Jim McMahon MP: speeches

Speeches

• 11 Dec 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill (First sitting) · Hansard source

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  Q Is part of the tension not that the question described a broken market, but that response describes a functioning market? Is the real issue that many institutional investors would sooner have an empty property with a notional rent attached to it, even if the rent is never achieved, than accept a tenant for a lower rent that would have an impact on their overall balance sheet? Is there not a tension there? Stuart Adam: Yes, I think that is right. There is an interesting question as to why so many properties are left empty for so long, when it would seem to be in the landlord’s interest to have anyone in there paying them something, rather than no one in there paying them anything. There are certainly aspects in which the market does not function well, but on the whole it still looks to me like a market where, basically, prices are determined by supply and demand, and such evidence as we have seems to support that.

• 11 Dec 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill (First sitting) · Hansard source

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  Q Thank you, Mr Watson, for taking the time to be here and for the insight you have provided on that first question. I am interested in the point about the number of multipliers. If I understand you correctly, there is a risk that the more multipliers you provide, the more confusion there might be in the system. However, the counter-argument—this is certainty our position—is that the business rate system is a blunt tool almost by design, and that by creating this different approach, we can better target the support that we provide not only for retail, hospitality and leisure, but for the large footprint occupiers, warehouses and distributors, where we create that pool of funding. I am interested to get an insight into how you and your members would see that balance being struck in the right way. Gary Watson: As a professional body, we sometimes have quite diverse views, because we have those working in local government, for example, and then we have those working in the private sector, and they can have some quite different views sometimes. Standing back and looking at what our preference would have been, before we saw the Bill, the whole relief system is very complicated at the moment. The reliefs do not interact with each other, and it is confusing for the ratepayer and perhaps for the local authority. We could have looked at the reliefs as a whole and started again. What we have are the multipliers, and that is what we have to work with. If we had the choice at the beginning, we might have looked at some more targeted form of mandatory relief, but we are where we are. The important thing is that we will make it work, and I think the Bill gives the Government the flexibility to change. What you found with the pandemic, for example, was that the property tax system, to some extent, came to the fore, because it allowed Government very quickly to not only get money out of the door but target it to certain types of business. The key issue will be that, assuming the Bill gets Royal Assent, the secondary legislation has to be very clear on the types of business that the Government want to support with the different multipliers, and perhaps the exclusions that they want to consider. That also allows the Bill to be flexible, so it is not as if that is all you have to work from. By keeping it in secondary legislation, things will change. Importantly, we have found over the last 10 years that, because it is all under section 47 of the Local Government Finance Act 1988, it allows Government to bring things in really quickly whether or not there is any new Bill. There is no delay, and local government can get that money and support out of the door really quickly. It also allows local government to plan on the financial side as well.

• 11 Dec 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill (First sitting) · Hansard source

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  Q On that point, is that not why this measure is so important? If we think about the types of shocks that many businesses face, the pandemic was exceptional but also profound. Having that flexibility to move quickly and adapt was very important to the system. With the current system, aside from it being temporary, short-lived and a cliff edge, the business did not know whether it was going to continue, and if it was going to continue, in what guise. It also had the impact of capping the amount of relief that could be given to any business at £110,000. How do you and your members perceive the high street? From the Oldham perspective, when I look at the high street, national retailers such as Boots and Specsavers are actually the foundation of many high streets alongside local independent retailers, but previously they were locked out of the temporary scheme. It would be interesting to get your views on that. Gary Watson: In terms of the high street, the companies that you named are there and they are often the draw, which is a benefit to the smaller ones. When we lose some of the more well-known retailers on the high street, those properties do not stay empty too long—certainly the smaller ones—because people move in very quickly. Sorry, I did not get the other part of the question.

