Sir Mel Stride
MP for Central Devon · Conservative · United Kingdom
“May I welcome the Chancellor to his position and thank him for his kind remarks earlier? May I also wish him every success, because I am afraid that under this Government we need some? He will know that if we are to fix the economy, we have to fix the welfare bill.”
“Given all that is going on, this could be the last time. The legacy of this Chancellor has been the highest taxes on record, a benefits bill spiralling out of control, and unemployment 300,000 higher than it was at the last general election. The right hon.”
“The right hon. Lady cannot bring herself to answer the simple question I asked. I will tell her: she is borrowing one quarter of a trillion pounds more than the plans that she inherited—that is her legacy. We hear that the right hon. Member for Makerfield (Andy Burnham) is considering borrowing even more.”
“May I begin by agreeing with you, Mr Speaker, and saying how disrespectful it is that this U-turn on fuel duty has already been released to the media earlier this week?”
“Today’s announcements will bring little comfort to the hundreds of thousands of people who have lost their jobs, the countless businesses that have folded and the high streets that are now hollowed out.”
“The Conservative party has been campaigning for a fuel duty freeze for months. The Chancellor repeatedly rejected those calls, creating unnecessary uncertainty for motorists and businesses. Why did it take her so long to realise that putting up fuel duty during an energy crisis is a bad idea?”
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“The Transport Secretary said that not every vehicle will be stopped, and that is absolutely right. In fact, we will use intelligence-led, technologically driven interceptions where appropriate, as is currently the case for our dealings with countries outside the European Union.”
“We are committed to, and confident that we will achieve, a frictionless border between Northern Ireland and the Republic of Ireland that will facilitate trade in the future.”
“We have made it very clear that sufficient staff will be made available. The head of Her Majesty’s Revenue and Customs has made it clear that there will be a requirement of between 3,000 and 5,000 additional staff. The Chancellor made it clear at the Budget that £260 million would be made available for HMRC in the coming year, and those resources are for people as well as technology. The right and appropriate number of people will be available.”
“An example of the technology would be the customs declaration service system that HMRC is developing as a replacement for the customs handling of import and export freight system. It is currently in testing, will go live come August and will be used in its entirety come January next year—well over a year before the end of the implementation period.”
“In a customs union, as I am sure the hon. Lady will know, a country would be bound by the external tariffs set by that customs union. A relationship with a customs union takes the form that I have described, which would be a frictionless interaction of our exports and imports with that customs union.”
“With regard to Euratom’s remit over the kinds of isotopes that the hon. Lady is referring to, nothing in our relationship with Euratom, or our lack of involvement with it going forward, will affect the ability of those isotopes to move between mainland Europe and the United Kingdom.”
“One of the reasons for that relates to our Crown dependencies and overseas territories, where we may need to make arrangements to make sure that the whole deal functions effectively.”
“I have made it very clear that facilitation such as the pre-lodging of customs declarations before vehicles even arrive at a particular border is an approach that, combined with other technological approaches, can ensure that vehicles move very swiftly and frictionlessly through borders, as evidenced by a number of examples around the world of where exactly that is happening.”
“We are confident that this collaborative spirit, which led to the December agreement, will endure as we take our approach forward into the next phase, including at the European Council next week.”
“We stand at the threshold of a new beginning with our European partners, and a renewal of our commitment to ensure the continued prosperity and stability of both the UK and the EU. Before I turn to our future economic partnership with Europe, it is important to set out just how far we have come, and what awaits us as we progress our discussions. The agreement in December was a significant step forward. The joint report issued by the UK and the EU set out progress on three areas: a fair deal on citizens’ rights that enables families who have built their lives together in the EU and the UK to stay together; a financial settlement that honours the commitments we undertook as members of the EU, as we said we would; and an agreement in relation to Northern Ireland.”
