John Glen
MP for Salisbury · Conservative · United Kingdom
“I welcome the Chief Secretary to her new position, but what words of comfort could she give the residents of Salisbury in Wiltshire, a unitary authority? We are not part of a combined authority and we do not have a metro mayor.”
“Sam Moody is my constituent. He is the chief executive of Rockhopper. During my time in this House, he has been absolutely scrupulous in following the laws of this country and respecting the Falkland Islanders.”
“I listened carefully to what the Minister said about the process, and I respect that. But most people who take a pretty level-headed, pragmatic view of the need for a transition over time still cannot get their heads around the short-term reality: when we have so much turmoil in the middle east, why would we extend the time that we are no…”
“It is 55 days till the Budget. Given the market’s reaction to the Prime Minister’s statement on Tuesday, and given that our gilt rates are higher than those of our peers in the G7, could we have a debate on the implications of higher taxes for growth?”
“Before the hon. Lady makes her statement on Thursday, will she, when reflecting on the arrangement in Wiltshire that would embrace Wessex—although we have been told that that is not the Government’s view—address the prevailing concern that the people of rural Wiltshire will be considerably worse off without having the opportunity to embra…”
“I recognise that the Minister wants to come to what the Government are going to do, but does he not accept that the decisions already made in the last two years—with respect to the price of employment and the national living wage, the cost of employment with regard to legislation, and business rates—have depressed the appetite of many sma…”
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“Most people across the country will be very grateful to the Prime Minister for the judgments made on the vaccine roll-out and on the testing regime that followed. Quite obviously, given the scale of that intervention, it was going to have a significant impact on the economy and the growth figures overall. The Government have never been complacent about the impact of the inflation levels on the people of this country. That is why just two weeks ago the Chancellor introduced a significant package of interventions in a number of dimensions that focused on the most vulnerable—those who will not be able to earn more, particularly those on means-tested benefits, the disabled and universal additional support for pensioners. Respectfully, I do not accept the hon.”
“My hon. Friend always makes constructive suggestions. He will be aware of the interventions that have already been made, including the cut on VAT on energy efficiency measures, equivalent to £240 million, as well as the £6.7 billion of investment across this Parliament in energy efficiency measures. None the less, he makes a reasonable point and I am very happy to follow it up with him and discuss it further as we construct that set of interventions in the autumn.”
“Absolutely. We must always, with all our trading partners, seek to develop the best possible relationships. That has been my objective in conversations that I have had on visits to Berlin, Luxembourg, Madrid and the US over the past six months on financial services and as regards the work that the right hon. Gentleman is undertaking as we advance the conversation with the Swiss on the mutual recognition agreement. I was there last week to build on that. It is absolutely right that we build those trading relationships in goods and services across the globe in markets that are mature and in those that are yet to develop fully.”
“My hon. Friend predictably, and reasonably, makes a plea for investment to be located in his constituency, but he also draws attention to the significant investment of £20 billion in R&D by 2024-25. He is right to stress that to get a high-productivity, faster-growing economy we need to make those sorts of strategic investments and build on what we have already done. I will look constructively at his suggestion about his constituency and region.”
“No, I do not. I accept that that was a challenging period for economies everywhere. There was a period of adjustment, and the Government will be working in a co-ordinated fashion to remove any frictions and to ease the passage of trade, particularly for smaller businesses.”
“As hon. Members would expect, the Treasury has a strong and frequent dialogue with different members of the Bank of England and deputy governors. However, our main inflation tools for an independent monetary policy—fiscal responsibility and supply-side activism—will remain the best weaponry for dealing with the challenges we face, and we will work in a co-ordinated fashion with an independent Bank of England to address those pressures.”
“The Government will always look constructively at all the options. In light of the representations made across this House and across the country for more interventions to support those facing increases in the cost of energy at home, we made those interventions. The Chancellor has made clear that we will reform and cut taxes on investment in the autumn to spur that growth and productivity, and we are working closely with industry on the best possible way to make those interventions.”
“In Gloucestershire, as across the country, we remain focused on the challenges facing both small and large businesses. As my hon. Friend mentions, during the pandemic we made a number of sector-specific interventions for retail, hospitality and leisure businesses, which will continue to benefit from the business rates holidays. We are keen to ensure, however, that we achieve better productivity, with more investment in capital, in ideas and in measures that will lift us to a new level of growth. That means interventions across the whole economy.”
