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Oral Answers to Questions
(4 years, 1 month ago)
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Paula Barker (Liverpool, Wavertree) (Lab)
The Secretary of State for Northern Ireland (Brandon Lewis)
The Budget is a fantastic boost for Northern Ireland as we support the Executive to deliver on the public’s priorities, providing substantial investment for Northern Ireland’s economy with an additional £216 million in 2020-21. The economy will benefit from the announcements on tax cuts, including an increase to national insurance thresholds and the employment allowance. Since the Budget, we have also heard yesterday’s announcement, which will result in an additional £640 million for the Northern Ireland Executive, taking total covid-19-related Barnett consequentials to more than £900 million.
Paula Barker
Northern Ireland has the highest prevalence of mental illness in the UK. The Government pledged money to Northern Ireland as part of the confidence and supply arrangement to address those challenges, but that money has not materialised. What discussions has the Secretary of State had with the Chancellor in relation to that funding, and do the Government intend to keep their promise?
Brandon Lewis
The hon. Lady makes an important point. We all want good support for mental health and to see people with mental health issues getting the right support and healthcare. As I have outlined, we have a very substantial Budget for the Northern Ireland Executive, and I hope we will be able to see good provision. I spoke to the Health Minister yesterday about covid-19, but the issue that the hon. Lady raises is one of those that we will continue to have conversations about.
Tony Lloyd (Rochdale) (Lab)
The link between health and the economy is now automatic because of the coronavirus situation. If I had been asking the Secretary of State a question about health in Northern Ireland two weeks ago, I would have pointed out that there is a £600 million shortfall in bringing the Northern Ireland health budget up to speed. How much money exactly will be put into that budget to ensure that the health system there is robust against coronavirus, and to build up the capacity that it ought to have so that it catches up with the rest of the UK?
Brandon Lewis
As the hon. Gentleman will know, a key focus for the Northern Ireland Executive is how we improve, and how they improve, health support for people across Northern Ireland. Quite rightly, everybody’s focus at the moment is primarily on not only wider health issues, but the specifics of dealing with coronavirus. The Executive have been hugely focused on that, including the Deputy First Minister, the First Minister and the Health Minister, all of whom I spoke to yesterday. That is where the focus is. There is a substantial budget—as part of the “New Decade, New Approach” deal, there is £2 billion of support for the Northern Ireland Executive, and I hope that we will see a really improved health service for the people of Northern Ireland.
Tony Lloyd
The Secretary of State has to do better than this. The amount of money that has been made available for coronavirus and health generally is not enough for the needs of the people of Northern Ireland. Will the wider moneys available guarantee support for those who cannot get sick pay and cannot pay their rent, and guarantee that those whose small businesses are under pressure will still be in business when we get through this crisis?
Brandon Lewis
I say gently to the hon. Gentleman that there is £2 billion linked to the “New Decade, New Approach” deal. As I said, last week’s Budget announcements will provide £900 million for the coronavirus situation. That is a substantial amount for Northern Ireland, on top of the money that the Executive already have. I share his desire to see the Executive delivering strong and good healthcare for Northern Ireland, and we will work with the Northern Ireland Executive on that.
Theresa Villiers (Chipping Barnet) (Con)
May I appeal to the Secretary of State, in his work with the Executive on the Budget and the economy, to have a strong focus on farming? It is at difficult times like this that people realise fully the importance of food security to our nation, and to every family and household in this country. We need to ensure that we look after our farmers in Northern Ireland and across the whole United Kingdom.
Brandon Lewis
My right hon. Friend, with her huge experience in this area, is right regarding the United Kingdom and particularly Northern Ireland. I held a roundtable conversation with people in the agricultural sector in the last week or two, looking at what we can do to ensure that they can be successful both now and as we go through the process of leaving the European Union, because food security is important for the United Kingdom. The agricultural sector is hugely important in Northern Ireland, and I will continue to work with it to ensure that it is successful.
Gavin Robinson (Belfast East) (DUP)
The Secretary of State is right to highlight some of the positive announcements in the Budget last week and yesterday’s emergency measures, but does he accept that a huge opportunity was missed by not mentioning anything about air passenger duty? The Chancellor said last night that he will engage with the Transport Secretary imminently about what we can do to protect the aviation industry. The loss of Flybe was hugely significant to regional connectivity, and the Government will have to move on air passenger duty in the weeks to come.
Brandon Lewis
The hon. Gentleman is absolutely right about the challenges, and we are very focused on ensuring that connectivity continues. This is a hugely important issue for us, and it is good that some of the routes that Flybe has vacated have already been picked up by organisations such as Loganair and Eastern—and hopefully by others as we go forward. With coronavirus, this is a particularly difficult time for the airline industry, which is why the Chancellor and the Transport Secretary are focused on it. I have spoken to the Transport Secretary and he is acutely aware of the importance of ensuring that we keep strong connectivity.
The hon. Gentleman is not entirely correct, in that the Budget outlined that the Treasury is taking forward a piece of consultation work around APD. I understand people’s determination to see that delivered; the Chancellor is very aware of it. We are very alert to the work that we have to do, and we will continue pressing on the importance of connectivity between GB and Northern Ireland.
Dr Andrew Murrison (South West Wiltshire) (Con)
The Northern Ireland economy is much more heavily based around the public sector than those of other parts of the United Kingdom, and covid-19 may make the situation even more acute. What further fiscal measures can be taken, in anticipation of a post-coronavirus future, to ensure that we redress that balance and make the Northern Ireland economy far more self-sufficient?
Brandon Lewis
My right hon. Friend makes a very important point. Despite the challenges we that all face —internationally and here in the UK—due to coronavirus, there are really good opportunities in the wider economy for Northern Ireland. He is right about the differential between the private and public sectors, which is one of the reasons why we have put such substantial support into the city and growth deals, which offer a huge opportunity for economic growth in Northern Ireland and job creation through the private sector. Obviously, we have the very substantial package that the Chancellor announced last night, including some very important and large numbers—circa £900 million for Northern Ireland —and I will repeat the point that the Prime Minister and the Chancellor have made: for the benefit the United Kingdom, we will do whatever it takes.
