Graham Stuart
MP for Beverley and Holderness · Conservative · United Kingdom
“I hope and expect that we can move forward in the right way and get the balance right between being overly prescriptive to the banking industry and setting a clear sense of direction to make sure that no one is left behind, as so many Members have set out.”
“It is a pleasure to serve under your chairmanship, Mr Wishart. I congratulate the hon. Member for South Devon (Caroline Voaden) on securing this debate.”
“Is my hon. Friend as astonished as I am that the Minister—I know she is new to her post—has come here to propose a six-month extension of the movement of costs from bills to the Exchequer and cannot tell the Committee how much money that will cost?”
“The Minister is being most generous again. I did not ask her about protecting consumers from energy price shocks; I asked about a clear, unequivocal manifesto pledge to reduce household energy bills by £300. She, like her predecessors, refuses to address it directly. It was a clear promise.”
“Banking hubs themselves came out of an industry response from the NatWest executive. Does the Minister agree that we must present the information from the Lloyd review to the banking groups, be clear about what we want, and give them the opportunity to respond and provide a solution, as they did with banking hubs, so that we can perhaps a…”
“I am pleased to say that Lloyds listened and, as of this morning, people can deposit cheques at those places. These issues being raised by Members across the House today are important. I trust that given the timing of the Richard Lloyd report, the Minister in her seat will make sure that they are be resolved to everyone’s satisfaction.”
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“Time for a coffee and to let others speak. However, over the last two years the Government have made a series of announcements looking to put greater rigour into the system. They announced the ending of modularisation of GCSEs, tackling the culture of re-sits, ending equivalences and promoting the English baccalaureate, which, of course, rewards those students who achieve good GCSEs in English, maths, two sciences, a language and either history or geography. However, at the end of that process, if the leak is to be believed—I am in a state of confusion now—they suddenly announced the scrapping of GCSEs altogether. That does not seem terribly coherent.”
“The Government have two priorities for education: raising standards for all; and closing the gap. Those are right, but when setting priorities it is terribly important to show what the top priority is. I am yet to understand how the changes specifically will help the least able, but then again I am unclear as to what exactly the proposal is—even if I have not quite fallen to the level of the hon. Member for Cardiff West (Kevin Brennan), who of course got so confused about percentages last week.”
“As I have said, I think that increased rigour throughout the system is necessary and important. I think that the accountability system for schools needs to be changed so that it does not have perverse outcomes, such as putting people on courses that lead nowhere but allow the institution to meet its benchmark—we on the Committee have been critics of that for some time. Perhaps the announcement, or the leak, suggests a change in view by the Secretary of State on that front. If we look across the system, where we need more rigour and we need to ensure that we end the perverse incentives, we find that the biggest problem we face in a global knowledge economy, where the first rung of the ladder keeps rising up, is what we do about people who are not getting those basic skills and that basic education.”
“We need to look at re-gearing our whole system in a way that the Labour Government failed to do, despite efforts in that direction, to ensure that we provide opportunity for all, because both socially and economically we cannot afford to have so many children left behind, unable to get on the first rung of the economic ladder and thus be full members of our society. If any proposals from the Secretary of State are driven by that central insight, he can certainly look forward to my support.”
“A more rigorous system is great, but the only way to raise standards ultimately—this is the only thing that matters in education—is through quality of teaching. We need to ensure consistent, high-quality teaching and an excellent institution for everyone, everywhere. At the moment, there are all sorts of incentives in the accountability system to focus on borderline pupils at the expense of those at the bottom, and within the system for people to move from a school that is very challenging to one in the leafier suburbs—a much more congenial place for many people to teach in.”
“That is a lot better than I did, so I will leave it there. Ofqual now has a statutory duty to ensure two things, one of which is that we maintain standards over time. We shall see whether it does its job right; it is relatively newly empowered and we need to give it the chance to see whether it can reverse this grade inflation and keep us up there with our international competition. Has it said that there needs to be a restructuring of the examination system, not necessarily the administration of it, but the whole quality of it and the possible tiering of it? I would like to hear from the Secretary of State about that. I have only a minute left, so I shall finish by repeating that the central problem is what we do about the young people, all too many of whom are now not in education, employment or training—NEET—and are being left behind.”
