Gareth Davies
MP for Grantham and Bourne · Conservative · United Kingdom
“Will the Trade Minister address that point when he responds to the debate, and confirm that the Government still hold these concerns about practicality? Labour Members have been questioning that.”
“Not right now, and I have already taken an intervention from the hon. Lady. Finally, and more broadly, we worry that the campaigners ultimately want this ban to become a gateway to a wider ban on trade with Israel. If that is the case, they simply do not accept the importance of the relationship that we have with Israel.”
“I will make a little progress in the interests of time, because I know that Members will want to hear from the Minister. It is the official Opposition’s view that a proposed ban on the trade of Israeli settlement goods and services will bring about the same result as I have been talking about and will prove counterproductive and ineffecti…”
“These include the decision to cancel trade talks while Hamas were still holding hostages after the 7 October attacks; the decision to impose export licence suspensions while Israel was burying hostages so barbarically taken from their loved ones; and the decision to recognise a Palestinian state when no formal peace process had been agree…”
“I thank Members from across the House for their contributions today, and I congratulate the hon. Member for Sheffield Central (Abtisam Mohamed) on securing this debate on trade—granted, of course, by the Backbench Business Committee.”
“] I see that you are asking me to conclude, Madam Deputy Speaker. We firmly believe that the proposed trade embargo would have no practical effect whatever on the situation in the region. We are concerned that it is part of a broader push by Israel’s opponents to isolate the Jewish state politically and economically.”
The complete record
Every one of 597 lines we hold for Gareth Davies, in date order, each linked to its source. Free to read, in full, without an account. Page 2 of 12.
“I thank the Secretary of State for advance sight of his statement, and for coming to the House proactively this morning. I refer the House to my entry in the Register of Members’ Financial Interests and my former career in asset management. I very much welcome the Government’s recognition that industrial energy bills remain incredibly high. This is an issue that businesses across the country have been raising for many months. I have heard what the Secretary of State has to say, and there are a number of areas where I would appreciate further clarity. First, according to the Government’s figures, at least 99% of companies will not benefit from the scheme, even after the announced expansion.”
“Finally, I was contacted overnight by Expedia Group, which has set out its detailed thoughts on the regulations. I will write to the Department with the concerns it has raised. Its requests include that the Government publish guidance defining the terms “single visit” and “facilitate” within the regulations before commencement takes effect, so that operators such as Expedia have legal certainty about the scope of the new package definition. On that specific point, I would be very grateful if the Minister could explain her views.”
“The ongoing compliance costs for businesses offering those services will increase. Can the Minister now give us an estimate of how many businesses the Department feels this will impact, and can she confirm that she has at least met with some of those businesses to hear their views on how the regulations will impact their day-to-day operations? Secondly, as the Government Whip set out, the regulations also establish a 14-day period for the refund of cancelled services. Can the Minister therefore set out the rationale for arriving at that 14-day period? When the Government come up with these periods, I am always interested to know how they arrived at, say, 14 days rather than another period. Is there a specific reason for that number of days?”
“At least one of the four changes before us reduces regulation, which is a good thing and something that I applaud. While I welcome the sensible measures to alleviate the regulatory burden, however, we must always remember that there is little point having pro-growth deregulation while increasing anti-growth taxation. Over the past two years, many in the domestic tourism and hospitality industries have felt like a target—in fact, many have felt like target No. 1—when it comes to additional red tape and higher taxes. At least two of the four changes we are considering still act to increase regulation. I have a few questions on those changes. First, as type A linked travel arrangements become absorbed into the package definition, in the explanatory memorandum the Department has clearly set out that this will increase the regulatory burden.”
“It is a great pleasure to see you in the Chair presiding over us, Mr Twigg. I am very grateful to the Government Whip for setting out the regulations. It is clear that this is a matter of great importance across Government, and it is an important matter for the Opposition, too. In fact, the regulations carry on work that the Conservatives started—work that the Labour Government are now continuing. The aim has always been for reforms that support our domestic tourism and hospitality industries, while still providing appropriate protections for consumers. That is exactly what our goal should be with all regulations. I am pleased that, in this area at least, the Government seem to recognise that growth is increasingly being held back by red tape that brings little benefit to anyone.”