Mr Tobias Ellwood (Bournemouth East) (Con)
On air passenger duty, I reiterate the concern about stresses on small and regional airports such as Belfast. What goes on in Belfast links with Southampton and Bournemouth. I know that the Secretary of State is very alive to this, but will he have conversations with the Transport Secretary to find out when the review on APD will be brought forward?
Brandon Lewis
I can assure my right hon. Friend that the conversation between myself, the Transport Secretary and the Chancellor on the issue is ongoing. We are very focused on ensuring that there is good connectivity around the whole United Kingdom. I appreciate that Eastern is an important airline for connectivity around various regions. A number of other airlines are looking at picking up the routes for Belfast. We must also make sure that we have good connectivity with Derry/Londonderry and other places around the whole United Kingdom. We will look to deal with that as quickly as we can despite the challenges of coronavirus, which will make this a very difficult time for the airline industry, as per the Chancellor’s comments last night.
John Spellar (Warley) (Lab)
The Minister of State, Northern Ireland Office (Mr Robin Walker)
Northern Ireland is renowned for bus manufacturing, including Wrightbus’s New Routemaster hybrid model, which is famously operating around London today, and I know that the new owners are pioneering hydrogen technology. As part of “New Decade, New Approach”, the UK Government are providing £50 million to support the roll-out of ultra low emission public transport in Northern Ireland. I am in no doubt that Northern Ireland manufacturers will continue to lead the way in developing these next-generation buses.
John Spellar
I thank the Minister for that reply, and it is very welcome that money is going to electric buses and, indeed, ultra low emission buses, including hydrogen technology, but when I contacted my local bus company, National Express, it confirmed that the 29 vehicles already ordered are being built in Britain, but would not commit for future orders. It went on to express a hope that capacity would grow with demand—not just from it, but from other operators. Does the Minister agree that there is a real role for the Government here, and will he push for a whole of Government and industry approach to ensure that cash flowing into electric and low emission buses benefits bus builders in the United Kingdom, including Wrights in Ballymena?
Mr Walker
The right hon. Gentleman makes a very good point. As he will know, the Prime Minister announced new funding to overhaul bus links in England and made a commitment to at least 4,000 new zero-emission buses. We want to work with the industry to ensure that those buses are flowing through to orders to all those UK companies, including, as he says, Wrights in Ballymena.
Ian Paisley (North Antrim) (DUP)
I agree whole- heartedly with the question that has just been asked. On an immediate strategy for bus builders and bus operators, the Government could underwrite Transport for London, Birmingham buses, Translink and National Express, encourage them to make the orders that they have already indicated that they wish to make over the next year, and put at least £100 million of liquidity into manufacturing in Northern Ireland and across the UK overnight. That would cost the taxpayer nothing— they are paying for this anyway—but it would allow manufacturers to continue and employees to have surety of employment and the ability to put bread on the table. I urge the Government to adopt this strategy.
Mr Walker
I always listen carefully to the hon. Gentleman’s representations, and I am very happy to discuss that with colleagues at the Department for Transport. Further details are being developed alongside our national bus strategy, which we expect to publish later this year, but I absolutely understand the importance of the issues he raises and, as I say, I am happy to undertake that discussion.
Alex Cunningham (Stockton North) (Lab)
The Secretary of State for Northern Ireland (Brandon Lewis)
The Government are committed to engagement with the business community in Northern Ireland in relation to the protocol and our future trading arrangements with the EU. I have had the opportunity to engage with a range of business representatives in Northern Ireland in recent weeks, and I look forward to continuing positive and constructive discussions in the weeks and months ahead.
Alex Cunningham
The Secretary of State says that there will be no border down the Irish sea or across the island of Ireland. The fact that the Government are intent on diverging from existing standards, however, means that checks of some sort will have to take place in Northern Ireland. What kind of checks does he think will be necessary? On the basis that there will be very real barriers to trade, will he take personal responsibility for the ensuing mess?
Brandon Lewis
The hon. Gentleman should have more faith in our ability as a country to deal with technical matters. We are considering the best way to ensure that we implement the protocol, and we will discuss that with the EU in the joint committee—the specialised committee created under the withdrawal agreement, which will meet for the first time very soon. We are clear that Northern Ireland is part of the United Kingdom and we will have unfettered access.
Mr Robert Goodwill (Scarborough and Whitby) (Con)
I am sure that we all wish to give our best wishes to my hon. Friend the Member for North Dorset (Simon Hoare), the Chair of the Northern Ireland Affairs Committee, who is making good progress following hip surgery. I hope that I will not have to deputise for him for much longer.
What discussions has the Secretary of State had with those involved in the Lough Neagh eel fishery, who face the triple challenge of an uncertain trading future with the European Union, the effect of the coronavirus on their important markets in Belgium and Holland, and the possible re-designation of the European eel under convention on international trade in endangered species regulations once we have left the European Union?
Brandon Lewis
I add my good wishes to my hon. Friend the Member for North Dorset (Simon Hoare), who is recuperating. I have been in contact with him this morning; understandably, he continues to take a keen interest in the issues of Northern Ireland.
These are unprecedented and challenging times for many sectors. The Chancellor has announced a package of support for business and indicated further measures, if required, for the coming days. I will raise the issue of the specific group mentioned by my right hon. Friend the Member for Scarborough and Whitby (Mr Goodwill) with the Secretary of State for Environment, Food and Rural Affairs. I assure my right hon. Friend that my hon. Friend the Minister of State has been dealing with this and met that group recently, and we will continue to take this forward.
Sammy Wilson (East Antrim) (DUP)
On a recent visit to Belfast, EU officials and Michel Barnier made it quite clear to the business community that they expected a hard border in the Irish sea and, secondly, that they expected the Government to start implementing the things that need to be done to put that in place. Given that the Government have a different interpretation of the withdrawal agreement from the EU, will the Secretary of State assure us that no steps will be taken to put a physical, administrative or electronic border in the Irish sea, which would disrupt trade between Northern Ireland and Great Britain?