“I am delighted to open the second day of this very important debate. At the outset I want to set out the status of our negotiations and reiterate this Government’s vision for a future economic partnership with the EU. I will in particular focus on the important issue of financial services within any future trade agreement, and remind the House that we have been very clear that the decision to leave the EU does not mean some loveless divorce or division. There is indeed no need for this, given that the economies of the UK and the EU are inextricably connected, and given our long and shared history of common values and shared challenges, and I have no doubt that any future economic partnership must recognise and reflect these facts.”
“We saw the implementation period prioritised in the Chancellor’s Mansion House speech and the Prime Minister’s Florence speech, alongside a frictionless customs arrangement and a comprehensive agreement on trade in goods and services. The implementation period is the essential first step to ensure that we can all experience an orderly exit from the EU, plan accordingly, and enjoy certainty during the transition.”
“We trust that these will provide the flexibility to allow the EU to think creatively about our future relationship, and, looking ahead, we are confident that we will conclude a deal on the entire withdrawal agreement by the European Council in October. This confidence is not just grounded in our mutual interest of striking a deal, but also because we enter these negotiations from a point of striking similarity: our rules, regulations, and commitment to free trade and high standards are the same. So, as we build this new relationship, we are doing so from a common starting point. The next milestone in the negotiations will be an agreement of an implementation period.”
“It is standard practice for the Government to use non-disclosure agreements, and delivering a seamless post-Brexit border is a top priority for us. Non-disclosure agreements with key delivery partners for the border are crucial to the open exchange of information and opinion on options and scenarios, and they ensure that all planning negotiations and decisions are based on what is achievable and most appropriate for the UK to ensure a safe and secure border. In respect of our future trading relationship, draft EU negotiating guidelines have been circulated to the EU for comment, and we expect final guidelines to be formally adopted next week at the March European Council.”
“While being ingenious in his use of language, my right hon. Friend will I am sure agree with me that the purpose of the implementation period is to make sure we have a period of certainty for business, so that when we end up with our final withdrawal agreement we only have one set of changes to make from where we are now to where we will be at that point. That is the purpose of the implementation period.”
“Whether it is a transition period, an implementation period or whatever period one seeks to term it, the important thing is to understand what the period is about, and we have always been clear about that. It is a period in which we will remain closely involved—similar to how we are at the moment—so that when we move into the post-transition or implementation period we have undergone just one set of changes and that we have certainty in the interim for British businesses, which is exactly what they have been telling us they would like.”
“My hon. Friend makes an important point and, as I will say later in my speech, there is every reason to move towards a comprehensive free trade agreement covering not just goods, but services.”
“The text would codify an implementation period that preserves the current status quo for business and consumers, is time-limited but also provides a sufficient window for the EU and UK to put new processes and systems in place, and ensures continuity in the application of international agreements. As a third country, the UK will have the ability to use the period to negotiate and sign new trade deals, while reflecting the fact that we cannot bring these agreements into legal effect until after the end of the period. We will also introduce a new registration scheme for EU citizens arriving post-Brexit but during the implementation period, when EU citizens should be able to continue to visit, live and work in the UK as they do now.”
“My hon. Friend raises an important point. We will be seeking a unique deal for our country that recognises the prime importance of financial services both to our country and to the European Union and of the provision of competitive finance to the EU’s businesses and consumers. She mentioned CETA, and the relevant point there is that the negotiations, which were led by Michel Barnier, recognised the importance of attempting to include areas such as financial services, which is exactly what we will seek in the negotiations that will now follow. We have the reassurance that the UK and the EU both issued a published text on the approach to the implementation period that reflects the significant common ground between us.”
“What I can tell the hon. Gentleman is that a large number of trade missions have been led by the Department for International Trade and its Secretary of State. We have had extremely encouraging discussions with a large number of important potential future trading partners with whom we may be seeking free trade agreements. As I have said, we will be able to negotiate deals within the implementation period, although they will not come into effect until we are beyond that point.”
