PARLIAMENTARY DEBATE
Finance (No. 3) Bill - 8 January 2019 (Commons/Commons Chamber)

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

With this it will be convenient to discuss new clause 5—Review of public health and poverty effects—

‘(1) The Chancellor of the Exchequer must review the public health and poverty effects of the provisions of this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider—

(a) the effects of the provisions of this Act on the levels of relative and absolute poverty in the UK,

(b) the effects of the provisions of this Act on life expectancy and healthy life expectancy in the UK, and

(c) the implications for the public finances of the public health effects of the provisions of this Act.’

I rise to speak to new clause 1 in my name and that of my right hon. Friend the Leader of the Opposition and other Members.

In opening for the Opposition today, I shall start with a few general comments on the Bill before moving on to my substantive remarks on child poverty and equality. First, I must mention the new schedule the Government have tabled, at this late stage, on intangible fixed assets. It is yet another example of the Government’s absolute contempt for parliamentary processes—a result of their desperation to cling to power. Although the Chancellor announced this proposal at the Budget, the introduction of this detailed schedule at this stage of the Bill guarantees that Members are denied the opportunity to scrutinise it properly. It circumvents the Public Bill Committee process, which was created to ensure that technical measures such as this one receive forensic and detailed analysis. This is no way for any Government to conduct legislation. With that in mind, perhaps the Minister could explain why this measure has been included at the final stage of this Bill, denying Members the opportunity to properly scrutinise it. Is it a deliberate decision to once again circumvent parliamentary process? Will he consider withdrawing the schedule and including it in the next Finance Bill later this year, ensuring that it receives the proper parliamentary scrutiny it actually warrants?

It appears that Ministers are hellbent on starting this new year in the same fashion that they ended the last—by treating Members of this House as a peripheral part of the law-making process, bypassing parliamentary processes and breaking long-established conventions. The vast majority of Members in this House are fed up to the back teeth with the Government’s attempts to avoid parliamentary scrutiny.

Given the heinousness of the charges that the shadow Minister has laid against Her Majesty’s Government, I presume that this is further grist to his party’s mill for a no-confidence vote. When will that be tabled and debated in this place?

I don’t think he is taking it seriously.

My hon. Friend is absolutely right. We are here debating the Finance Bill and the Government’s dreadful performance in bringing legislation to the House for much-needed scrutiny. They seem to be incapable of doing that. They seem to be incapable of doing very much these days.

Has it not occurred to the Government that had they entered this place in a spirit of co-operation, they might not have suffered defeat after defeat on this legislation? This Finance Bill is the product of a Government on the run—a Tory party totally consumed by its Brexit civil war, unable and unwilling to posit even the feeblest domestic agenda here for fear of upsetting its nasty, hard-right faction. The Prime Minister’s speech about fighting burning injustices has turned to ash. Her claim that she would end austerity lies in tatters. She occupies our highest public office, and yet the public have no confidence in her—neither do many of her own Back Benchers, for that matter.

Meanwhile, the view is even worse from the Treasury. The Institute for Fiscal Studies said that the Chancellor was gambling with the public finances at this Budget, and it seems that even before the Bill has left this place, he has already lost that bet. The Office for National Statistics recently blew a £12 billion hole in the Chancellor’s spreadsheets by returning student debt to the Government’s books.

So one has to wonder, what is the point of the Tory party—unable to deliver a competent Brexit deal, unable to secure our economic future, unable to meet its own fiscal rules, and unable to deliver a domestic policy programme? It is a party still reliant on the old dogmas of neoliberalism and austerity, unable to see the evidence of its failures. An example of this absurd neoliberal dogma came over the break when, as we heard today, the Transport Secretary awarded a ferry contract to a company with no ferries. If he is looking for expertise in this matter, perhaps I can invite him down to Merseyside, where we have been running ferries since 1330, very successfully—and they are publicly run, I have to say. I invite him to have a go on a ferry up the River Mersey and get the feel for how it works, basically. He will have diplomatic immunity and will not be thrown overboard—I can guarantee that as well.

Did my hon. Friend notice yesterday that the Government are beginning to backtrack on universal credit? Although they say they will introduce it for 10,000 people, in essence they are backtracking. He may also have noticed the announcement today by an independent organisation that we need to build something like 3 million social houses, not in the private sector, over a 10-year period. Does he agree that that should be looked at and done through council housing?

My hon. Friend is right, and the reality is that we are not going to get it from the Conservative party—it is as simple as that. It seems incapable of doing anything that is in any way constructive for the social fabric of our country.

The Government now pick and choose whichever target provides cover for their devastating treatment of children across the UK, including—when it suits them—using the very targets that they themselves scrapped. That is why new clause 1 is so important. The Government can no longer be allowed to ignore the plight of millions of children across the country.

The statistics do not lie. They show quite clearly that, prior to the Conservative Government coming to power in 2010 with their Liberal Democrat partners, child poverty in the UK was falling. The new Social Metrics Commission, which draws on the widest possible set of poverty measures, states concretely that there are now half a million more children living in relative poverty than there were just five years ago. The whole country knows that austerity is to blame, and we all know who introduced austerity—it was the Government.

I completely agree with the point that the hon. Gentleman is making. Does he agree that the two-child cap, which will apply to all new universal credit claimants from 1 February this year, and other measures that the Government are pushing mean that up to an additional 3 million children will apparently go into poverty?

The hon. Lady is right. The Government appear to want to put misery upon misery on families and children.

Despite the claims from Conservative Members, austerity was not some necessity nobly chosen by the Government of the day, but a political and ideological choice—it is as simple as that. If it was the only option, why did the United States not embark on a similar venture? Why did the likes of Germany and France not undertake a similar level of spending cuts, or Japan, or, for that matter, Australia? [Interruption.] Conservative Members are chuntering, but those are the questions that we need answering.

The shadow Minister referenced public spending in the United States of America. Is he seriously arguing that we should look to adopt its system of welfare and healthcare spending?

The hon. Gentleman knows that I am not saying that. He can twist his party’s policies if he wants, but he should not twist Labour’s policies.

We should remind those on the Government Benches that the crash, if we want to call it that, actually started in America with the Lehman Brothers and that the Obama Administration pumped $80 billion into the motorcar industry. The rest is history, as we say.

My hon. Friend makes an excellent point and backs up the point that I was making.

Those countries acknowledged a hard economic fact that appears to have stumped this Government: we cannot cut our way to growth. That has failed repeatedly, from its early use under US President Herbert Hoover, which turned the stock market crash into the great depression, to the International Monetary Fund programmes that have been imposed in developing countries and the economic and social devastation inflicted on Greece. This Government’s austerity agenda is yet another failure to add to that list. They have missed every economic target they have set, and it is the poorest in society who have paid the price.

It is interesting to listen to my hon. Friend’s informed explanation of how austerity has not worked across history. Does he agree that up until the 2010 general election, because of the fiscal stimulus put in place by the Chancellor Alistair Darling and the Prime Minister Gordon Brown, those first two quarters were successive periods of growth, and the economy fell off a cliff because of the austerity introduced by the Conservative party?

My hon. Friend is right. The economy thereafter, with the help of the Liberal Democrats, started to go down the pan. To this day, we have not recovered, and the Government’s own figures indicate that this will go on for many more years. We will have more of the same, and it is not working. When will they learn the lesson? They seem to be incapable. Even the IMF recognises the failure of austerity and has called for increased public spending to offset the negative economic effects of Brexit.

I am grateful to the hon. Gentleman for this fascinating tour de force on the period since 2010. If the Labour party in government was doing so fantastically well, growth was going so well and its economic management was prized highly by the electorate, why did it lose the general election in 2010 and then in 2015? If all was going so well, why did it lose?

I am sure the House would be delighted to hear my psephological analysis of the general election, but we are talking about the Finance Bill. You are very generous, Madam Deputy Speaker, but I do not think even you would be sufficiently generous as to hear my psephological comments.

It gives me great pleasure to agree with the hon. Gentleman. He was doing very well on new clause 1.

Thank you, Madam Deputy Speaker.

The UN special rapporteur has concluded that the rising level of child poverty is a result of political choices, underpinned by the Government’s callous austerity agenda. I will draw my comments to a conclusion because I know that lots of Members want to comment on how dreadful the Government are, how they try to stitch up Committees, how they do not allow us to have proper debates and how—for the first time since Winston Churchill introduced the notion—they have circumvented the amendment of the law motion. They talk about bringing back control to the House of Commons, but they are bringing back control to about two or three people on the Front Bench, and that does not include the Treasury Ministers.

The Finance Bill before us is yet another Bill of broken promises. It offers further tax reliefs for the rich and for multinational corporations, and it prolongs austerity for yet another year, condemning many families and many children to abject poverty. Labour’s new clause 1 would require the Government finally to assess the impact of their economic policies on the most vulnerable in our society. It would require the Government to face up to their responsibility to come and explain to this House why they are not yet changing their economic policies, despite the obvious evidence that they are doing dreadful—I repeat, dreadful—damage to this country and to our communities.

I am grateful, Madam Deputy Speaker, for the opportunity to speak at this stage of our proceedings. I am extraordinarily concerned about new clause 1, because it would delay the implementation of clause 5, which is a key part of the Bill because it sets the very level at which people in this country start to pay tax. If we are to address the issues that affect those in our country on the lowest incomes, the best way to help them will to be allow them to keep more of their money in their pockets.

That is why a key part of this Government’s economic strategy has been to make sure, year after year, that those on the lowest incomes are able to keep more of what they earn and to help themselves to build their way out of poverty. That means that 34 million people in this country are paying less tax than previously, and many millions of people have been taken out of tax altogether. This was the No. 1 recommendation of the tax reform commission, which I worked on back in 2006, and I am absolutely delighted that it was among the first steps taken first by the coalition Government, then by the 2015 Government and now by the 2017 Government. This Finance Bill means that raising the level before anyone pays tax to £12,500 is being introduced faster than we ever thought possible.

Given the Front-Bench speech that we heard from the Opposition, it is worth noting that the allowance was only £6,475 when Labour left power, but is now £12,500 under this Conservative Government.

Absolutely. That is exactly the point, because we know that the best way to address poverty is to make sure that more people can earn their way out of poverty. That does not work for everyone, but for those who can do so, this makes a significant difference, and that is exactly why poverty is now at record lows.

According to Department for Work and Pensions figures, there are 1 million fewer people in absolute poverty since 2010, with 300,000 fewer children in the same situation.

Absolutely. That is exactly the point: absolute poverty is now at record lows. That also has an impact on children—my hon. Friend made that point— because the number of children living in workless homes has fallen to the lowest level since records started.

Would not the situation for working families be even worse under a Labour Government, with the proposal announced at the Labour party conference of £500 billion of public spending, which would mean a doubling of VAT, a doubling of national insurance, a doubling of income tax and a doubling of council tax? They are not my words, but those of a Labour MP, the hon. Member for Nottingham East (Mr Leslie).

I thank my hon. Friend for that precise contribution. I cannot understand why the Labour party has voted against increases to the level at which people start to pay tax, because helping people to keep more of their earnings in their own pockets is fundamental to increasing house ownership and to building a fairer economy.

I trust that my hon. Friend’s question was not a rhetorical one, but perhaps I can try to answer it. As far as socialism is concerned, it is absolutely fine until Labour Members have run out of other people’s money to spend. That is why they are opposed to these things.

I thank my hon. Friend for that point.

I also want to talk about fairness. Yes, it is true that the provision also increases the rate at which people start to pay a slightly higher rate of tax, but the biggest impact is on those on the lowest level of tax. That is why the tax gap—the difference between the highest and lowest levels of income—has actually fallen. The ratio of the average income of the top fifth to that of the bottom fifth of households has fallen, after taking into account all benefits and taxes.

The hon. Lady has got two facts wrong. First, we did not vote against these proposals, as she suggested. Secondly, I was actually talking about the new schedule, not clause 5. If she is going to attack us, she should get her facts right, for goodness’ sake.

Perhaps this should be better drafted on the amendment paper, because the Opposition’s explanatory statement clearly refers to the “impact of clause 5”.

I agree that one should always take impacts into consideration, but I strongly believe that the issue raised by the hon. Gentleman of needing to address poverty is best addressed by allowing this Bill to go forward today, especially the elements that involve raising the level at which people start to pay tax, so that they can keep more money in their own pockets. That is fundamental to building a fairer economy, to having a lower gap between those on the highest incomes and those on the lowest incomes, and to encouraging more people in this country to take up the work opportunities available to them under this Conservative Government, with the continuing growth of the economy.

It gives me great pleasure to speak to new clause 5, which is in my name and those of colleagues. As I have previously stated, I declare an interest as chair of the all-party group on health in all policies, and as a fellow of the Faculty of Public Health, following 20 or so years of national and international work in this field.

Under new clause 5, the Chancellor

“must review the public health and poverty effects of the provisions of this Act and lay a report of that review before the House of Commons within six months of the passing of this Act…A review…must consider…the effects of the provisions of this Act on the levels of relative and absolute poverty in the UK”.

There has been a lot of talk about absolute poverty levels, and we would of course welcome any reductions in absolute poverty levels. Those are the most severe levels of poverty, when people are unable to meet basic physiological needs, such as for food, water and shelter. However, relative poverty is a really important measure that we must reflect on, so I want to stress that the review would look at both relative and absolute poverty in the UK. I also want the review to assess

“the effects of the provisions of this Act on life expectancy and healthy life expectancy in the UK, and…the implications for the public finances of the public health effects of the provisions of this Act.”

Yesterday, the Government announced their new 10-year plan for the NHS. In his statement to the House, the Health Secretary talked about the importance of reducing health inequalities—absolutely, I could not agree more—and how we need to reduce the demands on health services. I do hope that the Government will take new clause 5 seriously as an opportunity to ensure that their policies actually meet the objectives they have set out, because it will help to do exactly that.

As important as the 10-year NHS plan is to improve our nation’s health, overwhelming evidence shows that the most important thing we can do is to reduce the poverty and inequality that too many of our citizens face today. The most effective way to do that is to focus upstream by assessing policies, as they are developed, for their effects on poverty, inequality and, ultimately, the health of our citizens. That was why I tabled the new clause.

As the UN special rapporteur on extreme poverty and human rights said recently, the cuts and reforms introduced in the past few years have brought about misery and torn at the social fabric of our country. There are 14 million people living in relative poverty in the UK, 8 million of whom are working. That is the highest level ever—I advise those who may not be familiar with the most recent data to refer to the Joseph Rowntree Foundation report published last month. Two thirds of the 4 million children living in poverty are from working households. How are young people who are living in extreme poverty and who are hungry going to excel at school?

What about disabled people? They are twice as likely to live in poverty as non-disabled people, because of the costs associated with their disability. As we heard from Labour’s Front-Bench spokesman, policies on not just taxation but public spending and particularly social security are having a devastating impact on disabled people, and that includes universal credit. More than 4 million disabled people are living in poverty today. They are increasingly isolated and confined to their homes, and I am afraid that the situation is going to get worse, because we have had no real confirmation from the Government of how they will protect disabled people in relation to universal credit.

As analysis from the Institute for Fiscal Studies and others has shown, the lowest income decile has lost proportionately more income than any other group since 2015 as a consequence of personal taxation and social security changes. Last autumn’s Budget had only marginal impacts on the household income of the poorest, while reducing the number of higher rate taxpayers by 300,000. The Government’s regressive measures have done nothing to reduce the gap between the rich and poor.

Last week’s Fat Cat Friday heralded the fact that top executives now earn 133 times more than their average worker; it was 47 times more in 1998. In the first three days of January, FTSE 100 bosses earned what an average full-time worker will earn in a year. That is the unequal society that this Government have allowed to run rampant.

When cuts to household incomes are combined with the cuts to public spending and services, the impact is even more dramatic. We have seen disproportionate cuts in Government funding to towns and cities across the north. The effects of all this on life expectancy are now being seen, with gains made over decades falling away. Life expectancy has been stalling since 2011 and is now flatlining, particularly in older age groups, for older women and in deprived areas.

The regional differences in how long people live reflect the socioeconomic inequalities across the country. People may be aware of these figures, because I mentioned them when I spoke in November, but life expectancy for men in the Windsor and Maidenhead local authority, which covers the Prime Minister’s constituency, stands at 81.6 years, while in my Oldham and Saddleworth constituency, it is 77 years.

Even within those areas there are differences in how long people will live. In Windsor and Maidenhead, the life expectancy gap is 5.8 years for men and 4.8 years for women, while in my constituency there is an 11.4-year difference for men and a 10.7-year difference for women. We should really concentrate on those figures. Those health inequalities are reflected across the country.

Inequalities in life expectancy are mirrored by inequalities in healthy life expectancy—how long somebody can be expected to live in good health. Healthy life expectancy at birth across local authority areas varies by 21.5 years for women and 15.8 years for men. In addition, according to the Office for National Statistics, women’s healthy life expectancy at birth decreased by three months between 2009 and 2011. How have the Government responded? They have actually increased the state pension age: people are living shorter lives, and living shorter lives in good health, but we are increasing the time they will be expected to work.

The gains Labour made in reducing health inequalities are now being reversed. The recent Royal College of Paediatrics and Child Health report showed that infant mortality has started to increase for the first time in 100 years. Four in 1,000 babies will not reach their first birthday in the UK, compared with 2.8 in the EU. Those are the unacceptable consequences of austerity.

Last month’s report by Public Health England investigating these inequalities in life expectancy confirmed what many of us have been saying: austerity has wrought misery and poverty, and has ultimately brought an early death for too many. If the Prime Minister is committed to tackling burning injustices and ending austerity, she needs to commit to her policies being independently assessed for their effects on poverty, inequality and public health, as my new clause outlines.

Reducing the gap between rich and poor benefits not just those who are lifted out of poverty. As the International Monetary Fund’s report five years ago showed, if we increase inequality, we reduce growth, and if we reduce inequality, we increase growth. Trickle-down economics has been shown not to work. As evidence from totemic reports such as “The Spirit Level” shows, society as a whole benefits from decreased inequality, with increases in life expectancy, educational attainment, social mobility, trust between communities and much more. Fairer, more equal societies benefit everyone. Inequalities are not inevitable; they are socially reproduced. They are about political choice, and they can be changed.

Order. Before I call the next speaker, I should take the opportunity to inform the House—this is not very exciting; it is just to set the record straight—that some names that were intended for amendments to the Agriculture Bill were added in error to amendments to this Bill. [Interruption.] I did warn the House that it is not very exciting, but it is important to keep the record straight. For the sake of clarity, let me tell the House that the name of Mike Gapes should not appear on new clause 1, and the name of Kerry McCarthy should not appear on new clauses 10, 17, 8 and 18, and amendments 39 to 41. Having got that important matter straight, I will happily call Mr Kevin Foster.

Thank you, Madam Deputy Speaker. Hearing your announcement that the hon. Member for Ilford South (Mike Gapes) is not in fact a signatory to new clause 1 has, of course, completely changed my view. Clearly that has changed the whole speech I was about to give.

It is useful to be here for this debate on new clauses 1 and 5. I found the speech by the hon. Member for Bootle (Peter Dowd) of interest, as always. I know from one of our previous exchanges in the Chamber he will be very disappointed to hear that I am not going to give that promised talk on unpacking the holy trinity today. Even in the two hours available, that is probably not quite something that I can effectively manage. I am, however, going to go through an issue on which Members across the House generally have strong views and about which they are passionate: how we best tackle equality issues so that our policies are effective in ensuring that those who are in poverty have a route out of it.

It was not in pure jest that I made a comment in my intervention on the shadow Minister about spending levels in the United States. People talk about the US not having gone down the austerity route, but instead having had a spur or fiscal stimulus. To spend the same as the US, we would have had to make significant cuts to the public sector to get down to US levels of social spending, and in particular healthcare spending. The US has bizarre outcomes from its healthcare system: it spends more of its GDP on healthcare while achieving worse outcomes. No one in the House would wish to implement that system in this country given that failing of spending more and, bluntly, getting a lot less. It is therefore bizarre for that spending to be cited as a great stimulus. It most certainly was not. The US was still spending far less than us after our programme of austerity to bring the deficit under control.

Is that not a slightly bizarre argument? I think the Opposition are trying to ask the Government to take into account in the review the priorities we have, rather than the Government’s priorities. For example, they may be putting policies in the Finance Bill to raise taxes to do something specific, whereas we are asking them to look at public health impacts.

New clause 1 says what it says: it asks the Chancellor to produce a review of the impact of provisions and to lay a report of that review before the House. It does not require anything to be done. It does not set out a detailed list of policy changes and how they would be paid for. I do not really see where the hon. Lady is coming from. Members can generally debate all matters that are put before the House, what they believe their impact will be and whether they will make a difference.

I have to say—my Scottish colleagues like to raise this point—that in some areas, for example the Scottish education system, it would be interesting to look at how help is being provided to children so that they have a route out of poverty. In the past, the Scottish education system was one of the highest rated in the world, but I think the Scottish National party has now pulled Scotland out of the global rankings—not because it is going up them, it is safe to say. We can certainly have reviews both ways, and it will be interesting to hear whether comments from SNP Members reflect the impact that aspects of Scotland’s domestic policy, for which it has been responsible for most of the past decade, have had on some of the statistics they wish to complain about.

I welcome the fact that the Bill again increases the earnings that someone can receive before becoming an income tax payer.

Will the hon. Gentleman give way?