Brandon Lewis
The right hon. Gentleman makes an important point. I am happy to be very clear about this. We are determined to deliver on the agreements not only in the protocol, but in the Good Friday/Belfast agreement, so that we ensure there is no border between the Republic of Ireland and Northern Ireland, and there will be no border between Northern Ireland and Great Britain. Northern Ireland is part of the United Kingdom. There will be no hard border in the Irish sea.
Dame Diana Johnson (Kingston upon Hull North) (Lab)
The Minister of State, Northern Ireland Office (Mr Robin Walker)
The Government have been engaging on this issue with the British Pregnancy Advisory Service, which is contracted to provide booking services for women travelling to England to access abortion services. Flights have been rebooked for anyone affected by the collapse of Flybe to ensure access for women and girls. The Government continue to fund all the costs of the procedure, including travel and, where needed, accommodation. We are also working closely with the devolved Administrations, the Department for Transport and airlines to identify opportunities and to encourage them to act quickly to fill routes that are vital for local communities and business. As my right hon. Friend the Secretary of State mentioned, a number of routes have already been taken up.
Dame Diana Johnson
I thank the Minister for that answer but, of course, abortion was decriminalised in October 2019 and we now see the lost opportunity of this medical procedure not being provided over the last six months in Northern Ireland. The failure to do that means that we are now in a much more difficult position with covid-19. Has the Minister given any more thought to what other action he could take to ensure that services are available to women in Northern Ireland?
Mr Walker
The Government are under a clear duty to deliver abortion reform for Northern Ireland, consistent with section 9 of the Northern Ireland (Executive Formation etc) Act 2019, which requires that evidence-based protocols are adopted for the provision of services in Northern Ireland. Those regulations will be laid, and the deadline for that is the end of this month.
Sir Jeffrey M. Donaldson (Lagan Valley) (DUP)
In the current circumstances, the priority of my party is to protect human life, including that of the unborn child. The Minister will be aware of concerns expressed by members of my party, including the First Minister, about the decision to press on with regulations on abortion in Northern Ireland, despite the Assembly being restored and this being a clear breach of the devolution settlement. Will the Minister heed the calls from Northern Ireland politicians for this matter to be dealt with by the Assembly, not this Parliament?
Mr Walker
I recognise the strong views on all sides on this issue. I also recognise the constitutional challenge, but the deadlines within which we have to act were clearly set by Parliament. It was clear that if the Assembly was not in place by the deadline in October, the Government would be under a legal obligation to lay the regulations by March. That is the obligation under which we are acting.
Wendy Chamberlain (North East Fife) (LD)
The Secretary of State for Northern Ireland (Brandon Lewis)
Northern Ireland is in, and remains part of, the United Kingdom’s customs territory. The protocol makes that clear. It ensures unfettered market access for goods moving from Northern Ireland to Great Britain, and the arrangements we introduce will reflect that. We will discuss the implementation of the protocol with the EU at the joint committee later this month.
Wendy Chamberlain
At a time when many people have sadly been thrown into economic turmoil, it is incredibly important that wherever the Government can eliminate economic uncertainty, they do so. There is no area more clouded by uncertainty due to our departure from the EU than the Irish border and its regulatory future. Given that the Government have committed to doing “whatever it takes”, will the Secretary of State commit to removing that uncertainty by extending the Brexit transition period by one year?
Brandon Lewis
I do not think that anyone around the United Kingdom would thank us for extending the period. The election was very clear in giving us a mandate to deliver on our manifesto pledge to leave the European Union, and we are determined to do that. The certainty that we can give to business is that Northern Ireland is, will be and will always remain part of the United Kingdom’s customs territory and will have unfettered access.
Ben Everitt (Milton Keynes North) (Con)
Mary Robinson (Cheadle) (Con)
The Minister of State, Northern Ireland Office (Mr Robin Walker)
The Government have made it clear on many occasions that we will never be neutral in expressing our support for the Union. I believe that the UK Government working with the restored Executive to continue making Northern Ireland a great place to live, work and do business is one of the best ways we can strengthen its place in the Union. As part of the Union, Northern Ireland benefits from being part of the world’s sixth largest economy, and that allows for the pooling of risks and the sharing of resources to fund public spending, such as on defence, education and our national health service.
Ben Everitt
These are unprecedented times and our Union is incredibly precious to us. I am sure that the Minister will join me in welcoming the additional powerful financial support for Northern Ireland from the UK Government that was announced by our right hon. Friend the Chancellor for Northern Ireland to deal with covid-19.
Mr Walker
My hon. Friend is absolutely right. There is a strong package of measures to support the UK economy at a very difficult time. The Chancellor has said that the Government will do “whatever it takes”. Yesterday’s announcement, as we discussed during last night’s Adjournment debate, will result in an additional £640 million for the Northern Ireland Executive, taking the total covid-19-related Barnett consequentials to more than £900 million.
Mary Robinson
In the absence of a functioning devolved Government in Northern Ireland, the Northern Ireland (Executive Formation etc) Act 2019 made it a legal requirement for the UK Government to implement an abortion framework before the end of March this year. The Government are yet to respond to the consultation that they set up to inform the framework. However, in the spirit of devolution, does my hon. Friend agree that now that the Northern Ireland Executive is up and running, this should rightly be a matter for the devolved representatives?
Mr Walker
The Government understand the strength of feeling about this issue. We have always been clear that the best way to bring forward reform in this area would have been for the Executive and Assembly to take that forward in the best interests of Northern Ireland. However, the Government are under a clear legal duty, which this House put on it, to make regulations that provide lawful access to abortion services in Northern Ireland by 31 March 2020. To comply with the legal requirement, we will shortly lay regulations in Parliament. It will be a matter for the Department of Health in Northern Ireland to commission the new services.
Tony Lloyd (Rochdale) (Lab)
I know the Minister will agree that underlying the strength of Northern Ireland are commitments to the Good Friday and Stormont House agreements. This morning the Secretary of State made a statement about legacy. That seems to override the need for five-party consultation on this matter, and to override the need for co-operation between the Governments here in London and in Dublin. When will the Secretary of State come to the House so that he can be questioned on this matter of enormous importance to the future—if you like—of the Union, and certainly to stability in Northern Ireland?