“We are raising the participation age by looking to use the extra years up to 17 and 18 to deliver a basic and rigorous standard. The most successful state school in the country, which I think is Lawrence Sheriff school in Rugby, uses a three-year course for its GCSEs and gets a tremendously high level of success. Perhaps it would be helpful to find out more about how education can be structured so that children can keep on learning until they get to that very high standard.”
“An interesting outcome of this debate was texting my office to ask how many people—I realise that as Chair of the Select Committee I should know this—take these foundation GCSEs. The answer I got back is that that information is not collected by the Department for Education or by the exam boards. Go figure.”
“I welcome improved rigour, stretch and achievement for our most able pupils, but the central problem facing this country is not about its most able pupils but about the lowest-performing and, all too often, the poorest. How will these changes and proposals improve the outcomes for the lowest deciles of achievement in our population? Socially and economically, we cannot afford the tail that we have inherited from the Labour party.”
“The hon. Gentleman is giving a powerful speech that rightly highlights the importance of community hospitals. Does he, like me, regret the fact that more than 3,000 beds in community hospitals were closed by the last Labour Government? Does he recognise that only a huge campaign across this House made them see the error of their ways and reverse their savage cuts to this most vital of local assets?”
“The Minister will recognise that community hospitals in the north-east, as well as in Beverley and Holderness, were starved of funding under the last Government. We saw gross distortions in funding, as the formula used deprivation as a way of pouring funding into urban areas, where there were young people who, regardless of their social background, were not in need of health funding. That starved the community hospitals serving ageing populations, which did need the funding. What we need is not reverse gerrymandering, but health funding that follows clinical health need. We did not have that under the last Government, who starved rural community hospitals of funding. I congratulate the Minister on having the courage to face down the vested interests of the Labour party.”
“The hon. Gentleman is making a passionate speech, as well as a self-congratulatory one. He is congratulatory about himself, but he is dismissive of the qualities of our young people. One of the transitions that they have to make is from childhood to adulthood. Students in this country are perfectly capable of recognising their duty and the requirements to register to vote. The suggestion that they or people in ethnic minorities somehow have a likelihood of being incapable of doing that is one that I find offensive to them, and I ask him to retract any such suggestion.”
“[P001085] The Petition of residents of Workington. [P001086] The Petition of residents of Islwyn. [P001087] The Petition of residents of New Forest West. [P001088] The Petition of residents of Shrewsbury and Atcham. [P001090] The Petition of residents of Milton Keynes South. [P001091] The Petition of residents of Ludlow. [P001092] The Petition of residents of West Worcestershire. [P001093]”
“[P001070] The Petition of Residents of Eastleigh. [P001071] The Petition of Residents of Selby and Ainsty. [P001072] The Petition of residents of Birmingham Northfield. [P001073] The Petition of residents of Poole. [P001074] The Petition of residents of Blyth Valley. [P001075] The Petition of residents of Bognor Regis and Littlehampton. [P001076] The Petition of residents of Forest Heath. [P001077] The Petition of residents of Carlisle. [P001078] The Petition of residents of South Dorset. [P001079] The Petition of residents of Tynemouth. [P001080] The Petition of residents of North Norfolk. [P001081] The Petition of residents of North Devon. [P001082] The Petition of residents of Stirling. [P001083] The Petition of residents of Harwich and North Essex. [P001084] The Petition of Residents of Blackpool South.”
“The Petitioners therefore request that the House of Commons urges the Government to reverse its decision to levy VAT on static caravans. And the Petitioners remain, etc. [P001027] The following petitions were also presented: The Petition of residents of Rochdale. [P001060] The Petition of residents of Christchurch, [P001061] The Petition of residents of West Bromwich West. [P001062] The Petition of residents of Dwyfor Meirionnydd. [P001063] The Petition of residents of Clacton on Sea. [P001064] The Petition of residents of South Down. [P001065] The Petition of residents of Bridgwater and West Somerset. [P001066] The Petition of residents of West Dorset. [P001067] The Petition of residents of Filton and Bradley Stoke. [P001068] The Petition of residents of Montgomeryshire. [P001069] The Petition of Residents of Ceredigion.”
“Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) in his seat; South Dorset; South Down; Stirling; Tynemouth; Wells—I am delighted to see the hon. Member for Wells (Tessa Munt) in her seat; West Bromwich West; West Dorset; West Worcestershire; and Workington. Mr Deputy Speaker, you can tell the breadth and depth of concern about this issue. The petition states: The Petition of residents of Beverley and Holderness Constituency, Declares that the Petitioners believe that levying VAT on static holiday caravans would cost thousands of jobs in caravan manufacturing, from their suppliers, and in the wider UK holiday industry; and notes that the Petitioners believe that such a levy would lose revenue for the Government.”
“In addition to presenting a petition on behalf of those in Beverley and Holderness, I am presenting petitions from the constituencies of: Birmingham, Northfield; Blackpool South; Blyth Valley; Bognor Regis and Littlehampton; Bridgwater and West Somerset; Carlisle; Christchurch; Clacton-on-Sea; Dwyfor Meirionnydd—I hope there are no more Welsh constituencies to trouble me; Eastleigh; Filton and Bradley Stoke; Forest Heath; Harwich and North Essex; Islwyn; Milton Keynes South; Montgomeryshire—I am confident about pronouncing that one; New Forest West; North Devon; North Norfolk; Poole; Rochdale; Selby and Ainsty—I am delighted to see my hon. Friend the hon. Member for Selby and Ainsty (Nigel Adams) in his seat and supporting this presentation; Shrewsbury and Atcham—I am also delighted to see my hon.”
“Normally at this time of night the House is emptying, not filling up. Instead, colleagues are coming into the Chamber because of their concern about the imposition of VAT on static caravans. If enacted, the Government’s proposal to impose VAT on static caravans will cost jobs. Only today, Willerby Holiday Homes, Britain’s largest caravan manufacturer, announced plans for 350 redundancies in anticipation of the tax rise. Jobs will be lost not only in manufacturing and the supply chain, but in the parks themselves, which employ 26,000 people directly across the country. I am grateful to Mr Speaker for allowing us half an hour this evening to present these petitions on behalf of so many constituencies across the country. Although I will read out the full text, Mr Deputy Speaker, you have asked that others do not do so.”
“The hon. Gentleman will be aware that for nearly the entirety of the period for which his party was in office the higher rate of tax was lower than it is today. As for the hypocrisy we are hearing from the hon. Gentleman and his colleagues who put this country in a position where public expenditure must necessarily be brought under control, his party always leaves office with unemployment higher that when it entered it and it is under his party that the money has all gone. This Government are having to deal with that, and he should show some shame for his part in the situation.”
“It is a pleasure to be on my feet again in the Chamber with an opportunity to talk about an issue that is so important to the people of east Yorkshire and coastal and rural communities around the land. East Yorkshire is at the heart of the caravan industry. I have a major manufacturer, ABI, in the centre of Beverley, suppliers to the manufacturers scattered around my constituency and parks dotted down the Holderness coast. For us, static holiday homes are a big deal. The presence of so many Members, despite the fact that it is a Thursday evening, when Members are normally thinking of moving back to their constituencies, demonstrates the depth and breadth of concern about this issue, not least among Government Members.”
“Before I give way to my hon. Friend, I should point out that I shall be the only person making a speech before the Minister responds, but because there has been so much interest in the debate, I shall give way to as many hon. Friends on both sides of the Chamber as I possibly can as we work together to persuade the Treasury to think again.”
“That is why there has been such a groundswell of feeling that this issue should be reconsidered.”