“Can the Minister clarify whether she has met any businesses since taking office in this specific industry, and not just relied on the 2023 piece of work?”
“In 2022, Grantham saw the opening of one of the country’s first community diagnostic centres; since then, more than 100,000 tests have been completed for the local population. Now, I want the same for the town of Bourne. Will the Minister meet me, so that I can make the case for a new community diagnostic centre in Bourne?”
“We all want innovative British companies not just to start up in Britain, but to scale up in Britain, too. I welcome the Minister’s previous comments, and actually his enthusiasm, for our most innovative companies. However, he will know that the Chancellor’s decision to cut venture capital trust rate relief will be very damaging. How does he explain the disconnect between his Department’s words and what the Chancellor is doing?”
“I am grateful to the Minister for that answer, but I asked specifically about VCT rate relief. The last time that rate relief was cut, under the last Labour Government, fundraising was cut by two thirds and it took a decade for that to recover in the sector. Specifically on VCT rate relief, which has been cut from 30% to 20%, will he commit to meeting the Venture Capital Trust Association, the industry body, and will he take its concerns to the Chancellor and ask her to reverse course?”
“The Government’s strategic defence review rightly highlighted the important role of reservists across the country. I am very proud that Grantham’s Prince William of Gloucester barracks trains around 70% of all Army reservists in the country. Can we have a debate on the Government’s decision to close down Grantham’s barracks, and not just the impact on the town of Grantham but the wider national security issues it will cause?”
“What analysis has the Department done to provide this House with an adequate answer that will get us comfortable with approving that £50 million? From increased taxes to additional red tape, the Government have soured business confidence, and it is working people who are paying the price for their higher unemployment and higher prices. No matter how many billions are spent by the Department and then increased at supplementary estimates, that fact will sadly always remain.”
“Meanwhile, the British Business Bank’s financial capacity has increased to £25.6 billion, and it also has a new industrial strategy growth capital initiative. The growth guarantee scheme is a perfectly legitimate use of Government funds—it creates Government-backed business lending and performs an important role in the economy. However, according to page 7 of the supplementary estimate, an additional £50 million has been provided to DBT this year, so it is natural that I want to ask a few more questions about the scheme. First, can the Minister tell us what the default rates are for the loans provided by this scheme, and how does he square that with the additional £50 million of capital? Secondly, it is critical to know whether those loans and that amount of money are complementing private lending, or are actually displacing it.”
“Whatever answer the Minister provides, given that we are still awaiting a steel strategy, as many Members have alluded to, is it not the case that the Government are asking Parliament to approve hundreds of millions of pounds in retrospective spending on an industry they do not really know how to support, and on a company whose future remains undecided and whose costs seem to be open-ended? I would really appreciate it if he could give a detailed answer. Finally, I turn to the British Business Bank—an organisation that I admire, that I like, and that I had the pleasure of overseeing from within the Treasury. When I looked at the supplementary estimate, I noted that the additional capital DEL that is being provided to DBT for the growth guarantee scheme, which supports business lending, is to the tune of £50 million.”
“In a written answer to the shadow Secretary of State for Business and Trade, my hon. Friend the Member for Arundel and South Downs (Andrew Griffith), on 15 December 2025, the Minister indicated that the total cost to the Exchequer of keeping operations running at British Steel came to £274 million. However, pages 12 and 13 of the supplementary estimates that we are reviewing and discussing today seem to indicate a total cost of more than £830 million across resource departmental expenditure limit and capital departmental expenditure limit business group funding. That is obviously a significant difference in cost, so when the Minister stands up, I would appreciate it if he could set out the detail of what this is all about.”
“It feels like the Department is developing a pattern of asking Parliament to approve a budget in the main estimate, only to return months later asking for 30% or 40% more. This is far from supplementary; it is a Department that systematically underestimates its budget in the main estimate, and then returns to ask us for even more. As such, can I ask the Minister please to comment on why DBT is such an outlier compared with other Departments, and can I suggest that when its Ministers next come to Parliament with main estimates, they come with a better estimate of how much taxpayers’ money they wish to spend? One item that particularly jumped out to me in the 10 February 2026 estimates was the cost of the intervention in British Steel, which the right hon. Member for Birmingham Hodge Hill and Solihull North also alluded to.”