Mr Walker
Our commitment to the Good Friday agreement and its successors is absolutely intact and 100%—and the Secretary of State is, of course, answering questions in the House today—but it is also clear that the first step we are taking on this is to engage with the parties and, indeed, with the Irish Government. That is clear from the written statement that the Secretary of State has published.
Kerry McCarthy (Bristol East) (Lab)
The Minister of State, Northern Ireland Office (Mr Robin Walker)
The UK Government are committed to prioritising the environment. As a world leader in tackling climate change, we are the first major economy in the world to legislate for a net zero target. Following the restoration of the Northern Ireland Executive, Northern Ireland Ministers have been in contact with Executive Ministers on a range of issues. The Department of Agriculture, Environment and Rural Affairs, which leads on environmental issues in Northern Ireland, has recently sought views on an environment strategy for Northern Ireland, and I understand that a summary of its findings will be published in spring this year.
Kerry McCarthy
In its submission to the consultation, Sustrans said:
“It is unacceptable there is no specific climate change legislation in Northern Ireland”
which
“would allow specific policies to be developed to meet emissions targets and adapt…to… risks.”
Given the close connection between the climate emergency and the natural environment emergency, is it not time that Northern Ireland was able to legislate so that it could develop its own climate strategy?
Mr Walker
The hon. Lady has raised an important point. We want to work closely with the Northern Ireland Executive on this issue. Clearly these are devolved issues, and I think that the Executive’s response to the consultation on environment strategy will be key to addressing that question.
Gavin Newlands (Paisley and Renfrewshire North) (SNP)
Anne McLaughlin (Glasgow North East) (SNP)
The Secretary of State for Northern Ireland (Brandon Lewis)
We continue to consider the best way to implement the protocol, and I will be discussing that with the EU in the joint committee and specialised committees. I am in frequent contact with the Prime Minister as we prepare for these meetings.
Gavin Newlands
Last month it was extensively reported that the Prime Minister had ordered his officials to “get round” the Northern Ireland protocol. I accept that his Government have said that they will comply with their obligations, and rightly so. Can the Secretary of State tell the House whether the Prime Minister said those words, or anything remotely like them?
Brandon Lewis
I always find it best not to take as writ whatever rumours may be picked up in any newspaper article. What can be taken as writ is what we have said at the Dispatch Box and what we have said as a Government. There will be unfettered access between Northern Ireland and Great Britain, and Northern Ireland is part of the United Kingdom’s customs territory.
Anne McLaughlin
What discussions and consultations has the Secretary of State had with the new Northern Ireland Executive about the protocol, and what specific—I emphasise the word “specific”—input will they have on its implementation?
Brandon Lewis
Obviously I talk regularly to the Northern Ireland Executive, particularly the First and Deputy First Minister. I currently speak to them several times a week on a range of issues. We have discussed the protocol, but we will also be discussing it with the European special committee. We are determined to deliver on the protocol in a manner that ensures that there is no border down the Irish sea, and that there is unfettered access for the whole United Kingdom.
Kirsten Oswald (East Renfrewshire) (SNP)
I know the Secretary of State will agree that the coronavirus crisis is causing deep and genuine concern to businesses, communities and individuals across Northern Ireland. Given that burden and the current real uncertainty, does he not also agree that now is not the right time to impose new customs and trading arrangements in Northern Ireland, and that the Brexit transition phase must now be extended well beyond the end of this year?
Brandon Lewis
I refer the hon. Lady to the answer that I gave a few moments ago. The British public want to see us deliver on our promises, and the Prime Minister is rightly determined to ensure that we do that. The best certainty that we can give businesses in Northern Ireland is that, as part of the United Kingdom, they will continue to have unfettered access, and to benefit from the trade deals that we seek to establish around the world.
Jim Shannon (Strangford) (DUP)
Can the Minister further outline the plans in place to ensure that, post December 2020, the UK works and moves as one entity and that Northern Ireland is not precluded from alignment with its biggest market, mainland GB?
Brandon Lewis
We are absolutely determined to make sure we deliver the protocol in a way that, as we have said, ensures we deliver on our word that Northern Ireland has unfettered access to Great Britain, is part of the United Kingdom economy, is part of the United Kingdom customs union and will benefit from our trade deals around the world.
Mr Speaker
Order. I would like just to make a very short statement.
Those watching our proceedings will have noticed that our attendance today is significantly below the normal numbers. I have discussed with the usual channels ways in which we can limit the number of people crowded together to ensure maximum safety. We are all doing our best to keep Parliament sitting and to follow Public Health England guidance.
Rob Butler (Aylesbury) (Con)
The Prime Minister (Boris Johnson)
The whole House will want to join me in paying tribute to Lance Corporal Brodie Gillon, a reservist medic of the Scottish and North Irish Yeomanry, who was tragically killed in Iraq last week. My thoughts and deepest sympathies are with her family and loved ones at this very difficult time.
This morning I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall have further such meetings later today.
Rob Butler
Like many others in the United Kingdom, my constituents in Aylesbury are understandably deeply concerned about covid-19, and I pay tribute to staff at Stoke Mandeville Hospital, Bucks social services and everyone in the community who is helping those with the virus or in isolation. Can my right hon. Friend assure the people of Aylesbury, and everybody in the country, that the Government will take whatever action is needed and spend whatever money is needed to save lives and protect livelihoods?
The Prime Minister
I join my hon. Friend in paying tribute to the staff at Stoke Mandeville and to all the staff in our fantastic NHS for the way they are coping at this extremely difficult time. We not only put another £5 billion into the NHS last week, as he heard from my right hon. Friend the Chancellor, but we will certainly do whatever it takes and provide whatever funding is necessary to help our NHS through this crisis and, indeed, to support the whole country with Government-guaranteed loans, as he will have heard yesterday.
Jeremy Corbyn (Islington North) (Lab)
Thank you for your statement, Mr Speaker. I thank MPs for the very responsible approach they have taken to today’s Question Time by sitting a suitable distance apart to avoid cross-fertilisation of this horrible disease.
