Richard Holden is MP for North West Durham.
The famous Omnishambles Budget was a result of one key flaw – not being open enough to float ideas with Parliamentary colleagues and test the water. The pasty tax. The caravan tax. The hairdresser tax – I could go on. The public will forgive you doing your best in an impossible situation, but they won’t forgive you cocking it up when it comes to public finances.
The replacement of the Sajid Javid with Rishi Sunak was undoubtedly the stand-out moment of last week’s reshuffle. I was in the meeting when Gavin Williamson and Rishi, then Chief Secretary to the Treasury, went through the Education budget in the last spending round, and it’s clear to me that Rishi will be a formidable intellect in Number 11 who, despite his age and relatively few years in Parliament, will have no trouble getting to grips with the top job at the Treasury.
There are doubtless major issues at stake about fiscal rules, the direction of the country and how we ‘level up’ spending across the country to help ensure that opportunity (and thereby productivity improvements) reach every corner of the UK.
But Chancellors also have many smaller levers at their disposal – which signal their personality, their understanding of the party in Parliament, and their intent. It’s vital that in these small measures the Chancellor ‘gets it right’ next month.
So I’ve got five small suggestions for the forthcoming Budget. None would cost the earth, but would knock some of those “barnacles off the boat”, and provide a small flurry of positive headlines:
Beer & Cider.
In 1894, Conservative Clubs were established, providing beer less expensively than public houses and in direct competition with clubs affiliated to the Labour Party.
The ability to get an inexpensive pint in convivial surroundings is seen internationally as one of the hallmarks of Britain. With the craft beer renaissance in recent years, a couple of small but significant moves in this area would be well received, especially by the huge memberships of CAMRA in the country and by the APPG on Beer in Parliament.
Britain faces some of the highest beer taxes in the world outside Scandinavia. A freeze would be welcome, but at a cost of about £85 million, a penny off a pint of beer and cider would go down a treat.
Furthermore, small beer producers currently pay half the duty rate if they produce under 60,000 hectolitres a year (about a million pints), but if they produce anything over that they pay full duty on the whole amount.
A staggered scheme that removed this cliff edge wouldn’t be impossible, and would be welcomed by craft breweries across the land. The current half-price duty scheme costs the Treasury around £60 million a year. It wouldn’t take much to provide a non-cliff edge that would also allow the expansion of small breweries and enhanced competition in the broader market.
For about £100 million, the new Chancellor would be the toast of the town.
Nothing grinds people’s gears more than charity chief executives preaching while pocketing massive pay cheques themselves.
All Government appointments that earn more than the Prime Minister must be approved by Number 10. Extending this principle to charities would be a helpful way of highlighting those with excessive executive pay, especially in the international aid sector. This small change would cost nothing, but throw in some much-needed transparency, and ensure that people aren’t taking the mickey out of donors.
For a change in the procurement rules, the Chancellor could be the champion of transparency.
Ok, this is particularly personal for me. North West Durham is one of the biggest motorhome producers in the UK and we also have some beautiful countryside where people drive them to park up for a week or two.
In September last year, Vehicle Excise Duty and road tax on new motorhomes went up a lot (as EU Regulation 2018/1832 was gold plated, treating them like cars in the British tax system) meaning that now, during the first five years of buying a new motorhome, you pay over £5,000 in tax rather than about £1,200. New motorhome (which start from around £42,000) sales are down 10 per cent as a result.
This is damaging domestic tourism, and the environment by pushing people on planes. Reversing this counterproductive measure would save jobs and, in the end, would probably be net positive for the Exchequer, although the initial cost would be around £25 million.
So for an initial hit, the Chancellor could avoid being the man who doubled down on the second ‘caravan tax’ – show he’s in touch with the aspirations of “Blue Wall” voters, and save jobs in both UK manufacturing and domestic tourism.
This was developed by left-wing social workers in Hackney – not the opening of a sentence you’d expect from me. However, this programme saves lives, helps end abuse, and it also saves taxpayers lots of cash.
It came about when social workers noticed women (often with a combination of the ‘toxic trio’ of domestic abuse, substance abuse and mental health problems) having child after child that was then being taken into care.
What Pause provides is an intervention after a woman has had her second child taken into care – helping her take control of her own fertility and helping her seek other services and a job, and building her back up from what I can only imagine is the most soul-destroying of situations.
Crucially, the programme is voluntary and part of it is offering women, usually for the first time, long-term contraception so they can break the cycle of pregnancy and then having a child removed.
For people in this group who are not on Pause, conception rates are high, roughly a third (with a large number of the conceptions being terminated). When on Pause, it drops by 90 per cent plus. Thus allowing women, often in the most difficult of circumstances, the ability to start to regain control of their lives, get a job and start to become independent.
To roll this programme out nationally would cost £20 million. Initial studies of the programme have shown that payback in terms of saved court time, costs of putting children in care, etc is about 18 months – a rate of return usually only “delivered” by Ponzi schemes. And the Government would know it’s working within a year were it rolled out nationally.
For the Chancellor to show he’ll take good ideas from anywhere and empower the most vulnerable women, often for the first time in their lives, this is a tiny cost with a massive payback in every way.
This one’s simple and can get easy headlines. Local authorities are slashing public toilets across the country. One of the biggest reasons is that local councils pay business rates on them. That’s right. They’re not currently exempt. It is madness.
I declare an interest as the Co-Chair of the Local Democracy APPG (the voice for town and parish councils). For our high streets, tourism areas and our ageing population, the ability to have a loo nearby is important and we don’t want to see more lost.
Relieving councils of business rates on loos would require primary legislation. The move was proposed before but got lost in the wash up last year. At a cost of £8 million a year, which goes directly to local government in most cases, this is a small cost/big win for the Chancellor.
So for under £150 million, the Chancellor could please:
Every beer & cider drinker; social worker; charity donor; town and parish councillor; motorhome manufacturer, retailer and owner; caravan site owner, and public toilet user in Britain. In my humble opinion, if there is a bit of slack to play with, the new Chancellor could do worse pick up some of these ideas.
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