Kit Malthouse
MP for North West Hampshire · Conservative · United Kingdom
“We have heard time and time again that the situation that thousands of our constituents live with every single day is so horrific and appalling that even the best palliative care cannot alleviate their pain. I urge colleagues to consider what their vote may mean today.”
“I will not. Some of those Members had just a few months before been specifically rejected by the electorate and replaced in this House by others, and I am afraid that they cannot be trusted not to do the same thing again. I grant my right hon.”
“The Health and Social Care Committee of the House of Lords found that in territories that have assisted dying, palliative care generally improves, because people become less afraid of talking about death.”
“One of the most affecting people I have met over the last 11 years of campaigning on this issue is Warwick Jackson, who came to our party conference a couple of years ago. Warwick’s wife, Ann, was diagnosed with terminal peritoneal cancer. She basically knew that she was going to die a slow, suffocating death at the end.”
“I respect my right hon. and learned Friend’s expertise in this matter, but, as he has already heard on the Floor of the House, it is perfectly possible for this House to suggest amendments, negotiate them with the promoters of the Bill, place them against the legislation in the House of Lords and then have them come back to this House for…”
“As co-sponsor of the Bill once again, I am acutely conscious that there is more at stake today than merely the fate of those who are facing their end, because the conduct of the other place means that our democracy is also on trial today.”
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“An enormous amount of compliance is required even before a company makes its first investment, and a fair amount of the investment that is being made can be absorbed in compliance costs. Complexity is therefore as much of a deterrent as the limits on the scheme, which may be why it is not being taken up with the enthusiasm that I am sure the Minister would like to see.”
“Let me again draw attention to my entry in the Register of Members’ Financial Interests. The SEIS changes are welcome, but, as I am sure the Minister knows, the amount of initial finance raised under the SEIS and, indeed, the enterprise investment scheme has been declining in recent years. That may be a reflection of the wider economic environment, but it nevertheless means that fewer businesses are being started under that scheme. Will the Minister and her Treasury colleagues give some consideration over the next few years to the sheer complexity that is involved in making what is a relatively small investment through the SEIS? The scheme deals with quite small amounts of capital—£25,000 or so—but an accountant and a lawyer are needed, as is pre-authorisation from His Majesty’s Revenue and Customs.”
“Are we likely to see Governments around the world play a game of competitive subsidies and competitive allowances? We will have full expensing, but some of our competitors will not—full expensing will reduce the effective rate for quite a lot of capital-intensive businesses, although not necessarily for services businesses—but there will now be a menu of allowances, derogations and tax breaks that can effectively be used to play a slight game of subterfuge as we all compete for these large, and now very mobile, businesses to locate in our territories.”
“The Minister is being generous with her time, although we are in Committee, so detailed scrutiny and questions are appropriate. I have a couple of questions. The Minister says that one of her missions is simplicity, and I know she understands that this measure will necessarily add several thousand pages to “Tolley’s Tax Guide”, which is now in two volumes—it was only one volume when I trained as an accountant. That is unfortunate, and we can debate the desirability or otherwise of this measure, but what protections are there against the creation of just another game? Although this Bill seeks to set a minimum floor on the headline corporation tax rate, it is perfectly possible for countries to compete on effective corporation tax rates.”
“The headline rate then becomes less important than the effective rate. We may well be kicking off that game with this measure. I am not entirely sure what protections there are against that, and against the complexity that comes with it, in this Bill.”
“Perhaps I was not entirely clear. For example, it is perfectly possible for us to say that our headline corporation tax rate is 25%, but we previously had—we are now getting rid of it—a super deduction that allowed me to offset more than 100% of any cost or investment against my tax and, therefore, reduce my effective rate of corporation tax to much less than 25%. It is possible, away from the headline rate at which we are imposing this minimum rate around the world, for Governments to play the game of subsidy. “We will give you £150 million to come to our country, and you then pay 25% corporation tax. It is like for like. I am paying you, but I am getting my money back.” It is also possible to create a raft of allowances against that income, which will reduce the effective rate.”