In a moment—I did not intervene on the hon. Lady.

Again, those with the lowest incomes will be able to keep more of what they earn. The days when earning £6,500 was considered enough for someone to start paying tax have disappeared. We were actually able to bring forward the increase in tax-free earnings for millions of people. That is a positive measure, which really makes work pay and helps the lowest earners the most.

What will be the effects of the Government’s increase in the personal allowance on the life expectancy of citizens of this country?

Any policy that encourages people to be in work and keep more of what they earn, and allows them to save, will help improve their overall health. One of the things that most improves someone’s life outcomes is being in employment. [Interruption.] It is bizarre to be heckled for saying that.

My hon. Friend is giving an insightful speech. One impact of the Government’s policies is the improvement in our Gini coefficient, which is widely recognised as an objective international measure of inequality. According to that objective international measure, our inequality has reduced since 2009-10. Nothing is perfect, but it seems that the direction of policies is working.

As always, my hon. Friend makes a well argued and succinct point. He demonstrates the positive difference that Government policies are making for his constituents and the UK as a whole. It must be said that that difference is being made by a whole package of policies, not just by the Bill. I know that a range of measures will help tackle the health inequalities in my patch, including intervention, better services, better urgent care, ensuring that we realise the benefits of technology in primary care, dealing with things such as rising obesity, ensuring that people have proper diets and continuing the welcome decrease in the smoking rate. It is bizarre that those who can least afford to smoke end up being impacted most by it, worsening already poor health inequalities.

The Bill is welcome. I do not think either new clause brings much to the debate, other than highlighting that people want reviews and statistics. With a genuine review, we think about our policy conclusions at the end, yet we hear Opposition Members say, “We want a review—but by the way, here are all our conclusions about the policies we believe should be adopted, even though we can’t really outline how we would pay for them, other than with a massive borrowing splurge that would need to be paid for by a future generation.”

It is welcome that, as has been pointed out, the number of people in absolute poverty is at a record low —1 million fewer people overall and 300,000 fewer children are in absolute poverty. [Interruption.] We hear a groan, but those are the statistics—the sorts of statistics the Opposition seek through their new clauses. The number of children living in workless homes has fallen to its lowest since records began. Being in work makes a positive difference to people’s lives.

If the hon. Lady wishes to argue with that, I am only too happy to give way.

No, I would like to ask the hon. Gentleman whether he believes in policy-based evidence or evidence-based policy. He seems to be talking about policy-based evidence. His argument is absolutely facile. He has no evidence to support it. It is absolutely ridiculous.

For policy-based evidence, we need only look to those who continue to argue that the Leader of the Opposition and the shadow Chancellor should be leading this country, despite the increasing evidence of what their economic policies would do to this nation. Anyone who takes a trip to Caracas will see the outcome there, and still some argue that we should bring those policies to this country. [Interruption.] It is lovely to be heckled all the way through my speech. I sometimes do it myself.

It is somewhat strange for the Government to be accused of not basing their policies on evidence by a party that crashed the UK economy eight years ago, and to continue to hear the excuse that the financial crash merely happened because of bankers in the United States, despite it being a former Labour Prime Minister who, just before the problem with the banks, predicted that a golden era for the City of London was about to start and set up the regulatory system that so badly failed to prevent this country from being exposed to the financial risks and shockwaves. It is somewhat strange to get that lecture on evidence, when there is plenty of evidence of what went wrong a decade ago, when we were left needing to make savings that Labour was planning to make anyway.

My hon. Friend prompted me when he mentioned a golden era. Does he remember when a certain Labour Chancellor thought it an excellent idea to sell off our gold reserves at a record low?

Absolutely. We could spend a long time analysing the decision to flog the gold reserves. It was the same Chancellor who claimed to have abolished boom and bust—to be fair, he was right: he managed to end the boom at the end of his term, although he did very little to take us away from the bust. The economic cycle is still there, and those who pretended it did not exist were deluding themselves. They kept betting that things would always go up and then things started to go down.

The other thing that has made a difference in Torbay, whose economy has many jobs in the service sector, the hospitality industry and the care sector, is the introduction of the national living wage, because of which many people have had a salary increase. It is easy for an Opposition to pledge all sorts of things, but it is very different to actually deliver in government an income rise for the lowest earners. More people are being paid more than the national living wage—local employers in Torbay are paying beyond that level to attract the staff they need, given the fall in unemployment. We cannot say that the Government’s fiscal policies have had nothing to do with that; they have made a positive difference to the lives of people in my community and others across the UK.

Does my hon. Friend agree that it is this Government who are trying to build a fairer economy and that, in my constituency and his, the gap between the highest and the lowest incomes has fallen since 2010?

Absolutely. It is worth remembering, when we hear how the Opposition want to tax people and what our tax policies are, that the highest earners in this country are paying a higher percentage today than they did for all but the last few weeks of the previous Labour Government. The claim that the Government are being much more generous to the highest earners through income tax is completely false. Sadly, my hon. Friend now represents the highest-taxed part of the United Kingdom. I refer to the work of the SNP in making Northumberland a tax haven from its policies, which have hit a range of people on middle incomes. I am concerned that the impacts in Scotland of that policy will see its representatives here in Westminster blaming those impacts on Bills such as this one, when they are due to policies that the SNP, not this Parliament, has imposed on the Scottish people.

The Scottish Government’s Budget ensures that 90% of businesses will pay less in business rates than they would if they were anywhere else in the UK. Does the hon. Gentleman believe that his Government should change their policies to match Scotland’s?

I certainly do not believe that the Westminster Government should change their policies to match the SNP’s income tax raid on middle earners and those who drive the economy. On business rates, anyone who has sat through my speeches on the high street will know that I have taken the view for some time that we need to look at how we tax the high street in future. The era of large corner premises being the most profitable place to sell goods and wares is long gone. I have to say that I do not think I will be looking at the SNP’s record for much inspiration when it comes to the question of how to stimulate the economy and boost people’s earnings.

I will go to Ochil and South Perthshire first.

The hon. Member for Aberdeen North (Kirsty Blackman) made a point about being able to lower business rates in Scotland. That has been fantastic. Will my hon. Friend join me in thanking the Chancellor for putting more than £40 million into the Scottish budget so that we could fund such a business rate cut?

Absolutely. That support was very welcome. However, one of the issues that I am surprised SNP Members do not want to be raised—although perhaps it is not a surprise, when I think about what would be said—is what the impact would be in all these areas if the Bill included a border between England and Scotland, making it harder for business to be done between those two parts of our great United Kingdom. What would be the impact on the economy if Scotland had to experience SNP Members’ overall economic and fiscal policies? Surprisingly, I do not think that they want that kind of analysis to be included in the review.

I was quite surprised by what my constituency neighbour the hon. Member for Aberdeen North (Kirsty Blackman) said. She is well aware that the north-east of Scotland—its very engine room, and the area that she represents—has ended up picking up half the business rates in Scotland. Does my hon. Friend agree that it is dangerous for business rates to damage particular parts of the economy and to unbalance it disproportionately, whether in Scotland or in England?

I could not have put it better myself. If business rates unbalance the economy, that is clearly a real issue. It is no surprise that two years ago, when voters in the north-east of Scotland—which is, as my hon. Friend says, the powerhouse of Scotland’s economy—had to decide which party would be the best to drive forward economic policies and represent their interests, the area, funnily enough, suddenly turned quite a pleasant shade of blue, with only a dot of yellow in the middle. That reflected the confidence of those voters in this Government’s policies.

I am conscious that I have been speaking for a little while, and that others wish to contribute. Let me end by saying that I do not believe the two new clauses add anything to the Bill. They were tabled by Members who regularly like to give us policy-based evidence, and who advocate a form of economic management for the country that has failed many times in other countries. There is no reason why it would not fail again here if they were given the chance to implement it. I hope that the House will not accept the new clauses, but will accept that the Bill will make a difference to working families across the country, will help to drive our economy forward, and will have a positive effect on the country overall.

I support the two new clauses. Unlike the hon. Member for Torbay (Kevin Foster), I think that they are very measured. They simply ask the Government to review the impact of the Bill on poverty and inequality.

I do not know what other Members think, but let me describe what I think the vast majority of people in all our constituencies believe, and what they believe this Parliament should be saying and doing. They believe that the current levels of inequality in our country are simply and utterly unacceptable. They believe that the levels of child poverty are simply and utterly unacceptable. They are not interested in someone being able to tell them that there are 2 million children living in terrible poverty, or 1,850,000 children living in absolute or, indeed, relative poverty. That is what those people are sick of, and what I am sick of, and what this Parliament should be reflecting.

Across the country, people are asking, “Can you not do any better? Can you not do something about the fact that there are still pensioners in one of the richest countries in the world who cannot heat themselves properly in cold weather, including at Christmas?” They are asking, “What is Parliament doing when we see children living in absolute poverty who cannot afford to go to school, with shoes and clothes and food being given to them as an act of charity by people in those schools?” They are not interested in whether the figures have gone up by 0.5% or down by 1%. They are interested in what this Parliament is doing about it, and what we are saying.

All these new clauses do is say to the Government, “If you believe, for example, that clause 5, through allowing people to keep more of their income when in work, addresses some of those issues, let’s have a review to see whether or not that is the case.” That is what people would expect.

I am sick of this myself. When I drive around, not just my constituency but the country, I see enormous wealth. I am not talking about people who have worked hard and done well, which we all want to see; I am talking about massive accumulated wealth—not just income—with people able to afford to pay astronomical sums on different ways of life, while half a mile down the street there is a kid in a household that cannot afford to put any proper food on the table.

Does my hon. Friend agree that it is terrible to think of all the many places in the country where there are so many more food banks, and that the year-on-year increase the Trussell Trust has told us about is deeply worrying?

That is right. Every Member of this House would no doubt say, “Isn’t it great that there are food banks and so many volunteers at them?” I agree with that; I agree that it is good to see in communities across this country, in every part of the UK, so many people who volunteer their time with others donating to them. What I object to is that food banks, which are there as a charity, are used as an instrument of public policy—they are used as a way of tackling poverty. What on earth have things come to in 2018 and 2019 when food banks are a public policy mechanism for dealing with poverty? They are supposed to be charitable organisations for people who have somehow slipped through the net, not places where someone at the DWP sends people with tokens. That is an absolute outrage, and this Parliament should be seething about it. In saying that, I do not decry the volunteers; this brings the very best out of people, but—goodness me—is that public policy now?

That is what the Minister should be addressing. The challenge that I think every Member of this House would make to the Government would be to ask what is being done to address these issues. We do not want some academic debate about a bit of research here or there which means that the hon. Member for Torbay can say, “There’s 1,000 fewer here and 2% less there.” The levels of poverty and inequality in our country are a fundamental disgrace; why are the Government not raging about that and doing something about it through their Budget?

Does my hon. Friend agree that when he speaks to the food bank volunteers they say to him that they do not want to be doing this work as it should not be necessary because people should be able to pay for the food for their families without having to rely on handouts? They do not want to be volunteering for this because this problem should not exist in 2019.

I agree with my hon. Friend.

In my relatively brief contribution I just want to ask the Government why there is disagreement about these perfectly reasonable new clauses that ask the Government to review the impact on poverty and inequality. When the Minister responds, will he say whether he refuses to keep under review any of the budgetary measures to be implemented through this Finance Bill to see whether they impact on poverty and inequality? Is that honestly what he is saying? If he is not saying that, why cannot he accept a new clause that is asking him to review this? Who disagrees with looking at whether our Government’s policies are actually tackling poverty and inequality? I find this absolutely incredible.

The Minister can say that this is all rhetorical nonsense, but let us see what he says about how he intends to review the impact of the Government’s policies. For example, he knows that one of the key challenges for Government policy is that, despite what they have tried to do, the number of working people in poverty is increasing. That is a policy challenge. It is not a Labour-Tory thing; it is a policy challenge. If the Minister simply retrenches on this, he is not acting as a Minister of the Crown or a Government Minister responsible for our country; he is acting as a Tory party politician, and that is not what a Minister of the Crown should be doing.

I find it sad to have to ask this, but does my hon. Friend agree that perhaps the reason why the Government will not accept the new clauses is that they would provide the evidence that these policies are wrong and that they are harming our citizens?

I agree. I am not sure if the Minister is listening, but that is the point. Surely the Government would want to know whether their policies were working, so that they could do more of them. And if their policies were not working, all of us would want the Government to change tack.

Poverty and inequality should be at the heart of everything the Government do and of everything this Parliament demands. All that the new clauses and amendments are doing is saying to the Government, “Look at what your policies are doing. Look at the impact out there. What are you doing to tackle the utterly unacceptable inequality, child poverty and increased use of food banks that we see in our country? How are your policies going to address this?” That is the purpose of the new clauses, which I totally support.

It is a pleasure to follow the hon. Member for Gedling (Vernon Coaker). In fact, I agree with some of the sentiments that he has expressed. The level of poverty is still unacceptable, and that makes me unhappy. I am also unhappy about the level of inequality across the country and in my own constituency, but I want to support a Government who are doing something about it, not just through words but through actually taking steps to make these things better.

I have enormous respect for the hon. Member for Oldham East and Saddleworth (Debbie Abrahams), who introduced her new clause 1 earlier. It proposes a review of the impact of clause 5 on child poverty and equality—that is, the impact of raising the level of the personal allowance after which people start paying tax. She also spoke to new clause 5, which proposes a review of the public health and poverty impact of the whole Act. It is enormously tempting to say yes, we should do this. All of us in this Chamber care enormously about poverty and inequality levels. I have a background in healthcare, and I feel very strongly about reducing health inequalities. I am also conscious of the different life expectancies within my own constituency, which are substantial, but we must be careful not to be lured into a sense that reviewing a specific part of an Act will give us an accurate picture of all that is being done and of its impact on, for example, reducing health inequalities.

I want to reciprocate by expressing my respect for the hon. Lady and for the work that she does in this place on mental health. I have huge experience in this area. I spent more than 20 years working on health inequalities and specifically on the assessment of policies to ensure that we get them right. That is part of the reason that I came into Parliament, and I know that this can be done. As my hon. Friend the Member for Gedling (Vernon Coaker) said, if we are all so committed to reducing poverty and inequality, let us assess our policies before they are implemented, to ensure that they do just that.

I thank the hon. Lady for her intervention, but we should be a little cautious about assessing a particular bit of policy in isolation without considering other policy areas, because that might result in false information. For instance, if we examined a specific bit of Government spending, it may appear to be doing a fantastic job, but if we do not consider the counter-effect and the money that is being taken away from people elsewhere, it does not provide the whole picture and might lead to poor policy decisions.

I want us to look at the overall impact of Government policy in the round. For example, we should look not only at the impact of raising the personal tax allowance, which is positive because it enables people on low incomes to retain more of what they earn, but at where the Government are investing money. For health inequalities, we should look harder at the extra £20.5 billion going into healthcare and the impact of the NHS long-term plan, published yesterday, which has a particular focus on directing funding to reduce inequalities and increasing funding for primary and community care. Those things will particularly help those in the most deprived areas and those with some of the worst health outcomes.

I know that it is enormously controversial, but universal credit—I will probably get booed by the other side of the Chamber—is helping people into work and is doing so hand in hand with an economy that is strong overall, leading to unemployment in my constituency halving since 2010.

I totally support what the hon. Lady is saying about importance of inequalities and health inequalities, but does she not recognise that two thirds of children in poverty have a working parent? People are trapped in low-paid work, and they are still poor, and she knows from her time on the Health and Social Care Committee that poverty is the biggest driver of ill health and health inequalities.

I recognise that there is poverty in working families, but I do not agree with her use of the word “trapped”. It is important to ensure that people are in work, because that is the best way out of poverty, and then to ensure that we support people to raise their earnings. One way of doing that is through the support available through the jobcentre when people resume universal credit, which now tends to help people to move up and earn more money, and the other is by looking at the wider economy. As the hon. Lady will know, the minimum wage has risen and is rising, but we are also seeing wages rising independent of the minimum wage as a result of a more productive economy. What is actually key to a better level of wellbeing and fewer people being in poverty is having more people in work, which is the case, and a more productive economy, which means that people earn more. We can achieve that through driving up skills and technology, increasing exports and a swath of other things that would take me into a whole other conversation.

My hon. Friend has mentioned some of the benefits of having a working parent or family member, but it also sets an enormously good example for the children. Children brought up in workless households have low aspirations and ambitions when it comes to obtaining work themselves, so somebody being in work is not just about money, it is about psychological and educative factors, too.

My hon. Friend is absolutely right. While education standards are rising in our schools—readings levels, for example, are increasing substantially, leading to better opportunities for children—low levels of aspiration are still a problem and, as the teacher I was speaking to at a primary school in a deprived area said the other day, raising young people’s aspirations is key.

I am completely insulted by the point made by the hon. Member for St Albans (Mrs Main). I grew up in in-work poverty. My parents were working, and I saw them struggle day in, day out, but I assure the House that my aspirations were not stopped. It may do some Members good to understand what people living in such conditions have to go through day in, day out, and Members should not patronise people when they simply do not understand the situation.

I thank the hon. Lady for her contribution and for the example she sets. Although she has described a very tough childhood, she is a role model and is playing her part in Parliament.

To be clear, what I said was from a conversation with a teacher, who is doing a very good job in a very deprived school, about her experience. The hon. Lady’s experience might be different but, from this teacher’s experience, although there is so much she can do to help children learn to read, write and perform better in their education, what would make the next difference for those children is for their aspirations to be raised and for them to have a sense of the opportunities for them beyond their needs and environment.

Will the hon. Lady give way?

I have already taken an intervention from the hon. Lady, so she has had a chance to make her point.

Does my hon. Friend agree that making sure people can keep more of their earnings before they pay tax, introducing the national living wage and reducing the very high taper rate for people on legacy benefits will all contribute to helping people to get out of the in-work poverty trap?

My hon. Friend is absolutely right, and she reminds me of a constituency case, before universal credit, of a mum who was looking to raise her income but who was coming up against a threshold. If she worked more than 16 hours a week, she would not benefit, so she was trapped in poverty—the hon. Member for Central Ayrshire (Dr Whitford) used the word “trapped” earlier—because it did not make sense for her to increase her hours of work.

My hon. Friend is making an important point about aspiration. In this House we often get caught on economics and money, but social capital is just as important. In many communities right across the United Kingdom, we need to be helping people to see the true opportunities, both inside and outside their communities, to allow them to realise their true potential. It is important that we consider the social alongside the monetary in all these debates.

I absolutely agree and that is one reason why we have to look at policies in the round. I completely support the policy of taking people out of income tax, but let us look not just at that. Let us look, for example, at the strong economy, at the opportunities that gives people and, beyond that, at the strength provided by having a family and community around people, which also provides the social capital to be able to make the most of their lives.

Does my hon. Friend agree that the challenge for Parliament changes over time? In the Labour years we were very concerned in Parliament about the number of workless households—there were 3 million then. There are now a lot more people in work, but there is this issue, which has been rightly raised, of the quality of that work, of the skills involved and of whether it rewards people adequately. That is the new challenge, but we are making progress.

I thank my right hon. and learned Friend for his intervention.

The hon. Member for Gedling spoke earlier of his frustration. He did not want people to talk about changes in percentages and there being perhaps a few fewer people in poverty, but actually the numbers do matter. The numbers tell us what is happening, and the numbers are moving in the right direction, which is really important. The fact that the numbers are moving in the direction of our having fewer workless households should not be sniffed at or dismissed. Achieving that has been a challenging job, and it has involved a significant effort from many people.

Will the hon. Lady give way?

I think I should conclude my remarks, as I am aware that I have been speaking for a while.

New clauses 1 and 5, which call for reviews on specific aspects, have been advocated in a way that suggests that one side of the House cares more about poverty, for instance, than the other, but that is not the case at all. Members on the Conversative Benches care very deeply about poverty and equality within society.

What really matters is the track record of governing parties in these areas. I would raise these questions with the House. Which party in government oversaw an increase in unemployment from 5% to 8%? Which party left office with nearly 4 million workless households? Which party left office with rising absolute poverty? All of us know that it was Labour.

In contrast, under this Government, we have more than 3 million more people in work, the lowest unemployment since the 1970s, 600,000 fewer children living in workless households, falling absolute poverty and rising wages. When it comes down to it, this is what matters—getting right those policies that improve people’s lives, reduce inequality, reduce poverty and make life better for everybody. That is what we should all be backing.

It is a pleasure to follow my hon. Friend the Member for Faversham and Mid Kent (Helen Whately).

I rise to oppose new clause 1, and I do so for these reasons. If any Members were so inclined, they should please come and visit my constituency of North Dorset. If they visited North Dorset, they could easily be forgiven for thinking that everything in the garden was rosy. There are pretty villages, attractive market towns, lush fields, healthy-looking cattle grazing and a strong local economy where unemployment is virtually zero. If Polly Toynbee or the hon. Member for Bootle (Peter Dowd) were to arrive in North Dorset and say to me, “Simon, would you take me to your most deprived ward?” I could not, because I do not have one, but I know that I have pockets of deprivation and of poverty in each village and market town in my constituency.

One of the big challenges facing any suite of financial policies is recognising that poverty manifests itself in various ways and guises, but right the way across our nation. It is, I would suggest, far easier to identify large pockets of urban deprivation and poverty. The real public policy challenge is also to recognise and address those of rural poverty, often in sparsely populated areas where the instinct—maybe it is part of the rural community DNA—is slightly to shy away from asking the state, either local or national, for support and to demonstrate a strong sense of resilience and smaller communities trying to work together, although that is no excuse for any Government to shy away from focusing like an Exocet on trying to deliver policies that help to address rural poverty.