• 11 Dec 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill (First sitting) · Hansard source

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  Q Thank you for attending the evidence session, and for the written evidence that you have provided by way of preparation for the meeting. I think there is an acceptance in the evidence that you have given that any business rate system ends up having to draw the line somewhere; it is the nature of the multipliers and of the value that you apply. It stands a fact that, when it comes to most of your members, despite the 4,000 that you say will be above the £500,000 threshold, 772,000 are below the threshold. Therefore, it stands the case that the vast majority of your members will be the beneficiaries of the measures taken here. Also, although it can be portrayed—and has been during this evidence session—that the relief is being decreased from 70% to 40%, the truth is that the temporary relief over covid was due to come to an end. That was a cliff edge, but this measure provides a permanent relief in legislation, which gives certainty over the long term. It would be interesting to know the views of your members on that. Helen Dickinson: I just heard the end of the previous session. Obviously we have got to get to the point of implementation, but once we are there the long-term certainty is going to be really important. I completely understand the context in which the covid support was given and how valuable that was. Painful as it may be for many businesses when transitioning from a higher discount to whatever the new system might be, longer-term certainty outweighs that because we will not be limping from year to year waiting to see what that might look like. In the context of your point about the proportion of businesses and shops that would benefit from the proposals as they stand, I completely agree that the 4,000 shops I mentioned is less than 5% of the total number of shops. Where it becomes much more difficult is that, if you look at that small proportion of shops, it is about a third of the rateable value of all shops. If you think about it within a retail context, what we are effectively doing is penalising some shops to support other shops. In the competitive landscape of retail, where businesses are competing for consumer business day in, day out, it is distortive to competition. We completely agree that you have to draw a line somewhere, but we think the line should sit outside retail and hospitality, rather than being drawn within retail—and hospitality, she says, with her retail hat on. Does that answer your question?

• 11 Dec 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill (First sitting) · Hansard source

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  Q For the record, I refer to my entry in the Register of Members’ Financial Interests. Mr Gerrard, many of the stores that you operate are not on the high street or in town and city centres; they are often the last remaining store on the estate in a community. How do you think this Bill might contribute to making those more viable? During the pandemic, when children were being educated from home and given vouchers to get meals during the day, we found that there were significant retail deserts in large parts of the country where that immediate meal was not available, bar the local convenience store on the estate or in the local neighbourhood. From that perspective, beyond the high street and town centres, what impact do you think these measures might have? Paul Gerrard: You are absolutely right; many of our stores are on high streets, but a lot are just local stores that will be the corner shop on a street. The rates bill is significant—as I said, it is one of the top three costs that we have, alongside our people. As you know the Co-op has always paid the Living Wage Foundation’s real living wage, because we think that is the right thing to do, and that is for every colleague, regardless of age or employment status. The other top cost is rent, and then the third one is rates. I do not think we close stores because of rates, but the current rate system makes it really difficult for some stores to be viable. If we then add to that issues around crime—I have given evidence in this place before on that—there are a lot of costs hitting us. The proposals here are particularly important for those small stores. I think about two thirds of our stores are underneath a £51,000 rateable value, and that rates bill will have a significant impact on the viability and profitability of those stores. You are right that, during the pandemic, when we were all told to stay at home to keep safe, my colleagues and shop workers throughout small stores went in and made sure that the shops were open so that people could get food and water to live. As I said before, I think we saw in technicolour how important small stores are. The retail sector is multichannel and there are lots of different parts to it, and those different parts play different roles and have different impacts. Small stores are the beating heart of communities. We have done some work, which we are just refreshing, that says that, if you have vibrant high streets, you have better mental health. You have a whole range of better outcomes, and those small stores are at the heart of it.

• 11 Dec 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill (First sitting) · Hansard source

