15:41 Jesse Norman (Conservative)

The last 12 months have delivered a grave shock to this country and its economy, but the Government have met that shock with a determined and sustained response. That work is not done. With this Finance Bill, we are continuing to support the lives and livelihoods of families and businesses up and down the land, while simultaneously setting the terms for an investment-led recovery. The Bill puts in place the foundations for a fairer and more sustainable tax system. It further enshrines commitments on the environment and the work we are doing to tackle climate change, and it begins the work to rebuild the public finances. For those reasons and more, I commend it to the House.

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15:57 James Murray (Labour)

The Budget in March and this Finance Bill should have been an opportunity to pull out all the stops to get the economy going. The Chancellor should have focused resolutely on supporting families, securing jobs and backing small businesses. The Government should have used this opportunity to make sure we invest in solutions to the problems that we have struggled with as a country for so long, from social care to the climate emergency and the housing crisis.

Far from charting a course for the future, the Bill lacks any mention of a plan to tackle the big problems that we have faced in this country for a decade or more and that have in so many cases been brought into sharp focus by the covid outbreak. It is clear that over the past decade under this Government, our country’s social care system has been underfunded, with its workers chronically underpaid. Our country’s response to climate change has stubbornly lacked the urgency, ambition and scale that it needs. Our country’s answer to the housing crisis has been left to developers and speculators, leaving an entire generation let down and left behind. Investing in better social care, new green infrastructure and the council housing that we need would create jobs, improve lives and finally start to tackle the problems that our country needs to resolve.

We will vote for our amendment and against the Bill, to make it clear to people in our country that we understand that people need to be spared the Bill’s tax rises; that Amazon does not need any favours; that NHS workers deserve our support, that we need good new jobs in every region in the nation; that the economy will grow only through responsible investment; and that we need to fix social care, the climate emergency and the housing crisis. Above all, people in our country need a Government who are on their side, and it is absolutely clear from the choices that the Bill and their Budget make, and the problems that they choose to ignore, that this Government fail that test.

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16:30 Alison Thewliss (Glasgow Central) (SNP) [V]

We believe there should be a greater focus on pushing investment to meet net zero. The UK Government must ensure that this investment is one for future generations, and I ask how exactly Ministers intend to monitor the effectiveness of this super deduction. There should be safeguards against what Tax Justice has called egregious investments such as Jacuzzis. I note also that the purchase of flags might be on the list of things people could buy through their companies, which will no doubt please all the Tories on Zoom.

I turn to freeports. We on the Opposition side continue to have concerns about their effectiveness and the potential for tax dodging. The point by the Chair of the Select Committee about displacement was also well made. Their use around Europe and around the world has left many scratching their heads about what the UK Government aim to achieve. Scotland has set out a differentiated approach, engaging in good faith but adapting and improving the UK’s model to address the climate emergency in our green port approach. The Scottish Government stated:

“Operators and beneficiaries will be required to commit to adopting Fair Work First criteria and contribute to Scotland’s just transition to net zero”.

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16:46 George Freeman (Conservative)

On levelling up, I highlight the Government’s phenomenal package of support, rightly making the crisis not just a moment to prop up the pre-covid economy but to drive growth out. The 45 town deals and the eight freeports are genuinely transformational for places such as Teesside that have been left behind by successive Labour Governments, who ought to have been representing them better. There is the move of the UK infrastructure bank to Leeds, the levelling-up fund, the community renewal fund, the Help to Grow for SMEs, the future fund and the substantial commitment to net zero and the green infrastructure that we need for a proper recovery. This was a Budget not just to repair the damage of covid, but to lay the foundations for a more sustainable and sustained economic recovery, creating jobs and opportunities for generations to come. I welcome it particularly for that reason.

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17:02 John McDonnell (Labour)

I have heard the Prime Minister and the Chancellor claim that we have only been able to meet the demands of a pandemic because of the so-called strength of the pre-covid economy, so it is worth reminding ourselves what the pre-covid economy was like. Some 4.2 million of our children were living in poverty—30% of children in this country. Rough sleeping had more than doubled. Food banks were handing out 1.5 million food parcels a year. Nearly a million people were working on zero-hours contracts. Going into this pandemic, the NHS had suffered the longest funding squeeze in its history and there were 100,000 vacancies, including 40,000 nurse vacancies. Social care was even worse, with £8 billion taken out of social care budgets since 2010 and, according to Age UK, 1.5 million of our older people not getting the care they needed. The existential threat of climate change was effectively ignored, with the Government hopelessly off target to secure even the modest goal of net zero emissions by 2050.

Also, nothing exposes the vacuity of the Bill more than its real failure to address the existential threat of climate change with firm action. There is nothing in the Bill that dictates this priority and the scale of investment and action needed to address the crisis of climate catastrophe that we now face. If there is one thing that people have maybe begun to learn in recent months, it is that the promises of the Prime Minister and the policies of the Chancellor do not generally coincide either with reality or, as some have alleged, with the truth.