I am motivated by this every day. I know the figures move around, but the average national salary for the UK is in the region of £24,000 or £24,500 per annum, as I understand it. In North Dorset, when I was first elected in 2015, the figure was £16,500 and it has just risen to about £18,000, but rural jobs always pay less, if people are in the agricultural sector, food production or the hospitality trade. In those rural areas we do not have those big, high-paying employers. That is why we should always focus on trying to deliver support.

I find myself agreeing with what the hon. Gentleman is saying about rural poverty. I am an MP in Cheshire, and our local food bank expresses real concern about the rise in the number of people who live in rural areas having to access the food bank. He is right about pride, and another relevant group is elderly people, who often will not access help and support, so it is important to mention rural poverty.

I am grateful to the hon. Lady for her intervention. I am not entirely sure whether her support of me or my support of her has damaged her career more than it has damaged mine. We will leave our respective Whips to adjudicate on that. Nevertheless, she is absolutely right, and she is absolutely right to highlight that often incredibly annoying sense of pride when a retired person comes to an advice surgery. I say, “Look, we can try to help you to get this, that and the other,” and they say, “No, I don’t want to, Mr Hoare. I don’t think it is right. I have never asked the state for anything.” There is some locked-up pride among some of our retired citizens and we must forever say to them that the state in all its manifestations is there to provide. The second duty of the state, after keeping the country safe, is to provide that safety net that delivers self-respect and the opportunity for people to live with some semblance of dignity and happiness, particularly in their later lives.

Those in later life are a group that is often hard to reach. They will never be contacted through the digital economy; they need to be outreached to. I make the point again—I know the hon. Member for Crewe and Nantwich (Laura Smith) will agree with me—that one of the great challenges in sparsely populated rural areas is that outreach is often harder, because there is not that dense concentration such that at almost every door one knocks on in an area one would say “Yes, this is the area that requires most attention.”

I thank my hon. Friend for painting this clear picture of rural poverty, but pockets of poverty occur in urban constituencies such as mine, too. Does he agree that poverty is about not only how much someone earns but the cost of living? That is why it is so important that we focus not just on the relative poverty measures that the Labour party focuses on, but on reducing absolute poverty, which is the measure that this Government have succeeded in dealing with.

My hon. Friend is absolutely right to pinpoint the cost of living. Opposition spokesmen sometimes dispute this, but it is more expensive to live in a rural area. It is more expensive to heat one’s home. Travel costs are higher, usually in the absence of public transport, meaning that the running of a car is not a luxury but a necessity if one is to access even the most basic of public or retail services.

Will the hon. Gentleman give way on that point?

If the hon. Gentleman will forgive me, I will not, because I want to refer to the speech by the hon. Member for Gedling (Vernon Coaker). I hope that he will not think it is untoward for me to say this, but the passion with which he delivered his speech was powerful and incredibly compelling. He struck on a point that I was going to make and on which I had jotted down a note or two, and it is a point I have been making in recent speeches around the place. I often admire the Labour party—

Stop there. [Laughter.]

There is always a “but”, though. [Interruption.] My right hon. Friend the Financial Secretary to the Treasury says that my career has definitely gone now. I did not even know that I had a career, so that is going to be interesting.

There is usually no embarrassment on the Labour side at talking with passion about the burning injustices that we see in all our constituencies and having a clear determination to do something about them. There is no inhibition at all on the Labour side. On my side—I say this as somebody who has been a member of our party since 1985—I occasionally find that we get slightly inhibited about talking from the heart. Other Members have referred to this. We can bandy the statistics about—relative or absolute, percentage this versus percentage that, up, down, more in this, fewer than the other—but it does not matter, because if someone is poor, the statistics do not affect them: they are poor. They want to know that their elected representatives, locally, in this place and those in Whitehall are doing their damnedest to make their life just a little better.

I make this plea to my colleagues on the Treasury Bench: we on the Conservative Benches do not talk enough about the whys of politics. We talk a lot about the whats, but we do not say why. We find homelessness gut-wrenchingly upsetting. We find the closing down of hope, aspiration and life expectancy intensely moving, and we burn with the desire to help. It certainly motivates me every morning to get out of bed and to do my best for my constituents in whatever way I can by supporting policies that I fundamentally believe have the power to make our local economy, and therefore my constituents’ lives, better. If anybody in this House is not motivated by that fundamental political passion to stir up the soul to go and do something about it, I say to them with the greatest of respect that they should not be here. That, I think, must be our principal function. Members from both sides of the House want to arrive at a place where aspiration, hope and opportunity are available for as great a number of our citizens as we can possibly facilitate.

We also want to make sure that the economy is buoyant. Why? Because warm words butter no parsnips. The emotional speeches may salve our consciences, but we need the economic policies that deliver the taxes and pay for the safety net below which, I am determined, none of my constituents should, or will, ever fall on my watch. We need to be ever vigilant to make sure that our economic policies are delivering that growth.

I am very grateful to the hon. Gentleman for giving way. I say with the greatest respect that he is making a very good speech for the two new clauses. The knowledge gained from reviewing policy implementation feeds into the decisions that go forward, so, at this stage, I invite him to support the two new clauses.

The hon. Gentleman is—what’s the phrase?—pushing his luck on that. I think that the divide here will be on the theoretical and the practical. I am always conscious that we can go to any Minister’s office, or any Department, or any local council, and find gathering dust, spiders and dead flies on many a window sill reports, reviews and assessments of this, that and the other, and they have a pretty short shelf life. I would much prefer to spend Government time focusing on delivering those policies of hope and growth.

The hon. Lady has winked at me in such a beguiling way that of course I will give way to her.

I would just like to put it on the record that I absolutely did not.

You winked.

It was just a northern smile; that was all.

Does the hon. Gentleman not see that he has massively contradicted himself? His speech, as my hon. Friend the Member for East Lothian (Martin Whitfield) has said, would indicate that he should really be supporting these new clauses, and yet, when pushed on it, he is not. Does he not agree that that is why people in the outside world become frustrated with politicians who are very good at speaking in one way, but who act in another?

It was all going so well, wasn’t it? I agree with the hon. Lady that many people become incredibly frustrated when a Minister of any political persuasion delivers a speech that makes them think, “Something good is going to flow from this”, but then very little has actually happened when they come to think about it.

I would prefer to do the doing rather than the reviewing. I do not need a whole series of reviews to tell me that there are poor, deprived people who live in North Dorset. I do not need tables of statistics to tell me that I am going to hold the Government to account to ensure that policies are delivered to provide support for those who need it, to encourage a ladder of expectation and aspiration for those who wish to scale it, and to put policies in place to ensure that we remain a civilised and humane society. I do not need a whole bookcase of learned treatises to tell me this. It was strange that the hon. Member for Gedling made exactly that point—that he did not need a whole load of statistics and reviews—when that is actually what new clauses 1 and 5 are calling for.

I do not need these pieces of paper to tell me that it is the first duty of a Government of any colour—even if it were the hon. Member for Bootle (Peter Dowd) sitting on the Government Benches and my right hon. Friend the Minister sitting on the Opposition side—to try to ensure that the economy grows and that opportunities are presented.

As well as not needing to do these reviews, does my hon. Friend agree that we should be looking at our track record—at what has actually happened when it comes to getting the deficit and the debt down? Surely that is what people will be looking at. What gives them the most comfort that we will be able to deliver on our promises in the future is that we have delivered on them in the past.

My hon. Friend is right, but I think people will look at it differently. I think that most people in this country come to an evaluation of an Administration, irrespective of which party happens to be in power, based on whether they and their family group feel more secure, more prosperous and more confident about their opportunities, and on whether they can see that the opportunities for the next generation of their family are going to be deeper and wider than those presented to them when they were making their first choices.

If I may say so, my hon. Friend is making the speech of his life. In a finance debate, it is particularly good to hear a speech about burning injustices, and I agree with him that this is the right place to be having this debate. In turn, does he agree with me that employment is at the base of dealing with all those injustices?

My hon. Friend is right. I think that the hon. Member for Crewe and Nantwich (Laura Smith) slightly misheard my hon. Friend the Member for St Albans (Mrs Main). My hon. Friend the Member for St Albans said precisely what the hon. Member for Crewe and Nantwich said, which was that although the hon. Member for Crewe and Nantwich was in a tight or low-income household, it was a house of work.

Will the hon. Gentleman give way?

Of course, but let me just finish this point with my hon. Friend the Member for Banbury (Victoria Prentis).

Where did we all learn that it was normal and expected to get out of bed in the morning, have a bit of a wash and a tidy-up, get ourselves to school and then on to work, and all the rest of it? It was from our parents. Growing up in Cardiff, I can remember large council estates where worklessness was endemic, and where the welfare state had not been that support, safety net or springboard, but had instead become a way of life for too many people. If that is the case, how on earth can we expect anybody to learn the work ethic?

I chaired the all-party parliamentary group for multiple sclerosis, which two years ago held an inquiry into people with MS who were in work and wanted to stay in work. Without reducing employability to a utilitarian argument, for people to feel that, even with a painful degenerative condition, they could still play an active, productive role in their family’s life, in the life of their community and thereby in the life of the economy nationally, had a huge impact on their mental health. I therefore entirely agree with my hon. Friend the Member for Banbury, who speaks with great passion on this issue.

An understanding of employment and the benefits that flow from it has to be rehearsed again and again by Treasury Ministers and other Ministers. We take this for granted, possibly because it is in our DNA and possibly because it is the only thing that we have ever known, but we must be conscious that there are others in our country who have not. We should be advocates, apostles, evangelisers and any other word one could think of in shouting from the rafters the strong benefits of employment.

Does my hon. Friend agree that not only has employment benefited but, since 2010, this Government have delivered a reduction of 661,000 in the number of children living in workless households—so over half a million young people are now growing up in a home where they are getting those lessons on the importance of work—and have also reduced the number of children living in absolute poverty by 200,000?

My hon. Friend helps me and my hon. Friend the Member for Banbury by amplifying the point.

I said earlier that I was born and brought up in Cardiff. One of my abiding memories was of my late grandmother, who was born in 1908, and what motivated her throughout the whole of her life. She was the daughter of Irish immigrants. When she was at school—a Catholic primary school called St Patrick’s in Grangetown —a teacher brought a child to the front of the class, theatrically held their nose, and said, “Boy, go home, you smell.”

I can remember, in different circumstances in the 1970s, my Catholic primary school in Cardiff called St Mary’s. It was the school that my mother had gone to as well. It drew from a mixed economic demographic. There was a family with three children—I can see them now. If I sound emotional on this point, it is because I am. I am emotional because I can remember—although this may sound entirely preposterous and pompous—how I felt as an eight or nine-year-old, as I was, seeing this family. The mother always looked underfed. The father always looked harassed to death. The children, one of whom was in my class, had a colour of poverty. They had a smell of poverty. Poverty has a smell about it. It has a posture about it. It says, “We are beaten.” At the age of eight, nine or 10, I can remember looking at my classmate and thinking, “What can I do?” I realised that I could do nothing apart from provide a bit of friendship and support, and I did it as best I could, as I am sure that anybody would.

But that impotence of an eight-year-old has disappeared, and I can now stand here as a 49-year-old—[Interruption.] Yes, only 49—I know. I have had a hard life—that is what I tell my wife, anyway. I burn with the sense of injustice that the hon. Member for Gedling expressed. We are all in a position in this place where we are not impotent—we can actually do something about this. If I thought that Her Majesty’s Government were not as committed as I am on this issue, I would be in the Lobby with Opposition Members, but I do not think that. I think that the strategy of the Finance Bill is right. Our values and our principles must shine through. I urge Treasury Ministers and other Ministers to talk a little more about the why of what we are doing in our politics and a little less about the percentages and statistics.

I want to talk about a few issues, many of which have been brought up during the debate. The first is the subject of new clauses 1 and 5, both of which I support, and the way in which they have been written. I stress to the Government, and particularly to the hon. Member for Torbay (Kevin Foster), that the reason why the new clauses call for reviews is that we have no amendment of the law resolution, which means that we cannot put forward more robust amendments that ask the Government to do things. If we could have tabled more robust amendments, we would have done so, and I am sure that the Labour party would have done so as well. The Government have chosen to hamstring us and, as I have said before, when Conservative Members are sitting on the Opposition Benches, they will regret this behaviour. The fact that they chose not to move an amendment of the law motion makes it much more difficult for us to table any substantive amendments, but we are doing our best.

The things that we have managed to do during these Finance Bill debates are unparalleled in the Scottish National party’s history. We have managed to have two substantive amendments accepted to the Bill. I had two amendments accepted to the previous Finance Bill, but they were particularly minor. These ones are much more substantive and call for reviews. One of those amendments fits nicely in this section of our proceedings, as it relates to the public health effects of gambling. I am pleased that that amendment continues to be in the Bill, and I look forward to the Minister bringing forward that review in the next six months, as we have called for him to do.

There are various reasons why a Government can choose to change or introduce taxes. They can choose to have a tax to raise funds for the Government. They can choose to have a tax relief to encourage positive behaviour, or a tax to discourage negative behaviour. They can choose to have a tax to do one of the things that the Opposition and the hon. Member for North Dorset (Simon Hoare) have been keen to talk about. They can choose their priorities. They can choose to have a tax system that aims to reduce child poverty, reduce inequality and increase life expectancy, and we are asking for that to be the Government’s focus when they are setting taxes.

The Government should be looking at the life chances of the citizens who live on these islands and doing what they can to improve those life chances. That is the most important thing—it is why these reviews are being asked for. Whether or not the taxes that the Government have set are appropriate, we are asking for a change of focus and a change of priority, and I think the hon. Member for North Dorset was agreeing with that.

Forgive me if I am stating the obvious, but do we not also need these reviews because we have Brexit coming up, and we have to be able to reflect on and evidence things?

That is correct. One of the difficult things about looking at the potential outcomes of Brexit is that those stats do not exist. It is all well and good to talk about the fact that there are reviews sitting on shelves gathering dust, but we need stats. We need stats to be able to prove that Government policy does what it says on the tin.

The Minister can stand up and say, “This policy will raise £100 million for the Government,” but I would like to see not only the working beforehand, but the review afterwards that proves that the policy did what the Government intended it to do. I have been clear on a number of occasions that I do not think the Government do enough of that evidencing. The reviews being asked for would allow the Government to provide us with that evidence. Evidence written by the Government, rather than an independent individual, is still a legitimate thing that we can look at. The hon. Member for Torbay seemed to suggest that we would doubt information were it to come from the Chancellor of the Exchequer—surely not! It would be good for him to provide that.

I want to talk about a few things that the SNP has been doing in Scotland and the changes we have chosen to make to not only our tax system, but other systems, and particularly those that affect the issues raised in new clauses 1 and 5. We have mitigated the bedroom tax, which has been a major factor in us having the lowest child poverty rate of any country in the UK. We have increased the number of people from disadvantaged areas who are going to university. We are making major changes to the care system for looked-after children. Those young people have had some of the poorest life chances in the past, and what the Scottish Government are doing on that is hugely important for ensuring that their life chances are improved.

We have increased the pregnancy and baby grant to £600. We are improving access to childcare, and we have the baby box scheme. We are the best country in the UK at paying the living wage—not the pretendy living wage, but the real living wage. People working in Scotland are more likely to be paid the living wage than those working in England. About half of taxpayers in England pay more than they would if they lived in Scotland, and that is the half of taxpayers who are earning the least. We think that that is a progressive measure that is assisting people to get out of poverty.

The hon. Lady is bringing out the successes of the SNP Administration in Edinburgh, but does it not still stand that, after a decade in power and with powers over taxation and healthcare, men and women in Scotland live for two years less than other people in the United Kingdom? In fact, we have the lowest life expectancy in the whole United Kingdom. There may be some successes—I support those on care—but certainly on the one thing that matters most, which is keeping people alive the longest, the SNP is an abject failure.

We have not had taxation powers for 10 years, and we do not have the full range of powers. For example, we do not have the full range of powers over public health, so we do not have in Scotland powers such as the public health taxation measures—the sugar tax—that were brought forward in the previous Budget. We do not have the full range of powers, and if Scotland were to be an independent country, with the full range of powers, we would be putting the things we are discussing today at the heart of our Government’s agenda. Our Government have done this and we will continue to do this—we are pushing for fairness.

I will wrap up, because I am aware that I am relatively short of time, but I want to talk about the people who are the poorest and, by the way, the most disadvantaged by the way in which this society is set up. Following the changes to universal credit, those in the bottom 30% of incomes will gain less from the work allowance than they will lose in the benefit freeze. The benefit freeze is costing them more than the changes to the work allowance will give them. Those people, who have no recourse to public funds, are the poorest individuals I see coming through my door, and this Government have caused that situation. This Government have caused a situation in which asylum seekers have got absolutely nothing. This is about the very poorest people, who have got the worst life chances as a result, and this Government are completely failing to do anything to support them or to improve their life chances. This is about people on disability benefits, who are really struggling, and at every turn, this Government have made their lives worse, rather than better. This is about lone parents, who are disadvantaged as a result of universal credit. This is about the increases in food bank usage.

The Government talk about people working their way out of poverty. I do not understand how people can have hope when they do not have enough to eat.

I thank everybody who has made a contribution in this very important debate. There have been some extremely passionate and well-argued speeches.

Part of the debate has been exemplified by the hon. Member for Gedling (Vernon Coaker) and my hon. Friend the Member for North Dorset (Simon Hoare), who spoke in effect about who cares about these issues. We need to recognise that Members on both sides of this House—I include the Opposition in my remarks—care very deeply about whether our fellow citizens in our great nation are impoverished, are in dire straits, do not have enough to make ends meet, do not have enough to feed their children, or have children who do not have the opportunities in life that we wish for our children in turn. Those things matter considerably, and I congratulate my hon. Friend on the quality of the speech he delivered, particularly in that respect.

Something else that lay at the heart of the debate between the hon. Member for Gedling and my hon. Friend the Member for North Dorset, is whether the numbers matter. Do the figures matter? I think it was the contention of the hon. Member for Gedling that, in a sense, the figures do not matter. In a curious way, that is rather at odds with the notion of supporting new clause 1, because it calls for more figures to inform our decisions. In one sense, of course, the figures do not matter, because what matters is the condition of the people who live in our country. However, figures do matter when it comes to formulating the policy responses we need to address the situation, and if we are, in any meaningful way, to chart the progress, or otherwise, that Governments—ours and the Labour Governments who preceded us—have made on this extremely important issue.

I do not know whether the Minister is aware of this, but the European Commission does this sort of analysis every year on its programme of policies, so it is not that this cannot be done. Its work covers not just quantitative but qualitative data, which relates to the points my hon. Friend the Member for Gedling (Vernon Coaker) made. There needs to be more than what the Government are doing—they do not know what the impacts of their policies will be.

I think I have been misunderstood, and I apologise to the hon. Lady if I was not clear enough. I am certainly not saying that data does not matter—quite the opposite. What I am saying is that we need to have the right kind of data for the exercise to be meaningful and worth while.

New clause 1 would require the Chancellor to report on the impact of changes to the personal allowance and the higher rate threshold on households of different levels of income, on child poverty, on equality and on those individuals with protected characteristics. New clause 5 would require the Chancellor to report on the Bill’s effect on child poverty, life expectancy and public health.

Let me first address the question of the Treasury’s compliance with its public sector equality duty, as referenced in new clause 1(2)(c). Equality and fairness continue to lie right at the heart of the Government’s agenda, and we take our compliance with this duty deeply seriously while deciding policy. That means that Government decisions are explicitly informed by the evidence available of the implications of those decisions for those sharing protected characteristics. I have no hesitation in saying that the Treasury complies with the public sector equality duty.

Further provisions in new clauses 1 and 5 call for the publication of different forms of analysis for clause 5 and for the whole Bill in turn. The Government have been, and continue to be, transparent—more transparent than any other. Changes to the tax system are always accompanied by a tax information and impact note, and each Budget is accompanied by detailed distributional analysis.

TIINs, in particular, are relevant to the questions discussed today. These notes provide Parliament and taxpayers with information on the expected effects of changes to the tax system, and form a vital part of the Government’s commitment to transparency and accountability around tax decisions. In the context of clause 5, for example, the TIIN already sets out the impact on groups of taxpayers according to their age, gender and income tax band, and this data is readily available to HMRC through tax returns.

That is the point: the assumptions on distributional analysis are assumptions. What we want is to see whether those assumptions turn into reality.

I will come to the very issue that the hon. Gentleman rightly raises.

Clause 5 will benefit households across the UK. Due to the information collected by HMRC through tax returns, we have various pieces of information on geographical distribution, as sought under new clause 1(2)(d). That is an important point, because much of the information being requested is actually already available.

In addition, the distributional analysis published by the Treasury already sets out the impact of tax changes on households with different levels of income. To be completely clear, the analysis shows how the living standards of households in each tenth of the income distribution will be affected by the decisions the Chancellor and Prime Minister have taken since they took office in 2016. Not only does the analysis meet the intention of new clause 5(2)(a) regarding the effects of the Government’s tax changes on different households, it actually goes beyond that by including changes to welfare and spending on public services, and by considering changes in addition to those announced at each fiscal event since the autumn statement in 2016.