“Perhaps unsurprisingly, I cannot give the hon. Gentleman that figure at the Dispatch Box at this point, but we have introduced timely, temporary and targeted interventions. We recognise with a real sense of empathy the fact that people will be struggling. We have been very clear from the time we made this series of announcements and over the past six months that we will not be able to ameliorate the impact of every single additional cost. The key intervention we need to make is to encourage that growth and productivity in the economy in the context of fiscal responsibility and the commitments we have made to intervene so far.”
“Yes, I can. In a few weeks’ time I shall introduce to the House a financial services and markets Bill that will fundamentally reset the way that our financial services industry, which constitutes 10% of the economy, will be regulated into the future. That will be underpinned by strong, independent world-class regulators in the Prudential Regulation Authority and the Financial Conduct Authority, but with an obligation to look at competitiveness and global growth as a secondary objective. That is absolutely imperative. We must make sure that we have an economy that takes account of what is going on elsewhere and regulates accordingly.”
“No, it will not. It will involve targeted investments across the country in schemes that will give us a lift in productivity and address the fact that under previous Governments, despite all the rhetoric, there was not that reset in investment across other parts of the country and we did not see the level of growth that was anticipated.”
“Absolutely we will. It is very concerning that we are not seeing the savings passed on and we will continue to look very carefully at what is happening.”
“No, I think there is a pretty clear consensus that the rapid wind-down of the testing had a significant effect—around 0.5% of GDP. If that had not happened, we would have seen very modest growth during this past month.”
“Absolutely. It is clear we are seeing the best unemployment figures for well over a generation. It is very pleasing to see the impact that is having on constituencies such as that of my hon. Friend. It is important that we build on that and look to increase that investment to get businesses investing in new capital and more productive jobs to increase productivity in the economy as a whole.”
“Clearly in different markets there will be different challenges. We must make sure that we have a deep dialogue and look to find consensus. Where we cannot, we must take action.”
“The hon. Gentleman will also know that the Government invested in a seasonal workers scheme for 30,000 across agriculture, which has made a significant impact. We will continue to work with industry to see what further interventions can be made and need to be made.”
“The hon. Lady will know that just two weeks ago, the Chancellor came to this Dispatch Box and made a series of targeted interventions, in a greater way than many were calling for, to give assistance to the most vulnerable in our society—to pensioners, to those on means-tested benefits and to the disabled—with more support for pensioners on top of that. She will also know that as we approach the fiscal event, we will look at the state of the economy and the best possible interventions to assist not only that growth narrative, but the most vulnerable.”
“I do not think Stoke-on-Trent could have a better advocate than my hon. Friend, with his passionate desire to highlight the successes going on in his constituency. I absolutely agree that it is that positivity, and focusing on interventions that make a real difference to people who live in his community, that people will remember as we move forward.”
“The hon. Gentleman makes a reasonable point about the challenges facing the rural economy, of which I know that he has great personal experience and experience in his constituency. That is why, as we made clear, there will be an additional £500 million to supplement the household support fund and bring it to a total of £1.5 billion, so that local authorities can give additional money to those most affected where existing measures have not been helpful.”
“Although the Financial Conduct Authority does not yet regulate funeral plan providers, it is currently going above and beyond its legal duties by helping to support the industry and administrators as they look to find a longer-term solution for Safe Hands customers. I am hopeful that customers will not need to wait too much longer before they see further progress on a longer-term approach. The example of Safe Hands clearly demonstrated the need for a better-regulated funeral plan market, because although the sector provides a valuable service, we must ensure that the situation that has developed for Safe Hands customers is not repeated. That was the purpose of the work that has been done.”
“Separate criminal investigations may also be undertaken in any administration where evidence of criminality is uncovered. However, it is only right that at this stage we await the outcome of the administration process. As hon. Members will be aware, and as has been mentioned this afternoon, Dignity, one of the UK’s largest funeral plan providers, stepped in to provide funerals for Safe Hands customers, following the firm’s entering administration. I have met with Dignity myself, in the Treasury, and I know that my hon. Friend the Member for Telford has met with Dignity as well. I am very pleased that Dignity has now agreed to do that—at no additional cost to plan holders—for a further six months.”
“A number of points have been raised about that, particularly by the right hon. Member for North Durham. Within three months of any administration, the administrator must report to the Insolvency Service on the conduct of the directors prior to the company’s failure. In addition to the Adjournment debate and some of the points made during that debate two Thursdays ago, more points have today been made, helpfully putting on the record some of the concerns about those behaviours. When that administration process has concluded, those matters will obviously be there to be taken up. I understand that, where there is misconduct that shows people to be unfit to be a director, they may be disqualified from acting as a director for up to 15 years where that is in the public interest.”