I also want to join the Prime Minister in paying tribute to Lance Corporal Brodie Gillon, who was killed in Iraq last week. Our thoughts are with her family and friends.
Today people are mourning the loss of loved ones, and many more will be suffering from the effects of coronavirus, including those already losing work or losing their jobs who are worried about whether they can keep a roof over their head. Our greatest thanks must go to the frontline medical and public health staff who are fighting to combat the spread of the disease, to the public servants, particularly postal workers, who have made such sacrifices today, and to the cleaners who are providing vital support. We must also thank those working round the clock to make sure our shops and warehouses are stocked with the essential food supplies that everybody needs.
We on these Benches will do our duty to hold the Government to account. Together, we need to ensure that the most effective action is taken to protect people, and it is in that spirit that I ask questions of the Prime Minister today.
Every member of the public will make sacrifices in the effort to stop the spread of coronavirus, but those on low pay, self-employed workers and small business owners are understandably worried. Sue wrote to me this week. Her family is in isolation, and she says the current £94.25 a week statutory sick pay is
“not enough to pay for their food shopping.”
Can the Prime Minister do what the Chancellor repeatedly refused to do yesterday and pledge to increase statutory sick pay to European levels?
The Prime Minister
I thank the right hon. Gentleman for the way in which the Opposition have approached the issue generally and for the co-operation so far between our Front Benches on this matter. As he rightly says, this is a national emergency, and we are asking the public to do things and take actions in a way that is unprecedented for a Government in peacetime, and perhaps even unprecedented in the last century.
When we ask people to take action to isolate themselves if they or a member of their household has the disease, or to take steps that jeopardise businesses and cause people to risk losing their job, it is absolutely right that, whatever their circumstances, we should ensure workers get the support they need. So in addition to the package of business support that my right hon. Friend the Chancellor outlined yesterday, we will be working with the unions and colleagues across the House, and bringing forward further measures to support workers of all kinds throughout this crisis.
Jeremy Corbyn
UK sick pay levels lag far behind those of European counterparts. The Scandinavian countries are giving many people 100% of wages during this crisis, and I hope that when the Prime Minister brings forward proposals on this they will reflect the reality of people’s lives—you cannot feed a family on 90-odd quid a week. Those people are therefore putting everybody at risk because they have to go out to work in order to put food on the table. In order to claim statutory sick pay, workers need to prove that they earn a minimum of £118 per week, so I hope that when the Prime Minister brings forward proposals he will give confidence to the millions of people who work in low-income jobs, are in insecure work or are self-employed, and will commit to extending very much enhanced statutory sick pay to all workers.
The Prime Minister
As I have told the House before, of course we will ensure that nobody is penalised for doing the right thing, protecting not just themselves but other members of society and making sure that our NHS is able to cope. Clearly, statutory sick pay will, typically, be supplemented by other benefits, but I repeat what I said to the right hon. Gentleman: as the state is making these demands of the public and of business, it is only right that throughout this period we should be doing whatever it takes to support the workers of this country throughout this crisis.
Jeremy Corbyn
What it takes is a recognition of the social injustice and inequalities that exist in this country, and I hope that when the Prime Minister makes the proposals on statutory sick pay levels that will be recognised. A quarter of the people who are most crucial to support us in the crisis, social care staff, and almost half of home care workers are on zero-hours contracts, so they are therefore automatically not entitled to sick pay. By not extending statutory sick pay to all workers, the Government are forcing social care staff—the people who could, unwittingly, be transmitting the disease among the most vulnerable in our community—to choose between health and their own hardship.
Yesterday the Chancellor, unfortunately, offered nothing to the 20 million people living in rented homes, including 3 million households with children. These people are worried sick that they will not be able to pay their rent if they get ill, lose pay or feel that they need to self-isolate. It is in the interests of public health, of the health of all of us, that people do not feel forced to go to work in order to avoid eviction when they know that they may be spreading this terrible disease, so will the Prime Minister now confirm that the Government’s emergency legislation will protect private renters from eviction?
The Prime Minister
The right hon. Gentleman is making a series of very powerful points, and I can indeed confirm that we will be bringing forward legislation to protect private renters from eviction. That is one thing we will do, but it is also important that, as we legislate, we do not simply pass on the problem, so we will also be taking steps to protect other actors in the economy.
Jeremy Corbyn
We look forward to seeing the details of that, because we all represent private sector tenants in our constituencies and we know the stress that they are going through now. They need something to be said urgently about this issue, so I hope that the Government will say something as soon as possible. Today would be appropriate.
NHS staff and those who work in the care sector are on the frontline of caring for patients suffering from coronavirus. Sadly, however, those workers have no idea whether they are transmitting the virus themselves—they may not be obviously suffering from it, but they could still be transmitting it—whether they are ill or not, and what effect it will have when they return to work on the frontline. Will the Prime Minister please explain why the Government are not prioritising the testing of all healthcare staff—those in the NHS and those doing such a vital job in the care sector?
The Prime Minister
In point of fact, we are prioritising the testing of NHS staff, for the obvious reason that we want them to be able to look after everybody else with confidence that they are not transmitting the disease. This country is actually far ahead of many other comparable countries in testing huge numbers of people. We are increasing our tests from 5,000 a day to 10,000 a day. It may be of interest to the House to know that we are getting much closer to having a generally available test that will determine whether or not someone has had the disease. That will truly be of huge benefit to this country in tackling the outbreak.
Jeremy Corbyn
The World Health Organisation said “test, test, test.” We should be testing on an industrial scale. When I met the Prime Minister on Monday evening, he assured me that 10,000 tests were going on per day. That is better than none, obviously, but it is nowhere near even the number of people working in the NHS and the care sector. It is a massive undertaking and I wish there was a greater sense of urgency from the Government in getting testing available for all staff.
NHS staff are obviously on the frontline, and many are scared because the guidance has been changed to say that they do not need to wear full protective equipment when caring for patients. A senior doctor has said:
“The rest of the world is providing staff with full protective gear and we are restricting it”.