There is, as I suggested at the outset of my remarks, much that we can agree on across the House. Child poverty, public health, life expectancy and inequality are among the greatest issues of our age. We have got on with the job. Absolute poverty rates are at record lows. One million fewer people are in poverty now than under Labour. I say to the hon. Member for Gedling that 1 million is indeed a number, but for every one of those million, their lives have been enhanced. That includes 300,000 fewer children in poverty than under Labour. As we know, the best route out of poverty is through work. There are 3 million more people in work now than in 2010, with 637,000 fewer children in workless households. That is a record of which we should be proud. I urge the House to reject the new clauses.

If I may rephrase St Augustine, who said “O Lord, make me chaste, but not yet,” what we have here is a Government saying, “O Lord, make me charitable and compassionate, but not just now. Let’s do it in the future.” It comes to something when the British Government, with an expenditure of approximately £840 billion a year, say that it will be difficult to get statistics, either qualitative or quantitative, from which they can make policy. That is how it seems to me, but I tell you what: every day when I am in my constituency I see people who are homeless. What have the Government done about that? Nothing. I see food banks opening up all the time. What are the Government doing about that? Absolutely nothing. What are the Government doing about the 24% of homeless people who are from the LGBT community? Absolutely nothing. And then we heard the dross coming out—that is what it is, dross—about intergenerational worklessness. The Joseph Rowntree Foundation—through evidence, through statistics, through analysis—found that that was not a significant factor in homelessness. So we hear all this talk about charity, compassion and working together, but I am afraid it does not wash when it comes from the mouths of Tories.

Question put, That the clause be read a Second time.

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

With this it will be convenient to discuss the following:

New clause 7—Review of effect of carbon emissions tax on climate targets—

“The Chancellor of the Exchequer must review the expected effect of the carbon emissions tax on the United Kingdom’s ability to meet its internationally agreed climate targets and lay a report of that review before the House within six months of the passing of this Act.”

New clause 12—Review of expenditure implications of Part 3—

“(1) The Chancellor of the Exchequer must review the expenditure implications of commencing Part 3 of this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) No regulations may be made by the Commissioners under section 78(1) unless the review under subsection (1) has been laid before the House of Commons.”

This new clause would require a review within 6 months of the expenditure implications of introducing a carbon emissions tax. It would prevent part 3 (carbon emissions tax) coming into effect until such a review had been laid before the House of Commons.

New clause 13—Report on consultation on certain provisions of this Act (No. 2)—

“(1) No later than two months after the passing of this Act, the Chancellor of the Exchequer must lay before the House of Commons a report on the consultation undertaken on the provisions in subsection (2).

(2) Those provisions are—

(a) sections 68 to 78,

(b) section 89, and

(c) section 90.

(3) A report under this section must specify in respect of each provision listed in subsection (2)—

(a) whether a version of the provision was published in draft,

(b) if so, whether changes were made as a result of consultation on the draft,

(c) if not, the reasons why the provision was not published in draft and any consultation which took place on the proposed provision in the absence of such a draft.”

This new clause would require a report on the consultation undertaken on certain provisions of the Bill – alongside New Clause 11, New Clause 14 and New Clause 15.

New clause 19—Review of powers in consequence of EU withdrawal (No. 2)—

“(1) The Chancellor of the Exchequer must, no later than a week after the passing of this Act and before exercising the power in section 89(1), lay before the House of Commons a review of the following matters—

(a) the fiscal and economic effects of the exercise of the powers in section 89(1) and of the outcome of negotiations for the United Kingdom’s withdrawal from the European Union giving rise to their exercise;

(b) a comparison of those fiscal and economic effects with the effects if a negotiated withdrawal agreement and a framework for a future relationship with the EU had been agreed to;

(c) any differences in the exercise of those powers in respect of—

(i) England,

(ii) Scotland,

(iii) Wales, and

(iv) Northern Ireland;

(d) any differential effects in relation to the matters specified in paragraphs (a) and (b) in relation between—

(i) England,

(ii) Scotland,

(iii) Wales, and

(iv) Northern Ireland.”

This new clause would require a review of the economic and fiscal impact of the use of the powers in section 89 in the event of no deal and in event of a withdrawal agreement passing.

Amendment 16, in clause 78, page 51, line 32, after “may” insert

“(subject to section (Review of expenditure implications of Part 3))”.

See New Clause 12.

Amendment 1, in clause 89, page 66, line 38, at end insert—

“(1A) The Chancellor of the Exchequer must, no later than a week after the passing of this Act and before exercising the power in subsection (1), lay before the House of Commons a review of the following matters—

(a) the fiscal and economic effects of the exercise of those powers and of the outcome of negotiations for the United Kingdom’s withdrawal from the European Union giving rise to their exercise;

(b) a comparison of those fiscal and economic effects with the effects if a negotiated withdrawal agreement and a framework for a future relationship with the EU had been agreed to;

(c) any differences in the exercise of those powers in respect of—

(i) Great Britain, and

(ii) Northern Ireland;

(d) any differential effects in relation to the matters specified in paragraphs (a) and (b) in relation between

(i) Great Britain, and

(ii) Northern Ireland.”

This amendment would require the Chancellor of the Exchequer to review the fiscal and economic effects of the exercise of the powers in subsection (1) before exercising those powers.

Amendment 13, page 67, line 7, leave out subsection (5) and insert—

“(5) No statutory instrument containing regulations under this section may be made unless a draft has been laid before and approved by a resolution of the House of Commons.”

This amendment would make Clause 89 (Minor amendments in consequence of EU withdrawal) subject to the affirmative procedure.

Amendment 7, page 67, line 19, at end insert—

“(7) The provisions of this section only come into force if—

(a) a negotiated withdrawal agreement and a framework for the future relationship have been approved by a resolution of the House of Commons on a motion moved by a Minister of the Crown for the purposes of section 13(1)(b) of the European Union (Withdrawal) Act 2018, or

(b) the Prime Minister has notified the President of the European Council, in accordance with Article 50(3) of the Treaty on European Union, of the United Kingdom’s request to extend the period in which the Treaties shall still apply to the United Kingdom, or

(c) leaving the European Union without a withdrawal agreement and a framework for the future relationship has been approved by a resolution of the House of Commons on a motion moved by a Minister of the Crown.”

This amendment would prevent the Government implementing the “no deal” provisions of Clause 89 without the explicit consent of Parliament for such an outcome. It would provide three options for the provisions of Clause 89 to come into force: if the House of Commons has approved a negotiated withdrawal agreement and a framework for the future relationship; if the Government has sought an extension of the Article 50 period; or the House of Commons has approved leaving the European Union without a withdrawal agreement and framework for the future relationship.

Amendment 8, page 67, line 19, at end insert—

“(7) The provisions of this section shall not come into force until the House of Commons has come to a resolution on a motion made by a Minister of the Crown agreeing its commencement.”

Amendment 14, in clause 90, page 67, line 22, after “may” insert

“(subject to subsections (1A) and (1B))”.

See Amendment 15

Amendment 15, page 67, line 24, at end insert—

“(1A) Before proposing to incur expenditure under subsection (1), the Secretary of State must lay before the House of Commons—

(a) a statement of the circumstances (in relation to negotiations relating to the United Kingdom’s withdrawal from the European Union) that give rise to the need for such preparatory expenditure, and

(b) an estimate of the expenditure to be incurred.

(1B) No expenditure may be incurred under subsection (1) unless the House of Commons comes to a resolution that it has considered the statement and estimate under subsection (1A) and approves the proposed expenditure.”

This amendment would require a statement on the circumstances (in relation to negotiations) giving rise to the need for, as well as an estimate of the cost of, preparatory expenditure to introduce a charging scheme for greenhouse gas allowances. The amendment would require a Commons resolution before expenditure could be incurred.

New clause 18—Review of effects on measures in Act of certain changes in migration levels—

“(1) The Chancellor of the Exchequer must review the effects on the provisions of this Act of migration in the scenarios in subsection (2) and lay a report of that review before the House of Commons within one month of the passing of this Act.

(2) Those scenarios are that—

(a) the United Kingdom does not leave the European Union,

(b) the United Kingdom leaves the European Union without a negotiated withdrawal agreement,

(c) the United Kingdom leaves the European Union following a negotiated withdrawal agreement, and remains in the single market and customs union,

(d) the United Kingdom leaves the United Kingdom on the terms of the draft withdrawal agreement of 14 November 2018.

(3) In respect of each of those scenarios the review must consider separately the effects of—

(a) migration by EU nationals, and

(b) migration by non-EU nationals.

(4) In respect of each of those scenarios the review must consider separately the effects on the measures in each part of the United Kingdom and each region of England.

(5) In this section—

“parts of the United Kingdom” means—

(a) England,

(b) Scotland,

(c) Wales, and

(d) Northern Ireland;

“regions of England” has the same meaning as that used by the Office for National Statistics.”

This new clause would require a review of effects on measures in the Bill of certain changes in migration levels.

This group of amendments relates to the tax and fiscal implications of the UK’s withdrawal from the EU.

Throughout the last year Parliament has been asked to approve a series of Bills giving the Government the power to deliver every type of Brexit deal conceivable, and this Finance Bill is no different. I said when closing the Second Reading debate on the Bill for the Opposition that this approach was one of “give us the powers now and we will make the decisions later,” and as it currently stands Brexit represents the biggest transfer of power to the Executive in modern constitutional history. That is disappointing for anyone who thought Brexit would see greater powers for this Parliament, but it is also a recipe for very bad decisions, and there is a classic culprit in this Finance Bill in the form of clause 89. Innocently named “Minor amendments in consequence of EU withdrawal”, it gives the Government power to amend tax legislation without any of the usual due process in the event that the UK leaves the EU without a deal.

The Government always tell us—I am sure they will do so again—that this is simply a safeguarding provision that we will never have to use, but all of us here today know that as it stands the Government have absolutely no chance of getting their deal through, because that deal does not deliver the basics of what this country needs. It does not deliver smooth, low-friction borders for manufacturing and supply chains, nor does it deliver market access for financial services. It also fails to resolve the big question: after we leave the EU, will we prioritise market access or trade autonomy? Because of that, we will almost certainly end up in the backstop arrangements, a halfway house without any say for the UK—the very worst of all worlds.

The new clauses and amendments are therefore of seminal importance, and I am extremely grateful to the Chair of the Home Affairs Committee, my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper), for laying amendment 7 before the House today. It is clearly a cross-party amendment, supported by the Chairs of the Treasury, Exiting the European Union and Business, Energy and Industrial Strategy Committees, but it has the Opposition’s support because it offers Parliament a chance to make a clear statement rejecting a no-deal outcome—a statement that cannot come soon enough.

Anyone pretending that crashing out without a deal is simply about resorting to World Trade Organisation schedules is dangerously misinformed. As The Economist magazine said last month:

“A no-deal Brexit is about a lot more than trade—it would see many legal obligations and definitions lapse immediately, potentially putting at risk air travel, electricity interconnections and a raft of financial services”.

It would mean tariffs on trade with the EU, but it would also affect trade beyond the EU as all our current trade agreements negotiated as an EU member would immediately cease to apply. Agriculture, aerospace, the automotive sector—all these major sectors of our economy—would face potentially irreparable damage, and while tariffs may be reduced over time, excise duties and health checks on food, plants and livestock cannot be reduced so easily. Researchers at Imperial College London have calculated that just two minutes more transit time per lorry at Dover and the Channel tunnel translates into a 47 km traffic jam, and for perishable items like food, delays of that magnitude simply could not be sustained. When we add to that higher prices through tariffs and further inflationary pressure from another inevitable fall in the value of the pound, it is a recipe for significant pressure on living standards. That is why the Opposition say that no deal is not a real option.

There has been some suggestion that the Government might accept amendment 7.

Does the hon. Gentleman not acknowledge that by ruling out preparations for no deal one is in effect tying the hands of one’s negotiating team, which in effect makes a trade deal—which we all, I think, would prefer to leaving on WTO terms—more difficult to achieve and therefore makes leaving on WTO terms more likely?

The facts are as they are. It is far too late for that. Everyone knows the position that this country is in. The Government have run down the clock. They lost their majority through a general election that they did not need to call, and it is far too late to start applying the logic that might have applied several years ago. Because of that, our vulnerability is evident for everyone to see. No one should underestimate the likelihood of a no-deal outcome at this stage. No one should be pretending, through semantics or parliamentary chicanery, that we might be able to present no deal as a way of giving us greater leverage in negotiations. I am afraid that the Government have got us to the point of ruin if that is the strategy that Conservative Members wish to pursue.

Given that the Business Secretary said in the House earlier that no deal should not be contemplated, and that my hon. Friend is outlining the possibility of the Government accepting amendment 7, would it not be right for the Government to say clearly at the end of business today that they are ruling out no deal because it would be so damaging to this country?

I absolutely agree with my hon. Friend. We all know that several members of the Government take that view, even though they may not be able to say it on the record. They are quite clear as to what no deal would mean, and they would not contemplate going down that route. It would be far simpler and far better to get to a position where ruling out no deal was clearly the Government’s intent.

New clause 3 would oblige the Government to publish a review of the fiscal and economic effects of the exercise of the powers in clause 89, as well as the differences between exercising those powers in Great Britain and in Northern Ireland. As we edge closer to the reality of crashing out without a deal, clause 89 is not simply hypothetical. We are now just two and a half months away from the UK’s exit without an agreement. It is therefore of critical importance that we have a full and transparent view of the implications of a clause of this kind.

I am afraid that the hon. Gentleman is going to have to do a bit better than this. He talks about crashing out without a deal, but he needs to get into the detail of the implications. Perhaps he is going to start talking about planes, but amazingly, the planes are going to keep flying. Amazingly, we are still going to have drugs supplied into the United Kingdom. He needs to get down into the detail of exactly what the implications will be, because if we are faced with the reality of no overall agreement, there will be a barrow-load of minor agreements to ensure that the common interests of the United Kingdom and the European Union survive the transfer to WTO terms on 29 March with minimum impact on the citizens of the EU and the UK. It is time he got real and stopped this nonsense—

Order.

Thank you, Mr Deputy Speaker.

I have just talked about some of the consequences of crashing out without a deal. I have talked about relationships, about tariffs on products and about the legal definitions under the common agreements that this country has undertaken with other European countries. We all know this—the information is readily available—so I am not quite sure what point the hon. Gentleman is making. I think he is aware of the dangers of taking this course of action.

He is frustrated with his own Government.

And yes, people are frustrated with the Government.

With respect, it is quite right to concede that some of the fears being raised about no deal are grossly exaggerated, but the problems are quite real enough. If we leave with no deal, we will be the only developed country in the world that has no trade agreement at all with anybody and that is having to fall back on WTO rules, which are made to sound marvellous by the Brexiteers but which do not actually amount to very much. We will also be erecting new barriers to trade and investment around the borders of the United Kingdom, including along the Irish border, and that is bound to disadvantage our economy very seriously indeed.

The Father of the House is as accurate as ever. Some colleagues are pursuing a dangerous argument that all our trading relationships with countries that are not in the EU are somehow currently under WTO terms, which is an absurd misconception. We have entered into trade agreements as a member of the EU that account for something like 16% of our goods exports.

Regardless of the significant impacts of a no-deal outcome, we could go further and say that to leave the EU having not secured a deal—an acrimonious departure —would damage our relationship with our most important trading partner for years to come and fundamentally undermine our credibility on the world stage. I cannot see how any serious-minded Member of this House could understand that that would not be of severe consequence for the United Kingdom, which is why it is so important that this House makes a clear statement today about the dangers of no deal.

Can the hon. Gentleman name a single country that has a free trade agreement with the EU that will not transfer it to the UK under the novation procedures?

We simply do not know the answer to that question. I always listen to what the right hon. Gentleman has to say in Treasury and Finance Bill debates, but he is one of the archetypal Members who come to the House and pursues what I call the BMW argument: “Everything will be fine because we buy BMWs and everyone will give us what we want.” That argument is still being pursued in these debates, but it has been proved completely untrue by the stage of the negotiations that we are at. It is simply not good enough to say, “It will all be alright on the night. Everyone will transfer over the benefits we currently have. It will be as straightforward as that.” If that were case, the Government would not be in this morass and the country would be in a far better position.

I thoroughly agree that what the Government have got us into is not a great negotiating position, but that is because the negotiations have been driven by the best interests of the internal politics of the Conservative party. If the national interest had been considered, we would be in a completely different place.

Trade can exist on WTO terms. It is not that the UK would somehow no longer be a trading nation, but that is not the test of good Government policy. The test is to consider the ramifications of that decision and to decide whether it is in the UK’s best interests, but I cannot believe that anyone would look rationally at what a no-deal outcome means and say, “I would find that acceptable for this country.”

Does not my hon. Friend think that it would be irresponsible for any Government not to be making contingency plans for WTO rules in these circumstances? Does he also agree that the Irish Taoiseach has in the past few days looked for the first time at making some changes to his intransigent approach to the backstop, precisely because the Republic of Ireland would suffer so much more from WTO terms than the United Kingdom?

The merits of the Government undertaking contingency measures are different from the political case that we must consider, which is whether we would find it desirable to undertake a course of action that would mean that we had to use those contingency measures. The focus of the debate in this Finance Bill should be a seriously hard-headed look at the consequences of no deal, and there should be a statement from Members on both sides of the House that that is not what we seek for the UK and that we do not believe that it is possible.

I will take an intervention from the hon. Member for Dover (Charlie Elphicke), and I may come to the hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) if the intervention is good enough.

The hon. Gentleman is making an interesting speech. My concern is with how he can support undermining the making of contingency preparations that are in the national interest, which is the effect of amendment 7. It is just the wrong thing to do, and the Labour party ought to be more responsible than that.

I completely disagree with the hon. Gentleman, and a little humility from Conservative Members on the point about responsibility for the Brexit negotiations would be appreciated. For my entire lifetime, this country’s European policy has been dictated by the internal politics of the Conservative party. Every Conservative Prime Minister in my lifetime has been brought down by the issue of Europe. To suggest that any other political party or actor in this country needs to have more regard for the national interest, when it is the Conservative party that has never been able to do so, is not something I will take.

Bearing in mind that 95% of the world’s growth over the coming decades will come from outside the European Union, what assessment has he made of the opportunities that will be afforded to the United Kingdom by our being able to tailor-make bilateral trading agreements?

I am extremely glad that that issue has come up, because the opportunities created by growth outside the EU have no relationship to our membership of the EU, and could possibly be undermined by our leaving the EU. If we want to compete in competitive emerging markets around the world, what better way is there to do so than from within the single market? I would wager with the hon. Gentleman that a country like Germany will do far better from that growth around the world through its continued membership of the European Union than we will. I am afraid that it is because of such statistics, which have no bearing on serious Government policy or reality, that this debate has got to where it is, but I will move away from a wider debate on Brexit and return to the Finance Bill before you tell me to do so, Mr Deputy Speaker.

I will now come to clause 89 and the relationship between Great Britain and Northern Ireland. Under the draft withdrawal agreement it is widely accepted that, under the backstop arrangements, Northern Ireland will remain in regulatory alignment with the European Union, which would be particularly the case for EU customs law but it would also apply to compliance with elements of EU single market regulation in the technical regulation of goods, state aid and other areas of north-south co-operation between Northern Ireland and the Republic. Of course, Northern Ireland would be included in parts of the EU VAT and excise regimes and in the single electricity market.

With that in mind, it is clear that the powers handed to the Treasury by this Bill may not be applicable in Northern Ireland in the legal and regulatory areas under which EU authority would remain. We are therefore seeking a review that clearly sets out any difference in application of these powers in respect of Great Britain and Northern Ireland, and I urge Members on both sides of the House to support new clause 3.

New clause 7 relates to clause 90 on establishing an emissions reduction trading regime. It would require the Government to review the expected effect of the carbon emissions tax on the UK’s capacity to meet internationally agreed climate targets. There has never been a more critical time to take urgent action on climate change to avoid environmental catastrophe. The report from the UN Intergovernmental Panel on Climate Change, published in October 2018, shows that we have just 12 years left to make unprecedented changes to prevent global warming increases above 1.5° C. Our exit from the European Union must not be used as an excuse to step back from action on climate change. Worryingly, clause 90 contains one of the Bill’s very few passing references to environmental issues, and our review, proposed in new clause 7, would ensure that the Government are held accountable for making progress on reducing emissions without using Brexit as an excuse for stalling.

This is evidently a Government in chaos, seemingly without any plan or strategy at all. The new clauses and amendments in this group would improve both the Finance Bill and the process by which we leave the European Union. They are sensible, proportionate and timely, and I commend them to the House.

I realise that time is short and that many hon. and right hon. Members want to speak on this group, which shows the appetite of Members on both sides of the House to have their say on this critical issue. There is a deep frustration that debate was curtailed last month before we got to the meaningful vote on the Prime Minister’s draft withdrawal agreement.

I rise to support amendment 7, which was tabled by the right hon. Member for Normanton, Pontefract and Castleford (Yvette Cooper) and to which I have added my name, and amendment 8.

My right hon. Friend is very gracious in giving way. Does she accept that the UK trades profitably with the majority of the world’s GDP on World Trade Organisation terms? Therefore, this is not the cliff edge or crashing out that many people paint.