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  Q It does, a bit, but I am not entirely sure it hits at the facts, to be blunt about it. It is not the case, from the evidence, that properties above £500,000 are essentially cross-subsidising those below £500,000. Those above £500,000 are only 7.5% of the total rateable value in the whole system. It is not the case that we are seeing that transfer. Is it not also the case that many of your members who will occupy premises above the £500,000 will be the larger footprint occupiers, such as supermarkets and big department stores? If we were to move the centre of the cross-subsidy entirely over to warehousing and distribution, they would pay it on the back-end anyway, because Tesco, Sainsbury’s and the rest have huge warehousing and distribution models in their business. Helen Dickinson: I am trying to think of the best way to answer that without going into too many details and numbers. Again, I agree that with the cross-subsidy we are not talking about going from one to the other within retail. If you look within retail, the rateable value of all of the small and medium-sized retail properties is about £9.2 billion, and there is an additional £4.6 billion of larger properties. Taken together, that is about £13.8 billion, with one third large and two thirds small. As you say, there are many other properties that sit outside retail, including warehouses and distribution centres, but also offices. In fact, I think the biggest chunk of that is offices. We are not just talking about things that will impact retail, like warehouses, coming into the other side of the equation; we are talking about all those other sectors as well. Going back to what I said at the beginning, if the objective of this is to stimulate local investment in communities—that has to be the goal, because we all, as consumers and customers, want to see our high streets and town centres flourishing and vibrant with a diversity of offer—then we have to be able to find a way for that funding to come from right across the spectrum of properties, whether it is offices, distribution centres or whatever else sits outside. The modelling we have done shows that that is possible within the context of the framework you have laid out. Tom Ironside: Just to be clear, are we talking about the exemption of shops above £500,000, not the exemption of other sorts of properties?

• 11 Dec 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill (First sitting) · Hansard source

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  Q On the point that you made about the potential to improve the system more generally, clearly we want this to be a measure that supports the fabric of community. In the end, these are retail businesses, but they are often the places that bind communities together. That is very much the way that we as a Government perceive them, and perceive the value of our high streets and our precincts in our villages and towns. From your perspective, what measures could be taken to really target the measure to ensure the support is given where it is needed? Edward Woodall: On the multipliers, we will have to see if the rate of the multipliers is going to have an impact overall. I gave some examples of where you set the multipliers determining how much businesses can invest. What is described in the Bill is well targeted for retail, hospitality and leisure, to support the areas my members trade in and the types of businesses that the communities want in those locations. If we look at our polling about the most desired services on local parades, convenience stores, post offices and pharmacies come top, and all of those trade out of similar premises. Hopefully, it will help our sector, but it will also help the other businesses that trade in those locations as well to continue to deliver those services too.

• 11 Dec 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill (First sitting) · Hansard source

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  That would be very helpful.

• 2 Dec 2024 · Devolution Agreements: Somerset · Hansard source

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  I think we have all had to endure Liberal Democrats, so I can reflect on that. We are in constant dialogue with local councils on our twin-pronged approach. One prong is devolution and making sure that we push power out of this place and into local communities. The other is reorganisation in cases where councils recognise that it delivers more effective and efficient local government. The Department is keen to hear the conversations that local areas are having on that.

• 2 Dec 2024 · Devolution Agreements: Somerset · Hansard source

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  In July, the Deputy Prime Minister invited places without a devolution agreement, including Somerset, to come forward with proposals for their area, in order to gauge the approaches and forms being considered across the country. We welcome Somerset’s support for this initiative, and look forward to hearing its views on the imminent White Paper on English devolution, which will be released shortly.

• 2 Dec 2024 · Devolution Agreements: Somerset · Hansard source

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  Central Government have said to local government that we want to reset the relationship and work as partners in power, and it is not unreasonable to expect that councils will do the same at a local level and will work together in partnership. We see that across the country: local councils work in partnership with their parish and town councils in the interests of their community. Whether or not reorganisation takes place, we expect that to continue.

• 2 Dec 2024 · Devolution: Local Communities · Hansard source

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  That is some way from community ownership, but the devolution White Paper is one of a number of measures that we are taking and it will have a clear community strand. This does not sit in isolation, however; it is part of the wider reforms that are taking place to ensure that communities, local authorities and Government work in partnership.

• 2 Dec 2024 · Devolution: Local Communities · Hansard source

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  The English devolution White Paper, due by the end of the year, sets out how we will transfer power from Westminster to people who know their areas best. The White Paper will also announce measures that will give local places and communities greater control over shaping their area.

• 2 Dec 2024 · Devolution: Local Communities · Hansard source

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  In there is the point about devolution and localism: structures matter and the framework matters, but in the end it is about getting the power out to the communities who have skin in the game. That is why we want to ensure that the community right to buy provides an effective means for communities across the country to take ownership of assets that are important to them. We are considering what further support and guidance we will provide to communities and local authorities to support them in this measure, and I know that the Minister for local growth, my hon. Friend the Member for Nottingham North and Kimberley (Alex Norris), is fully engaged in this endeavour.