“We must not forget that although the investment may absorb all of the profit for small businesses, it will, in effect, create a tax loss that is able to be carried forward beyond the window. So I do not understand his criticism of our having a window if, as the Government say, they want action now rather than in three years’ time.”
“I wish to challenge the hon. Gentleman’s assertion about the notion of a window. We know that where taxation is concerned the creation of a window can often create an incentive to move quickly. For example, when there was a stamp duty window, we saw a significant number of transactions brought forward and take place. The Government are saying that they want to see very significant investment taking place. We know that British industry has accumulated a large amount of cash on its balance sheets. Why would the Government not create a particular incentive by saying, “Look, there is a deadline. If you get in now, we will give you this very generous tax break and then who knows what may happen in the future”?”
“Laurels in abundance are due to the Secretary of State and her team for a significant achievement. The urgent need to reorient our economy to the east was one of the many reasons why so many of us voted to leave the European Union. On 3 November, I asked the then Minister of State, my right hon. Friend the Member for Chelsea and Fulham (Greg Hands), about the place that lamb and sheepmeat and UK lamb and sheep farmers played in the CPTPP negotiations. Will the Secretary of State outline the benefits to those specific producers of sheepmeat that she has achieved in this deal, so that I can reassure the farmers of North West Hampshire—and, indeed, the whole of the United Kingdom—that our fantastic British lamb will appear on tables across the world?”
“Even a modest amount of tinkering instils a sense among British businesses, particularly small businesses, that they must put everyone back through the system, at enormous cost. Unless the Minister is very careful and very clear about the changes being made, she will create a whole new industry for the next two or three years, as every data controller in a small business—often doing this part time alongside their main job—has to be retrained.”
“Let me first draw attention to my entry in the Register of Members’ Financial Interests. Let me also apologise for missing the Minister’s opening remarks—I was taken by surprise by the shortness of the preceding statement and had to rush to the Chamber. May I take the Minister back to the subject of compliance costs? I understand that the projected simplification will result in a reduction in those costs, but does she acknowledge that a new regime, or changes to the current regime, will kick off an enormous retraining exercise for businesses, many of which have already been through that process recently and reached a settled state of understanding of how they should be managing data?”
“Does he think that, as well as safety, we should be emphasising that line in the sand?”
“My hon. Friend makes a strong point about safety being designed, but a secondary area of concern for many people is discrimination—that is, the more data companies acquire, the greater their ability to discriminate. For example, in an insurance context, we allow companies to discriminate on the basis of experience or behaviour; if someone has had a lot of crashes or speeding fines, we allow discrimination. However, for companies that process large amounts of data and may be making automated decisions or otherwise, there is no openly advertised line of acceptability drawn. In the future it may be that datasets come together that allow extreme levels of discrimination. For example, if they linked data science, psychometrics and genetic data, there is the possibility for significant levels of discrimination in society.”
“The fact that we do not muck about with our rates all the time and they do not vary very significantly from year to year has a big impact on businesses’ ability to plan for the future. The Americans have a higher corporation tax rate than we do, but they have not touched it for years—it has been the same for many years—which allows businesses to trade a higher rate for a longer planning horizon. We might benefit from such a perspective.”
“I draw attention to my entry in the register. My hon. Friend is making a powerful point and is right about the impact of thresholds on behaviour. There are a number of thresholds, including the VAT threshold and income tax rates, and these marginal rates have a massive impact. Does he think that during the passage of this Bill the Government should consider whether the threshold of £50,000 to £250,000 ought to be higher, not least because catching a company just as it makes £50,000, on an ellipse of growth, and taxing it more is effectively to punish it for success? What is his view on the notion that not just the rate but also consistency has an impact on the national and international sentiment about investment?”
“Again, I draw attention to my entry in the Register of Members’ Financial Interests. Does my hon. Friend think that there is a risk that countries may seek to manipulate their tax code in such a way that, while their headline rate might comply with the international minimum, the effective rate could be manipulated by the creation of all sorts of bonkers and crazy allowances, as we have seen in the past? We have full expensing of capital. That is fine for a capital-intensive company, but we have lots of items that are disqualified for corporation tax, which could be allowed if we wanted to make the effective rate lower than the minimum 15% in future. In many ways, that encourages even more gaming of the system by countries, rather than the system that we have at the moment, where it is a bit more transparent, if indeed complex.”