“My hon. Friend is absolutely right, and I shall address that point in my speech. I ran a street surgery in Withernsea, a coastal town in my constituency, on Saturday. As I stood talking to people and handing out leaflets, perhaps as many as three out of 10 people said to me, “I’m not from round here, mate.” They were not staying in bed and breakfasts or hotels, because we have hardly any in the area; they were staying in static caravans. Two or three out of every 10 people going into Aldi, or into the bakery down the road, or spending money in the pubs were staying in static caravans. In addition to those directly employed in the manufacture of the caravans and in addition to the parks, however important they all are, the importance of visitors to the rural economy is immense.”
“My hon. Friend is absolutely right. I have good news, as I am sure the Minister will confirm later, in that the Government have listened to us. Hon. Friends on both sides of the House who represent East Yorkshire constituencies came together immediately after the Budget and we met the manufacturers. What we heard from them was chilling. The industry employs thousands in the manufacturing sector and tens of thousands in the parks. The Government estimate a 30% drop in demand, and that can only mean that thousands of jobs will be lost and that an industry that is struggling to recover from the credit crunch will be knocked backwards.”
“The Chancellor confirmed that it was a genuine consultation and that the Government would look at the evidence from us and from those out there in the industry—everyone should get involved in that—and would be prepared to look at the matter in the light of the impact that the measure will have.”
“My right hon. Friend is absolutely right. He and I have discussed this matter with the Chancellor, who has spoken to us about it separately on a number of other occasions. We also went in a group of 11 colleagues to see the Exchequer Secretary to the Treasury, my hon. Friend the Member for South West Hertfordshire (Mr Gauke). The reason for our only being 11 was that we did not think that there would be room for more around the table; it was not due to lack of interest. There is enormous concern about this issue. I am delighted to say that, when we debated the matter last week, the Minister agreed to extend the consultation.”
“My right hon. Friend is right. He and many other Members on the Government Benches who would not dream of opposing the Government’s general strategy, or even most of the specifics, have such profound doubts about this one policy that they are asking the Treasury to think again.”
“My hon. Friend is absolutely right. Of course, many parks have made major investments, some of them—I hate to say it, as one hates to talk about vulnerable businesses—are highly geared, and if there is a chilling impact and eddies of demand, notwithstanding a little additional demand before 1 October, we could subsequently see more than a 30% reduction, which could result in the closure of manufacturers and park businesses that have invested for the longer term in this excellent British tourism industry.”
“I am grateful to my hon. Friend. I know that the hon. Member for Scarborough and Whitby (Mr Goodwill), who I see on the Front Bench, has organised a meeting with his local park businesses in order to hear their concerns this coming Friday. Again, that shows how close this issue is to all of us.”
“According to the National Caravan Council, if we take Her Majesty’s Revenue and Customs forecast of a 30% reduction in demand, home production will reduce to 10,689 units—the lowest production level on record—with inevitable consequences for manufacturers, suppliers and parks.”
“My hon. Friend is right. I am not sure that I am ever going to get on to the issue of the non-anomaly that this measure is tackling. We are fortunate that Roger Tym & Partners produced a report on the economic impact of UK holiday parks in January this year, showing that 85% of static units are privately owned and that the remaining 15% are rented out as part of a park’s letting fleet. The market that will be most hit is the one that drives profits on these parks and drives investment. I do not think that the Treasury factored that into its calculations properly.”
“The right hon. Gentleman is right. He may not entirely share my sentiments when I say that the coalition has a great story to tell for east Yorkshire—the Humber bridge tolls have come down, and investments have been made in the A164, the Beverley relief road and the coastal communities fund—but I agree with him that this measure could have a devastating impact.”
“There is great fragility in isolated, sparsely populated rural areas. How many other jobs are there in such areas? Indeed, what other jobs could there be? The truth is that often there are none.”
“That is why I am grateful to Ministers for agreeing to listen to the evidence before reaching any definitive decision. Such a definitive decision has not been made, and I hope that when it is, it will be made in the right way.”
