Ways and Means — House of Commons, 2017-09-06
Topic: Macroeconomics
Stephen James McCabe (Labour, Centre-left): I am grateful for the opportunity to make a brief contribution to this debate I cannot help but feel that the Government seem a little embarrassed by this whole Budget, this whole set of measures and the state of the economy. Presumably, that is why there were so few people on the Government side to make a contribution today. We did have a fleeting, cameo appearance from the Chancellor earlier, but he is still taking his vow of silence. I understand that, because I used to work with unemployed people and people who feared losing their jobs, and I know about that sense of needing to keep your head down sometimes In the time available, I want to pick up a couple of the issues that have come up in the debate and to try to understand where the Government are at the moment. To be honest, the Minister gave very little detail in his opening remarks—it was not so much broad brush as "Don’t blink or you’ll miss it." I particularly want to ask about the proposal that has come up again to tax people’s redundancy pay and termination payments. My understanding was that there had been a discussion on this and that the Government had conceded, so I am not quite clear why we are back looking at what looks like virtually the same proposal. I want to ask a straightforward question: if this proposal is the right thing to do—I have grave doubts about the way we are proceeding—should Parliament not decide that? Is it really right that HMRC should be given the power to make the decision? I think that that is Parliament abdicating its responsibility, but more importantly it is another grab by Government to transfer power elsewhere so that they do not have to be accountable or scrutinised. We really should look again at whether that is appropriate I have a very simple request on business investment relief. It behoves the Government to place in the House of Commons Library details of where that business investment is going. We need to know which businesses and companies are benefiting; how evenly it is being spread around the country; and which regions and nations are seeing benefits. Otherwise it looks like another attempt to give someone a tax cut on the side. As long as people have that suspicion and do not have the evidence or an explanation, is it any wonder that they will adopt that view I intervened on the Minister earlier on the issue of non-domiciles. He was quick to tell me that I had nothing to say on the subject because Labour was in power before the present Government and the coalition. It is true that past Governments have struggled on the question of non-domiciles, but my memory is that the Conservative party could not have been clearer about its position in 2010. In fact, the former Chancellor was absolutely crystal clear about what it was going to do when it came to power. The question we have to ask is, having had all this time to work it out, how come there are so many exemptions, exclusions and difficulties in tackling a problem which, according to the Conservative party, has been at the centre of its own thinking for seven years? How is it so difficult? If the object of the exercise is not to try to avoid doing it—it was quick to say that that was not the case and that it was the party that would deliver—how come there are so many exclusions, exemptions and get-out routes for the people involved On the wider question of tax avoidance, the Conservative party seems to wonder why people do not believe, trust or have faith in it. Is it normal that those lobby groups and people who have spent time arguing against tax provisions to limit the amount of tax paid by individuals and organisations should then be given the power to scrutinise whether what individuals are doing is right and appropriate? That does not sound right to me, and when I try to explain it to my constituents it does not sound right to them either. They have a straightforward understanding of the rules: the Government set the rules, they are laid out in black and white, and we are expected to pay. However, when it comes to other people being expected to pay, the very same lobby groups and organisations that advise and assist them and lobby against paying are given the power to scrutinise what they are doing. That is why people do not have faith in what is going on I want to turn to the air passenger duty measure. The Minister was quick to use his crystal ball when tackled on corporation tax earlier. He quickly moved the issue away from what the Government are doing to what he foresaw a future Labour Government doing. I wonder whether he will go back to his crystal ball and reflect on two things. First, on the air passenger duty arrangements we are being asked to approve, what are the Government doing about the changes happening elsewhere in the country? When the Scottish Government set their rate for air departure tax, that could have a phenomenal impact on the airline industry and every regional airport and regional economy in this country. What is the point of the Government setting a rate in complete isolation from what is happening about 600 miles up the road? What is the value in that? Why do they not look at that and give us a coherent response Secondly, I am interested to know from the Minister’s crystal ball what is going to happen with corporation tax. Once Northern Ireland has to make a decision about corporation tax—presumably in relation to the Irish Republic—it cannot but have a knock-on effect on corporation tax rates in the rest of the country. How come there has not been a single comment about that from the Government? Will it be a case of them waking up after the event, as they have done at every stage in the economic management of the country so far, and telling us that they are going to think about it?