Sarah Bool
Main Page: Sarah Bool (Conservative - South Northamptonshire)Department Debates - View all Sarah Bool's debates with the Department for Business and Trade
(1 day, 22 hours ago)
Commons Chamber
Sarah Bool (South Northamptonshire) (Con)
As the late great Andy Williams sang, “It’s the most wonderful time of the year” but I am afraid that is not true for farmers, business owners or those in retail, hospitality or leisure. Following the Chancellor’s Budget just two weeks ago, there are only two lines in that song that resonate—“scary ghost stories” caused by the Chancellor’s announcements, and memories of “tales of the glories of Christmases long, long ago” before Labour got in.
One of the many problems with the Government’s approach to working is that they start with the premise that any flexible or part-time working, including zero-hour contracts, is by nature wrong and unfair. In actuality, it simply reflects the needs of the market and businesses at any given moment, as well as personal preference. Take food production as an example; it should be obvious, but that work in that sector is often seasonal and cyclical. The labour demands of farming and horticultural businesses are variable and difficult to forecast with 100% accuracy. Crop conditions, weather conditions and customer demand all contribute to the inherent unpredictability in food production.
On Monday night, Labour and Liberal Democrat MPs voted against an amendment from the other place to insert a proper definition of “seasonal work” into the Employment Rights Bill, and Reform did not even bother to show up. The Government have instead proposed an amendment to “consult”. This is another issue that the Government hope they can just kick into the long grass and hope we will forget about.
That difficulty with forecasting also spills into the hospitality sector, as has been acknowledged. With benefits ballooning and the tax bill for the working man increasing day by day, everyone is feeling the pinch. They are all tightening their belts, so it becomes incredibly hard to forecast the current level of need. I was speaking to one of my local hospitality businesses, which has already been hit by a £900,000 NICs bill this year alone. The business was explaining the impact of NICs and what it means in reality. I think we throw around large numbers but do not actually understand the intricacies of them.
The Chancellor said to the Treasury Committee that she does not see the link between the NICs increases and unemployment. I fail to see how she cannot see that link. Let’s do a NICs 101: NICs are paid on a month-by-month basis, and are triggered when someone earns £417 a month. If a student or anyone else worked for just one month and did more than 35 hours in the month at minimum wage, the business would then have to pay an additional 15% of national insurance on every pound above £417. Cash is king, and if that is to be rolled out, it is no wonder that businesses are questioning whether they can take on any other employees.
My hon. Friend makes an important point, although it is not just, or even primarily, about the increase from 13.8% to 15% on the overall rate, but that it kicks in at £5,000, down—from memory—from £9,200. That has a particular impact on those employed part-time, youth employment, and lower-wage employment, because it means that employers start paying NICs much earlier in the pay journey. Does my hon. Friend agree that that is exactly why we are seeing youth unemployment rising as well as general unemployment?
Sarah Bool
My hon. Friend makes a valid and correct point. We have started to see a rise in unemployment in South Northamptonshire among 16 to 25-year-olds exactly because of that.
The business owner I spoke to said that the problem is that the business starts paying at a certain level, but that increase pushes up across all wages across all levels of the business. Suddenly businesses are finding themselves drowning in the amount of money they are having to pay. That will stifle the market. We even talked to some of my hairdressers—they have been mentioned numerous times to the Minister—who said that the impact of NICs means that, according to the British Hair Consortium, there will be no new apprentice starts in 2027. That is staggering and appalling, when the Government are talking about all the opportunities for the young.
My hon. Friend may be aware that just across the channel in France, high regulation and high tax has led to consistent, long-term high youth unemployment. Speaking of Andy Williams, another song says that there is a “lesson to be learned” from this, and we do not have to look too far to learn it.
Sarah Bool
As always, my right hon. Friend makes a valid point. Andy Williams is getting a lot more airtime today than any of us imagined.
I am afraid that I do not know anything about Mr Williams, so I cannot add to the lovefest. I wonder whether my hon. Friend has reflected, as I have, that in households that have been workless for quite a long period of time, temporary seasonal intro-jobs often show our young people the value, importance and benefit of work and what it can do for their families and communities. When those opportunities are reduced, so the opportunity and potential for social mobility is curtailed.
Sarah Bool
Absolutely. We need to encourage that next generation through to the workforce, and I cannot see that they are getting any of those opportunities at the moment. The Government are so proudly trying to promote that, but let us look at the impact and the figures. There can be no denying that they are achieving none of what they hope to achieve in future.
Tom Hayes (Bournemouth East) (Lab)
Across these Benches in the mainstream parties, we have to develop solutions to the problems we face, partly because we know that in our Chamber we have the likes of Reform. Our country is in debt to the tune of £2.7 trillion and we spend around £105 billion each year to service the debt before we spend any money on anything else. We therefore have to think, in that difficult situation, about how we come up with solutions.
If we are to fund our public services to get people back into work, which helps to grow the economy, and are to do the other things that we want to do as a country, what is the right way of raising the funds that allows our country to pay down our debt and the amount we spend each year to service our deficit and to bring the change that people want in delivery of public services? I ask the hon. Lady please not to say “Welfare reform.” I agree that we need to do welfare reform—[Interruption.] If I may, I agree that we need to do that, and the Milburn and Timms reviews will be critical to taking forward an effective welfare reform package, but what else would she do?