“Put simply: British businesses need the Government to create a far better environment for firms big and small to trade and, critically, to hire people. Let me turn specifically, and properly, to the detail of the estimate before us, and I wish to ask a few questions of the Minister. First, to build on the opening remarks of the Chair of the Business and Trade Committee, the supplementary estimate shows an increase to the Department’s total managed expenditure of £1.5 billion, which is an uplift of 31%. For context, that is much higher than any other Department. In fact, the average in-year uplift for a Department under this Labour Government has been 4.6%—that is 31% versus 4.6%. In fact, last year also saw a large in-year uplift, when the departmental budget increased by some £1.8 billion, which was an uplift of 44.8%.”
“Over the past year, covered by the estimate before us today, the Government have indicated that they disagree with that. Just this week, as a result, we have seen business confidence fall yet again, according to the Institute of Directors. More than ever, I am afraid that Ministers across this Government, including in the Department for Business and Trade, are failing to drive economic growth. Indeed, do not take my word for it, but listen to the Labour Health Secretary and rival to the Prime Minister, who said that the Chancellor has no economic growth strategy at all in a text message to the disgraced Labour peer, Lord Mandelson. Some may question why the Labour Health Secretary is commenting on the economy, but then again he is used to dealing with things in critical condition.”
“The theme of today is that, up and down the country, businesses, entrepreneurs and those they employ are the engine of our economy and the basis for our future prosperity. In so many sectors, it is British business that leads the way. Whether it is life sciences, defence, across professional services or in many other areas, businesses employ millions of people, undertake critical research and attract investment both here and overseas. In the same sense, everyone who has contributed today, as will be the case for all MPs, will know of some SME in their constituency that seeks to grow, create jobs in their community and provide the bedrock of their local economy. The Opposition know that backing British businesses, both big and small, to grow, trade and invest means reducing the tax and regulatory burdens that they face.”
“Thank you very much, Madam Deputy Speaker, not least for the promotion that you just gave me—I hope the Whips are listening. It is a genuine pleasure, even before the promotion, to respond to the debate on behalf of the official Opposition. I am grateful to all colleagues from across the House for what I think were pretty good speeches that supported local businesses and dealt with the issues at hand. I also congratulate the Chair of the Business and Trade Committee, the right hon. Member for Birmingham Hodge Hill and Solihull North (Liam Byrne), on what I thought was an incredibly thoughtful, detailed and typical speech for him. As he will hear, it did not inspire my speech, which was pre-written, but I will echo a number of the points that he made so eloquently just a few minutes ago.”
“If so, what impact does the Minister believe that that reduction will have on consumers and businesses that use those services? Finally, what is the Government’s view of the impact the regulations will have on those who operate ADR businesses? The explanatory memorandum to the regulations states that the Government expect there to be no impact on businesses, and that “the instrument does not impose regulatory obligations”. However, that is exactly what is being done today, so that looks like an error. I would be grateful if the Minister clarified whether that is an error, and explained the language in the explanatory memorandum for the benefit of the Committee.”
“Although the Opposition of course remain supportive of the goals of the Digital Markets, Competition and Consumers Act 2024, we in this place should always be mindful of the adverse impacts of introducing any kind of red tape on British businesses, no matter how well-intentioned it might be. As the Committee would expect from the official Opposition, we have a few questions to probe some of the elements in these measures. First, will the Minister set out the current status of the ADR provider sector, and how the Government see the sector changing as a direct result of the regulations? More specifically, how many ADR providers are there in the UK, and how many of those are currently unaccredited and would therefore be impacted by these measures? Do the Government expect the number of ADR providers to reduce as a result of the requirements?”
“It is always a great pleasure to see you in the Chair, Ms Lewell. It is also a pleasure to see the Minister in her place. Alternative dispute resolution is intended to provide a low-cost, efficient alternative for resolving disputes between consumers and businesses. I thank the Minister for setting out what these regulations seek to achieve. The regulations follow various pieces of work that were carried out by both Conservative and Labour Governments over many years, with the overall goal of securing a fair deal for consumers and a fair operating environment for businesses.”
“—(Kate Dearden.) Draft Employment Rights Act 1996 (Application of Section 80B to Parental Order Cases) (Amendment) Regulations 2026 Resolved, That the Committee has consider the draft Employment Rights Act 1996 (Application of Section 80B to Parental Order Cases) (Amendment) Regulations 2026. —(Kate Dearden.)”
