4th September – Debate about Access and Facilities (House of Commons)
Nigel Mills MP: Thank you, Mrs Riordan, for calling me to speak. It is a pleasure to follow my hon. Friend Dr Coffey and my right hon. Friend Sir Alan Haselhurst, who is the Chairman of the Administration Committee.
I have the pleasure of serving on the Administration Committee myself and I think that my right hon. Friend was right to say in his introduction to this debate that the issue of visitor access and facilities is not a great topic of interest either for today or for most Members most of the time. However, it is one of those important issues about how a Parliament runs. Those of us who have a sad busman’s holiday occupation of going round other Parliaments see a very different situation to the one here. We have not just a working Parliament, which people want to see because they have an interest in
seeing how the Government work and how laws are made, but a hugely attractive historic building, which people want to see for its architecture and the art that is contained here. That creates twin pressures on visitor access: there is a huge amount of interest from people who want to come here to meet their own MP and see what we do here, but also from those who want to see the surroundings in which we do it.
The Committee rightly brought out that theme in its report. It is quite reasonable to charge people who want to come to Parliament as a tourist, but it is completely inappropriate to charge people who want to come here to engage in the democratic process and to see their MP. If people want to come here to see how Parliament works, how legislation is made or to lobby their MP, they must be able to do so in a timely manner and for free. We cannot and should not charge people to do that, and as far as I know there are no plans for that type of charging to be introduced. However, if people are coming to Parliament to have a tourist experience, they should more than cover the costs to Parliament of their doing that and they should make some contribution towards the upkeep of these historic buildings. I am not recommending that any subsidy should come from that contribution to support the parliamentary function, for which the taxpayer in general should rightly pay. However, the upkeep of these historic buildings needs to be funded somehow.
My right hon. Friend the Chairman of the Administration Committee also worked his way around how we fund the catering establishments in this place. Clearly, visitors have a role to play in that process. We only sit here as a Parliament for about 70% of the year, but we are funding catering establishments to be here for 100% of the year. That is one reason—there are many others—why we have such a large subsidy, or loss, for those catering operations.
I am not one who thinks that MPs should have glorious, luxurious eating establishments, but clearly there need to be catering establishments in a place such as this so that MPs and all their staff have somewhere to eat—and drink too, probably—and so that visitors too can eat. The more use we can get out of those catering establishments when Parliament is not sitting, the less demand we will make on the taxpayer to subsidise them. Hopefully, we will try to neutralise some of the issues that exist. People’s perception of those issues is partly correct, but they are also partly misinformed about where some of the catering establishments’ loss comes from. The more visitors that we can get in, the more we can enable them to be here and make full use of the catering establishments when Parliament is not sitting. That would be a far better situation than the current one.
I can give an example from my busman’s holiday this summer, in the state Parliament in Victoria. We had a free tour of the Parliament; it did not take very long. It was interesting to see the Parliament, but not all that exciting. However, we were then offered the chance to have lunch in the members’ dining room. We went in there, we handed over some identification, we were given a security pass, we could walk through the corridors and, as I say, we could go to have lunch in the members’ dining room while the Parliament was in recess. That is not something that a visitor can do here in this Parliament on spec. I am not necessarily saying that the Members’
Dining Room should be opened all year round for that purpose, but freeing up access and allowing more people to come and see what these House Dining Rooms are like and have a chance to eat the meal that we get to eat would have huge advantages all round. People could get to use the whole place and see it, and it would reduce the amount of money that we require from the taxpayer to subsidise those facilities.
I agree with all the other points that have been made, very articulately, about the importance of educational visits. However, it is very hard for schoolchildren from my constituency to get down here. It is quite hard to get a slot when schoolchildren can come on a visit. I know the organisation that is required to arrange such a visit; people need to be on the phone the minute those slots open to try to get a decent one. Also, visiting Parliament is a long and expensive journey for many schools to arrange, especially when there is not even the budget available to pay for half the travel costs that are still required.
The more that we can do to get children to come to Parliament from other places that are further away in the country than London, rather than just having children from the London area, the better it would be. Children really gain a lot from understanding how democracy works and how important Parliament is; they can see it. In the two and a half years that I have been here, I have had about half a dozen groups of schoolchildren come down to visit, out of the dozens of schools in my constituency. It really is a very small percentage of children who get to do that.
Before I was elected as an MP, I had only been in this building once before, and that was on an organised tour 14 years ago. Visiting Parliament gives people a completely different picture of this place. They come and have the tour, they have the experience and they see how Parliament works; they even see how small the House of Commons Chamber is. People get a very different picture of democracy from actually being here rather than just seeing those clips on a Wednesday night on TV of MPs behaving rather badly at Prime Minister’s questions.
