Business of the House – in the House of Commons at 8:30 pm on 7th April 2010.
I beg to move amendment 1, page 6, line 42, at end insert:
"(4A) In section 62(1A) (as amended by subsection (4))-
(a) in paragraph (b), for "£54.04" substitute "£50.22", and
(b) in paragraph (c), for "£36.01" substitute "£33.46.".
With this it will be convenient to consider Government amendments 2 and 3.
Clause 9 increases alcohol duty rates charged on beer, wine and spirits by 2 per cent. above inflation, and on cider by 10 per cent. above inflation, with effect from
The amendments will cost the Exchequer up to £15 million a year, and will undermine our intention of bringing the rates of cider duty more into line with those for other alcoholic drinks. We will therefore legislate to confirm the originally planned increases in a second Finance Bill, just after the election.
I clearly declare an interest: I am a long-time supporter of the Campaign for Real Ale, and I was the chairman of CAMRA (Real Ale) Investments, a little company that CAMRA formed. Why, despite all the evidence that pubs are closing and brewers are finding it increasingly difficult to survive, are the Government further increasing the tax on beer, a traditional British drink that is already highly taxed? In doing so, they are phasing out pubs which is where responsible drinking takes place. I hope that those on my own Front Bench will hear my request that, in the next Budget, the new Government will not continue to increase the tax on beer, which is used as a milch cow to raise funds.
I am delighted that we have been joined on the Front Bench by my right hon. Friend the Minister for Housing, who has a particular interest in the well-being and future of pubs and has done some very helpful work on that subject.
I would take Sir Nicholas Winterton back to his earlier intervention when he drew attention to the need to address the deficit. We are committed to halving it over four years and this is an important step towards achieving that. I am pleased that he has been able to make a further valedictory intervention and, along with everyone else, I want to wish him well for the future and express my appreciation for his contribution to the House over many years. Given that he has already made a point about the importance of addressing the deficit, I am sure he will recognise the importance of this measure, and I am pleased that his Front-Bench team has agreed not to resist this proposal.
The Minister will no doubt be aware that the cause of the closure of many pubs is not necessarily taxation, but the behaviour of the pubcos. One thing that his Government could do to reassure the pubs-
Order. I should say to the Committee that we have very little time left and this debate is supposed to be about the rates of duty on cider-and nothing else.
I commend the amendments and support the clause standing part of the Bill.
You will recall, Sir Alan, that at this stage of the Finance Bill last year, I spoke for one hour and 17 minutes on an amendment dealing with alcohol taxation. I am afraid that I do not have the same amount of time available this evening. However, the Government's changes to alcohol rates deserve some scrutiny.
We are delighted to see the Government forced to climb down on their massive across-the-board tax raid on cider drinkers, but it is clear that, without Conservative intervention, this would never have happened. It is equally clear that only the election of a Conservative Government will ensure that the tax on cider comes back down again. The Financial Secretary has already been quoted in the press as saying:
"No policy will change as a result of the negotiations."
This is because, as he has laid out this evening, he intends to introduce a second Finance Bill after the election to ram the increase through against the protests from everyone-from the ordinary cider drinker to The Wurzels.
May I put on record the fact that it was the Liberal Democrats who established the cider caucus in this Parliament and that it is the Liberal Democrats who have been campaigning to ensure that tax on cider is not increased? The hon. Gentleman should not take this as only a Conservative victory; he should take it as a Conservative and Liberal Democrat victory.
I am afraid to say that the hon. Gentleman was not there for the negotiations. I am going to mention the Liberal Democrat position on cider in recent years, because I am afraid that it has not been beneficial to the argument the hon. Gentleman is making this evening.
I just mentioned The Wurzels, and a piece of breaking news is that The Wurzels have today issued a press release welcoming the Government climbdown. It states:
"Here in the West Country cider is close to our hearts and if we, through our music and association with cider, helped bring this campaign to a ciderhead, then I think we all deserve a pint".
If they can wait until after
"has the potential to undermine what businesses both large and small have done and the great contribution they are making to the rural economy and communities they are part of."
On a number of occasions, I have met the NACM and some of the many small craft cider makers it represents. Their businesses are threatened by the Government's actions. In the west country and beyond, they know how punitive a 10 per cent. duty increase will be.
I am not giving way, as I have only two minutes.
Those businesses will also be appalled that the Government, if they get the chance, are planning to undo the amendments before us today.
Finally, let me say something about the Liberal Democrats' position. It is a pity that Mr. Browne, their spokesman on Treasury matters, is not present to witness the Government's climbdown on cider duties. Dr. Cable is not here either, but it was the hon. Member for Taunton who mentioned, during the debate on last year's Finance Bill, that he had tabled an amendment that would have frozen duty on spirits but left duties on cider unchanged. Attempting to justify the move, he said:
"Cider is not as widely drunk in my constituency as it once was".-[ Hansard, 12 May 2009; Vol. 492, c. 778.]
That suggests to me that he is no great defender of the cider industry, although he is the Member of Parliament for Taunton. He subsequently tabled a further amendment to the Finance Bill which would have reduced taxes on beer but not, ultimately, those on cider. As we saw last year, the Liberal Democrats cannot claim to be friends of the cider industry.
The Opposition disagree with the whole basis of the Government's approach. Rather than imposing a blanket increase on all types and strengths of cider, we would direct tax increases at the problem, which is caused by high-strength, mass-produced cider. We believe in taxing those 3-litre supermarket bottles of problem cider rather than taxing ordinary, responsible drinkers.
Our approach is not specific to cider, however. We would apply the same approach to all alcohol duties. For example, we would also target super-strength beer. We believe in targeting problem drinks, not all drinkers. Meanwhile, the Government continue to make alcohol duties a blunter instrument than is necessary. Responsible drinkers are being punished, pubs continue to struggle, and the minority who cause trouble go unchecked.
Today we have won a significant victory for common sense on cider, but it is a forced victory. The Government's message to cider drinkers could not be clearer. They have given way temporarily, but are pledged to reverse this amendment if Labour is returned to power. Their message is simply this: if you want a 10 per cent. increase in cider tax, vote Labour. If you want your tax reduced-
Three hours having elapsed since the commencement of proceedings, the debate was interrupted (Programme Order, this day).
The Chair put forthwith the Question already proposed from the Chair (
Amendment 1 agreed to.
The Chair then put forthwith the Questions necessary for the disposal of the business to be concluded at that time (
Amendments made: 2, page 7, line 32, leave out "this section" and insert
"subsections (2) to (4) and (5)".
Amendment 3, page 7, line 33, at end insert-
'( ) The amendments made by subsection (4A) come into force on
Clause 9, as amended, ordered to stand part of the Bill.
Clauses 10 to 22 ordered to stand part of the Bill.
Clause 23 disagreed to.
Clauses 24 to 57 ordered to stand part of the Bill.
Clause 58 disagreed to.
Clauses 59 to 64 ordered to stand part of the Bill.
Clause 65 disagreed to.
Clauses 66 to 71 ordered to stand part of the Bill.