This is a doctor saying, “I am scared.” We should not be scaring doctors and nurses. Is there or is there not a policy for them to have full protective equipment? I believe that that should be the case.
The Prime Minister
Quickly, on testing, I can reassure the right hon. Gentleman that we are moving up to 25,000 tests a day.
On personal protective equipment for NHS staff, the right hon. Gentleman is absolutely right to raise the issue. It is obviously of huge concern to everyone that our NHS staff should feel that they are able to interact with patients with perfect security and protection, so there is a massive effort going on, comparable to the effort to build enough ventilators, to ensure that we have adequate supplies of PPE, not just now but throughout the outbreak.
Jeremy Corbyn
Generations to come will look back on this moment and they will judge us—they will judge us on the actions we take now. Our response must be bold and it must be decisive. The market cannot deliver what is needed; only collective public action, led by Government, can protect our people and our society. That collective action must not allow the burden to fall most on those who lack the resources to cope, as happened after the financial crash. People across the country do understand the need for temporary restrictions on our way of life to protect us all, and we will work with the Government, but the Prime Minister must understand that that will require balancing action to protect the most insecure and vulnerable, in the interests of public health as well as of social justice. The health of us all depends on the health of the most vulnerable, so I ask the Prime Minister: will he step up now—not tomorrow—and give support to those vulnerable people who live on the margins of our society, who are vulnerable themselves and make us all vulnerable, and give them the support and the assurance that they are desperately searching for today?
The Prime Minister
Indeed I can, and that is why we have announced another £500 million to go straight to councils to help them immediately with the needs of the poorest and the most vulnerable; that is why we have announced immediate cash injections into business, to help them through an unquestionably very difficult time; and that is why will be bringing forward further measures to ensure that every worker receives support throughout this difficult period.
Be in no doubt: the right hon. Gentleman is right to draw attention to the unprecedented nature of this crisis. We are asking the public to do quite extraordinary things and we are asking business to shoulder quite extraordinary burdens. But the more effectively we can work together to comply with the very best scientific advice, which is what has actuated this Government throughout the crisis—which is what has guided this Government throughout the crisis—the better our chances of relieving the burden on the NHS; the more lives we will save and the more suffering we will avoid; and the quicker we will get through it. Be in no doubt that—the right hon. Gentleman is absolutely right—this is an enormous challenge for this country, but I think the people of this country understand what they need to do to beat it. They also, I think, understand that we will beat it, and that we will beat it together.
Brendan Clarke-Smith (Bassetlaw) (Con)
The Prime Minister
I congratulate my hon. Friend on what he is doing for Bassetlaw Hospital. I remember going to talk to the wonderful doctors and staff at Bassetlaw. They explained in great detail their fascinating plan for improving service for their patients. I am absolutely determined to support him and them in their ambitions. That is why we have already put £15 million into expanding emergency care capacity in Bassetlaw. My right hon. Friend the Health Secretary is working intimately with Bassetlaw to take forward the whole project.
Ian Blackford (Ross, Skye and Lochaber) (SNP)
I associate myself with the remarks of the Prime Minister on the killing of Lance Corporal Brodie Gillon.
This is an unprecedented emergency and it requires an unprecedented response. I welcome the fact that parties across the House, and Governments across these islands, have worked together as we attempt to protect all our peoples. It is the right approach and it is the least the public expect and deserve from us.
Yesterday the Chancellor announced a £330 billion financial package for business. Today the UK Government need to announce a financial package for people. Members from six parties across the House have expressed support for a temporary universal basic income to help everyone, especially freelancers, renters and the self-employed. Using the current tax system, will the Prime Minister stand up and give a commitment today to provide people with the security of a universal basic income?
The Prime Minister
First, I want to thank the right hon. Gentleman for the spirit in which he has spoken. Indeed, there is a huge amount of collaboration going on across all four nations of this country, as you can imagine, Mr Speaker. We are in lockstep.
What I would say on the right hon. Gentleman’s appeal for basic income is, do not underestimate the value to people of the measures that we have already announced that will support business, keep jobs going and make sure those businesses continue in existence. That must be the first step. As I have said repeatedly now to the right hon. Gentleman, the Leader of the Opposition, it is important that throughout the crisis we take steps to support workers. The right hon. Member for Ross, Skye and Lochaber (Ian Blackford) is quite right and the suggestion that he makes is, of course, one of many such suggestions.
Ian Blackford
I thank the Prime Minister for his answer. There is a willingness from all of us to work together as we go through this crisis, but thousands of people are already losing their jobs. It is happening today. Millions will face the same threat. They need reassurance and support, and they need it today. They need an income guarantee.
We must not repeat history. People are worried about their bills and about keeping a roof over their head. In the last financial crisis, the banks were bailed out, but ordinary people were not. The Prime Minister has it in his power to protect people’s incomes and provide them with peace of mind. At this time, an emergency universal income scheme would do just that. Will he at least commit to meeting all of us who support that proposal to discuss how we can protect the incomes of all our peoples?
The Prime Minister
Yes, indeed. I can make that commitment and I said as much in my earlier answer to the right hon. Gentleman. It is very important that, as we go forward, we try to enlist a consensus in this House about how to support people throughout the crisis. I agree profoundly with what he said about not repeating history. It is very important that, as we ask the public to do the right thing for themselves and for everybody else, no one, whatever their income, should be penalised for doing the right thing, and we will make sure that that is the case.
Damian Hinds (East Hampshire) (Con)
The Prime Minister
I pay a particular tribute not just to our amazing NHS, but to our teachers and everybody who works in our schools for everything that they have done to keep our schools going throughout this difficult crisis so far. Of course we will do everything we can to remove burdens on schools, and Ofsted is one in particular that we can address. The House should expect further decisions to be taken imminently on schools and on how we make sure that we square the circle of ensuring that we both stop the spread of disease, but relieve, as much as we can, the pressure on our NHS.