Alan Haselhurst MP (Saffron Walden, Conservative): Does my hon. Friend not see that there is an incongruity in what he is suggesting? I absolutely agree with him that we should maximise the opportunities for schoolchildren to visit Parliament, and that may require subsidy, as it already does to some extent. However, if we simply increase demand without spending money on ensuring that visitors can get into the building, they will not exactly have the best of welcomes. The two things go together.
Nigel Mills MP: I absolutely agree with that point. There are things that we can do in the short term to make access easier. We can make better use of the various large rooms that we have. In this building in particular, we have this room itself—Westminster Hall—that is not used for much of the week. We also have the Commonwealth Parliamentary Association Room and the Inter-Parliamentary Union Room, which are also not used the whole time. Those rooms could be used more for educational visits than they are now.
My right hon. Friend was making the point about how we get visiting schoolchildren through security and into this place more efficiently. We must use the existing access routes more effectively; they do not run at capacity.
We do not use No. 1 Parliament street or Derby Gate effectively at all; Derby Gate is a fully effective security access route. There is no particular reason why, especially on days of nice weather, a party could not be led round there, through security and back through the building if there is a queue somewhere else. I know that option was not favoured, but if there is a half-hour or hour wait and accesses elsewhere are empty, there must be a better use for those accesses.
I am tempted to raise one of the thornier issues that affects the running of the Palace. Most people would be surprised to learn that the House of Commons runs half the Palace and the House of Lords runs the other half, and that, at times, never the twain shall meet. We are talking about sensible things such as starting the tour route and putting visitor and education facilities in the right places, but much of that has nothing to do with us. We have no say because those decisions are for the House of Lords.
In the interest of the good, sound, efficient and economic running of this place, we need to make more progress on jointly running catering, visitor access and security through one organisation, rather than artificially dividing them somewhere down the corridor where the carpet goes from green to red. That is an historical anomaly that leads to inefficient practices. We will not resolve those issues efficiently and sensibly until we have one management team running the whole building. We can skirt around that for historical reasons, but at some point, if we really want to address the issues, that point must be settled.
Question to Eric Pickles MP – Planning Reform – 6th September
Nigel Mills MP: I urge the Secretary of State, while he is finding more work for planning inspectors at failing councils, to say that planning inspectors should not be allowed to overturn the decision of a well-performing council when it rejects a planning application on reasonable grounds. The thing that most annoys local people is when an application is rejected by their elected councillors on reasonable grounds and the decision is turned aside for no good reason.
Eric Pickles MP (Secretary of State, Communities and Local Government; Brentwood and Ongar, Conservative): I do not like the decisions that I make being turned around either, but we must always ensure that people who apply for planning permission are treated fairly and reasonably. That is why we have an appeals system. In my experience, both from taking planning decisions myself and from what might best be described as our mystery shopping exercises on decisions that have been made over the last couple of years, reasonable objections are by and large upheld by planning inspectors, with just one or two exceptions such as those to which my hon. Friend refers, although I am not talking about that specific area.
13th September – Backbench Business (Tax Avoidance)
Nigel Mills MP: It is a pleasure to follow Margaret Hodge and I join the congratulations to Mr Meacher on securing this important debate. I have spent a lot of the last few months debating tax—it came up in the Finance Bill and at various other times—which shows how important it is. I promise that I will not list any Take That songs to embarrass celebrities who seek to avoid tax. I got enough flak for that the last time I tried it.
I agree with hon. Members who have spoken that it is absolutely right that the Government do everything they can to minimise tax evasion and avoidance. All hon. Members want everyone to pay the amount of tax they fairly owe, because that reduces the burden on everybody who does so. It is right that the Government take every step they can within the legal powers they have to ensure that that happens.
Hon. Members have discussed how much the tax gap is. The last HMRC figures say that it is £35 billion. I have served on the all-party group on beer, which has inquired into measures to tackle beer duty fraud, so I have been through in some detail the weakness of tax gap calculations. The same issue came up in the Select Committee on Northern Ireland Affairs, which has had an inquiry into fuel duty. There is a problem in calculating how much revenue we do not have—we do not get the revenue, so it is quite hard to know what it would be—but I suspect that £35 billion is not a million miles off either way. I fear that the figure will have increased in the last tax year. I am told that if we look at the difference between 2008-09 and 2009-10, the big reduction was in the loss of VAT, which was probably caused by the slight lowering of the VAT rate. Obviously, the rate has gone up since, so the tax gap will probably have increased slightly.