“I believe that my hon. Friend is right. I certainly read that article this morning, and if what it says is the case, that would be good and sensible news, because it would be entirely logical that we should be in a position to go out and negotiate free trade agreements during any implementation period, although we respect the fact that the deals would not be switched on until we were beyond that point.”
“Looking further forward, it is crucial that talks progress so that we can agree the terms of our future relationship with the EU. We are now moving at pace to set the parameters of an economic partnership. As a Treasury Minister, I am particularly focused on how our economies will interact and grow together. As the Prime Minister said in her speech on 2 March, the UK is seeking the broadest and deepest possible agreement that covers more sectors and co-operates more fully than any other free trade agreement. A key component of any future agreement should be the inclusion of services, particularly financial services.”
“We will also continue to discuss our involvement in relevant bodies as a third country during the period to ensure that EU rules and regulations continue to operate coherently. It is in the interests of both the UK and EU to agree the precise terms of the implementation period as quickly as possible. We are close to delivering that, and we expect it to be formalised at the European Council meeting next week. The implementation period is key to forging the best possible future relationship, giving businesses and Government the time and certainty to plan for Brexit, and preparing the UK for its status as an independent trading nation. It will be a bridge from where we are now to where we want to be in the future—on exit, on day one, and beyond.”
“I reassure the hon. Gentleman that it is an absolute priority for the Government to ensure the consistency and continuity of the existing arrangements as they pertain between the European Union and other countries. I see no reason why we should not benefit from those arrangements, just as those countries will indeed benefit from arrangements with us as we go forward. We have proposed practical solutions to help deliver a smooth departure from the EU. One such solution is the introduction of a joint committee to resolve issues or disputes that may arise during the implementation period. That approach is a common feature of international trade agreements. The joint committee would, for example, allow the UK to raise concerns regarding new laws that might be harmful to our national interest.”
“We manage €1.5 trillion of assets on behalf of EU clients, and 60% of all EU capital markets activity is conducted here in the United Kingdom. Around two thirds of debt and equity capital raised by EU corporates is facilitated by banks right here in the UK. The huge economies of scale have led to London’s dominant position in EU financial services. As the Chancellor made very clear last week, we should be under no illusions about the significant costs if this highly efficient shared market is fragmented—costs that will ultimately fall to consumers and companies right across Europe.”
“The hon. Gentleman will understand that both are an extremely high priority. We will be pursuing both avenues vigorously. As my right hon. Friend the Chancellor made clear in his Canary Wharf speech last week, financial services is a sector that calls for close cross-border collaboration. The Chancellor also reiterated that it is simply not credible to suggest that a future deal could not include financial services. It is in the interests of both parties to ensure that the EU can continue to access and enjoy the significant benefits afforded by our financial services hub, because it is a regionally and globally significant asset, serving our continent and beyond, and near-impossible to replicate. The UK can claim excellence in many areas, but in trade in financial services we are truly the global leader.”
“Along with my colleagues in Government, I have the greatest faith in our country and in our ability to work with others to achieve a deal that provides and endures for us all.”
“Any new trading agreement should reflect the starting point of deep and historic convergence. We understand that, over time, there will be points of inevitable divergence, so we recognise that any future agreement should set out a clear approach to that aspect. Our country seeks the deepest and broadest agreement possible—a bold economic partnership that is of greater scope and ambition than any comparable arrangement in history. The ambition of our vision reflects the scale of our mutual interest, our shared history and all that we can achieve together as good friends and trusted neighbours. Leaving the European Union represents an opportunity to chart a prosperous future.”
“Despite that, some still question the possibility of reaching such an agreement or insist that a trade deal cannot include financial services. The Chancellor addressed those sceptics in his speech last week, when he said that “every trade deal the EU has ever done has been unique”. The existing models do not represent the best way forward; nor do they provide a useful precedent to form the basis of any future agreement. Joining the EEA would not give the UK enough control, and a CETA-style deal would present too low a level of market access. The EU and the UK come to the negotiating table from the unique position of having the same rules and regulations on day one, not to mention our deeply interconnected economies. Unlike when other countries negotiate free trade agreements, this is not about aligning two totally different systems.”