“No one needs to explain to me the important role they play in celebrating the marking of a life and helping bereaved families and friends say goodbye to their loved ones. I have said previously that no one nearing the end of their life, or their families, should be consumed by money worries relating to the cost of their funeral. The hon. Member for Putney raised a number of issues about the broader nature of support for funeral provision. I will probably not be able to attend to them this afternoon, but I note those points and I will try to secure an answer for her. Safe Hands’s going into administration will naturally be very upsetting for its customers and their families, and those consumers will, of course, be anxious to know who will look into the behaviour of the company and its directors.”
“It is a pleasure to serve under your chairmanship, Mrs Cummins. I thank hon. Members who contributed to the debate: the hon. Members for Putney (Fleur Anderson) and for Gordon (Richard Thomson), the right hon. Member for North Durham (Mr Jones), and of course my hon. Friend the Member for Telford (Lucy Allan), who has professional experience in this domain and used her accountancy and forensic skills to examine some of the issues relating to Safe Hands. They are very relevant to some of the things we need to discuss this afternoon. I know she cares deeply about these matters, and I will try to attend to the points that have been made during the debate. That people care so much about funerals is not particularly surprising.”
“But those are the options available. Of course, we are midway through that journey, but what this afternoon’s debate has shown is the imperative of the industry working to sort out some of the issues that have been laid bare by the Safe Hands experience. I think Safe Hands is an exception, but it is a pretty awful experience for those customers. My belief is that this process of regulation will give clarity to the situation, going forward, in terms of who is regulated, how they are regulated and what being under regulation, either as an appointed representative or directly from the FCA, means. The FCA will be responsible for communicating that.”
“Going forward, people either are regulated—those who are going on the journey into regulation by the end of July go under FCA regulation, and it will be keeping an eye on their selling practices—or become an appointed representative of a bigger, regulated firm, which keeps an eye on them, and then the FCA keeps an eye on it. Many firms, most firms—I think it is in the order of 67 firms—are going through the journey into regulation. There will be smaller firms that decide not to go on that regulatory journey, and either they will become authorised under the appointed representative regime or they will wind down, and return the funds to their customers. Those are the two options. The FCA is working with the industry to smooth that journey. The House passed a statutory instrument to ease that process of transition.”
“As I said, it is difficult to be precise in all circumstances because every situation is different. The purpose of giving the FCA that authority is that it has the powers to fine, regulate and insist on certain levels of transparency. Ultimately, if firms that go into regulation do not align with those expectations, the FCA has the power to wind down those firms—in extremis. At this point we are at the start of the journey. The conversations I have had with Dignity—”
“I will certainly give way to the right hon. Gentleman in a moment. Dignity has set up processes to ensure that they continue to comply with those regulations. Those firms that do not choose to be regulated, or do not choose to go under the appointed representative regime, will be obligated to wind down those plans and return those funds. Forgive me; I cannot give absolute clarity on the detail of that process, but I am happy to engage with the right hon. Member for North Durham beyond this Chamber to give him more clarity.”
“That is what funeral customers deserve, and it is what they have a right to expect. I will reflect on this debate, and if there are any matters that I feel I have not adequately dealt with, I will write to Members and publish a copy of that letter for the House to see.”
“There was a consensus across the House: it was not just this Government, but Members from the Scottish National party and the official Opposition, who called for this action three or four years ago. A well-regulated market will also promote effective competition and do the right thing by consumers over the long term. As I have said, Safe Hands customers have been assured that they will be covered for at least another six months, and I implore others in the industry—other market participants—to take further action to protect consumers of firms that will not become authorised. Taking such action is good for consumers, but also for the reputation of the funeral plans sector. To that end, the Government and the FCA will continue to work closely with each other and the sector to ensure that the shift to regulation is as smooth as possible.”
“However, the action of Dignity to take a lead as one of the biggest industry players, to make provision for an initial six months and develop a transition option for those who unfortunately are victims of the Safe Hands situation, is very welcome, and I call on others in the industry to follow Dignity’s example. We do not anticipate that there is something else on the scale of Safe Hands out there; we can never be sure—I do not have a crystal ball. Nevertheless, it is incumbent on the industry to continue to work with the regulator to find enduring solutions for as many people as possible. There is no doubt in my mind that, by acting to protect consumers through a robust regulatory framework, we are doing the right thing.”