“Member for Bridgend through a private Member’s Bill, and the tremendous campaigning efforts of Mr Horsey, who is in the Public Gallery to witness proceedings. I thank the Minister for presenting the regulations, and we are pleased to support them. Question put and agreed to. Draft Employment Rights Act 1996 (Application of Section 80B to Adoptions from Overseas) (Amendment) Regulations 2026 Resolved, That the Committee has considered the draft Employment Rights Act 1996 (Application of Section 80B to Adoptions from Overseas) (Amendment) Regulations 2026.”
“I understand and welcome the fact that guidance will be provided for businesses, and the Minister acknowledged the £0.9 million impact on them. The Government have made it clear that they will publish details for businesses on the relevant website. The regulations are to come into force in April this year—just 40 working days away—so will the Minister provide a specific date as to when, between now and 40 days’ time, the guidance will be published? Businesses have raised that specific question with me. I repeat the Opposition’s position that we fully support the regulations. I join the Minister in praising the great work of the former MP for Broxtowe, Darren Henry, the great work of the hon.”
“It is a great pleasure to be in this Committee on behalf of His Majesty’s official Opposition. The regulations before us continue vital work that occurred under both Conservative and Labour Governments, as the Minister rightly said. I am pleased but not surprised that that work attracts genuine cross-party support. For a baby to lose their mother or primary caregiver is a tragedy for that child, and for the father and wider family. In this place, whenever possible and where it is practical to do so, we should support those families with their grief and as they continue to care for their child. It is with those families in mind that I can of course confirm that the official Opposition support the regulations. Just one questioned has emerged as I have engaged with businesses, so I would appreciate a simple clarification on their behalf.”
“We know that some British businesses are put off exporting by the costs, particularly the cost of cross-border payments. One solution is the adoption of innovative digital payment methods, which is why I warmly welcomed the Government’s announcement of the transatlantic taskforce for markets of the future. However, since its announcement last September, we have not had a great deal of detail on it from the Government, so will the Minister provide an update on the status of the taskforce and what he hopes it will achieve for our exporters?”
“I thank the Minister for that response. This is an area that we genuinely agree on. Digital payment technology will genuinely provide an opportunity for British exporters, so I gently ask the Minister to get on top of the detail on that taskforce and provide an update as soon as he can. We asked DBT Ministers last June exactly what the Government’s strategy on digital payment technology was. We were promised that it would be part of the industrial strategy, but it was missing. Can he explain why?”
“I wish to speak, on behalf of the official Opposition, to new clauses 10 to 12, which are in my name, but first, I want to set the scene on clauses 1 to 8.”
“I agree. We are trying to create a savings culture. We are trying to get people to take responsibility, and to put their income away for a rainy day and for their retirement. As I will go on to say, the Opposition’s position is that the Bill does not achieve that; in fact, it does the very opposite. As I was saying, clause 4 increases the ordinary and upper rates of income tax charged on dividend income by 2%, a fact the Minister seemed to miss out in his opening remarks. The income tax rate hike will apply from the tax year 2026-27. Clause 5 sets the savings rate of income tax for the tax year 2027-28 two percentage points higher than it is this year, and than the rate set in the Bill for 2026-27.”
“Literally as soon as the Chancellor announced the changes in clause 4, investment managers were warning that the change completely contradicts the Government’s stated desire to encourage more investors to hold UK equities—many of which, by the way, are pretty good income-paying stocks. International investors come to the UK to buy dividend-yielding stocks, yet these measures will discourage that even further.”
“They provide 60% of employment. They will feel the pain from these changes. Indeed, the Federation of Small Businesses has been clear that through clause 4, the Government continue to make investing in your own business one of the least tax-friendly things you can do with your money. Many entrepreneurs and business owners choose to pay themselves part of their income in the form of dividends. For many years, dividend tax rates have been set below the main rate, not by accident or ideology, but to reflect the fact that dividend income is paid out of profits that have already been taxed through corporation tax. I am afraid that even the largest businesses, never mind small and medium-sized enterprises, are not safe.”