“My hon. Friend points to an argument that, I have to confess, has perplexed me. People say that raising corporation tax to 25% will not necessarily damage investment or, indeed, British business, but then why stop at 25%? Why is that the appropriate amount? If businesses are impervious to the tax rate and it does not affect their behaviour, why not have 30%, 35% or 40%? He understands my point. They are making a value judgment about where the line of damage is to be drawn, and I think he is quite right that it is hard to think that it will not have some kind of impact.”
“While the Minister does her work to ensure that when strip searches are performed on minors that is done within the guidelines, will she ensure that she does not unwittingly expose very young children, in particular, to even more exploitation than they are currently exposed to?”
“I am pleased to hear that the Minister is taking the report as seriously as she obviously is. It is clear that police forces need to do significant work in respect of the alarming levels of non-compliance with existing guidelines on strip searches. However, the Minister will be aware that there is no boundary to the evil that these gangs will perpetrate, and that if we create no-go areas or particular demographics where the police are restricted in some way in their searches, we immediately expose those demographics to exploitation by gangs. She will know that, for example, one of the reasons why county line gangs use teenagers so much is that the police cannot recruit them as informants. As a result, they are seen as easily exploitable by those gangs.”
“Although there will be an investigation into the cause of the spill and any culpability, which may have consequences, where does accountability and transparency lie in the Environment Agency for the conduct of the investigation? Police and crime commissioners are accountable to police and crime panels for the work of the police, but the system for the Environment Agency is more opaque. How can my constituents have confidence that any investigation is conducted with alacrity and that culpability is apportioned appropriately?”
“As a number of Members have said, not least my hon. Friend the Member for South Dorset (Richard Drax), the Dorset coast forms part of an incredibly fragile ecosystem across much of the south coast. Part of its fragility and uniqueness is because it is fed by a network of chalk streams—80% of the world’s chalk streams are in our part of the world. In January, the River Anton, which flows through my constituency, saw a not dissimilar spill of 30,000 litres of oil. I commend the Environment Agency for its swift response: it tells me that it has recovered about 17,000 litres and that work is under way to recover the rest.”
“How can she restrict supply to those who genuinely need it without it necessarily becoming an illicit substance that drug dealers use for their business?”
“As the Home Secretary pointed out, crime is now at half the level it was when Labour told us that there was no money left in the coffers to continue the fight. I congratulate her on bending her elbow and putting so much effort into driving the number down even further. I particularly commend her on the publication of the plan today, which builds on the focus on antisocial behaviour that we published in the beating crime plan not so long ago. May I urge my right hon. and learned Friend to examine carefully the routes of supply of nitrous oxide? We need to avoid a situation in which the substance moves from the legitimate market into the illegitimate market and becomes another hook for drug dealers to draw young people into their awful trade.”
“Can the Minister confirm, as an illustration, that, if a demonstration is about to take place by a group who use a particular tactic—gluing themselves to the road, for example—the police may use this power to intercept individuals with glue in their pockets, before they carry out an activity such as gluing themselves that occupies enormous amounts of police time, often puts them and police officers in danger, and causes enormous inconvenience? In those circumstances, will the police be able to use this power to get ahead of the problem?”
“The hon. Lady says these measures may damage relations with the public. The vast majority of the public feel very strongly that their lives have been severely impacted by these protests, so giving the police the tools to get ahead of them may in fact command widespread public support, notwithstanding the issues of protest. I wonder what her solution might be to the problem of people who persistently come to protests and glue themselves to all sorts of surfaces, thereby causing enormous disruption to other people’s lives, disproportionate to the issue they are protesting about.”