Dr Rosena Allin-Khan (Tooting) (Lab)
The Prime Minister
I completely agree with what the hon. Lady says, and I thank her for all the work that she does in the health service. I can certainly tell her that we have stockpiles of PPE equipment and that we are proceeding—it is very important for the House to understand this—in accordance with the best scientific advice, and it is the timeliness of those measures that is absolutely vital in combating the spread of the epidemic, and indeed that is how we save lives. I am delighted that the UK’s approach has been commended today not just by Neil Ferguson of Imperial College, but by Dr David Nabarro of the World Health Organisation.
Edward Timpson (Eddisbury) (Con)
The Prime Minister
As the House will know, there is already a coalition of British manufacturers that are now working together at speed to supply the ventilators that we need. We already have 8,000, and we are moving rapidly upwards, and I will keep the House informed of developments.
The Prime Minister
I thank the hon. Gentleman for his invitation. I am happy to consider his invitation to Rhondda and will take it up.
Chris Bryant
What I really hope is that the Prime Minister will look at the whole coronavirus crisis through the eyes of the Rhondda, because we have a large number of sole traders, chippies, electricians and plumbers. We have a lot of people in very insecure employment. We have got lots of people who are elderly and people who are on very low incomes and have next to no savings. Many people have already been laid off this week or are worried that they are going to be laid off in the next fortnight, so we really do need the Prime Minister to address these matters.
If I am honest, I do not want to be partisan, but it does feel as if we are a bit of an afterthought. I really beg the Prime Minister to look through the eyes of the Rhondda, because I think he would then double sick pay so that it is a sensible figure. I think he would introduce something like a summer version of the winter fuel allowance so that the elderly get some help. I think he would probably introduce some kind of VAT holiday for sole traders. I know he hopes, and we all hope, that the whole of the country will bounce back quickly after this, but I say to him that after the floods and the poverty that we have historically suffered in the Rhondda, communities like mine will find it phenomenally difficult to bounce back if he does not take that kind of action now.
The Prime Minister
The hon. Gentleman speaks powerfully and passionately and, in my view, wholly rightly for the people of the Rhondda. I can tell him that our thoughts in this Government are with the people of the entire country in helping everyone to get through this virus. We will do, as I say, whatever it takes to support business and, as I said in my earlier answer to the right hon. Gentleman the Leader of the Opposition, also to support individuals and families. I welcome the agreement of the right hon. Member for Ross, Skye and Lochaber (Ian Blackford), the leader of the Scottish National party that we should do it on a cross-party basis.
Felicity Buchan (Kensington) (Con)
Florence Eshalomi (Vauxhall) (Lab/Co-op)
The Prime Minister
I repeat the answer I have given several times to several of the hon. Lady’s colleagues: we will do whatever it takes to ensure that all workers are protected throughout this crisis.
Stephen Hammond (Wimbledon) (Con)
The Prime Minister
We are extending the hours in which deliveries can be made, and we are talking right now with the Pharmaceutical Services Negotiating Committee about ensuring that pharmaceutical goods get at the right time to the customers who need them.
Neale Hanvey (Kirkcaldy and Cowdenbeath) (Ind)
The Prime Minister
I endorse completely the sentiment that the hon. Gentleman has just expressed about the need to do this collectively. The Government have announced a £46 million package of investment for finding a vaccine. As I have just said, a huge amount of work is going into investing in test kits, and those are changing and improving the whole time. The House will be reassured to know that this work is being done at an international level. We are working with our EU partners, the G7, the G20, the World Health Organisation and the International Monetary Fund—everybody is working together on the very issues that the hon. Gentleman raised.
Andy Carter (Warrington South) (Con)
The Prime Minister
Yes. My hon. Friend identifies exactly the three priorities of this Government.
Stephen Farry (North Down) (Alliance)
Defeating the coronavirus must be the top—indeed, the only—priority for the foreseeable future. There is already huge anxiety across the UK. Businesses are facing unprecedented challenges and uncertainty, so, regardless of leave or remain, how quickly will the Prime Minister recognise the inevitable and seek at least a one-year extension to the Brexit implementation process?
The Prime Minister
Our priority is to deal with the coronavirus epidemic. The other matter that the hon. Member mentions has, as he will know, already been legislated for.
Antony Higginbotham (Burnley) (Con)
The Prime Minister
I can indeed confirm that that is exactly why we have cut business rates. We are making very considerable sums available for small and very small businesses precisely to protect the high street and the enterprise environment on which so many jobs depend.
Mr Kevan Jones (North Durham) (Lab)
I am sure that the Prime Minister will agree that protecting our NHS staff at this crucial time is of maximum importance. At least one GP surgery in County Durham this week received surgical masks from the NHS with expiry dates of 2016 on the box. In other cases, labels had been stuck over the top, extending the expiry dates on the boxes. What assurances can the Prime Minister give not only that surgeries get the equipment they require, but that it is actually effective once they get it?
The Prime Minister
To the best of my knowledge, all the equipment we are sending out is of the correct standard. I would be happy to look at the case that the right hon. Gentleman mentions. As I said earlier, we have stockpiles of PPE, but are making huge efforts to ensure that we have enough for the outbreak ahead.
Miss Sarah Dines (Derbyshire Dales) (Con)
The Prime Minister
I wholly endorse what my hon. Friend has said. We will do whatever it takes, and we will beat it together.
Siobhain McDonagh (Mitcham and Morden) (Lab)
Apart from rent arrears, eviction from a private tenancy—a section 21 no-fault eviction—is the biggest reason for homelessness. On Friday, I met a 77-year-old woman who had lived in her home for 15 years, and a couple caring for a sister with Down’s syndrome. Both households were due for eviction today. Will the Prime Minister ask the courts to stop section 21 evictions to take the pressure off hard-pressed councils and these really worried families?
The Prime Minister
The hon. Member is absolutely right to raise this matter, and that is why I said what I did to the Leader of the Opposition. We will indeed be bringing forward legislation to address this point.
Gareth Bacon (Orpington) (Con)
The Prime Minister
My hon. Friend is absolutely right, and that is why we are speeding up DBS checks, so that they can be done in 24 hours. I want to thank and congratulate all the boroughs throughout this country for the way they are harnessing those volunteers.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
The Prime Minister talked about supporting families. Will he show his solidarity for households headed up by a single breadwinner with dependent children? Saturday is National Single Parent Day, which was initiated by Ronald Reagan in 1984. Will he join the right hon. Member for Romsey and Southampton North (Caroline Nokes), who is my friend in this, on the steps of Old Palace Yard immediately after Prime Minister’s questions to show that, old or young, rich or poor, big or small, all families matter?