“The inability to meet those new standards due to issues with conduct, business models or trust arrangements does not mean that the regulation is at fault. Rather, the regulation is acting as a cleansing agent, weeding out unsustainable practices and preventing future consumer detriment. Some Members have asked whether the Government are likely to compensate Safe Hands’s customers. I do not think it would be appropriate for us to set the precedent or expectation that the Government will use taxpayers’ money to compensate consumers for the misconduct of unregulated firms. The Government’s role is instead to ensure that appropriate regulation is in place to guard against such failures.”
“The FCA has therefore said that providers who decide not to obtain authorisation, or cannot obtain it, should either wind down before the regulation comes into force or transfer their plans to a provider that will operate under the new rules. The Government recently laid a supplementary statutory instrument to make such transfers easier. That is in line with my responses to earlier interventions—I am glad my speech is in line with my head. We are aware, of course, that when we bring a sector into regulation for the first time, some providers may be unable to meet the authorisation threshold. That point has been raised with me in representations from my right hon. Friend the Member for South Holland and The Deepings (Sir John Hayes) and representatives of the industry.”
“It is also about proportionate regulation. Across my brief as Economic Secretary, I want to be able to boost competition and protect consumers. That is exactly as it should be. That is what drives me in the other areas of regulation that I am looking at, such as buy now, pay later. At the same time, the Government very much recognise the impact of the change that regulation represents for providers. That is why we introduced a transition period before the new rules came into effect—to give businesses the chance to prepare and adapt. A key priority has been to minimise any disruption to customers resulting from the transition to regulation.”
“In future, consumers will have greater clarity and understanding of what is covered by their funeral plans, and will not be exposed to misleading or high-pressure sales tactics—an issue raised by the right hon. Member for North Durham. For the first time, funeral plan customers will also be able to take advantage of a redress scheme provided by the Financial Ombudsman Service, and benefit from the protection of the financial services compensation scheme. That reflects the point about this being a financial services product, raised by the hon. Member for Gordon. Indeed, we have seen a massive growth in that over the period between 2016 to 2019—a growth of, I think, 175%. That is why we are doing it. We want to ensure that there is proper regulation that is meaningful and give consumers real assurance around what protections exist.”
“My understanding is that the intention is for that process to commence at the end of July. In terms of the transition and the guidance to customers, I would need to refer to the FCA on that. I shall write to the FCA and make that letter available to the House of Commons, so that people can be clear about what the situation is. Among the questions that the hon. Member for Erith and Thamesmead asked me was one about the Government’s actions to this point. We have taken action and we did legislate to bring providers and intermediaries within the regulatory remit of the FCA. That means that from 29 July, funeral plan providers will be subject to robust and enforceable standards on the sale of their plans.”
“I would respectfully say that in the end, this has to be the responsibility of Government, because we mandated the FCA to do this. The Government must take responsibility, not the FCA, but my hon. Friend is absolutely right that it is now incumbent on the FCA to get this right, and I believe it will.”
“They relate to stamp duty land tax rules for Sharia-compliant peer-to-peer lending, and to the individual savings account regulations that may exclude certain arrangements from innovative finance ISAs. I am always grateful to those who bring such matters to the Government’s attention, and those points are being assessed. These changes reflect developments within the Sharia-compliant market and will allow the industry to continue to thrive and grow, maintaining the UK’s position as a global hub for Islamic finance. I hope colleagues will join me in supporting this order, and I commend it to the Committee.”
“Amending the rules to allow home purchase plans from FCA-regulated providers to fall within the alternative finance provisions will bring parity between conventional financial institutions and non-bank providers, and bringing Sharia-compliant peer-to-peer arrangements within the scope of the rules will encourage investors and operators to enter the Islamic finance market, allowing the Islamic community, especially small businesses, to benefit. It will also contribute towards offering a level playing field for Islamic finance and conventional finance. When consulting on the draft order, further issues arising from the developing market have been brought to the attention of the Government.”
“Lenders and borrowers entering certain finance arrangements through Sharia-compliant peer-to-peer platforms also face less favourable tax treatment, which means that home purchase plans provided by FCA-regulated providers, and certain alternative finance arrangements facilitated by an FCA-regulated peer-to-peer platform, are on an unequal tax footing with similar products provided by financial institutions and conventional peer-to-peer lending. The changes made by the draft order will allow both of those types of firms to access the alternative finance arrangements provisions for the purposes of income tax, capital gains tax and corporation tax.”