“I am grateful to my right hon. Friend. What he says is incorrect. At the time, we were dealing with a huge spike in knife crime in London, which was disproportionately reflected in the black community. Young black men were dying on an almost daily basis and, sadly, the vast majority of the perpetrators were also young black men. There was definitely a campaign to try to eliminate weapons from within that community, which worked. In 2008, 29 young people were killed in London, and by 2012 that was down to eight, so the campaign was successful. During that period and up to about 2016, confidence in the Metropolitan police rose to an all-time high of 90%, including rising confidence among minority communities in the capital. I am afraid that my right hon. Friend’s basic premise is not correct.”
“On that note, would it be possible for the Policing Minister to sit on the new board that Baroness Casey wants to be convened to supervise changes within the Met, and will the Home Secretary discuss that with the Mayor? I hope that the Home Secretary will also agree that key to turning around policing in general is the professionalisation of the workforce. She recently decided to cancel the policing education qualifications framework route into policing, although it held out the promise of the kind of continuing professional development that many people believe police officers need during their careers to keep them on the straight and narrow, in terms of values and operational practice. Will she reconsider her decision to cancel that project?”
“For anyone who, like me, has worked with the Metropolitan police over many years, this is a dark if not catastrophic day. While our thoughts are primarily with the many victims who have been let down and failed by the force, obviously we all reserve a huge amount of disappointment for the officers who do a startlingly good job every single day. Many of us who have visited the Met will have seen their work over the years. I hope the Home Secretary will agree that key to turning the force around is ensuring that this becomes a joint enterprise between City Hall and the Home Office. There has clearly been a failure of local accountability—and I speak as someone who has urged the Mayor, both in public and in private, to lean into the governance of the Metropolitan police during his time in office.”
“We talk a lot about housing in this country, and about putting houses in the hands of young people, but we never talk about putting shares in the hands of young people and encouraging them to own shares in the businesses for which they work and to participate in a capitalist economy.”
“Happily, the Government have talked expansively about science, technology and innovation; they obviously recognise that we are on the threshold of the fourth great advance in human understanding and ingenuity. Our country caught the first two advances—the industrial revolution and the industrialisation at the turn of the 20th century—but we broadly missed the advance that took place in the 1960s and ’70s. That was largely because our economy was sclerotic, but, critically, it was also because we had forgotten a basic tenet of capitalism: if we want the private sector to weigh in behind science, technology and advancement, we have to let capital rip. We have to deregulate it. We have to make sure that profit can be made from taking risk. Critically, we also have to allow capital to spread into as many hands as possible.”
“When he was the Chancellor, the Prime Minister put us into an international cabal of minimum corporation tax chargers across the world in an attempt to track all these companies down and tax all their profits, but if we went for a sales tax—if we focused on consumption and on those businesses’ sales—their domicile would be irrelevant, because the tax would relate to where their transactions had taken place. The huge international businesses that operate online and that we are currently chasing around the world would come into our taxation envelope, and we would find it easier to collect tax from them. The third big area is, in many ways, the missed strategic move in the Budget. It did not address one of the fundamental problems with the operation of our economy, which is the nature, spread and dynamism of capital within it.”
“We have a demographic problem and we have to encourage those who want to have children to do so. More thinking in that area would be great. The second area that I wish to raise is corporation tax. I concur with my hon. Friend the Member for Stockton South (Matt Vickers) in wanting corporation tax to be lower, not least because I believe in the Laffer curve; I do not believe that we will necessarily raise that much more by raising corporation tax rates. It raises a question in my mind about how we tax companies and why we continue to chase them for corporation tax when we know that the international and online nature of business makes it very difficult to tax such organisations.”
“Friend to look at what more we can do to expand childminder agencies in particular across the country as they are the only proactive tool we have for recruiting childminders. I also urge him to think more flexibly about what we can do to allow families to choose for themselves what kind of care they want to give. I urge my right hon. Friend to consider conflating the childminding budget, which now rises to about £9 billion, with the child benefit budget, which is now £12 billion although that is falling, and other ancillary budgets, into one huge budget that would allow us to think carefully about what reform we could put in place to support families, not just in looking after children but encouraging them to have more children. As my right hon. Friend will know, we are not replacing ourselves in this country.”