The test of the Government’s purpose in the Bill will be their attitude to the amendments that will be inevitably be tabled to protect the lowest paid from the stealth tax increases of threshold freezes; to ensure that tax reliefs are not used as methods of tax abuse; to make unearned wealth taxed at the same rate as income from work, as was proposed by the Government; and to prevent ministerial interference, tackle low pay and exploitation and ensure that responsibilities to tackle climate change are upheld. From their attitude to those amendments, we will see whether this Government are a Government for the people or, as I suspect, a Government for the corporations.

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17:37 Stella Creasy (Labour)

We need not just to build back better, but to build back for all. Andy Haldane has highlighted that around 10 million people in this country are on insecure contracts. Our economy was so hard hit by covid because it was over-reliant on services, which made up as much as 80% of our GDP, whereas just 14% was based in construction and just 6% in manufacturing. The Bill shows that the Government still have not learned the lessons about how we are able as a nation to handle future shocks and diversify; to invest alongside business and academia in new technologies; to learn from the vaccine programme and encourage co-operation and innovation alongside the state and not in spite of it; or, in the run-up to COP26, to provide the incentives to renewable energy manufacturing and production that could futureproof our economy for decades to come.

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18:21 Geraint Davies (Swansea West) (Lab/Co-op) [V]

I will bring my remarks to a close as you suggest, only finally to say that we need to do more on the issue of climate change and the environment, because 64,000 people a year are dying from air pollution, while nothing has been done about diesel or accelerating towards electrification. We need to look at a different approach whereby we can generate growth and opportunity for the future.

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18:43 Sarah Olney (Liberal Democrat)

The biggest opportunity missed, however, is the fight against climate change. We have heard many warm words on global warming from this Government. They appear to have grasped the magnitude and immediacy of the crisis we face, yet they have no plans for action. The 10-point plan for a green industrial revolution, released before Christmas, announced a wide range of aspirations, but no concrete policies or spending commitments. The Budget continues that trend. Liberal Democrats welcome the new direction to the Bank of England to take account of climate change, but that is a small drop in an ever-deepening ocean of what needs to happen if we are to take the necessary action.

The Government have shown with this Budget and Finance Bill that they are not serious about achieving net zero and creating a green recovery. They have gone as far as scrapping the industrial strategy, leaving businesses in the dark about how the UK will tackle climate change and achieve green growth in the years to come. The Budget promised to re-establish a new infrastructure bank, which merely replaces the green investment bank established by the Liberal Democrats in 2010 and sold off by the Tories in 2016. There was nothing on extending the green homes grant scheme, which could have tackled fuel poverty and cut energy bills for millions of homeowners while cutting emissions—and since then the Government have scrapped the scheme altogether. The Government even failed to cut VAT on home insulation products to encourage people to invest in their home themselves. There was nothing on increasing incentives on electric vehicles, including VAT cuts or new grants. There was nothing on investing in more public transport or new walking and cycling infrastructure. Liberal Democrats wanted a Budget to kickstart the green recovery, but the Conservatives have failed to deliver. We must see a bold green recovery plan that will invest £150 billion in the next three years to tackle climate change, create new green jobs and help us to grow our way out of this crisis.

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18:50 Steve Double (St Austell and Newquay) (Con)

I absolutely understand the Government’s rationale behind the decision to move people away from diesel towards alternative fuels to help to reduce their environmental impact and to help us as a country to move towards our net zero target, but the fact is that much of the heavy gear used in the mining and quarrying sector just does not have an alternative to diesel. The technology does not yet exist to provide an alternative form of cleaner energy. The sector will therefore bear the brunt of the Government’s decision to introduce this change from next April in the short term.

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19:02 Andrew Griffith (Conservative)

In the year in which the UK hosts the UN climate summit, let me conclude by welcoming two measures in the Bill that help us move towards a low carbon future. The first is part 2, which introduces a plastic packaging tax from next April. We should tax things we wish to have less of, and on that basis this is an excellent piece of legislation that will provide a clear economic incentive to use recycled material in the manufacture of plastic packaging. It is estimated that as a result, the use of recycled plastic could increase by around 40%, equal to carbon savings of nearly 200,000 tonnes a year and saving a lot of plastic from ending up in landfill and incineration. We only have one planet, so as soon as this useful measure is on the statute book, I encourage my Treasury colleagues to look at increasing the rate and lowering the exemption threshold.

