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Supporting Small Business
19 October 2021
Lead MP
Rachel Reeves
Debate Type
General Debate
Tags
EconomyTaxationBusiness & Trade
Other Contributors: 32
At a Glance
Rachel Reeves raised concerns about supporting small business in the House of Commons. Other MPs contributed to the debate.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Lead Contributor
Opened the debate
Reeves emphasises the importance of high streets and local businesses to communities, highlighting challenges faced by these establishments during and after the pandemic due to rising costs. She calls for a freeze on business rates multipliers and extending small business rate relief thresholds. Reeves criticises the Conservative government's plan to end temporary support for businesses from April 2022, arguing that this will unfairly impact many shops and threaten thousands of jobs.
Ellie Reeves
Lab
Lewisham West and East Dulwich
Reeves highlights the significant number of small and medium-sized enterprises in her constituency, which are struggling due to government plans to remove temporary support, emphasising that many viable businesses may go under.
Dawn Butler
Lab
Brent East
Butler stresses the importance of helping at-risk businesses in Brent and the need for the government to reach out and provide necessary support to keep high streets vibrant.
Jessica Morden
Lab
Newport East
Morden points out the stark contrast between Welsh Labour's supportive measures for 70,000 businesses in Wales compared to England where support was scaled back earlier this year.
Alex Sobel
Lab Co-op
Leeds Central and Headingley
Sobel agrees that the tourism and hospitality sectors have suffered significantly due to lack of support, urging for additional measures such as business rates cuts and reversal of recent tax increases.
Emma Hardy
Lab
Kingston upon Hull West and Haltemprice
Hardy discusses the rise in debt among residents due to economic challenges and criticises the reduction of funding for face-to-face debt consultations by the Money and Pensions Service.
Matt Rodda
Lab
Reading Central
Rodda underscores the serious situation faced by retail centres, even those considered thriving, like Reading's major retail centre, which currently supports 1200 small businesses through business rates relief.
Mike Amesbury
Lab
Worcester
Calls on the Government to move beyond reviews and implement solid reform in the business rates system based on income. He urges for action rather than further delay.
Chris Evans
Lab/Co-op
Caerphilly
Questions the Minister about the lack of a streamlined appeals process for businesses struggling with business rates, highlighting the frustration faced by local businesses trying to navigate existing systems without clear avenues for appeal or flexibility.
Emma Hardy
Lab
Kingston upon Hull West and Haltemprice
Queries the Minister on changes made by the Money and Pensions Service regarding consultation methods, expressing concern about moving from face-to-face to remote consultations during a challenging period for many individuals struggling with debt.
Pontypridd
Invites the Minister to comment on the possibility of extending reduced VAT rates, noting that this has enabled businesses in his constituency to invest in both their operations and employee wages.
Peter Grant
Lab
Glenrothes
Commends the Labour Front-Bench team for bringing the debate to the House, highlighting the crucial role of small businesses in the UK economy. He recounts an anecdote from his colleague Alasdair Morgan about how small businesses can play a key role in reducing unemployment. Criticises the Government for making it harder for small businesses to take on additional employees and notes that many small businesses face unique structural problems, such as being overcharged by suppliers due to lack of consumer protection. He calls for more protections for small businesses from large corporations. Emphasises the impact of labour shortages and Brexit on small businesses, highlighting how retail sectors are changing with fewer independent retailers. Urges continued support for small businesses through measures like non-domestic rates schemes.
Huw Merriman
Con
Bexhill and Battle
Merriman thanked the shadow Chancellor for laying the motion, addressing concerns about business rates and high street changes. He highlighted Government support during the pandemic, mentioning a business rate holiday for 750,000 businesses and furlough for 15,300 workers in his constituency. He argued against the Labour proposal to replace business rates due to its potential fiscal impact, advocating instead for reforms such as replacing business rates with VAT or turnover taxes.
