Labour forces binding vote on VAT cut on home energy bills – as government refuse to back a windfall tax that would help to support families

Labour is today urging Conservative MPs to vote for a VAT cut to home energy bills over the next year, as the energy and cost of living crisis continues to escalate.

The binding motion, put forward by Labour in its opposition day debate, would guarantee Parliamentary time for a Bill on a VAT cut to home energy bills if passed, forcing MPs to actively vote for or against the legislation to implement this cut.

This follows the government ruling out a windfall tax on North Sea Oil and Gas profits on Sunday. Education Secretary Nadhim Zahawi told LBC Radio that “oil and gas companies…are already struggling”, despite the fact that oil and gas companies are expected to report“near record" income in 2021/22.

The Labour party is proposing that a windfall tax would help fund their package to reduce the expected energy price rise in April - saving most households around £200 or more.

Crucially, the party said it would also target extra support to squeezed middle, pensioners and the lowest earners, receiving up to £600 off bills and preventing all of the increase in energy bills currently expected.

Part of Labour’s package to keep energy bills low would be achieved through scrapping VAT off home energy bills for a whole year – alongside focused and targeted support through increasing and expanding the Warm Homes Discount to 9.3 million people.

Shadow Secretary of State for Climate Change and Net Zero Ed Miliband said:

"The government - and all the Tory MPs who have previously backed a VAT cut on home energy bills - should follow through with their promises and vote with Labour today to scrap the tax for a year, as hard working people face a growing cost of living crisis.

“The Conservatives’ clear opposition to the windfall tax tells you exactly whose side they are on – and it’s not the British people struggling with their energy bills.

"It tells you everything you need to know about this Government that they believe we should prioritise oil and gas companies making huge windfall profits that they say are ‘struggling’, rather than the British people who face the true struggle to pay their energy bills.

“Labour will stand up for the millions of families across the country, with a package that won’t just help the average household with around £200 off bills, but also targeted and focused support for those who need it most – including low earners, pensioners and the squeezed middle – with up to £600 in total off their bills.”

Ends

Notes to Editors

1.    Please see the attached policy briefing for details of Labour’s fully funded policy package.

2.    Labour’s draft motion:

Draft motion

VALUE ADDED TAX ON HOUSEHOLD ENERGY BILLS

That this House calls on the Government to cut the rate on VAT for household energy bills immediately; and makes provision as set out in this Order:

(1) On Tuesday 1 February 2022: 

(a) Standing Order No. 14(1) (which provides that government business shall have precedence at every sitting save as provided in that order) shall not apply;

(b) any proceedings governed by this order may be proceeded with until any hour, though opposed, and shall not be interrupted;

(c) the Speaker may not propose the question on the previous question, and may not put any question under Standing Order No. 36 (Closure of debate) or Standing Order No. 163 (Motion to sit in private);

(d) at 3.00 pm, the Speaker shall interrupt any business prior to the business governed by this order and call the Leader of the Opposition or another Member on his behalf to present a Bill concerning a reduction in Value Added Tax on energy of which notice of presentation has been given and immediately  thereafter (notwithstanding the practice of the House) call a Member to move the motion that the Value Added Tax (Energy) Bill be now read a second time as if it were an order of the House;

(e) in respect of that Bill, notices of Amendments, new Clauses and new Schedules to be moved in Committee may be accepted by the Clerks at the Table before the Bill has been read a second time.

(f) any proceedings interrupted or superseded by this order may be resumed or (as the case may be) entered upon and proceeded with after the moment of interruption.

(2) The provisions of paragraphs (3) to (18) of this order shall apply to and in connection with the proceedings on the Value Added Tax (Energy) Bill in the

present Session of Parliament.

Timetable for the Bill on Tuesday 1 February 2022

(3) (a) Proceedings on Second Reading and in Committee of the whole House, any proceedings on Consideration and proceedings up to and including Third Reading shall be taken at the sitting on Tuesday 1 February 2022 in accordance with this Order.

(b) Proceedings on Second Reading shall be brought to a conclusion (so far as not previously concluded) at 5.00 pm. 

(c) Proceedings in Committee of the whole House, any proceedings on Consideration and proceedings up to and including Third Reading shall be brought to a conclusion (so far as not previously concluded) at 7.00 pm.

Timing of proceedings and Questions to be put on Tuesday 1 February 2022

(4) When the Bill has been read a second time:

(a) it shall, notwithstanding Standing Order No. 63 (Committal of bills not subject to a programme order), stand committed to a Committee of the whole House without any Question being put;

(b) the Speaker shall leave the Chair whether or not notice of an Instruction has been given.