I have great respect for my hon. Friend, but I think that it would have been better to have had this debate in 2016 rather in 2019, because the honest truth is that the Brexit that some Members on these Benches and some people out in the country say that they want was not outlined in any way, shape or form in the 2016 referendum. I refer to one Member, who said at the time, “Only a madman would leave the single market.” Yet now, that is exactly what he is proposing should happen.

I do not agree with my hon. Friend the Member for Basildon and Billericay (Mr Baron) about the advantages of WTO, and I will tell him why: if it was so good, Members who are backing the WTO option—a no-deal option—would not be so keen to get into negotiating free trade agreements so quickly with countries around the world. I do not know whether it was my hon. Friend, but one Member just now talked about trading with America and China, yet free trade agreements with America and China are touted all the time by those in favour of Brexit as agreements that need to be negotiated as quickly as possible.

The honest truth is that to make trade work around the world, all countries will seek to enter into agreements with countries they want to trade with in order to lift or to lower tariffs and non-tariff barriers. That is what we have done, very successfully, in our relationship with the European Union since we joined over 40 years ago.

May I intervene?

Very briefly.

My right hon. Friend is being very gracious and I very much appreciate that.

Many of us in this place—I would like to think the majority of us—would prefer a good trade deal to WTO. That is not inconsistent, but I think what my right hon. Friend misses is that on a bad deal versus WTO we have got to get the balance right, because the EU has had such a bad track record on negotiating trade deals. We trade with the rest of the world on WTO terms very profitably and very successfully, even though many of us would prefer a good trade deal.

Trade deals are immensely complicated. While Members know how I voted in 2016, I accept that this country will be leaving the European Union on 29 March—with regret, I have to say, but I do accept it—but one of the debates that we have not even started to have is how the House is going to approach the approval of trade deals. I can tell my hon. Friend that this is a real worry to those who are going to be negotiating those agreements. We saw with the Transatlantic Trade and Investment Partnership just how politically contentious that agreement was, even though it did not even reach the House as an agreement. We are going to spend the next few decades in the House negotiating and approving trade deals, which everybody, for various constituency reasons, will have problems with.

My right hon. Friend is making an extremely powerful argument. Does she recall that the trade deal between America and Canada, which was a “willing buyer, willing seller” trade deal, took many, many years? The idea that this is some wonderfully easy, smooth, simple process is, frankly, rubbish.

I have great respect for my right hon. Friend, and on this issue he speaks much good sense, as always. I hope that right hon. and hon. Members will listen to what he has to say. I am conscious of the time, so shall move on.

Over the past two years, we have heard it said in the House that no deal is better than a bad deal. I have to say that no deal is a terrible deal and it would be a gross dereliction of the responsibility of Members of this House to inflict no-deal on our constituents.

I am afraid I am going to make some progress. My hon. Friend will be able to intervene on other Members.

Those who wanted Brexit talked often about the taking back of control. I have not had time to watch the film broadcast on Channel 4 last night, but I understand that that was a key part of it. As I have said before, it is right that control should come back to this Parliament, and it is right and it is time for Members of Parliament on all sides to make it clear to the Government that a no-deal Brexit outcome is absolutely unacceptable.

It will have been noticed that many of those who have put their names to amendment 7 are Chairs of Select Committees. The Treasury Committee took evidence in December—I am grateful to all Committee members, who have varying views on Brexit—and we produced a unanimous report. One thing that was made very clear is that, compared with today’s trading arrangements, and assuming no change to migration arrangements, our GDP would take a 7.7% hit on a modelled no-deal scenario. That is greater than the impact of the 2008 financial crisis. Members who have been in the House since 2010, and perhaps just before, will know the impact of the financial crisis on our constituents.

Finally, as a wise general said to me a few weeks ago, Britain is renowned for its confidence and competence. Currently, we are demonstrating neither. A no-deal Brexit will completely destroy any reputation we have for confidence and competence. The Government decided to put off the meaningful vote, although hopefully we will get it either this week or next. It is time for Members of Parliament on all sides to start ruling out options that would be deeply damaging to our country. That is what amendment 7 and 8 are about, and I will be delighted to support them both, should they be voted on.

It is a pleasure to follow the right hon. Member for Loughborough (Nicky Morgan), because although we represent different parties and disagree on many issues, and although we will take different positions on the Prime Minister’s deal when it comes to a vote, on this issue we agree. I rise to speak to amendment 7 and to support amendment 8.

We agree on the dangers of no deal to the country. I tabled amendment 7 because I am really worried that delays, drift or brinkmanship mean that there is now a serious risk that we will end up crashing out of the EU with no deal in just 80 days’ time. I am worried that we could come to the crunch and Parliament would not have the powers to stop it happening. We have a responsibility not just to stand by. I believe that the Government should rule out no deal but, if they will not, Parliament must make sure that it has the powers to do so if it comes to the crunch.

Amendment 7 has support from across the House. It has been signed by Chairs of cross-party Committees—it has the support of the Chairs of the Treasury Committee, the Exiting the European Union Committee, the Liaison Committee and the Business, Energy and Industrial Strategy Committee and others, too—and it is supported by those with a wide range of views on the best way forward. It is supported by those who support the Prime Minister’s deal and those, like me, who do not, and it shows that those who take a wide range of views on the best way forward have come together to say that we should rule out the worst way forward.

Just to clarify, does the right hon. Lady herself intend to support or oppose the Prime Minister’s deal?

As I just said, and as I said when I spoke in the debate before Christmas, I am opposed to the Prime Minister’s deal. It is a blindfold deal that does not address some of the policing and security challenges, as well as customs union issues for manufacturing. I accept, though, that we take different views on that throughout the House. There are very different perspectives and views, which is why the opportunity to come together and rule out no deal is such an important one.

I will give way in a second. I am conscious of the time, so let me set out what the amendment would do and I will then of course give way to the hon. Gentleman.

The amendment applies to clause 89 of the Bill, which the Government say they need for minor amendments to tax-raising powers in the event of no deal. In practice, clause 89 is drafted much more widely than that, but that is the point that the Government have made. The amendment says that, if the Government want to use clause 89 powers to implement no deal, they first need to give Parliament a vote on no deal and to have Parliament’s support for no deal. The amendment provides a safeguard to make it harder for the Government to go ahead with no deal without even going back to Parliament.

I am still not clear. What could the Government do under clause 89 that this amendment deals with to rule out no deal? Can she say how exactly the amendment rules out no deal?

The amendment provides a parliamentary safeguard. It does not, in itself, solve any of the many Brexit issues that we have, but it does provide an additional parliamentary safeguard that says that the Government cannot use the powers in clause 89 to implement no deal without first coming back to Parliament to ask for permission and support for a no deal. The hon. Gentleman is right that there may be other powers that the Government may choose to use. There may be other issues that they may choose to pursue, but this is our opportunity within this Bill to address these powers. That is why it is an important one to come around.

I have heard four sets of objections to the amendment. Some say that it is irresponsible; that it is somehow holding the Government to ransom on powers that they need. Some say that it is undesirable and perhaps even unpatriotic because they think that no deal is a good outcome and should not be ruled out. Some say that it is unnecessary because the Prime Minister’s deal is the best way forward. Some suggest that it is unstrategic because we need the threat of no deal to force a decision one way or another. I want to take each of those objections in turn because each of them is wrong.

First, on the charge that this is an irresponsible amendment, the amendment does not affect the normal Treasury and Government operations; those carry on as normal. It simply requires the Government to get Parliament’s permission if they want to use these powers to pursue no deal. Even if there is deadlock, the amendment provides a way forward. Let us suppose that Parliament votes against any deal that is put and also votes against no deal, and the Government still desperately want to use the clause 89 powers. In that event, they could follow paragraph (b) of the amendment if they still want to use the powers they need to apply to extend article 50. So in fact, this is an extremely responsible amendment. The irresponsible thing to do would be just to stand back and hope for the best, or to stand back and allow the Government to drift towards no deal without any attempt to put the safeguards in place to prevent that from happening.

The second objection is from those who think that no deal is a good option, or at least a good enough option not to rule it out. That is reckless. The damage to manufacturing industry, on which many of our constituencies rely, would be too serious. One local factory has said to me that the cost of its imports will double in price if we go to WTO tariffs. Another has told me that its European parent company would be under pressure to switch production to continental factories to avoid delays. Burberry has hundreds of jobs in my constituency, making clothing that is sold all over the world. It has written to me about the risks and concerns about delays to its supply chain. Its letter says:

“My hope in writing to you is that you will work with your colleagues across Parliament to ensure that there is no scenario possible where a No-Deal Brexit is a possibility.”

That is what I am doing.

I thank my right hon. Friend for for tabling this amendment, which is so important. The Business, Energy and Industrial Strategy Committee has taken evidence from a number of businesses in the past few weeks, including Nestlé, Toyota and Airbus. Each one of them, and many others too, have said that the most dangerous thing would be to leave the European Union without a deal, which would have catastrophic impacts on their businesses and on the people who work for them. For that reason alone, anything that we can do to avoid a hard Brexit and going on to WTO rules, as some Members suggest, is the most important thing. This amendment at least helps to provide some safeguards to stop that from happening.

My hon. Friend is exactly right. This is about dealing with risk, delays and increased costs. There is the risk that border delays will hit tight cross-border supply chains, but the CBI also estimates that the impact of WTO tariffs will mean a £4 billion to £6 billion increase in costs on our exports. The Environment Secretary—the leave campaigner himself—has said that WTO tariffs on beef and sheepmeat will increase by over 40%.

The right hon. Lady is being very generous in giving way, but may I encourage her to temper her dire warnings about WTO terms? There were many forecasts and predictions from business organisations, the Bank of England and the International Monetary Fund about the disastrous consequences if we voted to leave the EU in 2016, including predictions of 500,000 extra unemployed by Christmas 2016. Those predictions did not materialise because investment is about comparative advantage such as low taxes and more flexible labour market practices. That is what determines investment at the end of the day.

I am not drawing on macroeconomic predictions about the overall impact on the economy, although I note that there are predictions of a 9% reduction compared with the level at which we might otherwise be. I am actually focusing on the microeconomic impact on individual businesses across the country of simply seeing those costs go up. That is a real impact of the tariffs. It is not about confidence, levels of investment and so on; it is about the real impact of those costs on consumers, manufacturers, exporters and importers that is the real consequence of WTO tariffs.

I am sure my right hon. Friend has noticed that the Office for Budget Responsibility said in its report on the recent Budget that there has been a loss of 1.5% of GDP since the referendum, and that the uncertainty was likely to make that worse, at least in the medium term. This Parliament has a duty to ensure that we mitigate that as much as possible, which is why I will be supporting her amendment.

My hon. Friend is right that we have a responsibility not to make life harder for our manufacturers, which face huge pressure and huge international competition. We also have a responsibility not to make life harder for our consumers, who could see significant increases in prices. The British Food Importers & Distributors Association warns that WTO rules could mean that food prices go up by over 20%.

The hon. Member for Leeds West (Rachel Reeves) has just cited Nestlé, which is a Swiss company. The right hon. Lady will be aware that Britain and Switzerland, which is able to make arrangements for the future, negotiated an agreement on 14 December 2018 to be able to continue trade, even if there is no agreement between the UK and the EU. Once this House has rejected the withdrawal agreement, that is exactly where the European Union and the United Kingdom will be. We will need to make the best of the situation in which we find ourselves. That is precisely why both sides will, under article 24 of the general agreement on tariffs and trade, move towards a free trade agreement to ensure that we do not put tariffs in place at all after 29 March. That is where we should be and those are the realities that are going to descend once we are through the “Project Fear” phase.

The same cheery optimism that the hon. Gentleman and others have expressed that everybody will suddenly magically come to an agreement once we are through this phase and if we are on WTO terms is exactly the same cheery optimism they had that we were going to end up with a deal by now—and we have not, because it is actually a lot tougher than hon. Members suggest. The reality is that we are going to have a big hike in prices in April if we have no deal, and that has consequences for our manufacturers, businesses and consumers right across the country.

I shall be supporting the right hon. Lady’s amendment. She talks about the manufacturing sector and I believe that there are a number of manufacturing jobs in her constituency. Has she heard any argument that falling back on WTO rules would ensure that those critical, just-in-time supply chains are able to continue, and does she agree that this issue is very important to the many millions of people across the country who rely on those just-in-time supply chains, because if we fall back on WTO rules, it is they who will be losing their jobs, not hon. Members?

I completely agree with the right hon. Lady. What I am saying just comes from listening to employers in my constituency who have told me that they have bought all the storage capacity they can find in order to stockpile, but they cannot stockpile more than 10 days’ worth of some of their products, and they are really concerned about the impact of the delays on just-in-time technology.

Does the right hon. Lady agree, in wanting to promote stronger and better industry once we have left, that the Government should set zero tariffs on all imported components, which we would be free to do, which would make them cheaper from non-EU countries and preserve zero tariffs for EU components?

It is not clear to me how that strengthens our negotiating position with countries all over the world that might then keep their tariffs extremely high on our goods. The whole point is that, if we crash out on WTO terms, it undermines our negotiating power. Whether one thinks that is about negotiating with the EU or negotiating with other countries, we are weakening our position abroad.

We also have the impact on the NHS, which is spending £10 million on fridges: it will have to put more money into this which could be put into patient care. The police have warned that we will be less safe. They and the Border Force would immediately lose access to crucial information that they check 500 million times a year to find wanted criminals, dangerous weapons, sex offenders and terror suspects. We will not be able to use European arrest warrants to catch wanted criminals who fled here having committed serious crimes abroad. We use those warrants 1,000 times a year to send people back to face justice in the countries where those crimes have been committed. If those 1,000 suspects commit more crimes here, MPs will need to explain to the victims why we took away the power from the police to arrest and extradite them by tumbling into no deal.

Order. I am listening to the right hon. Lady, as always, with great interest and enormous respect, but may I just very gently point out that we need to hear from other Members with amendments in the group and from the Minister? I am not certain how many more Members we need to hear, but my guesstimate is at least four, and we have 31 and a half minutes.

Thank you, Mr Speaker. I apologise to anybody else who wants to intervene, but I will not take any further interventions and try to conclude my remarks.

Some of those who say they support no deal have said that it is unpatriotic to rule it out. I understand that there are strong emotions, but I hope we could be more respectful of each other than that, because I believe that it is patriotic to stand up for manufacturing, for families who may be on the breadline and face increases in food prices, for our NHS, and for British citizens abroad who could lose their rights.

The other objection that people have raised is that this is unnecessary because the Prime Minister’s deal is the one they want as the way forward. I simply disagree, but I think the reality is not about my view but the view in the House: there is not, at this stage, support for the Prime Minister’s deal, and I do not think there could be. We have to be able to respond to what happens next.

Finally, I have heard some say that they want the imminent threat of no deal to persuade people to back the Prime Minister’s deal, if not now, then later. But brinkmanship in Parliament is not the way to resolve this and get the best deal for the country. This is too serious for us to play a massive Brexit game of chicken. The country cannot afford to wait to see who blinks first.

I hope that Ministers, as may have been rumoured, will accept this amendment and accept the principle behind it. The Government should get agreement on a deal before 29 March, get explicit agreement on no deal before 29 March, or, if that fails, commit to seeking an extension of article 50, so that there is time to sort this out. The amendment does not solve the Brexit challenges that we have ahead and the many intense debates that we will no doubt have about the best way forward, but it gives us an opportunity to rule out the worst way forward and to do so in a way that is calm, measured and sensible. That is why I hope that amendment 7 will have support from across this House.

An extremely brief speech, I feel sure, from Sir Oliver Letwin.

Thank you, Mr Speaker. I rise to support amendment 7, to which I am a signatory.

My right hon. Friend the Member for Mid Sussex (Sir Nicholas Soames), who is sitting next to me, and I have calculated that we have been in the House, collectively, for 56 years, and we have only ever, either of us, voted once against the Conservative Whip. This will be the second time that we will both be voting against the Conservative Whip, and I want to explain why. First, I want to say one thing about what this amendment is not. The right hon. Member for Normanton, Pontefract and Castleford (Yvette Cooper) and my right hon. Friend the Member for Loughborough (Nicky Morgan) gave eloquent expositions, but what they did not mention is that, in contrast to some things that have been suggested, it has no impact whatsoever on the Government’s ability to prepare for Brexit—it is about what the Government do after Brexit.

Secondly, clause 89 is an item that those of us who have been Ministers for a number of years will recognise as an “abundance of caution” clause. Some group of lawyers somewhere stuck in the bureaucracy clearly alerted Ministers to the possibility that they did not have certain unspecified powers and said it would be a good idea to have some unspecified powers in case the lack of unspecified powers turned out to be important. I do not think therefore that this amendment, in itself, will be likely to have a huge impact, if any, on the Government of this country.

That brings me to the question of why I am supporting this amendment. The answer is that it is most extraordinarily important to make it clear to the Government that it is not just this amendment. It is the precedent that this amendment sets, which is that on any power taken in any Bill in relation to the exit of the UK from the EU, if there is a majority in the House today and there continues to be a majority against no deal, it will be possible to bring forward similar amendments. It is my proposal that we should indeed do that. I want to make it abundantly clear to those of my hon. Friends who are thinking of voting against the Prime Minister’s deal, which I shall be supporting, that the majority in this House, if it is expressed tonight, will sustain itself, and we will not allow a no-deal exit to occur at the end of March.

My last point is on why I am so passionate about not allowing such an exit. Many Members, including the Father of the House, have spoken eloquently about the long-term dangers to our economy of WTO trading and so on. My right hon. Friend the Member for Wokingham (John Redwood), for example, very much disagrees with that. I do not take a particular view about that. My preference is for a continued free trade deal with the EU, which is by far our largest trading partner, but in contrast to some, I do not want to argue that there would be a disaster in principle if we were on WTO terms. I do not believe it would be disastrous. I think it is suboptimal but not disastrous.

For five long years, I was in charge of the resilience of this country. During that period, I saw many examples of our civil service, military and security apparatus being prepared or not being prepared for certain issues that closely affected the wellbeing of our country. That is one reason why two years ago I passionately argued—my right hon. Friend the Member for Wokingham will recall an occasion a year ago when I made that argument even more forcefully—that the Government should undertake serious preparation for a no-deal exit. That would have had the effect that some of my hon. Friends mentioned. It would have altered our negotiating position. It was not done.

I have been in awesome detail through the papers produced. I have listened to the briefing for Privy Counsellors. I have consulted senior officials across Whitehall. I know what the RAG ratings of red, yellow and green mean—nothing. I know what it is actually to have prepared for dealing with the gas interconnectors, the electricity interconnectors and the many other details concerned.

Some of my hon. Friends and others in the country believe they can assure that under circumstances where we wreck the deal, refuse to make all the payments that the EU is expecting and falsify its expectations of a reasonable departure, the EU will then reasonably set out to work with us in a calm and grown-up way to ensure a smooth departure. It may be so. I am in no position to deny that it will be. I do not make lurid projections. Anybody who believes that they know it will be so is deluded.

I do not believe that we in this House can responsibly impose on our country a risk that may be severe or serious short-term disruption, for the sole purpose of gratifying the possibility that we avoid certain eventualities that certain Members of Parliament would prefer to see avoided and on which nobody in this country ever voted because they were never asked to vote on it. Under those circumstances, I will be voting with the right hon. Member for Normanton, Pontefract and Castleford against my own Government and very much against my own will, and I will continue to do so right up to the end of March, in the hope that we can put paid to this disastrous proposal.

The right hon. Gentleman’s succinctness is a textbook of how to help the House, and I hope it will now be closely studied.

In the interests of time, I will be very brief. I want to make it clear to the House that the SNP intends to push new clause 18 to a vote. I will briefly speak to some of the other new clauses and amendments that we have put forward. A couple of them relate to the expenditure implications of the UK now having to take charge of carbon and greenhouse gas taxes. They are about making sure that the Government are clear with the House about why they are spending this money and about the money they intend to spend before they do so. This is an additional cost that would be associated with the UK leaving the EU, which is a concern of ours. Obviously, we would not have to spend this money if we remained in the EU.

I will be very brief, not least because my right hon. Friends the Members for Loughborough (Nicky Morgan) and for West Dorset (Sir Oliver Letwin) have described much better than I ever could why I am going to support amendment 7, which I signed almost while it was hot off the presses before Christmas. The one point I want to address is the question that has been raised, and indeed the accusation that has been made, that in doing so I and other Conservative Members are breaking faith with our constituents and somehow breaking a manifesto commitment. I believe this to be utterly wrong, and also a rather disgraceful suggestion to make.

In the referendum campaign on our membership of the European Union, I supported and indeed voted remain. However, the argument of my colleagues who voted and campaigned for leave that I found most powerful and most emotionally impactful was that Parliament is sovereign and should take control of all the decisions that affect the lives of my constituents. That was the argument that the leave campaign made that I found the most difficult to resist and the most difficult to say was worth compromising for the sake of our membership of the European Union. It is therefore somewhat extraordinary that the very same people who made that argument so eloquently and effectively during the referendum campaign should somehow have the temerity to criticise me or other hon. and right hon. Members for doing what we believe is right in the interests of our constituents and in the national interest.

I cannot think of a single leading Conservative Brexiteer who would have changed his opinions on membership of the EU in the slightest had the remain side won the referendum. They made it quite clear that they had no intention whatever of abandoning their long-held, quite sincere views, which they would have carried on arguing in this House and voting for. Does my hon. Friend share my view?