Bill Esterson
Lab
Sefton Central
Mr. Esterson argues for the overhaul of business rates, citing personal experience running a business and noting that over 450 businesses in Sefton face going out of business due to problems exacerbated during the COVID crisis. He calls for longer-term reform and challenges the Government to provide an alternative plan to replace revenue lost from business rates. He emphasises the competitive disadvantage UK manufacturers face compared to countries like Germany with lower property taxes, and questions how other nations fund their businesses without such high property taxes. Mr. Esterson gives examples of local businesses struggling under current conditions and supports his colleague's proposal for a digital services tax increase as an interim solution while advocating for international reform in corporation tax.
Kevin Hollinrake
Con
Thirsk and Malton
The speaker emphasises the need for a fair and level playing field for businesses, particularly in the context of changing consumer behaviour that favours online shopping. He notes that business rates were designed for an earlier era when most commerce was conducted from physical premises. Hollinrake suggests focusing on VAT rather than an online sales tax as a means to reform business rates, arguing that raising VAT by 3p would generate significant revenue and simplify the system. Additionally, he proposes reducing the VAT registration threshold significantly to encourage business growth.
Emma Hardy
Lab
Kingston upon Hull West and Haltemprice
Congratulates HullBID on its recent ballot success, highlights the challenges faced by businesses due to outdated business rates system. Emphasises the potential of remote working to revitalise high streets like in Hull. Criticises the current system for being unfair, especially mentioning Ye Olde White Harte pub's situation. Advocates for reforming business rates and promoting remote work hubs.
Acknowledges the importance of small businesses and shopping parades in constituencies. Defends the Government's support measures such as furlough scheme and restart grants. Supports the town deal, highlighting its impact on regenerating buildings and revitalising areas like Ipswich.
Sarah Olney
Lib Dem
Richmond Park
The Liberal Democrats emphasise the importance of supporting small businesses, particularly in sectors like travel that have been severely impacted by pandemic restrictions. They call for an extension and redesign of the furlough scheme to help these companies pay employees part-time as they continue to operate under limitations. Additionally, they urge the Government to reconsider immigration policies to support key industries, complete a promised review of business rates, and limit the impact of national insurance rises on small businesses by increasing the employment allowance.
Acknowledges the diversity of businesses in his constituency, from medical device manufacturers to pubs and farms. He highlights the substantial financial support provided by the Government through various schemes and notes that many businesses express gratitude for this assistance despite political affiliations. While recognising challenges faced by certain sectors like travel and hospitality, he also points out signs of optimism and steps towards recovery. Johnston agrees with all parties on the need to reform business rates but advocates for a balanced approach that levels the playing field without unfairly targeting online competitors such as Amazon.
Danny Kruger
Reform
East Wiltshire
Kruger acknowledged that there are real problems facing high streets due to lockdowns, online sales competition, and changes in lifestyle. He pointed out that technology can create opportunities for places left behind by deindustrialisation. Highlighting the market town of Devizes as an example, Kruger welcomed initiatives such as the Help to Grow scheme and start-up loans. He also emphasised the importance of connectivity through broadband and transport improvements. However, he cautioned against simply reducing business rates without compensating for potential fiscal impacts.
Matt Rodda
Lab
Reading Central
I pay tribute to small businesses in my constituency and across the country, highlighting their challenges under the current business rates regime. Despite thriving conditions, SMEs face pressures such as the pandemic's impact, supply chain crises linked to Brexit, national insurance rises, and economic shocks due to reduced physical retail. Reading is a prosperous town with a rich history and strong infrastructure, yet its small businesses are hindered by issues like the current business rates system. Education catch-up funding for post-pandemic pupils is crucial as many work in SMEs. Labour proposes £14.7 billion for better support, urging the Government to scrap the existing business rates regime.
I celebrate small businesses in Birkenhead that have supported their community during and after the pandemic. Businesses like Future Yard and Make Hamilton Square are revitalizing the town centre, bringing jobs and investment back to Birkenhead despite high levels of poverty and unemployment. However, nearly 150 local small businesses face closure due to rising prices, stock shortages, and national insurance hikes. The outdated business rates system must be reformed for economic recovery. Freezing business rates and increasing relief thresholds would support these businesses and align with the Government's levelling up agenda.