A report has shown that the UK tax gap is one of the lowest in the developed world—it is about 14% of tax revenue. I believe the gap in the US is somewhat higher, so it is not as if we are the worst in the world or have the weakest regime. We might even have one of the best.
It is important to understand that the tax gap is not entirely owing to complicated tax avoidance or deliberate tax evasion. Much of it is innocent error and people lacking care in filing their returns—they do not actively seek to get it wrong. Measures to tackle avoidance or evasion will not close all £35 billion of the tax gap. There is not much we can do to get tax off someone who has gone bankrupt. Perhaps we could do more to prevent the amount of tax they owe from building up that high, but there will always be some loss when a business goes bust before paying its taxes. So we will not get that £35 billion down to zero—this will not be the panacea for the Government’s deficit problems—but it is right that we seek to get it down as low as possible.
I commend some of what the Government have done. Only this week, we saw a press release from the high tax unit showing that it was well ahead of its target and had already saved the Exchequer £500 million. The Government have adopted the right strategy, building on that of the previous Government, to deal with tax avoidance: they get in the disclosure of these ridiculously aggressive schemes, which ought to be closed down, and then they close them down. Then the strategy is to improve and tighten tax legislation for the areas most under threat, so that those opportunities are not there.
I am not convinced, however, that a general anti-avoidance or anti-abuse rule is the right way to go. I have concerns that it would contravene the rule of law. We, in Parliament, should pass laws that are clear, so that everyone understands what the law is, and then we can expect taxpayers to follow it. And if they do not, they can be severely punished. The problem with a
general anti-abuse rule is that it allows the Revenue to say, “Okay, maybe you’re within the law, but we don’t think the law should have said what it said, so you should’ve been outside the law, even though you weren’t, and so we’re going to punish you.” I am not sure that we would want to give that power to a state agency in any other field of the law—the power to enforce not the law as we set it but the law as it might think we ought to have set it.
However much we stretch the general anti-abuse or anti-avoidance rule, fundamentally we are saying that the Revenue can tackle abuse that ought to be tackled by saying, “Ignore what Parliament says. Produce something that you think it should have said. And then enforce that.” I worry that that is a step too far—not that most of the people who would be caught would deserve anything less than they get, but the Revenue would be able to raise that stick against all manner of innocent individuals and businesses as well.
I worked as a tax adviser before entering this place. I can assure hon. Members that I was drawing up advance agreements on transfer pricing. I was not engaged in any naughty tax avoidance of any kind. Revenue Inquiries, in using its powers, writes, “Please send me this information. I think this doesn’t work as you say it does. By the way, if you don’t agree, I’ll have to use the general anti-avoidance rule.” And we have this stick being wielded in all manner of innocent situations in which businesses or individuals have got themselves into a complex situation where tax law is not clear, especially if there are a lot of transactions involving overseas parties.
Those individuals might be making perfectly sensible commercial attempts to apply the law as they think it is. They might not be trying to avoid tax but might be trying to be fully compliant, so the possibility of having that stick held over them and being told, “If you don’t pay up, we’re going to throw all these huge things at you,” will rightly concern lots of businesses around the country. We risk using a large sledgehammer, missing the nut and just increasing the burden on taxpayers. We have to look at the downsides of our tax regime appearing too unfriendly and uncommercial. How much investment will we lose, if international businesses and individuals think that this is not a great place to do business? We have to be careful, therefore, about how much power we give the Revenue to apply its own interpretation of the law, rather than getting Parliament to do it.
Simon Hughes MP (Bermondsey and Old Southwark, Liberal Democrat): I understand all the arguments and have seen the reports about general anti-avoidance measures and so on. Is there not the principle, however, that we should expect everybody, whether individuals or corporate bodies, to pay in tax at least a certain percentage of their profits every year to the Revenue—whether 20%, 25% or whatever—so that people know that they will not be allowed, by clever ruses, to avoid a minimum obligation to the state in which they live and work?
Nigel Mills MP: I thank my right hon. Friend for his intervention. Although that idea sounds attractive, and although various regimes around the world have minimum profit taxes and things like that, it would add huge complexity to our already too complicated tax regime. What we want is for people to be easily able to work out what tax they owe and then to pay it.
