Budget Resolutions - Income Tax (Charge)

Part of the debate – in the House of Commons at 5:50 pm on 31st October 2018.

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Photo of Susan Elan Jones Susan Elan Jones Labour, Clwyd South 5:50 pm, 31st October 2018

It is a great pleasure to follow my hon. Friend Dr Blackman-Woods and to contribute to this Budget debate. I wish to focus my remarks on three main aspects: Brexit, the north Wales economy and the voluntary sector.

The Financial Times has already referred to the Budget as a general election Budget. I do not know whether that is true, but it is most certainly a Brexit Budget, and I am not thinking of the new 50p pieces. Quite frankly, if that were all the Prime Minister and the Chancellor had to do to keep their ideological, hard Brexiteers happy, most of us would not mind too much. We now see more than £4 billion—about £4.2 billion, I think—going towards Brexit preparations. This is from a Government who have categorically refused either to have a general election or to ask the British people in a referendum about what we should do next vis-à-vis Brexit. One leading voluntary sector commentator offered a very sobering reflection when he wrote:

“The opportunity cost of spending that money is staggering. It’s equivalent to the total income of the UK’s 136,000 smallest charities for almost two years. Just think what they could do for communities with that.”

Indeed, let us just think about that.

On a more positive note, I welcome the fact that persistent local lobbying has led to the Chancellor announcing money for the north Wales growth deal. This, as I think they say in the wedding banns, is for the third time of asking: the deal has been mentioned twice, but this is the first time we have had any money for it. Members of Parliament from north Wales have worked across party and geography to fight for funding. I want to put on record my thanks for the part that local authority leaders and business people on the North Wales economic ambition board have played. I must, however, say of the funding that Belfast, which has a population of 333,000, has been pledged £350 million for its city deal, but north Wales, with a population of 687,000, has been pledged £120 million. I have nothing against the people of Belfast, but that does not seem to me to be very fair. We in north Wales will do everything we can to work with the Government and whoever else we need to work with to secure prosperity and wellbeing across our region. The North Wales economic ambition board has already stated, in the aftermath of the Budget, that our goal is to increase the value of the north Wales economy from £13.6 billion in 2016 to £26 billion by 2035, with a final deal in place later in 2019. It is an ambitious challenge, but one we are determined to meet.

I will now turn briefly to the voluntary sector. In advance of this year’s Budget, the all-party group on charities and volunteering, of which I am a co-chair, wrote to the Chancellor with some very helpful suggestions. I am pleased to see that our suggestion that the increase in the gift aid small donation scheme maximum from £20 to £30 has been taken up as a proposal. That is good, and it is a sensible measure. I think that all parliamentarians involved with the all-party group, as well as our several hundred affiliate members from the voluntary sector, will welcome the Chancellor’s words about reducing “administrative burdens on charities” by introducing a “package of measures” from April 2019. We await the details but welcome the principle. However, I am rather less enthused by the increasing tendency for Chancellors to pick specific charities and causes. When any charity gets funding in any Budget, I welcome it, but we know that, in all likelihood, such charities will not get this on a year-on-year basis. That approach can raise serious problems of financial stability for charities, and it goes against the Government’s own—largely, very thoughtful—civil society strategy.

If the Government are serious about the voluntary sector in the long term, we cannot have another Budget that does not seriously examine dormant assets. The voluntary sector has waited a long time to hear how the Government intend to further spend up to £2 billion in dormant assets. Voluntary sector leaders are absolutely right to call, as they did in a letter to the Chancellor, for that funding to be designated for the purposes of strategic long-term investment in civil society organisations. It is also time for the Government to add to that funding £500 million from the national fund, to be released for the purpose of investing in communities. There is no greater role, no higher calling, than for us to invest in our communities.