you to so many colleagues, from all nations and all parts of the UK, who have contributed to the debate and have made so many compelling arguments and constructive recommendations in so many different policy areas where we can take action. I also thank the Minister for the content and the tone of his response. I do not doubt for one minute his sincerity. I have trust and faith that we will see action from him, but we wish to be very clear that there is a sense of urgency. There is a bit of impatience, but we will trust the Government that they will take action. We are a nation of dog lovers and animal lovers. Let us take some more action so that we can really show that.

Question put and agreed to.

Resolved,

That this House has considered the matter of puppy smuggling.

Oral Answers to Questions

Nigel Huddleston Excerpts

Tuesday 5th March 2019 Commons Chamber

[Mr Philip Hammond]

As I have told the House many times—I will elaborate more at the spring statement next week—in what I now think is the unlikely event of a no-deal exit, the Government have both fiscal and monetary tools available to them to support the economy. Of course, the likely shock would be on the supply side of the economy, and we would have to be careful that fiscal interventions did not merely stimulate inflation. If we are to find ourselves in that situation, we have the firepower and the clear intent to intervene to support the economy.

[Nigel Huddleston (Mid Worcestershire) (Con)]

T6. I am sure that all those on the Treasury Bench agree that it is a really important responsibility of the Government to ensure that our children and young people can achieve their full potential. With that in mind, can my right hon. Friend assure me that skills and education funding will receive the priority attention it deserves in the upcoming spending round?

[Elizabeth Truss]

My hon. Friend is right. We also need to ensure that we are spending money on the right things. For example, the changes this Government have made to phonics have seen our children go from some of the poorest readers in Europe to some of the best. It is about money, but it is also about what we do with that money.