I have tabled amendments to both Finance Bills while I have been here to make the tax regime simpler, so that companies can get their tax profit much closer to their accounting profit. It should be much easier for them to know what tax they ought to pay, and if they have made an accounting profit, they ought to pay tax on it. That kind of reform would be a far better way of going down this line and making the transparency agenda much clearer. We do not need most of the complicated adjustments, reliefs or allowances that were introduced, probably to support well-meaning ideas, over the last 150 years. Our regime is far too cumbersome. It incentivises things that we do not mean to incentivise and penalises things that we probably ought to encourage. If we moved to a much simpler, flatter regime, where what a business reports as its accounting profit is pretty much what it pays tax on, that would be in everyone’s interest. It would reduce avoidance and make it a lot easier for business to comply and a lot easier for the Revenue to see that there was compliance, so that the Revenue’s resources could then be focused on tackling avoidance and evasion, which is what we ought to see.
I would like to use my remaining time on a report published quite recently by the RSA called “Untapped Enterprise”, which I would recommend Members read. It looks at how we can try to move people out of the informal economy and get them to be fully compliant as employers and taxpayers. The RSA’s research and the conclusions it reached are quite interesting. The report says that a significant proportion of new entrepreneurs feel that they need to stay in the informal economy while they test out their business and see whether they can make a profit on it, because they know that once they get caught by all the tax compliance and other reporting requirements, that can take up so much time and money that they might not be able to get their business off the ground at all. Most of them do not stay in the informal economy because they want to avoid tax; rather, they just want to focus on running their business.
Some of the ideas in the report for tackling the hidden economy are quite interesting. It makes the point, which has been raised in the debate, that we need to nurture the concept that paying tax is right and moral, that we get proper value for public services from doing so and that everybody ought to be doing it. The last thing we want to encourage is a situation where people think the Government are against them, that the taxman is an enemy or that avoiding tax is a perfectly sensible, reasonable thing to do because they think, “It’s them versus us,” or, “Every penny I can save is a good thing.” We need to make the case that paying tax is the right thing and everyone should do it.
While I am on this subject, I agree that we need to reform the non-dom rules. I cannot see any justification now for saying that because someone’s father was born outside the UK they do not have to pay full tax, even though they have lived here for 30 years. There should be a cut-off at, say, 10 years, so that once someone has been here for 10 years as a non-dom, they lose their non-dom status and have to start paying tax on their worldwide income. That would be a fair compromise between not discouraging people from coming here in the first place and getting our fair share of tax out of them.
The report also sets out the need to simplify the formalisation procedure. We need to make it simple for people to register their businesses for tax and to start paying. It needs to be simple to work out how much tax is owed. Let us not have people making the excuse that they did not pay tax because they did not know how much they were supposed to pay.
My final point is that we are moving towards a cashless society. It ought to be harder for business to be informal, because it is becoming more difficult for people to pay cash—indeed, I do not carry around a large amount of cash to pay for things with. That should move us in that direction, but we should also say to consumers, “Don’t pay people in cash; don’t encourage tax avoidance.”
Question to Michael Gove MP – GCSE Announcement – 17th September
Nigel Mills MP: I welcome the statement. What can my right hon. Friend do to ensure that students in the next five years also obtain qualifications that are well regarded by prospective employers?
Michael Gove MP (Secretary of State, Education; Surrey Heath, Conservative): One thing that the coalition Government have done is allow schools that are concerned about the quality of GCSEs, particularly the modular nature of some GCSEs, to teach the IGCSE. I visited a state school in Hertfordshire on Friday, where a mathematics teacher told me that she hoped that we would adopt a system that was more similar to the IGCSE, because that would help inject greater rigour into the process. I was able to reassure her that we were learning from best international practice and that I would encourage all schools to consider how the IGCSE might be an appropriate preparation for the changes that we hope to introduce.
Question to Damian Green MP – Victims’ Services – 18th September
Nigel Mills MP: Many victims feel let down by the whole process. Does the Minister agree that the police and crime commissioners, with their local knowledge, will be able to ensure that victims get a fair deal throughout the investigation and sentencing processes?
Damian Green MP (Minister of State, Policing and Criminal Justice; Ashford, Conservative): My hon. Friend is right. Individual PCCs in specific areas will be the best placed to understand the needs of the local community and to commission the services to meet those needs, as they will be taking those decisions closer to the people who will be most affected by them. That is the whole thrust of this important reform.
Nigel Mills MP: What assessment he has made of the effect on victims’ services of the work of police and crime commissioners.
Damian Green MP (Minister of State, Policing and Criminal Justice; Ashford, Conservative): We expect that the needs of victims will be one of the key priorities for police and crime commissioners and that the effect on victims’ services will be a positive one. PCCs will be ideally placed to commission the most appropriate services to support victims in their area.