Sarah Bool
At least the hon. Member has acknowledged that we have to repay debt, unlike the Green party, which suddenly believes that repaying debt interest is not a viable or true alternative in this world. The hon. Gentleman denies talk of welfare, but it is a fundamental element. [Interruption.] I am glad to see that he agrees with that, but there is so much more. Why is the Labour party increasing the welfare bill?
The Government have to grow the economy and that means supporting businesses, giving them opportunities, reducing tax and putting money in our pockets to do that. Unfortunately, we can see from everything that has come from the Government so far that the economy is not growing. Watch this space, but that is a problem that we will struggle with.
South Northamptonshire has 95 pubs, which are crucial to our rural community and to our economy. They are a great example of a place where young people can start their first jobs. At The White Hart in Hackleton, a young girl with Down’s syndrome, who could not get a job outside the village because of transport issues, took her first job. That job will be threatened by all the measures from this Government.
The Centre for Policy Studies has undertaken an analysis of all the impacts of both the previous Budget and the one last month on the cost of employing 18 to 20-year-olds. The shocking figure is that it will cost an employer £4,000 a year more to employ a single person between the age of 18 and 20. Given that, is my hon. Friend surprised that employers, just like the pub that she has mentioned, are taking rational decisions not to give young people jobs?
Sarah Bool
I agree entirely, and I am devastated to hear that, because that is exactly not what we need for society and for the young generation.
Research from the Taxpayers’ Alliance showed that in 2024 the average pub paid almost £100,000 per year in taxes on the sale of alcoholic drinks alone. When we add to that the coming changes to business property relief and the recent increase to employer NICs, we see that hospitality is really being smothered. But there is a way out. There is no need for an enforced and permanent dry January. The Conservatives have a plan, and it includes the abolition of business rates for hundreds of thousands of high street businesses.
The Government often deny it, but pubs and shops have seen their business rates bills more than double under this Government. We say that what is needed to bring back the festive cheer to our high streets is not more Government, but Government getting out of the way and allowing businesses and entrepreneurs to flourish. There is a big difference between business and the Government. Businesses, as has been mentioned, take risks with their own money. They provide jobs and they grow the economy. They are brave, as my hon. Friend the Member for Gosport (Dame Caroline Dinenage) said earlier, but this Government just risk taxpayers’ money, destroy jobs and contract the economy.
Particularly, I look to my farming community. I have 550 farms, and they are the driver and the lifeblood of South Northamptonshire. One of their biggest issues, alongside things like NICs, is the inability to plan. A lot of discussion has been had about helping our companies grow for the future, but part of that growth requires the ability to make long-term plans. Under this Government, we have seen the removal of the sustainable farming incentive, and capital grants have gone on and off. There is also the double cab pick-up tax and the fertiliser tax. When we add in the employer national insurance tax and the changes to agricultural property relief and business property relief, we have to ask how farmers are possibly supposed to plan or invest in the future.
On my hon. Friend’s point, how can businesses be expected to plan, having been told in the 2024 Budget that the tax rate was a one-off, and in 2025 that there was an unforeseen second tax rate but with no further plans? That is not a promise that one can necessarily rely upon. The presumption is that there will be more next year. How can businesses, whether they are agricultural, industrial or whatever, be expected to plan for growth, investment and job creation when they have absolutely no idea of the trajectory of the tax take that the Treasury is hellbent on introducing?
Sarah Bool
I thank my hon. Friend for making that point. The importance of the construction industry was mentioned earlier, along with the plan to give more construction apprenticeships and jobs to young people, but for those jobs to be offered, we need people to be investing in the first place. Companies are not doing that, because they cannot make those decisions. They do not know where the money is coming from. They do not know when the money will next be taken from them. We are not creating an environment in which they can grow. I do not see anyone on the Government Benches disagreeing with me on that, so I think my hon. Friend’s point is well made.
What seems to be missing on the Government Benches is any recognition of the growing anger among young people at the fact that they are being shut out of the jobs market. It is the most damaging time in someone’s life to be barred from work when they are young. The Minister does not seem to be an Andy Williams fan, but The Clash sang under a previous Labour Government:
“Career opportunities are the ones that never knock”.
Not under Labour.
Sarah Bool
Absolutely.
In Prime Minister’s questions earlier, I asked about the fair choices that this Government say they have made. I think those choices are fundamentally unfair. The Government are trying to introduce a digital ID scheme, unfunded by the Government, that could cost at least £1.8 billion, yet most of the public do not want it, given that 3 million people signed the petition against it. The Government then talk about inflicting tax hits on all our businesses. It is just madness. There is absolutely no sense of direction from this Government. This is not a pro-growth Chancellor but a no-growth Chancellor. That will be the legacy.
I never thought that a Christmas song could sum up a Government’s economic approach, but if we look at “We wish you a Merry Christmas”, it appears that we are in the “we won’t go until we’ve got some,” phase from this Government, whether they are demanding figgy pudding or, in this instance, tax. I am really hoping, though, that they will see the light and eventually help businesses to unlock, to reach their potential and to have a merry Christmas and a happy new year.