“My hon. Friend raises an important point about the significance of financial services, not just to us but to our European partners. On his specific point about regulatory continuity, we are considering the detail of that at the moment. We will certainly look at the prospect of returning to the matter on Report of the relevant Bill. The UK stands ready to engage on a future trade agreement—one that includes financial services. Our overarching vision is for an economic partnership—including a future trade agreement—that delivers the maximum possible benefits for both our economies in all sectors, respects the integrity of each other’s institutions and seeks to strengthen, not weaken, the prosperity of Europe as a whole.”
“For those who can move, there will be financial support towards the additional cost of their journey time for up to five years. HMRC is supporting those who cannot move by seeking redeployment opportunities for them in other Departments. Question put and agreed to.”
“I would be more than happy to do that. Perhaps doing so in Westminster would be most appropriate, as the hon. Member for Preston and my hon. Friend the Member for Dudley South might wish to join him for those discussions—I would certainly be open to that. Finally, the hon. Member for Dudley North asked about the support provided for those who might not, in the event, be able to make the move from Merry Hill to the new centre in the centre of Birmingham. As I have said, all staff will have a one-to-one discussion with their manager around a year in advance of any office move that affects them, to discuss their personal circumstances, establish whether they are within reasonable daily travel of the new office and discuss what support might be needed to enable them to move.”
“Gentleman also asked me an important question about the date to which staff not being transferred on the universal credit/DWP basis might expect to stay in place. Currently, HMRC expects there to be ongoing tax credits work in Brierley Hill until March 2021. At that point, the tax credits caseload is expected to have fully moved across to universal credit, so the tax credits work currently undertaken in Merry Hill will come to an end. However, HMRC intends gradually to redeploy the skilled and experienced staff there to other work as the tax credits caseload decreases. HMRC will work with those staff to ensure that there is every opportunity to make a successful move into reallocated employment. The hon. Gentleman asked whether I would be happy to meet him and some of the staff with whom he has been liaising.”
“There is also a range of support for those unable to make the move to a regional centre. HMRC runs a programme of training, workshops, webinars and coaching, which includes advice on CV writing and identifying transferrable skills. Since starting in the autumn, it has been offered to around 800 employees, and HMRC will continue to provide such support. Let me turn to some specific questions that the hon. Member for Dudley North posed. An equality assessment was conducted prior to the location’s announcement in 2015, with a high-level summary published to staff at that time. HMRC continues to review those, and the issues in the west midlands are of course considered with the active input of representatives from the Brierley Hill office and the local Public and Commercial Services Union. The hon.”
“That said, HMRC recognises that individual employees have distinct personal circumstances, and not everyone will feel able to move to a regional centre, even where they might be reasonably close by. So it has put structured support in place—this is a point that the hon. Member for Dudley North asked about—to help those who can move and those who cannot. One year ahead of any move, everyone affected has the opportunity to discuss their personal circumstances with their manager and talk through any particular needs to be taken into account when decisions are made or any help they need to make the move—for instance, help with additional travel costs for up to the first five years. It is a tried and tested process, with more than 10,000 such conversations held in HMRC over the last two years.”
“That is particularly important given that a substantial proportion of its long-serving workforce are approaching retirement age. HMRC is clear that it wants to do all it can to keep its people’s skills, knowledge and experience, and it has a policy of minimising any redundancies. The vast majority of HMRC employees are within reasonable daily travel of a regional centre, specialist site or transitional site, and that is deliberate: decisions on where to locate the regional centres were based on modelling of where existing staff are based. HMRC estimates that 90% of its workforce will be able to move to one of its regional centres or complete their career in their current office. For those currently based at the Waterfront offices, the travel time from Dudley to Birmingham city centre is between 35 and 55 minutes by car or train.”