“I was happy to see a number of those appear in the Budget, not least the expansion of the provision of free hours of care for under twos. However, I am sure the Chief Secretary to the Treasury, my right hon. Friend the Member for Salisbury (John Glen), recognises that the system is still very complicated and still has a number of anomalies in it, not least the £100,000 threshold, which keeps a lot of highly productive women out of the workforce who are punished for going back by having their free hours withdrawn. In addition, there are seven different ways for childminders to receive payment for the care they give. Given that the Government are putting lots of money in at the front-end of the equation, they need to think carefully about supply. I urge my right hon.”
“I draw attention to my entry in the Register of Members’ Financial Interests. It was a good Budget, a fine Budget, filled with lots of delights, with something in there for everybody. In deference to the Opposition Front Bench, it had Osbornian overtones, filled with smart, clever tactical manoeuvres to fan the flicker of growth that there is in the economy, hopefully into a flame. There are three areas that I want to raise with the Minister in my five minutes. While we have made some progress, we need to go further and do some thinking before the autumn, and indeed the Budget next year. First, on childcare, in my brief time at the Department for Education, I was pleased to put together some options that were going to form what we were calling “a childcare big bang”.”
“Given that the biggest killer of our people, the most frequent breaches of our border and, arguably, the most significant impact to the integrity of our economy result from the work of overseas organised criminal gangs, why is there hardly any mention of them in this document? Where is the resource to allow the National Crime Agency to deal with threats that are felt on the streets of the Secretary of State’s constituency and mine every day?”
“I draw attention to my entry in the Register of Members’ Financial Interests. Bravo to the Minister and, in particular, the resolutions team at the Bank of England, who have been honing their skills for many years and finally got the chance to put them to use. Further to the question from my constituency neighbour, my hon. Friend the Member for Devizes (Danny Kruger), does the Minister understand the relief felt by many that the taxpayer, once again, has not been asked to step in and, in effect, nationalise private sector losses? Does he agree that for a capitalist economy to function, even in the most painful of circumstances, it has to be allowed to do what it does best—recycle distressed assets?”
“If we are interested in regeneration and levelling up across everything we do, investment is about not just the individual child and their family, but the area in which they live and their community’s sense of aspiration and purpose.”
“My hon. Friend is quite right to use the word “investment” in this context. Has he ever come across the Tangelo Park project in the United States, which has fascinated me for many years? A local philanthropist took over a neighbourhood in Florida that was plagued by crime and low achievement—what one would refer to as a rough neighbourhood. He made two offers to the population: he said that he would pay for universal, high-quality pre-school childcare and that anybody who got into college would get it free. Obviously people normally have to pay for college there, so that created an incentive. The project has been going for 20 years and has completely transformed the neighbourhood, which has become prosperous, crime-free and a lovely place to live.”
“When I was in the DFE, we were considering the idea of a big public health campaign to illustrate the importance of attachment, not just to women but to men as well. An attachment to a father is just as important as an attachment to a mother.”
“I applaud my right hon. Friend’s work on the early years and, as she knows, I share her enthusiasm. We are talking today about the estimates for the Department for Education. What role does she think public health has to play in educating parents, particularly about our shared passion for attachment theory? We have been successful over the last few decades in educating parents about not smoking or drinking during pregnancy, about not smoking in the car with their children and about how to give them nutritious food. Much of that has been a huge success, but we have never really had a public health campaign based on the fundamental building block of emotional maturity in children, which comes from strong early attachments.”
“To a certain extent I think my hon. Friend is right about ratios, but does he accept that they inject into the system an element of inflexibility and certainly an element of nervousness? As I understand it, most providers under-pitch on ratios for fear of accidentally being caught on the far side through illness, absence or whatever. The delineated hard lines may be subject to interpretation, but they nevertheless produce a rigidity that is not helpful for providers.”
“As the Minister would expect, I will vote for the regulations, but I seek reassurance on that point. To give an example, my constituency home is in the middle of an avian flu control zone. A captive hawk was taken to the vet because it was a bit poorly, and it turned out it had the flu. As a result, we are in the middle of a 3 km exclusion zone, where everybody has to keep their chickens in. Has publication damaged that person’s business? I do not know. Presumably, the hawk’s illness has damaged their business. However, I hope the Minister understands my point—that there is a wider responsibility, other than to just the business itself.”