• 2 Dec 2024 · Topical Questions · Hansard source

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  We are working constructively with Medway council as part of our framework to support councils in the most difficulty. This Government are clear that the process will be collaborative and supportive and, on that basis, we are more than happy to meet to discuss it further.

• 2 Dec 2024 · Topical Questions · Hansard source

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  It was a pleasure to meet my hon. Friend and colleagues to talk about devolution in Cornwall. He will know that we have agreed to a non-mayoral devolution deal for Cornwall as a first step. We recognise the distinct culture, history and identity of the Cornish people. This important step will allow us to unlock deeper devolution in Cornwall and, in time, we hope it will allow Cornwall to take its seat at the Council of the Nations and Regions.

• 2 Dec 2024 · Topical Questions · Hansard source

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  The forthcoming English devolution White Paper will set out clearly our top-to-bottom redistribution of power, and how we include and engage people at a local level to ensure that they can actively participate in the development of their areas.

• 2 Dec 2024 · Topical Questions · Hansard source

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  We are currently in the process of reviewing oversight, accountability, and checks and balances to make sure that they are in place and fit for purpose, and that the early warning system works. More detail on that will follow in the English devolution White Paper before Christmas.

• 2 Dec 2024 · Topical Questions · Hansard source

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  I thank my hon. Friend for taking the time to meet me to talk about devolution and growth in that region. We are absolutely committed to ensuring that growth is felt in every part of the country, and that requires partnership from central Government, local government and the business community. I would be more than happy to meet him to talk about how we can do that going forward.

• 2 Dec 2024 · Topical Questions · Hansard source

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  I thank the right hon. Gentleman for his question on devolution. We are absolutely ready to talk to any areas that are keen to take on devolution, particularly a mayoral combined authority. Any decisions on whether elections do or do not take place will be part of future consideration.

• 27 Nov 2024 · Devolution: Lancashire · Hansard source

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  As a fellow Lancastrian—I am from Oldham—I start by congratulating my hon. Friend the Member for Lancaster and Wyre (Cat Smith) on securing this debate on this special day, Lancashire Day. If you go into Lancashire county hall, you will see Oldham’s crest emblazoned on the wall, pointing to our historic ties to the county of which we are very proud. This is a special day, and I am pleased to see the flag flying in New Palace Yard in recognition of that. I welcome this debate. This is an important moment, as the English devolution White Paper is due to be published before Christmas. I hope my hon. Friend will forgive me, but I will wait for the White Paper to be published before discussing a number of aspects of that framework. However, I am certainly happy to talk about Lancashire, the agreement that has been reached and the next steps forward; that may address some of her points more directly. This Government were elected on a platform to widen and deepen devolution across England. As part of our central mission to drive economic growth and improve living standards, we want to move power out of Westminster and back into the hands of those who know their areas better, giving those with skin in the game the tools to get the job done. In September, the Government agreed to the Lancashire devolution deal, which marked a significant step in delivering on that mission for the region. The agreement will help to reshape communities and unlock the economic growth potential of the region to benefit all residents by returning power from Westminster to local communities. Specifically, the devolution agreement means that a county combined authority will be established with Lancashire county council, Blackpool council and Blackburn with Darwen borough council as its constituent members. Local leaders through that body will take responsibility for services delivered at a strategic level, giving them more control and influence over the levers of local growth. For example, local leaders will take control of the adult skills fund, allowing Lancashire to better shape local skills providers. The Lancashire local enterprise partnership will be integrated into the new body, ensuring a more strategic and co-ordinated approach to business support. The new body will take on the status of the local transport authority, meaning better integration for local transport in the area to make it easier for local people to get from A to B. There will be new land assembly and compulsory purchase powers, enabling housing and economic development to flourish in the future. Yesterday, a statutory instrument was laid before Parliament to enable the combined county authority for Lancashire, and I look forward to debating that in more detail. The SI gives local leaders the powers I mentioned over transport, housing and economic development; powers over adult skills will follow. A locally run consultation demonstrated widespread support, including from the business community, for the area’s taking on these new powers. Investment matters. That is why the devolution agreement also sees the release of £20 million of capital funding to support local growth priorities identified in the area. That could include projects such as the National Cyber Force headquarters, the innovative low-carbon data centre at Blackpool airport, the civil service hub in Blackpool, the Blackburn innovation quarter and the cosy homes project to deliver better quality, more efficient homes in the area. I recognise that there have been live discussions on the role of district councils in the combined county authority, and it is my firm belief that district councils will continue to play a key role in the success of devolution in the area. We expect effective levels of collaboration to be demonstrated between upper-tier, unitary and district councils. In the end, it is the place and the people that matter, and we expect councils to work together in that endeavour. The devolution agreement that we have reached with Lancashire, which is being implemented at the moment, to be the start, not the end of the devolution journey. Essentially, it is the first step. It is a down payment made in good faith to work toward a mayoral combined authority. The discussions that we have been having in that area are not only about realising the potential of Lancashire, which is important, but enabling the north of England to realise its full potential. The way to achieve that is by taking power, decision making and resources away from the centralised model that we have in this country and bringing it closer to people and the communities where they live. We believe that where mayors are in place—and they are working together now, as a unit through UK Mayors, and on the Great North project where they are organising—they are beginning to make a significant difference and showing collective leadership for the north of England in particular, and we want to see all of England benefit from that. We do not shy away from that ambition.