“In fact, Hargreaves Lansdown described clause 5 as a “shocking tax rise” for savers. The measures will combine with the Chancellor’s cut to the allowances for individual savings accounts—in the Bill, there is a double whammy tax on savers. It treats saving less like a virtue to be encouraged, and more like a habit to be discouraged. We believe that will have a big impact on savings culture and the financial reality of people across the country. That is why new clause 11 calls for the Chancellor to come to the House to make a statement setting out the impact that the onslaught of this savers’ tax hike will have on all British savers and pensioners. It is not just savers who are impacted by the Bill. Small and medium-sized businesses are, as we were just discussing, the engine of growth up and down the country, in every constituency.”
“I have great sympathy with what my right hon. Friend says. He is right that there is a point at which you overtax risk and enterprise, and people stop taking risk and stop being enterprising. The trick in the Treasury is to ensure that the Government can raise enough revenue from a broad base of different taxes to pay for public services. [ Interruption. ] They need to try to achieve growth, not overtax growth and growth activity. They should incentivise it through other means. I completely agree with him on that point. I was talking about the increase in tax on dividend income and savings. Together, clauses 4 and 5 will have significant consequences, not just for those who take risks, but for household savers and pensioners, as well as investors in the companies that my right hon. Friend describes.”
“These clauses impose not one, not two but three income tax rises on the British public, totalling more than £5.5 billion. This is not a plan for change; it is a savers’ tax onslaught, carefully phrased, politely worded and deeply felt—the same old Labour.”
“The British Property Federation and the Office for Budgetary Responsibility have both warned that this measure could restrict the supply of private rental properties, adding pressure to an already strained market. The Royal Institution of Chartered Surveyors and the National Residential Landlords Association both say that rents will rise faster as a direct result of the Bill. New clause 12 in my name seeks to force the Government not to rely on their stereotypes about landlords, but to assess the impact of their new renters’ tax on both the supply and cost of private rental properties. In summary, these clauses represent a new front in Labour’s war on the middle class and aspirational households in Grantham and Bourne, Chipping Barnet and across the country.”
“They are the couple—one parent works long hours in a steady job, and the other juggles work and family life—who save carefully and invest in a small property because they know that the state pension alone might not be enough when they retire. They are the retired couple who inherit a modest flat from their parents—a flat that is not a windfall, but a source of security in later life—and who rent it out to supplement a fixed income. These are not people gaming the system, as many Labour Members have tried to suggest in the past, but people responding to it. They are good people. Forty-four of them are Labour MPs. This new tax does not just hit landlords, though; it hits renters, too.”
“New clause 10 includes further assessments specifically on domestic equity markets and institutional investors. This will have a negative drag effect on the international climate as it relates to getting more investment in UK equities from institutional investors. Finally, clauses 6 to 8 and schedules 1 and 2 introduce new rates of income tax altogether, this time on property income. Again, those rates are to be set for the tax year 2027-28 at two percentage points higher than the main rate of income tax. Government Members may take great satisfaction in what could be described as a war on landlords, but we should pause and remind ourselves who many landlords are. They are not barons or vast landowners; they are ordinary people doing what we have encouraged them to do for decades: taking responsibility for their future.”
“My hon. Friend touches on an important point. What is this for? People know that they have to pay tax. We may disagree on who pays tax and how much, but ultimately, where is the money going? It is going to the surrender of the Chagos islands. It is used to pay public sector workers eyewatering sums, only for them go on strike again. The hard bit for the general public is understanding where on earth all the money that is being raised by record tax hikes is actually going. That is what the Minister needs to be held to account for today. No explanation has been made. We are not in covid times; we are not in times of great crisis. This money is being raised because Labour is in trouble and in the pocket of the unions. I am very grateful to my hon. Friend for his intervention.”
“It would not be quite so embarrassing if the Chancellor herself had not proclaimed so theatrically in her first disastrous Budget that extending the threshold freeze would hurt working people. Yet here we are, and it is no surprise that the Prime Minister is breaking records for unpopularity. New clause 13 would ensure that the Government undertook an assessment of the impact of clause 10 on the average earner, because we all know that working people will be hurt very badly by this clause.”