(5) (a) On the conclusion of proceedings in Committee of the whole House, the Chairman shall report the Bill to the House without putting any Question.

(b) If the Bill is reported with amendments, the House shall proceed to consider the Bill as amended without any Question being put.

(6) For the purpose of bringing any proceedings to a conclusion in accordance with paragraph (3), the Chairman or Speaker shall forthwith put the following Questions in the same order as they would fall to be put if this Order did not apply—

(a) any Question already proposed from the Chair;

(b) any Question necessary to bring to a decision a Question so proposed;

(c) the Question on any amendment, new clause or new schedule selected by The Chairman or Speaker for separate decision;

(d) the Question on any amendment moved or Motion made by a designated Member;

(e) any other Question necessary for the disposal of the business to be concluded;

and shall not put any other Questions, other than the Question on any motion described in paragraph (16) of this Order.

(7) On a Motion made for a new Clause or a new Schedule, the Chairman or Speaker shall put only the Question that the Clause or Schedule be added to the Bill.

Consideration of Lords Amendments and Messages on a subsequent day

(8) If any message on the Bill (other than a message that the House of Lords agrees with the Bill without amendment or agrees with any message from this House) is expected from the House of Lords on any future sitting day, the House shall not adjourn until that message has been received and any proceedings under paragraph (10) have been concluded.

(9) On any day on which such a message is received, if a designated Member indicates to the Speaker an intention to proceed to consider that message—

(a) notwithstanding Standing Order No. 14(1) (which provides that government business shall have precedence at every sitting save as provided in that order), any Lords Amendments to the Bill or any further Message from the Lords on the Bill may be considered forthwith without any Question being put; and any proceedings interrupted for that purpose shall be suspended accordingly;

(b) proceedings on consideration of Lords Amendments or on any further Message from the Lords shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement; and any proceedings suspended under subparagraph (a) shall thereupon be resumed;

(c) the Speaker may not propose the question on the previous question, and may not put any question under Standing Order No. 36 (Closure of debate) or Standing Order No. 163 (Motion to sit in private) in the course of those proceedings. 

(10) If such a message is received on or before the commencement of public business on Tuesday 8 February 2022 and a designated Member indicates to the Speaker an intention to proceed to consider that message, that message shall be considered before any order

of the day or notice of motion which stands on the Order Paper.

(11) Paragraphs (2) to (7) of Standing Order No. 83F (Programme orders: conclusion of proceedings on consideration of Lords amendments) apply for the purposes of bringing any proceedings on consideration of Lords Amendments to a conclusion as if: 

(a) any reference to a Minister of the Crown were a reference to a designated Member; 

(b) after paragraph (4)(a) there is inserted—

“(aa) the question on any amendment or motion selected by the Speaker for separate decision;”.

(12) Paragraphs (2) to (5) of Standing Order No. 83G (Programme orders: conclusion of proceedings on further messages from the Lords) apply for the purposes of bringing any proceedings on consideration of a Lords Message to a conclusion as if:  

(a) any reference to a Minister of the Crown were a reference to a designated Member; 

(b) in paragraph (5), the words “subject to paragraphs (6) and (7)” were omitted. 

Reasons Committee

(13) Paragraphs (2) to (6) of Standing Order No. 83H (Programme orders: reasons committee) apply in relation to any committee to be appointed to draw up reasons after proceedings have been brought to a conclusion in accordance with this Order as if any reference to a Minister of the Crown were a reference to a designated Member.  

Miscellaneous 

(14) Standing Order No. 82 (Business Committee) shall not apply in relation to any proceedings on the Bill to which this Order applies.  

(15) No Motion shall be made, except by a designated Member, to alter the order in which any proceedings on the Bill are taken, to recommit the Bill or to vary or supplement the provisions of this Order. 

(16) (a) No dilatory Motion shall be made in relation to proceedings on the Bill to which this Order applies except by a designated Member. 

(b) The Question on any such Motion shall be put forthwith.  

(17) Proceedings to which this Order applies shall not be interrupted under any Standing Order relating to the sittings of the House.  

(18) No private business may be considered at any sitting to which the provisions of this order apply. 

[paras 19 to 23 on Northern Ireland (Executive Formation etc) Act 2019, Royal Assent and new Session omitted]

Interpretation, etc

(19) In this Order, “a designated Member” means— (a) the Leader of the Opposition; and  (b) any other Member acting on behalf of the Leader of the Opposition.

(20) This order shall be a Standing Order of the House