“However, home purchase plans provided by firms that do not fall within the existing statutory definition of a financial institution, and alternative finance arrangements facilitated by peer-to-peer platforms, are not currently within scope of the provisions. Home purchase plans are a Sharia-compliant method of obtaining property finance in a way that ensures no interest is charged. Currently, Financial Conduct Authority-regulated providers of such products are not defined as financial institutions, and their customers are not able to access the alternative finance rules. They therefore face less favourable tax treatment for the purposes of income tax, capital gains tax and corporation tax than providers that are already defined as financial institutions.”
“The development of Islamic finance products in the United Kingdom is a welcome sign and demonstrates our position as a world leader in this regard. It is important that our tax rules are reviewed and updated to reflect market developments and ensure a level playing field for alternative and conventional finance products. We already have alternative finance tax provisions that set out rules on the tax treatment of Sharia-compliant financial arrangements, which allow finance to be provided without payment of interest. The provisions allow for returns made by the finance provider to be treated as if they were interest for tax purposes when certain conditions have been met.”
“I beg to move, That the Committee has considered the draft Alternative Finance (Income Tax, Capital Gains Tax and Corporation Tax) Order 2022. May I say what a pleasure it is to serve under your chairmanship, Sir Edward? The draft order before the Committee widens the scope of the alternative finance arrangements provisions so that certain alternative finance arrangements can receive equal tax treatment to conventional arrangements of the same kind. The United Kingdom has established itself as a leading centre for Islamic finance, and the Government took steps to further build on this last year when we issued our second sukuk, the Islamic equivalent of a bond, at more than double the size of the first.”
“I sincerely believe that this order will help to level the playing field for those products and will aid the Islamic finance industry to move forward in the UK, and continue to develop, to cement our reputation as global leaders in this area. I hope that the Committee has found this afternoon’s session informative and will now be able to support it. Question put and agreed to.”
“Member for Glenrothes, has also been brought to the attention of my officials. It is likely that the ISA regulations will require some minor amendments to ensure that alternative finance arrangements can qualify for inclusion in innovative finance ISAs. The changes required will be included in the forthcoming technical changes to the ISA regulations. I think that deals with the substantive points that have been raised. As I said, I welcome Opposition Members’ support. This alternative finance order will enable home purchase plans provided by regulated firms that do not fall within the existing statutory definition of that financial institution, and alternative finance arrangements facilitated by regulated peer-to-peer platforms, to receive equal tax treatment for the purposes of income tax, capital gains tax and corporation tax.”
“Officials did not consider it feasible to implement those changes in this statutory instrument, and they and I are exploring the issue further through alternative means. The Government want to ensure that higher education remains accessible to those with the desire and ability to benefit from it. We are currently considering whether alternative student finance could be delivered as we take forward the lifelong loan entitlement. The consultation on the detail and scope of the LLE closed on Friday 6 May, and the Government are currently considering the responses. A further update on alternative student finance will be provided when the Government issue their response to the LLE consultation. I think that I have mentioned the non-inclusion of the stamp duty land tax. The issue of ISAs, which was raised by the hon.”
“I very much welcome the support of the hon. Members for Hampstead and Kilburn and for Glenrothes. They raised three issues: the treatment of ISAs, student loans—notwithstanding your injunction not to address that point too explicitly, Sir Edward, I will refer to it briefly—and stamp duty land tax with respect to fintech. First, I pay tribute to the hon. Member for Bradford West, who engaged with the consultation as chair of the all-party parliamentary group on Islamic finance. She was very supportive of this order and the changes. There were respondents to the consultation who requested an extension to the stamp duty land tax exemptions for regulated entities in the Islamic fintech industry, such as peer-to-peer platforms.”
“At Fintech Week on 4 April, I set out our firm ambition to make Britain a global hub for cryptoasset technology, and I announced a number of actions that will support that. That includes committing to consult on a future regulatory regime for cryptoassets later this year; legislating to bring stablecoins into payments regulation; and exploring ways of enhancing the competitiveness of the UK tax system to encourage further development in this sphere.”
“Yes, absolutely, and my officials are meeting the Cryptoasset Business Council later this week. We want to take a dynamic approach to industry engagement. Lots of similar organisations have spawned over the last few months, and I and my officials will work very closely with them as we lead this global leadership aspiration.”
“We watch these things very carefully. That is why, in January this year, we announced that certain cryptoassets will be brought within the scope of financial promotions regulation. I am very aware of the Financial Conduct Authority’s advice, which shows that only one in 10 cryptoholders are aware that they can lose all their money. We need to get that number up.”