“I understand the Minister’s desire in the financial assistance regulations to have the power not to publish in circumstances where disease or other matters might affect somebody’s business. However, in a world of social media and in a community that talks—and farmers do talk—I question how realistic that is. If there is an outbreak of disease in an area and we are attempting to control it, not publishing might protect one business, but it might also damage lots of neighbouring businesses, which will be unable to take the measures they need to to protect themselves from that disease. If the Minister is saying that that will be his judgment, that is fine, but the SI does not say that he will have regard to the overall surrounding businesses; it just talks about having regard to that particular business and to whether it will be damaged.”
“The instrument also omits the previous definition of the “farming investment fund”…the fund can be used more flexibly for any of the statutory purposes in section 1.” Does that mean that, without parliamentary consent, the Minister can start or close a new scheme or quietly do away with things that are not working? Where will the accountability be for the expenditure of public money on new things? If the Minister says we are going to have a trampoline standard, does that mean that we will pay someone who starts a trampoline park on their farm and that if it does not quite work out, it will be quietly closed and nobody will be any the wiser? There is a transparency issue there that concerns me.”
“I wrote to the Minister about that recently as well, and I would be grateful for elucidation today. I turn now to the financial assistance regulations. I am slightly concerned—perhaps the Minister can enlighten us—about the immense power the legislation gives him to create, close and amend schemes when that has previously required parliamentary consent. Paragraph 7.6 of the explanatory memorandum states: “This will help future-proof the 2021 Regulations against changes to the name or design of specific schemes, and avoid the need for an increasing list of financial assistance schemes in the regulations.”
“However, if my crop is devastated by some pest halfway through the season, and I have no choice but to use a pesticide, I will lose my payment, at the same time as I lose my direct payment. There is no partial payment; we cannot say, “For six months, you didn’t use a pesticide; we will give you half the money.” Farmers face an all-or-nothing cliff edge. They will have to make a financial calculation about whether the crop price merits the use of the pesticide or merits them allowing the crop to be destroyed and taking the subsidy. That injects an element of jeopardy into the system at a point at which there are these final, significant reductions in direct payments, which may not be helpful. I, too, would be interested to know what is going to happen to the underspend.”
“The Minister says there will be a reduction in bureaucracy, but I assume we will unleash an army of people in high-vis with clipboards across the countryside to ensure that all these standards are being complied with. That might be a one-off exercise, but nevertheless I presume there will be some confirmation of compliance in exchange for public money. If that is the case, timing becomes critical, because if compliance is about result rather than input, we obviously have a bit of an issue. Another point is about the nature of the payments. I wrote to the Minister recently, as he may know, about the pest management standard. As I understand it—he may correct me—if I decide I am going for the pest management standard, I avoid the use of pesticides. If I avoid the use of pesticides for the season, I get my payment at the end of the season.”
“As the Minister said, it is welcome that the Department published six new standards in January to go along with the existing three. However, reducing direct payments as farmers decide, singly or collectively—they can now operate in groups—which of those standards to pursue, whether that is hedgerows, pest management or whatever it might be, means that farmers will start to see reductions in their direct payments before they can demonstrate the benefits of those standards or claim under them. The Minister is a farmer, and he will know better than me whether somebody can put in place and comply with the hedgerow standard in time to fill the gap in cash flow caused by these reductions—whether they can procure hedgerow, plant it and make sure it is up to standard and is thriving, and not just go through the motions.”
“Member for Cambridge—slightly jammed into a decision today. As the Minister will know, there is a calculator online where farmers can work out what their reductions will be, and the rates were advertised beforehand. If we parliamentarians made some amendment to the SI today to change the rate of reductions either way, it would throw a spanner in the works for many farming businesses, including in my constituency. So I am not really being given a choice in terms of the vote on this, given the impact on farmers if we changed the regulations. I question whether that is the proper function of parliamentary scrutiny—we are making a decision, but we are not really making a decision. Another issue I want to raise on this SI is about notice.”