The Father of the House is completely right. I have to say—I am sure the same is true of him—that I rather admire them for it. I admire my hon. Friend the Member for Stone (Sir William Cash) for making the same arguments passionately and with principle for 40 years—longer, practically, than many Members have been alive.

I want briefly to address the question of the Conservative manifesto commitment. I should point out that quite large chunks of the Conservative manifesto were junked by the Prime Minister during her own election campaign, so I do not know quite why we have elevated it to be a sort of Moses-style tablet. Nevertheless, it contained a sentence saying that we maintain that no deal is better than a bad deal. I agree, and I agreed then, in my hospital bed, when I agreed to stand as a candidate in the election, that that was the right position for the Government to take. As my right hon. Friend the Member for South Dorset (Sir Oliver Letwin)—West Dorset; apologies to the people of Dorset—explained, it was entirely right for the Government to want to prepare for no deal. Unfortunately, as he pointed out, they failed to do so.

However, what we did not say in that manifesto is that no deal is better than any deal; we said no deal is better than a bad deal. I remind my hon. Friends that we have a deal; it is a deal that the 27 nations of the European Union have agreed, that the Prime Minister, who recently won a confidence motion in the Conservative party, and her Cabinet have endorsed and advocate, and that, at the last count, about 200 Conservative Members, including myself, intend to support when the vote is finally put. It is simply not possible to suggest that by saying that I will not countenance no deal, I am breaking that manifesto commitment. We do not have a bad deal; we may have a deal that you, individually, do not like —not you, Mr Speaker, but individual hon. and right hon. Members—but nobody can claim that we do not have a deal that it is reasonable for Conservative Members to support. It is therefore reasonable for us to say that, at this late stage, with the Government having prepared as woefully as they have for no deal, we will on no account countenance a no-deal Brexit.

Finally, I join my right hon. Friend the Member for West Dorset in very clearly saying this: I will vote on any motion, on any amendment, on any piece of legislation, proposed by whomsoever in this House to ensure that we leave the European Union on 29 March with a deal or not at all.

Order. Just before I call the next Member, we must hear from the Minister, and the Opposition Front Bench should really have the chance, very briefly, to comment on its own lead new clause before we come to the vote.

I will be brief, Mr Speaker. I will want to move amendment 8, which stands in my name and in those of many hon. Members on both sides of the House. In many ways, it complements amendment 7, which was tabled by my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper).

Amendment 8 would institute a commencement motion for the powers that the Treasury is seeking. Clause 89 might have been wrapped up as fairly minor and inconsequential, but essentially the Government are asking for pretty whopping permission to start legislating for no-deal arrangements. At this stage in the game, I really do not think that right hon. and hon. Members should be delegating our powers entirely to Ministers in this way without question. I know it is difficult for the right hon. Member for West Dorset (Sir Oliver Letwin) to rebel for a second time, on amendment 7, but I would like to persuade him to do so for a third time on amendment 8. A commencement motion is an important adjunct so that we can give the House and hon. Members the chance to express how they wish Brexit to go forward—so that we have the opportunity to express our view. A commencement motion would allow hon. Members the chance to do just that.

As things stand—certainly if the Government’s Brexit proposal is negatived next week—there could be 21 days or perhaps another seven days before anything is voteable on in this place. My own view is that before we start delegating powers to Ministers on these issues, or indeed on others, we need to start saying that enough is enough. Hon. Members need a chance to help to guide the way forward. There are many different views on these particular issues—the hon. Member for Grantham and Stamford (Nick Boles) has his particular preference and I have mine—but we need to provide for ourselves the time and the space to express them. Amendment 8 would simply provide for a commencement motion.

I hope that the Minister will recognise there is a strong cross-party opinion that we need now to give voice to Parliament. We cannot just drift into a no-deal situation. Parliament does want to take back control. He should concede and accept the amendment now.

I am grateful to all right hon. and hon. Members for the debate.

Delivering the deal negotiated with the EU remains the Government’s central priority. It is neither our preference nor our expectation that we will leave the EU without a deal. However, as a responsible Government, we must prepare for all scenarios. In the Budget, we furthered that commitment by confirming an additional £500 million of funding in 2019-20, taking the total Government investment on preparing for EU exit to over £4 billion. At the Budget, to help to ensure that the tax system can continue to function under any EU exit outcome, we announced a series of modest, sensible provisions, which included a power to make necessary minor technical amendments to UK tax legislation. It also allowed, as we have heard, for the Government to introduce a carbon emissions tax to replace the EU emissions trading system in the event of no deal. By including those measures in the Finance Bill, our foremost motivation is to provide certainty to taxpayers—the kind of certainty that one would expect from any responsible Government.

Let me turn to amendment 7, which was tabled by the right hon. Member for Normanton, Pontefract and Castleford (Yvette Cooper). Prior to proceedings in the Committee of the whole House, which considered clause 89, I placed a list of changes envisioned under the clause in the House of Commons Library. Right hon. and hon. Members who have taken the trouble to review the list will see that they are indeed minor technical changes, and out of minor and technical changes, these are the most minor and technical. Since then, we have received no indication from any Member to the contrary. Clause 89 is simply prudent preparation to provide our taxpayers with the certainty they deserve.

As I made clear, the Government do not want or expect a no-deal scenario. That was why we negotiated the withdrawal agreement, which will see us leave the EU in a smooth and orderly way on 29 March and sets the framework of our future relationship. As we heard from my right hon. Friend the Member for West Dorset (Sir Oliver Letwin) and my hon. Friend the Member for Grantham and Stamford (Nick Boles), the best way of avoiding a no-deal scenario, if that is of grave concern to Members, is to support the withdrawal agreement next week.

Will the Minister clarify his last sentence? Is he saying that if the deal is voted down next week, it will become the Government’s stated objective to deliver no deal?

The point I have just made is that the law of the land is that the UK will leave the European Union on 29 March, and nothing contained in amendment 7 will change that. As I will come on to say, the only difference that the amendment will implement is to make the UK somewhat less prepared for that eventuality. The purpose of clause 89 is to provide taxpayers and—

I give way to my right hon. Friend.

I am grateful to my hon. Friend, who is doing a valiant job—I do not envy him. Does he accept that although, as he says, the law at present is that we will leave on 29 March, the House of Commons, with the House of Lords and Her Majesty, has the ability to change that provision?

The House of Commons has the right to make the law, but the law as it is today is that we will leave on 29 March. The point I am making is that, whatever the intentions of the right hon. Member for Normanton, Pontefract and Castleford and those who may wish to support amendment 7, all that will be achieved by supporting it is denying our citizens and taxpayers the degree of certainty that we wish to give them.

I will give way one last time, but I have only a couple of minutes.

I, too, extend my sympathies to my hon. Friend, who drew the short straw of responding to the debate. He is trying very eloquently to minimise the significance of the whole thing, but of course he realises there are big issues behind this. Can he tell us what contingency arrangements the Treasury has made for the fiscal impact of leaving with no deal, and its likely impact on our trade, our manufacturing industry and so on? He must concede that the published figures for future deficits, debts and so on will be made utterly meaningless if we leave with no deal, and a fiscal crisis will occur. Is the Chancellor planning the emergency Budget he will probably require?

My right hon. and learned Friend and constituency neighbour tempts me to go into areas that I should not, but the Chancellor has said that we will be prepared and that we have fiscal room available—that was what he stated in the Budget, as certified by the Office for Budget Responsibility. My right hon. and learned Friend appears to be making the case for prudent preparations in case of a no-deal scenario, which is all that clause 89 seeks to achieve.

I will give way one last time to my hon. Friend—I apologise to the right hon. Lady, but I only have a couple of minutes.

With all due respect to my hon. Friend’s Department, is it not the case that it published a series of figures about the economic disaster that was allegedly going to occur if we voted to leave the European Union, although none of that has happened, and that what we have here is an attempt to blackmail the Government into not going ahead with a decision that was taken after a majority of the population voted to leave the European Union?

We are leaving the European Union. We wish to do so with a deal. The House will vote on the deal next week, but we must and will prepare for all scenarios.

I give way to the right hon. Lady because, of course, amendment 7 is hers.

Will the Minister confirm that he will still be able to use clause 89 powers if he either gives the House a chance to vote on no deal or, alternatively, takes the opportunity to apply for an extension of article 50?

Clause 89 would give the Government the ability to provide certainty to taxpayers now. That is what we want to ensure. We do not want to inhibit the ability of HMRC and the Government to provide that critical certainty. Who would want to do that? Who would want to diminish certainty for taxpayers at this time? The right hon. Lady listed a number of businesses. Those businesses want certainty, and by supporting her amendment, we would diminish that certainty and our preparedness—admittedly only modestly—for a no-deal scenario.

We will not be deterred from making sensible preparations—the public expect us to do so—and using the Finance Bill to prevent or frustrate preparation for any eventuality is unwise and irresponsible. I therefore urge the House to reject all the amendments and new clauses tabled against clauses 89 and 90 so that we give our constituents and taxpayers across the country the degree of certainty they deserve.

Order. If the right hon. Gentleman feels able and willing to express his views in a minute, I will be delighted to hear him—I hope he will not be offended—but otherwise I will call the Opposition Front-Bench spokesperson.

Thank you for your indulgence, Mr Speaker. I just want to say a few words in support of amendments 7 and 8. They are Brexit-neutral, in the sense that they require the House to approve any change, but of course they relate primarily to no deal. The fiscal issues, as the right hon. Member for West Dorset (Sir Oliver Letwin) explained them, were arcane and rather gentle. I tabled a more brutal amendment that was not called.

In the 30 seconds left, I want to relate an incident from this morning, when I went to the ferry port at Portsmouth. It is very clear that the Government are totally and utterly unprepared for the chaotic impact that there will be on the road system, including access to the naval base, if a no-deal Brexit occurs. Despite repeated requests from the council and others, the Department for Transport and the Ministry of Defence are refusing to co-operate, and the police now say that the M3 motorway will have to be closed from Winchester to Basingstoke in order to provide a lorry park. Repeated efforts to get Ministers to respond have not been heeded. A meeting was held for 19 regional MPs last week, but only one attended, so I am taking on the job of representing a no-deal Brexit. It is a task I undertake with all the enthusiasm of an arsonist trying to put out a bushfire, but I will do it.

This has been a significant and important debate. In fact, it is clear that the House desires a longer and broader debate—that point was well made by the Chair of the Treasury Committee. No deal is some people’s preferred outcome, and they are the same people who told us that doing a deal would be the easiest thing in history. They were wrong then and they are wrong now. I feel that the case against the unilateral use of these no-deal powers has been comprehensively made, and I urge all Members to vote for our amendments, because that is best for jobs, prosperity and the national interest.

On a point of order, Mr Speaker. I understand that in the previous debate there was some unhappy and unfortunate talk about the potential for the M3 to be closed in connection with a lorry park. I want to put it on the record, from the Government’s perspective, that the Government have absolutely no intention whatever of closing the M3 in connection with a lorry park. Therefore, the record should stand corrected as from now.

I am very grateful to the hon. Gentleman for what he has said, which is on the record and will be widely observed.

On a point of order, Mr Speaker. Several media outlets are quoting that I have signed a letter to the Prime Minister saying that I will vote against a no-deal Brexit. I would like to put it on the record that this is not correct. Can you advise me whether it is in order for a Member of this House to put another Member’s name to a letter when they have not given their consent to doing so? Given the febrile environment at the moment, can you make the point to the media that they should check their facts before they publish such information?

The hon. Gentleman arrogates to me almost superhuman powers if he thinks that I can advise the media upon the imperative of first checking facts before printing a story. I appreciate his confidence in me, but I fear that he has an assessment of my capabilities that is sadly unmatched by the reality. Nevertheless, he has put his point on the record, and doubtless he will circulate it more widely amongst the people of Nuneaton.

New Clause 2

Review of the effectiveness of entrepreneurs’ relief

“(1) Within twelve months of the passing of this Act, the Chancellor of the Exchequer must review the effectiveness of the changes made to entrepreneurs’ relief by Schedule 15, against the stated policy aims of that relief.

(2) A review under this section must consider—

(a) the overall number of entrepreneurs in the UK,

(b) the annual cost of entrepreneurs’ relief,

(c) the annual number of claimants per year,

(d) the average cost of relief paid per claim, and

(e) the impact on productivity in the UK economy.”—(Anneliese Dodds.)

This new clause would require the Chancellor of the Exchequer to review the effectiveness of the changes made to entrepreneurs’ relief by Schedule 15.

Brought up, and read the First time.

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

With this it will be convenient to discuss the following:

New clause 9—Review of changes to entrepreneurs’ relief—

“(1) The Chancellor of the Exchequer must review the impact on investment in parts of the United Kingdom and regions of England of the changes made to entrepreneur’s relief by Schedule 15 to this Act and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider—

(a) the effects of the provisions on business investment,

(b) the effects of the provisions on employment, and

(c) the effects of the provisions on productivity.

(3) In this section—

“parts of the United Kingdom” means—

(a) England,

(b) Scotland,

(c) Wales, and

(d) Northern Ireland;

“regions of England” has the same meaning as that used by the Office for National Statistics.”

This new clause would require a review of the impact on investment of the changes made to entrepreneurs’ relief which extend the minimum qualifying period from 12 months to 2 years.

New clause 10—Review of geographical effects of provisions of section 9—

“The Chancellor of the Exchequer must review the differential geographical effects of the changes made by section 9 and lay a report of that review before the House of Commons within six months of the passing of this Act.”

This new clause would require a geographical impact assessment of income tax exemptions relating to private use of an emergency vehicle.

New clause 16—Personal allowance—

“The Chancellor of the Exchequer must, no later than 5 April 2019, lay before the House of Commons an analysis of the distributional and other effects of a personal allowance in 2019-20 of £12,750.”

This new clause would require a distributional analysis of increasing the personal allowance to £12,750.

New clause 17—Review of changes to capital allowances—

“(1) The Chancellor of the Exchequer must review the effect of the changes to capital allowances in sections 29 to 34 and Schedule 12 in each part of the United Kingdom and each region of England and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider the effects of the changes on—

(a) business investment,

(b) employment, and

(c) productivity.

(3) The review must also estimate the effects on the changes if—

(a) the UK leaves the European Union without a negotiated withdrawal agreement

(b) the UK leaves the European Union following a negotiated withdrawal agreement, and remains in the single market and customs union, or

(c) the UK leaves the European Union following a negotiated withdrawal agreement, and does not remain in the single market and customs union.

(4) In this section—

“parts of the United Kingdom” means—

(a) England,

(b) Scotland,

(c) Wales, and

(d) Northern Ireland;

“regions of England” has the same meaning as that used by the Office for National Statistics.”

This new clause would require a review of the impact on investment, employment and productivity of the changes to capital allowance in the event of: Brexit with no deal; Brexit with single market and customs union membership; Brexit without single market and customs union membership.

New clause 24—Review of changes to capital allowances (No. 2)—

“(1) The Chancellor of the Exchequer must review the effects of the changes made by sections 29 and 30 of this Act within six months of the passing of this Act.

(2) A review under this section must include an assessment of—

(a) the cost to the Exchequer of these changes,

(b) changes to business behaviour that are likely to arise as result from these changes, including (but not limited to) levels of business investment in buildings, plant and machinery, and

(c) the impact of these changes on businesses in regions of England.

(3) A review under this section must compare these assessments, so far as practicable, with an assessment of the impact of replacing non-domestic rates in England with a tax on the value of commercial land.

(4) In this section, “regions of England” has the same meaning as that used by the Office of National Statistics.”

This new clause would require the Government to assess the effects on businesses and the public finances of new capital reliefs introduced by this Act and require the Government to compare these reliefs with replacing business rates with a tax on commercial land values.

Amendment 12, in clause 5, page 2, line 24, leave out subsection (4)

This amendment would delete provisions removing the legal link between the personal allowance and the national minimum wage.

Government amendment 2.

Amendment 34, in schedule 15, page 297, line 42, leave out “29 October 2018” and insert “6 April 2019”.

Amendment 34, along with Amendment 35, would remove the retrospective effect of the new qualifying conditions for entrepreneurs relief.

Government amendment 3.

Amendment 35, in schedule 15, page 298, line 10, at end insert—

“(6) In relation to disposals on or after 29 October 2018, the amendments made by this Schedule to the definition of “personal company” do not apply in relation to any day before 29 October 2018.”

See Amendment 34.

New clause 4—Review of late payment interest rates in respect of promoters of tax avoidance schemes—

“(1) The Chancellor of the Exchequer must review the viability of increasing any relevant interest rate charged by virtue of the specified provisions on the late payment of penalties for the promoters of tax avoidance schemes to 6.1% per annum and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) In this section, “the specified provisions” means—

(a) section 178 of FA 1989, and

(b) sections 101 to 103 of FA 2009.”

This new clause would require the Chancellor of the Exchequer to review the viability of increasing interest rates on the late payment of penalties for the promoters of tax avoidance schemes to 6.1%.

New clause 15—Report on consultation on certain provisions of this Act (No. 4)—

“(1) No later than two months after the passing of this Act, the Chancellor of the Exchequer must lay before the House of Commons a report on the consultation undertaken on the provisions in subsection (2).

(2) Those provisions are—

(a) section 15 and Schedule 3,

(b) section 16 and Schedule 4,

(c) sections 19 and 20,

(d) section 22 and Schedule 7,

(e) section 23 and Schedule 8,

(f) sections 46 and 47,

(g) section 83.

(3) A report under this section must specify in respect of each provision listed in subsection (2)—

(a) whether a version of the provision was published in draft,

(b) if so, whether changes were made as a result of consultation on the draft, (c) if not, the reasons why the provision was not published in draft and any consultation which took place on the proposed provision in the absence of such a draft.”

This new clause would require a report on the consultation undertaken on certain provisions of the Bill – alongside New Clause 11, New Clause 13 and New Clause 14.

Government new clause 6—Intangible fixed assets: restrictions on goodwill and certain other assets.

New clause 8—Review of changes to Oil activities and petroleum revenue tax—

“(1) The Chancellor of the Exchequer must review the effect of the changes to Oil activities and petroleum revenue tax in sections 36 and 37 and Schedule 14 in Scotland and the United Kingdom as a whole and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) A review under this section must consider the effects of the changes on—

(a) business investment,

(b) employment, and

(c) productivity.”

This new clause would require the Government to review and publish a report on the investment, employment and productivity impact of the Bill’s fiscal measures on the North Sea sector.

New clause 11—Report on consultation on certain provisions of this Act—

“(1) No later than two months after the passing of this Act, the Chancellor of the Exchequer must lay before the House of Commons a report on the consultation undertaken on the provisions in subsection (2).

(2) Those provisions are—

(a) section 5,

(b) section 6,

(c) section 8,

(d) section 9,

(e) section 10,

(f) Schedule 15,

(g) section 39,

(h) section 40,

(i) section 41, and

(j) section 42.

(3) A report under this section must specify in respect of each provision listed in subsection (2)—

(a) whether a version of the provision was published in draft,

(b) if so, whether changes were made as a result of consultation on the draft, and

(c) if not, the reasons why the provision was not published in draft and any consultation which took place on the proposed provision in the absence of such a draft.”

This new clause would require a report on the consultation undertaken on certain provisions of the Bill – alongside New Clause 13, New Clause 14 and New Clause 15.

New clause 14—Report on consultation on certain provisions of this Act (No. 3)—

“(1) No later than two months after the passing of this Act, the Chancellor of the Exchequer must lay before the House of Commons a report on the consultation undertaken on the provisions in subsection (2).

(2) Those provisions are—

(a) section 61, and

(b) Schedule 18.

(3) A report under this section must specify in respect of each provision listed in subsection (2)—

(a) whether a version of the provision was published in draft,

(b) if so, whether changes were made as a result of consultation on the draft,

(c) if not, the reasons why the provision was not published in draft and any consultation which took place on the proposed provision in the absence of such a draft.”

This new clause would require a report on the consultation undertaken on certain provisions of the Bill – alongside New Clause 11, New Clause 13 and New Clause 15.

New clause 23—Review of income tax revenue—

“(1) The Office for Budget Responsibility must review the revenue raised by income tax within six months of the passing of this Act.

(2) A review under this section must consider revenue raised by—

(a) the rates of income tax specified in sections 3 and 4, combined with

(b) the basic rate limit and personal allowance specified in section 5.

(3) A review under this section must also consider the effect on revenue of—

(a) raising each of the rates of income tax specified in sections 3 and 4 by one percentage point, and

(b) setting the basic rate limit for the tax years 2019-20 and 2020-21 at £33,850.

(4) A review under this section must also include a distributional analysis of the effect of introducing the policies specified in paragraphs (3)(a) and (3)(b).

(5) The Chancellor of the Exchequer must lay before the House of Commons the report of the review under this section as soon as practicable after its completion.”

This new clause would require the OBR to estimate how much money would be raised by increasing all rates of income tax by 1p and freezing the higher rate threshold.

New clause 26—Review of changes made by sections 79 and 80—

“(1) The Chancellor of the Exchequer must review the effects of the changes made by sections 79 and 80 to TMA 1970, and lay a report on that review before the House of Commons not later than 30 March 2019.

(2) The review under this section must include a comparison of the time limit on proceedings for the recovery of lost tax that involves an offshore matter with other time limits on proceedings for the recovery of lost tax, including, but not limited to, those provided for by Schedules 11 and 12 to the Finance (No. 2) Act 2017.