“It will also avoid costs of £75 million a year from 2021, when the current private finance initiative contact with Mapeley comes to an end. It is important to stress that this is not just about cost savings and bricks and mortar. HMRC’s new office structure will allow people to develop more fulfilling careers. There will be a far wider variety of jobs and different career paths to senior roles, as a wider range of work will be based on single sites. These modern buildings will unquestionably deliver a better working environment and experience for HMRC’s workforce. Crucially, their city centre locations will also increase HMRC’s attractiveness as an employer, enabling it to recruit and retain the next generation of skilled professionals.”
“In addition to the 13 regional centres, HMRC will keep seven transitional sites open across the UK for several years, where it will help retain key skills during the transition period, as well as five specialist sites for work that cannot be done elsewhere. For example, HMRC will retain Telford as a site for some of its specialist digital teams. By phasing the moves into its regional centres over a number of years and keeping sites open during the transition, HMRC will ensure that disruption to its business operations is minimised. The Birmingham regional centre will open in late 2020. The overall programme to move to regional centres will deliver savings to the taxpayer of around £300 million up to 2025 and then annual cash savings of £74 million in 2025-26, rising to more than £90 million by 2028.”
“It will be home to 3,600 civil servants, with 2,650 HMRC staff moving in from 13 offices around the west midlands region to undertake a wide range of key tax professional and operational delivery roles. The first of HMRC’s regional centres opened in Croydon in July 2017 and construction is under way at the Birmingham site, along with further sites in Bristol, Cardiff, Belfast and Leeds. All those offices will be modern, environmentally friendly and located in the heart of the community. Most of them will be shared with other Government Departments, and all have been sized for the future needs of HMRC and the taxpayer.”
“Changes to HMRC’s office estate are an important part of this transformation process, moving it from a large, widely dispersed estate of offices across the UK, varying in size, to a considered network of significant, modern regional hubs. In November 2015, HMRC announced that over the following 10 years it would bring its employees together in 13 regional offices, all in locations where it already has a significant presence, as it does in Birmingham. The co-location of teams across HMRC will lead to increased collaboration and flexibility, allowing it to provide more effective and efficient services to the taxpayer, and it has put support in place to help its workforce through the changes. In Birmingham, the regional centre will be situated in the heart of the city at 3 Arena Central.”
“Since 2010 we have made substantial investments, enabling HMRC to do more to tackle evasion, drive down avoidance and improve compliance. HMRC is transforming into a leaner, more highly skilled operation, offering modern digital services. It is moving away from outdated systems of manual processing to become more flexible and technologically driven—changing the way it works and using today’s technology and IT to improve the services it delivers for its customers. These investments in technology mean that HMRC can tackle fraud, evasion and avoidance more effectively and that customer services have improved, with far lower wait times on helplines and new ways to get support, such as webchats.”
“I congratulate the hon. Member for Dudley North (Ian Austin) on securing this important debate. I know that these are matters of particular concern to him, as they are to the hon. Member for Preston (Sir Mark Hendrick) and my hon. Friend the Member for Dudley South (Mike Wood), who have also made contributions this evening. HMRC’s location strategy was the subject of a Backbench Business debate held in November last year, and I am grateful to have the opportunity to return to this important matter. As the hon. Member for Dudley North pointed out, in November 2015 HMRC announced its location strategy as a crucial element of its work to create a modern, world-class tax authority—a key part of our long-term economic plan for national prosperity.”
“In addition, the agreement permits the taxation of services where they are performed in a country over an extended period—a feature of the UN model tax treaty. However, there are no unwelcome provisions permitting the taxation of leasing payments on a gross basis that either impede commercial activity or increase costs for consumers. The resulting treaty is therefore a good compromise that will encourage investment in Kyrgyzstan by UK businesses, to the benefit of both economies. I trust that the explanations I have given are helpful. The orders strengthen the UK’s taxing framework on many fronts, and I commend them to the Committee.”