• 27 Nov 2024 · Devolution: Lancashire · Hansard source

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  It is important to separate out the different roles and responsibilities. We do not see mayors as being super-councils. We see mayors as regional leaders that have a strategic responsibility. That is very different from councils that provide a public service delivery responsibility. We are seeing mayors begin to make a difference where they are in place. For instance, York and North Yorkshire is highly rural, with one of the biggest geographical combined authorities in the country. We have just agreed a mayoral combined authority for Greater Lincolnshire. There is a significant rural population there, too. Of course, Hull and East Riding will have a mayor next year as well. These devolution deals are being rolled out across the country in both urban and rural areas. In the end, it is about political leadership, accountability and getting powers from here. If people feel as though somebody down the road is distant, people feel much more that this place is distant. We have got to break the centralised model of command and control that we see here. In many of the questions that have been raised are the issues that we wrestle with—how do we balance a functioning economic area with a public service foot- print with people’s locally and strongly held identity and sense of belonging in a way that balances all those out to get to a settlement that can be supported and accepted? Those are all issues that we face in the English devolution White Paper and will continue to form part of the agreements that we have reached. On all of those tests, Lancashire is the ideal model. It is a modern county outside of our historic roots. It has units of local government that speak to that footprint. It has units of public service delivery that speak to that footprint. It has a police and crime commissioner that speaks to that footprint, and is a functioning economic area that speaks to that footprint, too. On that basis, I think that Lancashire is a very good candidate; and I think the people of Lancashire have a lot to gain from the mayoral model of devolution. This is worth facing head-on. In the discussions that we had in Lancashire—to refer to the intervention by the hon. Member for Blackburn (Mr Hussain)—we recognise that we want to see district councils represented, but local government reorganisation is clearly part of the conversations that are taking place. We get representations fairly regularly from council leaders and Members of Parliament, and we recognise that those are live discussions. They are separate discussions that might come together at a point in time, and we need to allow both processes to run and to be worked through in more detail. Finally, I again thank my hon. Friend the Member for Lancaster and Wyre for securing the debate. Although we have an overarching national ambition to see devolution across the country, it is fundamentally a local issue about how best to shift powers to communities and deliver real change on the ground. We look forward to that ambition being realised in Lancashire. Question put and agreed to.

• 25 Nov 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill · Hansard source

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  I thank all hon. Members who have contributed to this enthusiastic and impassioned debate. Whether they were speaking from the Government or the Opposition Benches, their speeches were genuinely rooted in the communities that people live in and that we represent. In a way, it has brought out the best of Parliament, but we could not quite avoid the party politics and the rewriting of history from the Conservative party. Shall we really take lessons on saving the high street from the Conservatives, who oversaw mass bank closures and the decimation of retail on the high street, with 6,000 pubs closing in local communities? They are now the farmers’ friends, but when they were in government they oversaw the closure of 7,000 agricultural businesses. Where were they when the energy market and labour supply challenges were decimating farmers? They were nowhere to be seen. Now, though, they come riding on the horse— [ Interruption. ] Would the shadow Minister like to intervene? Come in, please.