(3) The review under this section must also consider the extent to which provisions equivalent to section 36A(7)(b) of TMA 1970 (relating to reasonable expectations) apply to the application of other time limits.”

This new clause would require the Treasury to review the effect of the changes made by sections 79 and 80 and compare them with other legislation relating to the recovery of lost tax including specifically the loan charge provisions of Schedules 11 and 12 to the Finance (No. 2) Act 2017.

Government new schedule 1—Intangible fixed assets: restrictions on goodwill and certain other assets.

Government amendments 4 to 6.

Amendment 22, in clause 53, page 34, line 14, at end insert—

“(5) The Chancellor of the Exchequer must review the expected effects on public health of the changes made to the Alcoholic Liquor Duties Act 1979 by this section and lay a report of that review before the House of Commons within one year of the passing of this Act.”

This amendment would require the Chancellor of the Exchequer to review the impact of the revised rates on cider and wine on public health.

Amendment 23, in clause 60, page 44, line 17, at end insert—

“(3) The Chancellor of the Exchequer must review the effects of a reduction in air passenger duty rates from 1 April 2020 and lay a report of that review before the House of Commons within six months of the passing of this Act.

(4) A review under subsection (3) must in consider the effects of a reduction on—

(a) airlines,

(b) airport operators,

(c) other businesses, and

(d) passengers.”

This amendment would require the Chancellor of the Exchequer to review the effects of a reduction in air passenger duty.

Amendment 36, in clause 79, page 52, line 24, leave out “12 years” and insert “8 years”.

Amendments 36 to 45 would reduce the time limits HMRC have to make an assessment of income tax or capital gains tax (Clause 79) and inheritance tax (Clause 80) to eight years, rather than 12 years, where there is non-deliberate offshore tax non-compliance.

Amendment 37, page 52, line 27, at end insert—

“(2A) Where the loss of tax is brought about carelessly by the taxpayer, an assessment may be made at any time not more than 12 years after the end of the year of assessment to which the lost tax relates. This is subject to section 36(1A) above and any other provision of the Taxes Acts allowing a longer period.”

See Amendment 36.

Amendment 38, page 53, line 22, after “(2)” insert “or (2A)”.

See Amendment 36.

Amendment 39, page 53, line 28, at end insert—

“(7A) An assessment may also not be made under subsection (2) or (2A) if—

(a) before the time limit that would otherwise apply for making the assessment, information is made available to HMRC by the taxpayer on the basis of which HMRC could reasonably have been expected to become aware of the lost tax, and

(b) it was reasonable to expect the assessment to be made before that time limit.”

See Amendment 36.

Amendment 40, page 53, line 34, at end insert—

“(8A) Subsection (7A) will not apply in cases where the taxpayer is subsequently found to have failed to provide all relevant information available to HMRC, or to have provided misleading information.

(8B) For the purposes of subsection (7A), whether information has been made available to HMRC is to be determined in line with section 29(6) above.”

See Amendment 36.

Amendment 41, page 53, line 35, after “(2)” insert “or (2A)”.

See Amendment 36.

Amendment 25, page 54, line 1, leave out “2013-14” and insert “2019-20”.

This amendment, alongside Amendment 26, would mean that new section 36A of the Taxes Management Act 1970 did not apply retrospectively.

Amendment 26, page 54, line 5, leave out “2015-16” and insert “2019-20”.

This amendment, alongside Amendment 25, would mean that new section 36A of the Taxes Management Act 1970 did not apply retrospectively.

Amendment 42, in clause 80, page 54, line 19, leave out “12 years” and insert “8 years”.

See Amendment 36.

Amendment 43, page 54, line 20, at end insert—

“(2A) Where the loss of tax is brought about carelessly by a person liable for the tax (or a person acting on behalf of such a person), proceedings for the recovery of the lost tax may be brought at any time not more than 12 years after the later of the dates in section 240(2)(a) and (b).”

See Amendment 36.

Amendment 44, page 55, line 2, at end insert—

“(7A) Proceedings may also not be brought under this section if—

(a) before the last date on which the proceedings could otherwise be brought, information is made available to HMRC by a person liable for the tax (or a person acting on behalf of such a person) on the basis of which HMRC could reasonably have been expected to become aware of the lost tax, and

(b) it was reasonable to expect the proceedings to be brought before that date.”

See Amendment 36.

Amendment 45, page 55, line 8, at end insert—

“(8A) Subsection (7A) will not apply in cases where a person liable for the tax (or a person acting on behalf of such a person) is subsequently found to have failed to provide all relevant information available to HMRC, or to have provided misleading information.

(8B) For the purposes of subsection (7A), whether information has been made available to HMRC is to be determined in line with section 29(6) TMA 1970.”

See Amendment 36.

Amendment 27, in clause 82, page 58, line 9, leave out from “section” to “may” in line 10.

This amendment would provide for all regulations under the new power (EU double taxation directive) to be subject to the affirmative procedure.

Amendment 28, page 58, leave out lines 13 to 17.

See Amendment 27.

Amendment 18, in schedule 1, page 148, line 34, at end insert—

“21A The Chancellor of the Exchequer must review the expected revenue effects of the changes made to TCGA 1992 in this Schedule, along with an estimate of the difference between the amount of tax required to be paid to the Commissioners under those provisions and the amount paid, and lay a report of that review before the House of Commons within six months of the passing of this Act.”

This amendment would require the Chancellor of the Exchequer to review the effect on public finances, and on reducing the tax gap, of the changes made to capital gains tax in Schedule 1.

Amendment 17, in schedule 2, page 177, line 21, at end insert—

“Part 1A

Review of effects on public finances

17A The Chancellor of the Exchequer must review the expected revenue effects of the changes made to capital gains tax returns and payments on account in this in this Schedule, along with an estimate of the difference between the amount of tax required to be paid to the Commissioners under those provisions and the amount paid, and lay a report of that review before the House of Commons within six months of the passing of this Act.”

This amendment would require the Chancellor of the Exchequer to review the effect on public finances, and on reducing the tax gap, of the changes made to capital gains tax in Schedule 2.

Amendment 29, page 177, line 42, at end insert

“unless the amendment relates to a disposal of an asset or assets resulting in a capital loss between the completion date of the disposal in respect of which the return is made and the end of the tax year in which the disposal is made.

(2A) In that case, an amendment may be made to take into account any capital losses which have arisen after the completion date and within the same tax year.”

This amendment would allow UK residents to submit an amended residential property return where a capital loss on non-residential assets is incurred after the completion of the residential disposal and within the same tax year.

Amendment 19, in schedule 5, page 211, line 45, at end insert—

“Part 2A

Review of effects on public finances

34A (1) The Chancellor of the Exchequer must review the revenue effects of this Schedule and lay a report of that review before the House of Commons within six months of the passing of this Act.

(2) The review under sub-paragraph (1) must consider—

(a) the expected change in corporation tax paid attributable to the provisions in this Schedule, and

(b) an estimate of any change, attributable to the provisions in this Schedule, in the difference between the amount of tax required to be paid to the Commissioners and the amount paid.”

This amendment would require the Chancellor of the Exchequer to review the effect on public finances, and on reducing the tax gap, of Schedule 5.

Amendment 21, in schedule 6, page 221, line 26, at end insert—

“13 The Chancellor of the Exchequer must review the expected change to payments of Diverted Profits Tax and any associated changes to overall payments made to the Commissioners arising from the provisions of this Schedule, and lay a report of that review before the House of Commons within 6 months of the passing of this Act.’

This amendment would require the Chancellor of the Exchequer to review the effect on public finances of the diverted profits tax provisions in the Bill.

As my hon. Friends have set out a number of times already today, this is a Finance Bill that continues the Government’s previous programme of austerity for the many while the very best-off people are protected. This Conservative Government chose to tie the hands of this House with regard to amending the Bill, so there are very few means we can adopt to have an impact on any of these measures. None the less, new clauses 2 and 4 would require the Government to at least review their regressive policy approach. I realise that I need to compress my remarks, so I will speak briefly to each of those new clauses and then to new clause 26, which pushes in the same direction, and new schedule 1, which in many respects exemplifies this Government’s slipshod approach, particularly to tax policy making.

Will my hon. Friend give way?

I do not believe I can, as I have been told that I have to proceed quickly.

For many years, the Government failed to take action, before clamping down purely on taxpayers and doing little to nothing to the enablers of this form of tax avoidance. I hope the Minister will be clear about this. He has talked about the promotion of defective schemes. When taxpayers are described as having done something illegal, which is what HMRC has said about the behaviour of those subject to the loan charge, why will the Government not say that those who promoted those schemes also promoted something illegal? They use this language about defective systems. I am sorry, but that is pusillanimous. Those who were unwittingly led into schemes that are now described as illegal must themselves be able to take action against those who wrongly advised them.

I hope that the Minister will look at that very carefully and accept the new clause. If he does not, I hope that he will accept my backstop, to coin a phrase, and have a meeting with me. I am glad he has intimated that he may be willing to do so to talk about how we can better help people who have ended up in a very difficult situation—some of them with their eyes wide open, but many of them not realising the impact of these schemes.

I rise to speak briefly—I know time is short in this debate—about new clause 26. For the avoidance of doubt among those on the Treasury Bench, I will not be supporting the new clause, but, as Chair of the Treasury Committee, I want to put on the record some concerns about the loan charge on behalf of the many individuals who have contacted the Committee and of the Committee members who have expressed concerns about it. I hope that Ministers will listen and engage with MPs across the House on this issue.

The Committee has raised concerns about the loan charge in evidence sessions with my right hon. Friend the Chancellor, and with HMRC and the Chartered Institute of Taxation. As the hon. Member for Oxford East (Anneliese Dodds) said, it is right that people should pay their fair share of tax on their earnings, and we do not support anything that seeks to get around that. It is right that HMRC should act swiftly and firmly to close down such avoidance schemes.

However, tax law sets out time limits within which HMRC can open inquiries and make tax assessments. Normally, those time limits take account of whether a taxpayer has taken reasonable care to comply with their tax obligations, has been careless or has deliberately decided not to comply. They are seen as valuable taxpayer protections, giving a degree of certainty that takes appropriate account of taxpayer behaviour.

It is certainly concerning to me—I am not sure I can speak on behalf of the whole Committee, but I think it is fair to say that I speak on behalf of many of its members—that HMRC’s contractor loan settlement opportunity requires people who want to put their affairs straight to waive those protections, with the threat of the loan charge looming over them. It is not clear why it is necessary for that settlement opportunity to pressure people into paying tax for years that HMRC calls “not protected”—years where HMRC is out of time—even though it may have had the information it needed to open inquiries or raise assessments at the proper time.

I support the way in which my right hon. Friend is addressing new clause 26, on which I find myself in a similar position to her. Although we want people to pay the correct taxes, I have constituents who may face losing their homes over this, after entering into what they thought were perfectly legal and allowable arrangements. Does she agree that the Treasury must address that?

I very much agree with my right hon. Friend. It will probably turn out that most of us have constituents who are affected in that way. There are some who perhaps did know what they were doing when they entered into these tax arrangements, and some who clearly did not. It is absolutely right that the correct tax is applied, but, equally, it cannot be right that people are facing serious situations that will undermine their financial security and also their mental health.

Is my right hon. Friend aware that not only did quite a few people take advice, but they notified the Revenue of what they were doing and no objections were made at the time?

Yes, I absolutely agree with my right hon. Friend. That was raised in the Westminster Hall debate led by my fellow Committee member, my hon. Friend the Member for Wycombe (Mr Baker).

I say to the Minister that it is troubling to hear that tens of thousands of people who want to settle with HMRC before the 5 April deadline have yet to receive calculations from HMRC. It is impossible for them— I think it would be for most of us—to settle large bills within a matter of months if they do not know what they will be asked to pay, let alone if they cannot start to make arrangements for how to pay them. These individuals need to know how much they have to pay, and I ask Treasury Ministers to step in and make clear what will happen to those people if they do not hear from HMRC by 5 April.

I will leave that with Ministers. I hope they can tell that there are MPs on both sides of the House who are concerned about this. By working together, we can make sure that the right tax is paid, but also that people are treated fairly.

I am aware that we are fairly short of time, so I will not rerun many of the things I said in Committee—I am sure the Minister and those on the Opposition Front Bench will be delighted to hear that.

I want to highlight a few of the SNP amendments and new clauses in this group. We have a couple of new clauses asking once again whether the Government’s provisions will do what they intend. For example, we want them to review the changes to entrepreneurs’ relief. We also want them to look at the changes in relation to emergency vehicles, because we are particularly concerned about the potential rural impact. Those who have emergency vehicles in rural areas may have more cause to use them outside work time than people who use them in cities. We felt that that issue was not drawn out enough in Committee or in the information the Government provided previously.

New clause 17 is about Brexit analysis. It is important to note that, since the Brexit vote in June 2016, over $1 trillion has been pulled from UK equity funds, which is obviously a really large number. In any changes or preparations the Government carry out in relation to Brexit, therefore, they should note the impact on the economy, which, according to the Bank of England, has cost individual families £900 each so far, and there is also the impact on financial services, for example, which have historically been very strong in the UK.

New clauses 15, 11 and 14 again ask the Government to provide information through consultation reports. It is important that the Government tell us the consultation they did on the draft clauses they brought forward. On the ones they did not bring forward, why did they not do so?

On that point, I should mention that the Government have included a new schedule in this group. That is a relatively unusual thing for the Government to do at this stage, given that they could have included the schedule in the original Bill or brought it forward in Committee. Because the new schedule was not brought forward in the initial stages, the explanatory memorandum provided by the Government does not include details about it. It would have been helpful if it had been considered at an earlier stage or if the Members who sat through the Bill Committee had been notified that it was likely to come forward. Presumably, the Government knew about it before the Christmas recess, and it did not just appear out of the ether. That process could be improved.

The main thrust of my contribution in the short time I have remaining is about the removal of the link between the personal allowance and the minimum wage. I understand that the Government have removed it on the basis that the personal allowance has now reached £12,500 and that they therefore believe they do not need to keep the link. I understand why they are making that case, but if that link had been kept, with the Government required to do a review if the personal allowance threshold was set at less than £12,500, future Governments would have continued to be bound by it. That would have meant that the protection the Government felt was necessary for people on the lowest incomes would still be there in the future. I understand that the Government do not intend to reduce the personal allowance, but that protection could have been left in place without the law causing any problems. That is something I am concerned about.

It is particularly concerning when the living wage the Government have put in place is not a real living wage, but a pretend living wage. It also does not apply to anyone under 25, which is an issue the SNP has raised over and over again. Just because someone is 24 does not mean that their living costs are less than they would be if they were 26—they could have the same number of children and live in exactly the same accommodation. However, the Government believe that it is okay to pay them less just because they are under that age threshold. That is exacerbated by the fact that the minimum wage increases the Government have introduced this year increase by a higher percentage—not just a higher monetary value—the minimum wage received by those who are over 25. The gap is widening: those who are over 25 are getting a bigger increase in the minimum wage, while there is a smaller increase for the younger age groups. The Government need to take seriously the fact that they are saying apprentices are worth pennies, frankly, and that 16 and 17-year-olds are worth far less than people under the age of 25. We raised our concerns in Committee in relation to the removal of the number. I do not think it would have cost the Government anything to leave in the link to protect future generations.

I wanted to have more time to be able to say what a great job the Government have been doing: a 43-year low for unemployment rates, 1,000 jobs a day created and bringing in the personal allowance upgrade even earlier. We do not have time to go through all that, but I believe that getting people into work and out of poverty is the way forward for many families.

The Government were absolutely right to target business rates as a way of helping the high street and small businesses, with a cut of 33% in rates for businesses with a rateable value of under £51,000. In areas like mine with high property values, however, it is not having the impact the Chancellor might have hoped. The new rate simply provides a cliff edge that penalises successful businesses in areas that are plagued by high property values. We must devise a system that helps small businesses and pubs to thrive, not just those with a low retail value. I recently met pub owners in my constituency who have been hit extremely hard by business rates. I have cut out an awful lot of my speech, but I am pleased to say that I have secured a Westminster Hall debate on this matter next Tuesday. I look forward to exploring the matter further with a Minister. Pubs in areas such as St Albans are seeing massive hikes in business rates, not the help that was intended.

Time is pressing, but I want to touch on new clause 26 tabled by the right hon. Member for Kingston and Surbiton (Sir Edward Davey). I have serious concerns about the retrospective nature of the tax being collected. Several of my constituents have raised cases with me and I am extremely concerned about how the process has been handled. Many make the case that this was not illegal tax evasion; they were advised to use the scheme as a way of keeping more of their own money. It is worth remembering that these people are not employees. They take on more risk, with no sick pay, maternity pay or other forms of support offered to an employee. I want to give a couple of personal examples, because I think that is key and we have so little time.

One of my constituents, who worked as an IT professional in the FinTech industries, is being pursued for £900,000 by HMRC for the loan charge. He is extremely worried—many are on the brink emotionally—and this has put him and his family under considerable stress. He had been advised that what he had done was lawful and he considered it to be so. He told me, worryingly, that he tried to settle the case with HMRC for about £700,000, but that that had been rejected. Many people who find themselves in tax difficulties manage to make negotiated settlements with HMRC. It appears that this particular group of people are being treated very unfairly and are being left in the very difficult situation of not knowing exactly how much they owe or how quickly they have to pay.

Other colleagues will be aware that the oil industry had a lot of contractors who were using what effectively turned out to be disguised schemes. Does my hon. Friend agree that there is a duty on HMRC? We have heard today from another hon. Member that customers should not be unduly disadvantaged if they have not managed to settle their claim to date, because after 5 April it will be significantly more.

Exactly. I have also been advised by a former constituent, who, despite no longer living in the UK, is being pursued by HMRC for thousands of pounds of unpaid tax. Another person was advised that this mechanism truly was lawful and it has come as a huge shock to his financial planning that he is left in this position.

There are reportedly over 1,000 people being pursued for unpaid tax. No one is disputing that people should pay tax that is due. The issue is the way it is being requested. People have been badly advised. They have never been able to check whether anything they were doing was illegal, because they were being advised that it was not illegal at the time. It is a loophole that has now been closed.

Will my hon. Friend give way?

It will have to be very quick, because I am aware other people need to speak.

My hon. Friend is making a very valid point. One of my constituents, an IT contractor, was advised by his own accountant. A review would be very helpful in ensuring that people receive proper advice, so that laws can be followed and taxes collected.

My hon. Friend is exactly right. There are many versions of that story. I have constituents who say that HMRC was made aware of these arrangements but no objection was raised until many years later. That has to be fundamentally wrong. What more due diligence can anyone do?

I will conclude, because I know the right hon. Member for Kingston and Surbiton wishes to speak. The huge pressure and distress—even suicidal thoughts—that this measure has put in people’s minds is totally unacceptable. I say to the Minister: if we do nothing else tonight, can we accept new clause 26? There is a clear ambiguity in the law that applied at the time—perhaps clarity has been provided now. The fact that people cannot negotiate a reasonable settlement even though they acted in good faith at the time, and are being pursued to the point of the destruction of their careers, homes, family lives and marriages, is completely unacceptable. We clearly need a review, and I hope the Minister takes that on board and accepts new clause 26. If it is pressed to a vote, I shall vote for it.

I thank the hon. Member for St Albans (Mrs Main) for her passionate speech. I also thank the right hon. Member for Loughborough (Nicky Morgan), who chairs the Treasury Committee, and right hon. and hon. Members from across the House, who have campaigned as a Parliament against this measure and supported new clause 26. It is my wish to divide the House on the new clause if the Minister does not accept it.

Let me make it crystal clear from the start that I support the Treasury’s aim of closing tax loopholes and stopping tax avoidance. The introduction of loan charges in the Finance Act 2017 to stop future abuse was correct, and the review my new clause proposes would not seek to prevent the Treasury from stopping that abuse from the 2016 Budget announcement. Instead—somewhat inelegantly, due to the rules of Finance Bill debate—new clause 26 aims to focus the minds of Treasury Ministers on the gross unfairness of the way the 2017 Act went about closing an unacceptable tax loophole.

I believe that the review envisaged in the new clause would reveal the unfairness of the retrospective nature of the current loan charge legislation in two ways. First, it would show how that retrospective nature is even more severe than non-retrospective but backward-looking proceedings for the recovery of lost tax elsewhere in our tax legislation. Secondly, it would show that the test of reasonableness included in proposed new section 36A, if applied to the loan charge, would in fact prevent any retrospective tax collection from the loan charge.

Let me remind the House why the Treasury should, after the review, ditch the retrospective nature of this measure, delay April’s implementation and amend the charge so it focuses only on payments made after 2016. It is because the loan charge, as introduced, offends against the rule of law. It is the sort of taxation that led the barons to rebel against King John and gave birth to Magna Carta. It is simply not acceptable for a Government to introduce a law that makes illegal something someone did years ago, when that action was considered legal. That is a clear principle.

I thank the right hon. Gentleman for giving way— I realise time is short—and for tabling new clause 26, which I, too, support. Does he agree that it is unreasonable for people to be expected to have kept records going back 20 years when they were reassured at the time that the scheme was legitimate?

The hon. Lady is absolutely right, and I thank her for her support. Let us remember that these people—our constituents—were given professional tax advice and behaved in a way they thought was right and lawful at the time.