“It first requested talks in 2008 and repeated that request to us in 2013, citing a desire to open up its economy to promote economic development. For our part, we were keen to close a gap in our DTA coverage in the region and ensure that UK businesses could compete on an equal footing with businesses in comparable countries that had already concluded DTAs. The agreement reached will improve the business conditions for UK companies and individuals operating and investing in Kyrgyzstan, while reflecting that nation’s status as a developing country. The rates of withholding tax are reduced to 5% for interest, royalties and dividend payments to direct investors; the rate under domestic law in Kyrgyzstan is 10%.”
“It, too, reflects the model developed by the OECD. This Government are committed to maintaining an extensive network of tax information exchange partners and agreements, which are an essential aspect of securing UK tax revenues. The fluid exchange of information between jurisdictions is a key tool in the arsenal of international tax co-operation. Since 2010, HMRC has secured more than £2.8 billion from those trying to hide money abroad to avoid paying what they owe. The arrangement under consideration will assist HMRC in maintaining its strong track record of countering tax avoidance and evasion. The UK has not had a double taxation agreement with Kyrgyzstan since it gained independence from the former Soviet Union in 1991. It was Kyrgyzstan that suggested we rectify that situation.”
“The new instrument allows for automatic exchange of bulk financial data. This important change ensures that the UK continues to align with current international tax transparency standards. Bermuda will provide HMRC with an increased amount of information on UK taxpayers. Bermuda has the status of a UK overseas territory, but it is a separate jurisdiction, with its own elected Government, and is responsible for its own domestic fiscal policy. Thanks to UK leadership, Bermuda is committed to global tax transparency standards. This instrument is an important part of Bermuda’s commitment to those standards and will enhance HMRC’s ability to check the compliance of UK taxpayers who have financial affairs in Bermuda. There are no other substantial changes between the old instruments and the one proposed.”
“May I say, Mr Hosie, what a pleasure it is to serve under your chairmanship? The draft orders deal with a replacement tax information exchange agreement with Bermuda and our first double taxation agreement with Kyrgyzstan. Both statutory instruments bolster the United Kingdom’s long-standing network of international tax agreements. The UK has had a tax information exchange agreement with Bermuda since 2007. That arrangement has allowed for the exchange of information on request between Her Majesty’s Revenue and Customs and the Bermudan tax authorities. Under a further agreement, signed in 2013, certain financial account data are received automatically by HMRC directly from Bermudan financial institutions. The draft order will supersede that further agreement and replace the tax information exchange arrangement from 2007.”
“Draft Double Taxation Relief and International Tax Enforcement (Kyrgyzstan) Order 2017 Resolved, That the Committee has considered the draft Double Taxation Relief and International Tax Enforcement (Kyrgyzstan) Order 2017.— (Mel Stride.)”
“Gentleman is right that there are no mandatory arbitration provisions in the treaty, because constitutionally Kyrgyzstan is not permitted to enter that kind of arrangement. We have respected that. He is right to say that there have been some delays. It has taken time to go through the stages of the negotiation, partly because the Kyrgyzstan Government requested various technical changes along the way. There were also some issues about language and translation because the agreement had to be very, very precisely translated into three languages. On that basis, I hope the Committee will agree to these orders. Question put and agreed to.”
“Various studies, such as one conducted by Vienna University, have looked at the economic impact of withdrawing withholding taxes, of lowering taxes, and of providing the kind of certainty that businesses require when they consider where to invest internationally. That is an important medium to longer-term consequence for those countries of this kind of arrangement. The hon. Gentleman also talked about the anti-abuse provisions in the order and made specific reference to the BEPS project. The treaty was concluded before the BEPS arrangements came into effect, but there are anti-treaty shopping elements in the order to ensure that those anti-abuse provisions are robust. The hon.”