“I will give way to my other colleagues shortly, but let me first respond to my hon. Friend the Member for Lancaster and Fleetwood (Eric Ollerenshaw). The Finance Act 1972 introduced zero rating of certain caravans. The notes on clauses relating to what was then group 10 of schedule 4 referred to relief for “houses and other domestic accommodation”, and stated: “The caravans in the Group are akin to houses; they are too large to be towed on the road, and are usually permanently attached to the land.” The deliberate intention of the law, which was debated in the House—with no anomaly, no forgotten section, and no category of products that had been missed—was to treat caravans, other than those towed by cars, as “other domestic accommodation” in the same way as houses.”
“That would be consistent, because the qualities of a mobile caravan are completely different from those of a static caravan or a house. What are static caravans used for? They are second homes. Someone who buys a £240,000 cottage in one of the rural areas represented by my colleagues, which often means pricing out local workers, will pay tax of 1%, whereas it is proposed that someone who buys a static caravan for £24,000, a tenth of that amount, should pay 20%— 20 times as much—on a home that is used for precisely the same purposes. That is not getting rid of an anomaly, as Treasury civil servants originally suggested; it is creating an anomaly.”
“There are 800 staff just at Willerby, which is a manufacturer, and we know that there tend to be many more associated jobs in supplier firms and others around a manufacturing centre.”
“Finally therefore, let me pass on to the Minister some comments from a constituent of mine. Aaron Cambridge and I live in the same town, Beverley in east Yorkshire. He works at Willerby Holiday Homes, which in the most recent industry returns at the end of last year was listed as having more than 800 employees. It is based in the constituency of the hon. Member for Kingston upon Hull East (Karl Turner), whom I am delighted to see in his place. Even without this proposed VAT increase, Aaron has been on a reduced work schedule of three-and-a-half days a week for the past six months. He told me that he has worked in the caravan industry for 24 years and can never remember such hard times for the industry. That is the situation the industry is in now, before this possible VAT increase.”
“Because of the general provision in legislation for relief from VAT for housing it was thought appropriate to include large caravans within the scope of relief.” —[ Official Report , 20 March 1973; Vol. 853, c. 393.] Therefore, any suggestion that that was not considered by this House is false. I hope that will be reflected on. In June 1989, when my right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley) was Economic Secretary to the Treasury, he said that there was no question of withdrawing zero rating from the purchase of static caravans. He was right then, and we should stick with that view now. I want to give the Minister 10 minutes in which to reply, if no other colleagues wish to intervene on me. [Interruption.] Give him eight minutes? Okay, fair enough.”
“My hon. Friend is right. All Government Members are committed to the aims and objectives set out in the Budget. We wanted a Budget for growth. We support lifting people out of tax; we support lowering corporation tax; we want investment; we want British industry to be supported. May of us are therefore gently but firmly—and, I hope, powerfully—saying to the Government this evening that this measure should be looked at again, and, as I have said, they have agreed to do so. Terence Higgins, then Financial Secretary to the Treasury, said in March 1973: “We have already distinguished between two kinds of caravan; the kind of caravan which is a home or a residence, and not normally the kind that one tows around—because even outside the West Country it would be too large to tow conveniently—and that which is not regarded as a home.”
“He continued: “Such a reduction is likely to increase the cost of materials (due to economies of scale), make credit harder to come by and jeopardise the viability of manufacturers and suppliers.” I have said enough. Peter Smith put his finger on it, as have all the other Members who have spoken. The Budget is all about creating jobs, but if this measure is implemented, it would have exactly the opposite effect. What we ask, from both sides of the House, but particularly the Government Benches, is for the Minister to listen to the contributions to the consultation and reconsider.”
“The hon. Lady is right. I have many more examples, including that of Laura Goldspink, who lives in my constituency and also works at Willerby Holiday Homes. Charles Gillett, who runs a business that is 100% reliant on the caravan industry, has talked of “an industry on a knife edge, struggling to emerge from the ravages of the recent recession.” He, too, pointed out that it is not 750 companies affected, but well over 2,000. Peter Smith, the chairman of the Swift Group—one of the leading employers in east Yorkshire, with 800 staff and a turnover of £200 million —has said: “A very conservative HMRC prediction is a reduction in demand of 30% which would lead to the lowest market figure for over a decade of around 11,000 units,” as we have discussed.”