Alyn Smith
SNP
Na h-Eileanan an Iar
Commends the Labour party for bringing forward the debate on high streets and small businesses, highlighting the need for urgent reform of business rates. Acknowledges that while the pandemic accelerated changes in retail habits, it did not create them. Emphasises the importance of unique local businesses in communities and calls for intervention against poor landlords and compulsory repair orders to address empty shop units. Critiques current VAT and digital tax policies and highlights labour shortages and supply-chain issues caused by Brexit as significant challenges. Advocates for strategic long-term planning rather than short-term fixes, supporting initiatives like the Stirling City working group.
Naseem Shah
Lab
Bradford West
Shah emphasised the importance of supporting local businesses, particularly in Bradford where they are a crucial part of the economy and community life. She highlighted how local businesses struggled during the pandemic due to extended lockdowns and called for urgent government support, including freezing business rates until the next revaluation and increasing the threshold for small business rates relief. Shah also discussed the impact on wedding halls and other hospitality venues in her constituency, noting that these establishments are vital for job creation and community wellbeing. She cited a report indicating Bradford West is third highest in need of 'levelling up' due to regional inequality exacerbated by business rates. The MP also mentioned 332,000 businesses at risk of closure across the UK, impacting over 800,000 jobs.
Chris Evans
Lab Co-op
Caerphilly
Evans intervened to highlight how during previous financial crises, Labour had cut VAT to boost high street activity. He questioned whether a similar approach of reducing VAT could help counteract the current economic challenges faced by businesses.
Kim Johnson
Lab
Liverpool Riverside
Johnson asked Shah if she agreed that the brewing and pubs sector, which has been severely affected by the pandemic, would face further hardship due to proposed increases in VAT, beer duty, and business rates. She noted the significant contribution of this sector to Liverpool's local economy.
Chris Evans
Lab Co-op
Caerphilly
Chris Evans emphasised the importance of high streets in British communities, sharing personal memories and highlighting how his constituency's high streets have changed over time. He criticised MPs who talk negatively about their constituencies and called for business rates reform to support small businesses like Tidal’s Store. He also suggested measures such as free parking, short-term lets, and business rate holidays to revitalise local high streets.
Stephen Flynn
SNP
Aberdeen South
Emphasised the difficulties faced by small businesses due to Brexit, non-domestic rates, and national insurance contributions. He highlighted that small exporters face significantly longer delays in exporting goods post-Brexit, from a couple of days pre-Brexit to almost six weeks now. The MP also discussed the impact of the energy price crisis on businesses, suggesting that households and businesses are both affected by rising energy bills. Additionally, he criticised the Government's approach towards addressing the issue of online retailers having an unfair advantage over brick-and-mortar stores.
Sam Tarry
Lab
Ilford South
The impact of the pandemic has been devastating for businesses in Ilford South, with a staggering 332,000 businesses at risk of closure and over 7,975 unemployment benefit claimants. Sam Tarry calls for immediate business rates relief to prevent further closures, emphasising the need to support small independent businesses which are the backbone of communities.
Florence Eshalomi
Lab Co-op
Vauxhall and Camberwell Green
Eshalomi highlights how Vauxhall businesses have suffered from reduced footfall and tight margins, with many facing high rateable values and not qualifying for relief. She emphasises the importance of saving high streets to boost local economies and urges the Government to take real measures to support businesses across the country.
Pat McFadden
Lab
Wolverhampton South East
The hon. Member underlines that business rates are detrimental to high street businesses and disproportionately affect them compared to online competitors, advocating for reform as a matter of urgency. He notes widespread support from the business community for such reforms and criticises the Government's lack of action despite initiating a review 15 months ago.
Paul Scully
Con
Bromley and Chislehurst
Praised the resilience of small businesses during the pandemic, highlighted government support amounting to £352 billion through loans, grants, furlough scheme, and reliefs. Emphasised the need for a fundamental review of business rates. Criticised the opposition for lacking solutions despite identifying problems. Mentioned the upcoming enterprise strategy by the Secretary of State for Business, Energy and Industrial Strategy. Highlighted positive economic indicators such as low unemployment and high GDP growth compared to other major economies.
Kevin Hollinrake
Con
Thirsk and Malton
Asked about the potential impact of increasing the digital services tax, questioning whether it would be passed on to consumers as seen previously with Amazon.
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