I fully support the right hon. Gentleman’s comments and will vote for new clause 26 if it is pressed to a Division. I wonder whether he will reflect briefly on my concern that some people who support the Government’s position have implied that, in seeking justice and fairness for our constituents, we in some way condone tax avoidance. In fact, the opposite is the case—we say that there should not be tax avoidance or evasion. The real culprits in this are not the individuals who were conned and duped by professionals into taking out these schemes and now face bankruptcy, but the firms that designed and sold them the schemes in the first place, some of which are still operating.

The hon. Gentleman is right on all the points he makes. When my hon. Friend the Member for Eastbourne (Stephen Lloyd) tabled the early-day motion that got cross-party support when this campaign was getting going, those were exactly the points he made. We all condemn tax avoidance and support the Treasury, but this retrospective approach to taxation is simply unacceptable.

I congratulate hon. Members and hon. Friends on their speeches and wholly agree with them. It is grossly unfair that one of my constituents, a contractor between 2004 and 2006, is expected to repay tax from this period. It goes against the whole principle of fairness and surely would not survive any challenge in the European Court of Human Rights.

Indeed. HMRC knew about these tax schemes for years and took no action. They were widely used—as we have heard, right hon. and hon. Members from around the House have constituents affected—and widely advertised and yet were ignored by the tax authorities. People could only take some public sector positions if they agreed to be paid via these schemes, and it emerged ahead of the Westminster Hall debate that even some HMRC contractors were paid through such a scheme.

I am grateful to the right hon. Gentleman for tabling the new clause. I found HMRC’s answers to the Treasury Committee wholly unsatisfactory. There remain serious questions to be asked of the promoters of these schemes, of the employers, including public sector employers, who promoted them to contractors, and also of HMRC. If people were given tax advice and followed it, and if HMRC was aware of these schemes but did not take action in any previous tax year, how on earth could any reasonable person have concluded that they were doing anything wrong?

I totally agree, and I am grateful for the hon. Gentleman’s intervention.

Will the right hon. Gentleman give way?

I cannot resist.

It is not often that I agree with the right hon. Gentleman, as he knows, but I strongly agree with him on this issue. Retrospective legislation is bad in principle. This is an unjust provision, unreasonable and unfair, and I urge the Government to take note of the arguments put forward.

Having taken that wonderful intervention, I bring it to the House’s attention that the hon. Member for Wellingborough (Mr Bone) has signed my new clause. It is bringing the House together at a time when elsewhere it is divided.

I end on what this loan charge and its retrospective nature have meant for our constituents. It has caused misery. It has affected people’s lives, their health, their families. It has caused gross misery. Some people believe they will have to go bankrupt if they are forced to pay, or that they might lose their homes, and that is why the House is united against this retrospective action. I really hope that the Minister will get to his feet, accept the new clause, go ahead with the review and bring it back before the end of the tax year, so that the House can see it and vote on it.

I rise to speak in support of new clause 2. I was staggered to learn that entrepreneurs’ relief costs the Treasury an estimated £2.7 billion, and this to allow people selling companies worth up to £10 million to keep half the money they would otherwise pay in capital gains tax.

I was even more surprised to learn that this tax relief was concentrated among a few very wealthy individuals, with 6,000 people making gains of over £1 million and averaging £450,000 in tax relief each. This relief is only benefiting the very wealthy and should be reviewed as to its effectiveness. If it is scrapped, the £2.7 billion could be used to fund schools buckling under the pressure of funding cuts and provide huge investment in special educational needs and children and adolescent mental health needs. It could also go some way to funding children’s services and social care in local authorities and policing.

This is not the only area where the Government are giving away money that could otherwise be put to better use. Under amendment 22, in the name of the hon. Member for Aberdeen North (Kirsty Blackman), the Government are being asked to review the expected effects on public health of the changes made to the Alcoholic Liquor Duties Act 1979. The Alcohol Health Alliance has stated that the Government’s own figures show that alcohol duty cuts from 2013-14 have cost the Treasury £4 billion, which is the equivalent yearly cost of employing over 100,000 teachers. The figure is expected to rise to £9.1 billion by 2024. Considering the pressures on budgets as a result of austerity, that is not an insignificant amount.

The freeze on duty on beer, spirits and cider for 12 months from February 2019 is in effect a cut, as it is not keeping in line with inflation. Indeed, it has not done so for six of the last seven years. Cheap alcohol has a tremendous effect in causing damage to people’s health, the economy and wider society. Alcohol is the leading risk factor in respect of the deaths of people aged 15 to 49. In England alone, there are more than 1 million hospital admissions and 24,000 deaths related to alcohol every year. That is a clearly an impact that the Government need to consider when they set duties on beer, spirits and cider. Cuts in alcohol duty have a double effect. They reduce revenue for the Treasury, which in turn reduces the amount of funding for the NHS, while simultaneously increasing demand and costs in the NHS by encouraging the consumption of cheap alcohol. I therefore ask the Government to review the impact of the alcohol duty freeze on public health.

Does my hon. Friend agree that the stories we hear from our constituents suggest that some of them are not only afraid of losing their homes and livelihoods, but are actually having suicidal thoughts because of the pressure that is being put on them to pay the money?

That is an excellent point, which I was about to make myself. While the large accountancy firms have gone unpunished for creating tax avoidance schemes for big banks, those individual contractors are bearing the brunt of HMRC’s powers. I have been informed by the Loan Charge Action Group of suicides, bankruptcies and relationship breakdowns as a result of the stress involved in their dealings with HMRC. The group has said that many of the people being pursued by HMRC unwittingly signed up to loan-based schemes, but the promoters of the tax avoidance vehicles have not been targeted.

I ask the Minister to reconsider these measures and to ensure that people are not punished when they should not be.

Given the limited time that is available to me to summarise a debate that has covered a large number of amendments and new clauses, I shall confine my remarks principally to the issue that has been raised most frequently, which relates to new clause 26. The new clause requires the Government to lay before the House a report reviewing the effects of changes made by clauses 79 and 80 no later than 30 March 2019. While I should note that such a report will come too soon for the measures to have had a real effect, the Government of course remain committed to setting out the rationale for their policies as well as their impact, and in that spirit we will not oppose the new clause.

I do, however, echo many of the comments made by Members about what these schemes are truly about, which is gross aggressive tax avoidance. The way in which disguised remuneration typically works is that, instead of an employer’s paying an employee by way of a salary in the normal way, which attracts PAYE income tax and employees’ and employers national insurance, the payment is made as a loan. Typically, those so-called loans, which are not really loans at all—there is no intention of ever repaying them—are routed out via an offshore trust in a low or no-tax jurisdiction, and then routed back to the United Kingdom to be received by the end recipient. That is extremely unfair. It is unfair to our public services, because we have a duty as a Government to collect the tax that is due to fund them, and it is unfair to the vast majority of taxpayers who do the right thing, which is not to get involved in aggressive tax avoidance schemes in the first place and to pay their fair share of tax.

One issue that has been raised on a number of occasions is the question of whether HMRC’s loan charge arrangements are themselves retrospective. They are not retrospective because, critically—this is where I take issue with the right hon. Member for Kingston and Surbiton (Sir Edward Davey)—at the time when they were entered into they were defective. No matter how far we go back, the scheme typically—I have described the way it works—was defective. It did not work then, it does not work now and the tax is due.

These schemes have been taken through the courts on many occasions. A scheme used to the benefit of Rangers Football Club was taken to the Supreme Court—the highest court in the land—and was found to be defective.

Will my right hon. Friend give way?

I will not, simply because I have two minutes and 30 seconds left and I want to cover some of the other issues raised this evening.

However, as I have said, the Government will accept this new clause. It is absolutely right that, when HMRC deals with the public, it has a strict duty of care, a duty of proportionality and a duty to be as sympathetic as it can be relevant to the circumstances of those with whom it is dealing. In my dealings with HMRC, I have made those points forcefully clear. As the right hon. Gentleman will know, HMRC has recently come forward to say that those earning £50,000 or less—which is over twice the average national salary of somebody working in our country—will automatically be granted, without requirement for additional paperwork, a minimum of five years’ time to pay as an arrangement to settle their affairs. Of course for those who come forward before April there is effectively in most cases no penalty as such; they will simply be required to pay that tax which was due in the past—and it was always due in the past—plus the interest that is rightly applied.

I have less than a minute left and want to say a little about amendment 12, tabled by the hon. Member for Aberdeen North (Kirsty Blackman), on the national minimum wage lock. She will know that, because we have increased the personal allowance now to £12,500 for every year of the forecast period, there will be no necessity for that lock to be in place. She makes the point that there could be a projection beyond that point. That will be a matter for a future Government of course and it is not for this Parliament to bind its successors.

I conclude on the suggested entrepreneurs’ relief review and new clause 2, which the hon. Member for Oxford East (Anneliese Dodds) spoke to. We had a review that was published in December 2017, which reported on this particular matter, and it showed that a third of those using entrepreneurs’ relief went on to reinvest in new businesses and half of those who were aware of entrepreneurs’ relief said that it significantly influenced their decision to enter into an entrepreneurial activity. It is an important element of the business tax landscape and we will of course, as we do with all taxes, keep that relief under review.

In the six seconds I have left, I urge that the House accepts the Government new clauses and, with the exception of new clause 26, rejects the Opposition amendments.

I will now suspend the House for no more than five minutes in order to make a decision about certification. The Division bells will be rung two minutes before the House resumes. Following my certification, the Government will table the appropriate consent motion, copies of which will be made available in the Vote Office and will be distributed by Doorkeepers.

I can now inform the House that I have completed certification of the Bill, as required by the Standing Order. I have confirmed the view expressed in the Speaker’s provisional certificate issued on 7 January. Copies of my final certificate will be made available in the Vote Office and on the parliamentary website.

Under Standing Order No. 83M, a consent motion is therefore required for the Bill to proceed. Copies of the motion are available in the Vote Office and on the parliamentary website, and have been made available to Members in the Chamber. Does a Minister intend to move the consent motion?

indicated assent.

The House forthwith resolved itself into the Legislative Grand Committee (England, Wales and Northern Ireland) (Standing Order No. 83M).

[Dame Rosie Winterton in the Chair]

I remind hon. Members that, if there is a Division, only Members representing constituencies in England, Wales and Northern Ireland may vote on the consent motion. As the knife has fallen, there can be no debate. I call the Minister to move the motion.

Motion made, and Question put forthwith (Standing Order No. 83M(5)),

That the Committee consents to the following certified clause of the Finance (No. 3) Bill:

Clause certified under Standing Order No. 83L(2) (as modified in its application by Standing Order No. 83S(4)) as relating exclusively to England, Wales and Northern Ireland and being within devolved legislative competence

Clause 3 of the Bill, as amended in Committee and the Public Bill Committee and on Report.—(Mel Stride.)

Question agreed to.

The occupant of the Chair left the Chair to report the decision of the Committee (Standing Order No. 83M(6)).

The Deputy Speaker resumed the Chair; decision reported.

Third Reading

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

Eight years ago, our country’s finances were in peril. For far too long, Labour had spent and borrowed more than our country could afford. The deficit was at a peacetime high and debt was spiralling out of control. [Interruption.] I would not keep repeating it if Labour Members had learned their lesson, but they clearly have not, so they need to be told. This Government came into office knowing that we had to rise to the challenge of working with the British people to bring expenditure back under control and to once again live within our means, and we have done just that, with the deficit now four fifths lower than it was when we came into office and debt beginning its first sustained fall in a generation.

But bringing down the deficit alone was not the limit of our endeavour. The manner in which we did so was equally important: reducing the deficit, yes, but remaining committed to funding our vital public services, giving tax cuts to millions of strivers right up and down the country, and building a tax system that rewards and incentivises business and growth—prudent but pro-business, and deeply invested in the idea that those who work hard should be rewarded. The results are clear to see: 3.3 million more people in work since 2010, unemployment at its lowest level since the 1970s, wages growing, and the rate of absolute poverty at a record low. This Bill continues that work.

At the heart of the Conservative ideal is the firm belief that people know how to spend their money better than Government do, and that those who work hard deserve to be rewarded. The best way for Government to serve that ideal is to cut taxes, especially for those on low and middle incomes—to get out of the pockets of the British people and let them decide what they do with the money that they have worked so hard to earn. When this Government came into office, the personal allowance was at £6,475 and the higher rate threshold was at £43,875. We were elected to raise those thresholds to £12,500 and £50,000 respectively. In this Bill, we deliver on that commitment not just in line with our manifesto but a full year early—at the earliest affordable opportunity. Those changes mean that, compared with 2015, we have cut taxes for 32 million people, with an additional 1.7 million people paying no tax at all, and nearly a million fewer people having to pay the higher rate of income tax. We are also making sure that the extra money in people’s pockets goes further. It is for that reason that we are freezing fuel duty, freezing air passenger duty on short-haul flights in real terms, and freezing the duty on beer, cider and spirits.

Also central to the mission of this Government is our steadfast support for business—our instinctive and deep-rooted understanding that it is never Government who generate the wealth and taxes that fund our vital public services, but the innovation and hard work of millions of people right up and down our country. The achievements of our businesses have been very significant, yet despite that, productivity has been subdued since the financial crisis, and business investment in our country, while strong, is lower than we would like it to be to make the most of the opportunities that lie ahead.

That is why in this Bill we are taking substantial action to boost private sector investment. We have introduced, at the request of the CBI, a new capital allowance for qualifying non-residential structures and buildings that will support business investment and improve the international competitiveness of the UK tax system. From 1 January, we are increasing the annual investment allowance to £1 million for two years, providing additional support for firms to invest and grow. Not least because of the relentless lobbying of my Conservative colleagues who represent constituencies in Scotland, we are legislating for a groundbreaking transferable tax history mechanism for late-life oil and gas fields.

A core pillar of this Government’s approach to taxation is a belief in fairness—that everyone should pay what they owe when they owe it. This Government have an outstanding record in this area. We have protected more than £200 billion in revenue that would otherwise have gone unpaid since 2010, and we have introduced more than 100 avoidance and evasion measures since that time.

In this Bill, we continue that work, taking action against multinationals that keep their intangible property in low-tax jurisdictions in order to avoid UK tax; tackling profit fragmentation, whereby companies reduce their tax burden by artificially shifting their revenue; and cracking down on multinationals that attempt to erode the tax base—a tax system where enterprise is rewarded but everyone pays their fair share and our public services get the funding that they need.

I have been proud to take this Bill through the House. It provides a tax cut for 32 million people. It backs British businesses, introducing with measures to boost private sector investment and support jobs and growth, to ensure that our country is the country in which enterprise can thrive. I understand that the Labour party does not agree with every aspect of the Bill but will not divide the House on Third Reading, which is positive. Those on the Government Benches support tax cuts for millions of hard-working people. We support business growth and investment. We support job creation, and we are the side of the House to ensure that taxes are fair and paid. I commend the Bill to the House.

This has been a Finance Bill of highs and lows. One high was the Government finally listening, albeit only when they were pushed to do so by the prospect of losing a vote, as we have just seen in relation to the loan charge. Another high was the fact that we saw the House seize the initiative to act to protect our country from the negative consequences of a no-deal Brexit for our economy and for our safety and resilience, as set out by the right hon. Member for West Dorset (Sir Oliver Letwin) in what I thought was an extraordinary speech.

I understand that the vote a couple of hours ago on the amendment tabled by my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper) was the first time that a Government have been defeated at this late stage of a Finance Bill since the summer of 1978. At that stage I was only four months old, so I cannot exactly say that this is the only time I have seen a Government defeat on a Finance Bill in my lifetime, but I suspect it was the first time for many other Members. It was an appropriate defeat, because it shows that this House has adopted responsibility when our Government have sadly been unwilling to do so.

All this has happened in a context where Government have systematically attempted to reduce the opportunities for this House to influence the Finance Bill. Conservative Ministers’ decisions over recent years to prevent the House from substantively amending Finance Bills have been unprecedented. They have become a new norm and reflect the lack of confidence that this Government have in arguing their convictions. Surely that, above all, is the case with the Government’s approach in this Finance Bill, which preserves austerity for the many while the very best-off people and profitable corporations continue to benefit, our productivity gap yawns, regional inequalities widen and we see the creation of unprecedented phenomena in this country, such as the fact that getting into work is no longer the ticket out of poverty that it once was.

We have seen this Government’s unwillingness even to gather the figures and evidence about how their measures will affect child poverty or public health, in a context where life expectancy is for the first time going down in some of our communities. We have seen them bowing to lobbying pressure and introducing loopholes to protect many overseas investors from measures intended to level the playing field between them and domestic investors. Finally, we have seen the extraordinary contortion of a new schedule being inserted into the Bill just before Christmas to introduce a new tax relief for profitable corporations, not only very late in the day but without any information whatsoever about the cost that it will pose to the public purse. Indeed, we will not get that information before the measure is implemented.

The Government are spendthrift when it comes to profitable companies and the very best off, but miserly when it comes to the worst off. I see those on the Government Front Bench adopting a rather pantomime-style response to that. I am sorry to say that the overall package in this Finance Bill supports that contention, as do the figures, if only we could have them in front of us now.

Despite the considerable problems with this Bill, given the fact that it now contains provisions that militate against a no-deal scenario—surely the most significant risk currently to our economy and indeed to our security—we cannot and will not oppose it. I want to end by thanking all the civil servants and indeed staff of this House who have worked so hard on this Bill, and who have helped us in the Opposition—[Interruption.] I see that the Minister wants to thank them, too. I also want to thank all my hon. Friends who have contributed to our debates on this Bill.

It is great to have the chance to speak on the Third Reading of my fifth Finance Bill. Given my relatively short time in the House, that shows just how many Finance Bills we have had.

There is much this Government do that I would criticise, but I will start with three things that I am pleased are in this Finance Bill. The first, which the Minister mentioned, is the transferrable tax history. To be clear, I was calling for that when there was only one Scottish Conservative Member of Parliament in this place. Actually, I think there has been cross-party work on the transferrable tax history. I think the Government have worked well with industry in bringing it forward, and I am pleased that they have done so. I am really pleased that it is in the Bill, and I think it will make a big difference to the North sea in particular, given the fact that we can extract oil and gas from the North sea for a longer period as a result of the changes made. The jobs associated with that will be secured, which is particularly important for my constituents and those in constituencies around the north-east of Scotland, so I am pleased it is in the Bill.

I am also pleased that clauses 92 and 93 are in the Bill. Clause 92 was accepted by the Government in relation to tax avoidance. It was tabled by the SNP, and it requires a review of the effects of the provisions in reducing tax avoidance and evasion. The Government will have to bring forward this review within six months of the passing of the Act, and we look forward to them doing so. The Government chose to accept two of our amendments, neither of which I was involved in the debates on, so I am a little bit disappointed about that. My hon. Friend the Member for Glasgow Central (Alison Thewliss) led on this part of the debate, and my congratulations go to her on getting this through.

Clause 93 was also accepted as an SNP amendment. It was the result of the excellent work of my hon. Friend the Member for Inverclyde (Ronnie Cowan) on fixed odds betting terminals and the general work he has been doing on the public health impacts of gambling. Earlier, I made the point that we sometimes put in tax measures to discourage behaviour that we do not want to happen—for example, a harmful behaviour. I am really pleased that the Government will, as a result of the SNP’s pressure, bring forward a review of the public health impacts of gambling and the changes made. When the Government are taking decisions about gambling and gaming duties, they should always be thinking about the public health impacts and have them front and centre of any explanatory memorandum for future Finance Bills.

I am not going to be overwhelmingly positive; I have some negatives as well. The process for this year’s Finance Bill has been particularly—[Interruption.] Shambolic, yes. It has been particularly shambolic and inadequate, because the Government have failed to consult on as many of the measures as they should have done. They did not put them forward in draft format, so companies and organisations were not able to make known their concerns or suggest ways in which the Bill could be changed to make it better. I fear that that is not good for scrutiny. Changes were introduced in this Finance Bill to correct errors made in previous Finance Bills or to strengthen provisions that were inadequate in previous Finance Bills. Again, I am concerned that, because of the process this year, we will see more of that in future years.

The other thing that is particularly poor in this Finance Bill—this is a real contrast with the decisions made in Scotland—are the tax changes. Tax changes that have been made on things that are devolved to Scotland, which I none the less feel able to criticise, are not the ones that I feel should have been made, because they are not made from the progressive point of view that we would like. The tax changes we are making in Scotland are on a much more progressive basis, and the Government would do well to look at what we are doing in Scotland. In England, about half of taxpayers pay more than they would if they were in Scotland, and those taxpayers are the ones at the lower end of the income spectrum. They are the people we think we should be supporting, rather than the people at the top end of the income spectrum.

I have just a last couple of points. Better scrutiny of the process is always required. I have called repeatedly for the Finance Bill to be subject to evidence sessions in Committee, and I will continue to make that call of the Government until they capitulate, because Finance Bill Committees should hear evidence. The other half of this—the spend process—has been improved very slightly, but it has not been improved nearly enough, and we need better and more adequate scrutiny of Government spend before it happens, rather than just doing it through the estimates process.

Lastly, I would like to take this opportunity to thank my hon. Friend the Member for Paisley and Renfrewshire South (Mhairi Black), who was with me in Committee, as well as two members of staff, Jonathan Kiehlmann, who was involved in this, and Scott Taylor, without whose help I could not have gone through the Finance Bill Committee or the stages we are at now. I would like to offer my specific thanks to them.

Question put and agreed to.

Bill accordingly read the Third time and passed.