“Can my hon. Friend confirm that the Treasury did not do that much work on this? Where did it get the one third figure from? It is not one that I have heard from anybody. The Tym & Partners report, which is available and has been since January, talks about 277,760 owned statics and 49,600 rented statics. By no means is 49,000 one third of 277,000. It has been suggested that 750 companies will be affected, but the real figure is more than 2,000. The Treasury did not do its homework and Ministers are in a tough spot because they did not spot that.”
“When we think about the employers in the various constituencies in Hull, in my constituency and in those of my right hon. Friends the Members for Haltemprice and Howden (Mr Davis) and for East Yorkshire (Mr Knight), we find that so many companies are involved. More than 90% of the production of static caravans in the UK is concentrated in east Yorkshire and, as has just been said, so successful is this industry in the UK that nearly all the caravans that are bought and installed in the UK are built there. So my constituency has a great concentration of all those who may suffer from a 30% reduction in demand—manufacturers and all the people who work in that area, suppliers, and the parks themselves.”
“It is my pleasure to follow the other speakers. Like all those who have spoken so far, apart from those on the Front Bench, I shall speak to new clause 6 and the proposal that the Finance Bill should set out that this House will not approve, in a future statutory instrument, the imposition of VAT on static caravans. So much has already been said, but I must point out that my constituency contains ABI, a major manufacturer in the heart of Beverley; companies in the immediate area that are part of the supply chain; and a series of parks along the Holderness coast that depend for their profits on the sales of static homes, as we discover when we speak to the owners. The Treasury’s assessment of the impact of introducing the VAT is that there would be a 30% reduction in sales.”
“I am grateful to my hon. Friend for his intervention, but I am not looking for Ministers to limit that disruption; I am looking for them to remove that disruption altogether. However, he is right to mention the date. We are talking about a major manufacturing business. We are talking about businesses with 700 staff involved in tooling up, buying in the resources and planning their production, yet we are facing the introduction of this VAT on 1 October. Let us imagine the impact on the supply chain; imagine the impact on ordering; imagine the eddies of people looking to beat the deadline and at the same time destock to make sure that they do not hold stock on 1 October when whatever product they have will be 20% more expensive and potentially unsaleable.”
“My hon. Friend is right. We have heard examples of managing directors of companies being called in by their banks to talk about lending provision because of the threat and uncertainty that this measure brings. It will be extremely disruptive to a fantastic British manufacturing success story. Let me go through the process. The supply chain is in the UK. It is very much concentrated in east Yorkshire but hundreds of people are employed by suppliers elsewhere in Yorkshire and across the country.”
“We are talking about people who want to make a purchase of a home for about £30,000, not people who can switch easily to making a bricks-and-mortar purchase. When the tax-dodging, socialist, multi-millionaire candidate for the London mayoralty goes off to console himself by buying a cottage, he will not have to pay VAT, but when hard-working, decent people who like to pay their taxes go to get a slice of the decent life and have a stake in the countryside they will find that the caravan they want to buy at £30,000 now costs £36,000.”
“I fear that the hon. Gentleman may be right. As I was saying, there is the supply chain and manufacturers, all of which are UK-based, then there is the sales channel and the deployment of the end product. Where? That is in rural and often coastal areas and areas with low incomes all over the country. What is the effect? It is to bring people, once they have made the capital investment in a caravan, to visit those areas week in, week out, bringing all sorts of economic benefits to areas that otherwise do not have a lot of industry to fall back on. When one looks at the industry in the round like that, one sees that it is special. Perhaps everybody says that, but we must consider how successful it is and who it serves. I have not even got to the point about who will be affected.”
“My hon. Friend is quite right. That is why the hon. Member for Ynys Môn (Albert Owen) has a fair point. Some people will be able to afford permanent housing, thereby further pressurising the housing market in areas where such housing is limited. Static caravan parks have been a perfect arrangement, because they allow both the local community and people from outside to benefit. They have meant that the local worker who is looking for a house—often someone who works at a caravan park—has been better able to find a house.”