• 25 Nov 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill · Hansard source

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  I can answer this question: it is the impact that matters. Whatever Opposition Members say as the farmers’ friends, the truth is different: 7,000 businesses closed on their watch. That is what the evidence says. Let me move on to the reasoned amendment. This Government are fully committed to protecting and supporting our valuable high streets. The fact is that retail, hospitality and leisure rates relief was due to end in its entirety by the end of March 2025, which would have meant a cliff edge for businesses. At the Budget, we stepped in to prevent that by extending the relief further this year by 40%, with a cash cap of £110,000. We have also frozen the small business rates multiplier for 2025-26. Taken together with the small business rates relief scheme, that means that more than 1 million properties will be protected from any inflationary increases next year. That is 1 million properties protected by this Government.

• 25 Nov 2024 · Non-Domestic Rating (Multipliers and Private Schools) Bill · Hansard source

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  I want to make progress in the time that I have, and to wind up within the 10 minutes. The key point is that all children of compulsory school age are entitled to a state-funded school place if they need one, and all schools—and they know this—are required to follow the requirements of the Equality Act 2010 relating to British values and to promote an environment that encourages respect and tolerance towards families of all faiths and none. A number of Members have rightly mentioned SEND provision—it has been a significant part of the debate, for understandable reasons. We have ensured on the face of the Bill that private schools that are charities and “wholly or mainly” provide education for pupils with education, health and care plans remain eligible for business rates charitable rate relief. Furthermore, private schools that benefit from existing rate exemptions for properties that are wholly used for the training or welfare of disabled people will continue to do so. Taken together, we believe those policies mean that most private special educational needs schools will not be affected by these measures at all. We recognise that some pupils with special educational needs and disabilities will be in private schools, but without local authority funding in place, as it is judged that their child’s needs can be provided for within the state sector. Of course, parents will still be free to choose whether to be in the state sector or to remain in the private sector—that is a very important point to make. Local authorities aim to process all education, health and care plan applications in time for the start of the next school year, but in special cases, the local authority is able to prepay one term’s fees if the process is not complete. Likewise, some private schools will forgo the first term’s fees for pupils who are expected to receive their education, health and care plan in the future. Turning to high streets, the Government are wholly committed to rejuvenating our high streets. We want to support the businesses and communities that make our town centres successful. That is why through this Bill, the Government intend to introduce permanently lower rates for retail, hospitality and leisure from 2026-27, in order to protect the high street. That tax cut will be fully funded and sustained through a higher tax on the most expensive properties—the 1% of properties that have a rateable value of £500,000 or more. The new tax rates will be set out in next year’s Budget to factor in the business rate revaluation outcomes and the broader economic and fiscal context at that time. We were clear in our manifesto that we would look at the business rates system and support our high streets, and we meant it. We know that our high streets and town centres are the beating heart of our communities, but over the past 14 years, they have struggled to keep their heads above water. Think about all those household names that have gone to the wall—that are a thing of the past, not the future. Think about all the banks and pubs that have closed, and about the shutters that have come down on shop premises that were once the lifeblood of where people live. The previous Government had 14 years to get this right, but they oversaw the decline and decimation of our high streets. People feel that in their hearts, because town centres are more than just a place to do business; they are a place for a community to come together. That is something the Tories never understood when they were in government, but it is something that this Government absolutely understand. With the leave of the House, I thank all hon. Members who have contributed to this important debate. This Bill is the first step on the road to transforming the business rates system. The measures within it will provide certainty and support to our vibrant high streets, enabling the delivery of a permanent tax cut that is sustainable and that finally levels the playing field between the high street and online. The Bill will also help break down barriers to opportunity, supporting all parents to achieve their aspirations for their children. We need to bear in mind, of course, that the vast majority of children in this country—over 90%—are in state schools. This investment will see them given the support that they need and deserve, and that, frankly, they have waited a long time for. I commend the Bill to the House. Question put, That the amendment be made. The House proceeded to a Division.