“According to the Office for Budget Responsibility, the Labour Government’s freeze to income tax thresholds will raise around £7.6 billion in 2029-30 alone, and more than £12 billion in 2030-31. This is a £23 billion tax rise; clause 10 alone is a £23 billion broken promise. The OBR is clear: 920,000 more people will be pushed into the higher rate, and 780,000 more people will be pushed into income tax altogether. We have already heard the Minister try to explain away Labour’s breach of the promises that it made to the British people. The best the Chancellor can manage is to say that it is not her fault, because she was very clear in the small print—a technicality dressed up as an excuse. But people are not stupid.”
“I wish to speak to new clauses 13 to 15, which are in my name, but first I will cover what the clauses in this group mean for British taxpayers. If you will forgive me, Madam Chair, I will do so slightly out of numerical order. Clause 9 sets the starting rate limit for savings for tax years 2026-27 to 2030-31, keeping it fixed at £5,000. That is an important allowance for so many with relatively low incomes, including those who work part-time or are retired. Clause 69 fixes the various inheritance tax thresholds at their current level for a further tax year, 2030-31. Clause 10 freezes the basic rate limit for income tax at £37,700, and sets the personal allowance at £12,570 for tax years 2028-29, 2029-30, and 2030-31.”
“I will give way to the hon. Gentleman. I hope he will not ask me why we froze the threshold, because he will know that we did so under tremendous pressure, given the covid pandemic and the debt that we accrued in the economy. We are in a very different scenario now. I am sure that is not what he is going to ask.”
“It is not in clause 10, or anywhere in the 535 pages of the Bill. As far as I can see, it has not even been costed. I have two straightforward questions for the Minister: what is the Treasury’s assessed cost of that promise, and how will it be delivered in practice?”
“There are two issues here. First, the public were told that this would not happen. Secondly, now that it is happening, the Labour party—the Government—is spending that money recklessly. That is unacceptable, and it is the job of the official Opposition to hold the Government to account. Finally, there is an elephant in the room. From April 2026, the state pension rises by 4.8%. The new state pension will sit below the personal allowance next year, but that changes in 2027-28, when, for the first time, people whose only income is the state pension will be dragged into paying income tax. The Chancellor, when challenged on this after the Budget, said that she will protect pensioners from paying small amounts of tax, and the Minister just repeated that. Fine, but where is it? It is not in the Bill.”
“I understand the points that the hon. Gentleman makes, but as the spokesperson for the official Opposition, I speak on behalf of millions of people who were told that this would not happen, and who voted for a party that told them that it would not be increasing taxes on working people. The Chancellor repeated that claim at the Dispatch Box just a year ago, but then went back on it, which is unacceptable. Whether I agree with it does not matter; we have to represent the millions of people who were frankly let down and misled by this Government. That is our job—to hold the Government to account for breaking that promise, and for where the money is going. I ask the Government: what is this about? Is it about giving up sovereignty—giving up the Chagos islands—or paying off public sector unions, only for them to go on strike once again?”
“My hon. Friend is absolutely right. That is why I want to ask the Minister, as he does, how this will be delivered. What is the definition of what the Chancellor has described, albeit to the media? How will this work, and why is it not in the Bill? We know that when the Government have spoken before, they have not stuck to it.”
“Exactly. I have nothing to add to that; the right hon. Gentleman puts it perfectly. New clause 14 would require a proper assessment of clause 10’s impact on state pensioners, and new clause 15 would require an assessment of the cost of the Chancellor’s so-called exemption from small amounts of tax—let her define that in a piece of legislation; I do not think she will be able to. Clause 10 is simple: another Labour tax promise has been broken and pensioners will pay the price. I hope that Members from across the Committee can see that and that they will vote with the official Opposition tonight.”
“Yet the experience of many Members, from speaking to farmers and businesses in our constituencies, and that of several industry bodies is that that figure is massively wide of the mark.”
“Friend the Member for Keighley and Ilkley (Robbie Moore), who gave this House five chances before today to vote against these changes. The Government had ample opportunity, but here we are. We know that their partial U-turn will not be enough. The Country Land and Business Association has been very clear that it will only limit the damage. Many serious questions and concerns remain on the impact of clause 62, but I will highlight just three. First, from the very start the Government’s numbers have been, at best, questionable. The Treasury has disagreed with the CLA and others on how many farmers and businesses will actually be affected. Even after the partial U-turn, HMRC expects 1,100 estates to face larger inheritance tax bills in 2026-27, 185 of which will be claiming APR.”