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19:25 Ben Lake (Plaid Cymru)

Noting the significant risk that the proposed capital allowance super deduction might turbocharge regional inequality in the UK, Plaid Cymru will also table an amendment requiring the Government to consider the impact and geographical reach of that super deduction. Given the pressing challenge of climate change, and the need to recapitalise our economy to further decarbonisation efforts, our amendment will require the Government to consider the impact of a super deduction on climate change mitigation efforts. I sincerely hope that the Government will be supportive of that amendment, particularly given the Bill’s overall lack of measures and support for the green transition—except, it is worth noting, a welcome change to the Bank of England’s mandate.

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19:33 Claire Hanna (SDLP)

That was a fair point well made about contributions earlier, Madam Deputy Speaker, and as I am mostly going to address climate change, I will try to be aware of the levels of hot air I am producing myself.

I rise to speak in favour of the reasoned amendment in the name of the hon. Member for Brighton, Pavilion (Caroline Lucas)—my name is also on the amendment—and to say that Social Democratic and Labour party Members will vote against this Bill. We spoke last month in the Budget debate to highlight the missed opportunities, including the opportunity to respond to the economic challenges and the challenges of inequality that have been exposed by the pandemic. However, while interim and half measures can perhaps be explained away with an economy in lockdown and in deep freeze, they cannot be justified for the live climate crisis we are facing at the moment. This Bill misses the opportunity to act on that ecological emergency because it lacks the ambition and the urgency required to meet the UK’s obligations under the Paris agreement. It does not deliver the transformational investment needed to create green jobs, particularly at a time when so many people have lost their work and when so many sectors will take time to recover. Opportunities also need to be there, not least here in Northern Ireland.

This year, the UK hosts COP26, which provides even greater impetus than ever to be a leader in climate action, with meaningful cross-governmental action right at the very heart of the Bill and right at the very heart of this global inflection point that we are experiencing at the moment.

We have been doing things differently necessarily for the past year and we should continue to do that and to follow a different ecological and economic course from the one that we would otherwise be on. The Government have repeatedly highlighted the importance of net zero, which is welcome, but the Bill does not reflect the urgency of what we are experiencing here and what we are seeing around the world. We cannot keep putting the meaningful actions into the “too difficult” piles. Recent moves by the Government, including approving a mine, granting new licences for oil and gas exploration, scrapping the green homes grant and cutting overseas aid to countries that are dealing with the impact of climate change and removing funding at a time when they need to transition to less carbon-intensive measures, is going in the wrong direction. These are not the signals of a Government who are serious about a green recovery or serious about the wellbeing of the planet or of future generations. There needs to be consistency in domestic policies and international objectives that we are not seeing here.

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19:58 Richard Thomson (Gordon) (SNP)

First, lest there be any doubt, the sector deal is absolutely welcome. It has been called for for a long time and I know that the Government and industry have been working together closely to deliver the package. Although it might be a sector deal, whatever else it might be it is emphatically not a fiscal deal. There are big numbers in respect of the amounts of investment money that might potentially come in, but the Government are not putting a huge amount of money on the table to achieve that. It may help—I hope it does—to drive the objectives of a just transition and to boost the skills and retain human capital in the north-east of Scotland, but we need to be prepared for the possibility that further incentivisation might be needed.

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20:05 Pat McFadden (Labour)

Turning to the debate, it is a pleasure for me to respond on behalf of the Opposition. I thank all Members on all sides of the House, who made very wide-ranging contributions today, and some of them, Madam Deputy Speaker, related to the Bill before us. We have heard excellent contributions on a wide range of issues, including the move away from diesel, climate change, local recovery bonds, the taxation of covid tests, those excluded from Government help schemes, the arts and cultural sector, the aviation sector, the Help to Grow scheme, freeports and regional inequality—or, as the Government call it, levelling up.

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20:17 Kemi Badenoch (Conservative)

The Bill improves tax transparency by paving the way for the UK to implement the OECD’s international reporting rules for digital platforms, stops tax cheats by strengthening our existing anti-avoidance regimes and tightening the rules designed to tackle promoters and enablers of tax avoidance schemes, and provides even more certainty to taxpayers by setting out a more consistent, fairer penalty regime across VAT and income tax self-assessment. In addition, it will help to deliver a low-carbon future, as highlighted by my hon. Friends the Members for Arundel and South Downs (Andrew Griffith) and for Stoke-on-Trent Central (Jo Gideon) and the hon. Member for Ceredigion (Ben Lake), with the introduction of a plastic packaging tax and by removing most sectors’ entitlement to use red diesel from April next year. I know that my hon. Friend the Member for St Austell and Newquay (Steve Double) raised concerns about the policy. I will ensure that officials continue to engage with the sector, and he should receive a letter from me shortly. We recognise that it will be a big change for some businesses. They have another year before changes take effect, and we are doubling the funding provided for energy innovation through the new £1 billion net zero innovation portfolio, which will support the development of alternatives that businesses can switch to.

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