The Prime Minister
I could not agree more strongly with what the hon. Lady said. Whether I will be able to join her, I am not sure; I will have to look at my diary. I think I have a date with you, Mr Speaker.
Dr Andrew Murrison (South West Wiltshire) (Con)
The Prime Minister
My right hon. Friend raises a very important point, but it is one that is not unknown to the medical profession, and we will be relying on the clinical decisions of those medical professionals.
Kevin Brennan (Cardiff West) (Lab)
On the matter of “whatever it takes”, it takes more than three-word slogans, and in this case it takes a bit of war socialism. We need to get money into the pockets of the workers. Has the Prime Minister seen early-day motion 302, which I have proposed, about bringing in a temporary universal basic income to support workers and get money to where it is needed?
The Prime Minister
I hear the hon. Gentleman loud and clear. He echoes a point that was made by the right hon. Member for Ross, Skye and Lochaber (Ian Blackford). Of course, that is one of the ideas that will certainly be considered.
Mrs Theresa May (Maidenhead) (Con)
My right hon. Friend is rightly engrossed day to day in dealing with the developments of covid-19, but I would like to ask him to cast his mind a little further forward. The chief scientific adviser and the chief medical officer have been clear that the best solution to this is a vaccine, but the chief scientific adviser has said that that could be as much as a year away. He has also suggested that, until that vaccine is available, it may be difficult to ease restrictions successfully. Does my right hon. Friend agree with that analysis, and if so, what does a sensible exit strategy look like?
The Prime Minister
The objective of the Government and of our scientific advisers is to depress the peak of the epidemic, to ensure that we get through it, so that we come out on the other side, and that we do that as fast as possible. That is why we are taking all the measures that we have announced. That is why we have announced the package of business support that we have. I am not going to give a timescale on it, but that is the strategy, and I am absolutely certain that it will succeed.
BILL PRESENTED
Chris Bryant (Rhondda) (Lab)
On a point of order, Mr Speaker. Several Bills were just presented, but the one Bill that has not yet been presented is the one that the Government have talked about extensively, which is the emergency legislation on coronavirus. It is said that the Bill will be published tomorrow and we will deal with it on Monday. I hope that there will be a process whereby it is possible to table amendments before Second Reading, which is not the normal convention but is possible for emergency legislation. If the Government seriously intend this legislation to last for two years, I hope we will be able to table amendments to suggest that that could only be done with a review by Parliament on a regular basis.
Mr Speaker
That is on the Order Paper, and I am sure there will be time to table amendments. The message will have been taken on board that that should be made available.
Children (Access to Treatment)
Wednesday 18th March 2020
(4 years, 1 month ago)
Commons ChamberRead Full debate Children (Access to Treatment) Bill 2019-21 View all Children (Access to Treatment) Bill 2019-21 Debates Read Hansard Text
A Ten Minute Rule Bill is a First Reading of a Private Members Bill, but with the sponsor permitted to make a ten minute speech outlining the reasons for the proposed legislation.
There is little chance of the Bill proceeding further unless there is unanimous consent for the Bill or the Government elects to support the Bill directly.
For more information see: Ten Minute Bills
This information is provided by Parallel Parliament and does not comprise part of the offical record
Bambos Charalambous (Enfield, Southgate) (Lab)
I beg to move,
That leave be given to bring in a Bill to make provision about children’s access to medical treatment; and for connected purposes.
The recent case of Tafida Raqeeb was a sad example of a long line of disagreements about the treatment of seriously ill children that have ended up in court. In February last year, Tafida, then aged five, suffered a traumatic brain injury that left her on a life support machine in a hospital in London. In the autumn, contrary to the wishes of her family, the hospital trust wanted to turn off her life support. Tafida’s parents wanted to take her to Italy for further treatment, but that was challenged by the trust, which argued that it was in Tafida’s best interests that she should not be taken out of the country, and that she should instead be allowed to die. In a landmark High Court ruling in October, Tafida’s parents won the right to take her to Genoa for medical treatment. Tafida was allowed to leave the UK. She received the medical treatment she needed and, just nine weeks ago, she was taken out of intensive care. She is now breathing unaided.
In another case in 2014, Ashya King, a young boy with a brain tumour, was taken abroad, contrary to the wishes of the local trust, for proton beam therapy, which at the time was not available in the UK. Ashya’s parents were arrested in Spain for not acting in his best interests, but the High Court later ruled that he could receive the proton beam therapy in Prague. Following the therapy, which is now available in the UK, an MRI scan found that Ashya was free of cancer.
Not all cases have such successful outcomes. Those are just two of a number of cases in which a disagreement has ended up in expensive and intensive court proceedings, where judges have had to make what should be an ethical decision about medical treatment. That is a fundamental flaw in the system, which the Bill tries to remedy. It is clear to me that we do not have the appropriate support mechanisms in place to bring parents and doctors together at an early stage where there are disagreements about treatment, to properly address difficult questions that may prevent long, stressful and expensive court cases that are harmful to the child, the parents, the doctors and the hospitals.
In recent months, I have met Chris Gard and Connie Yates, the parents of Charlie, who, tragically and in highly public circumstances, passed away on 28 July 2017. Charlie was born with a rare genetic disorder, mitochondrial DNA depletion syndrome, which causes progressive brain damage and muscle failure. Following a breakdown in communication between the parents and medical professionals over an experimental treatment for mitochondrial disease, the hospital and Charlie Gard’s parents entered into a lengthy and distressing dispute involving a series of court proceedings. The case went to the High Court, the Court of Appeal, the Supreme Court and even the European Court of Human Rights. It was painful for all involved: the parents, the medical professionals working at the hospital where Charlie received his treatment, and everyone else concerned.
The case clearly illustrated problems with the current dispute resolution systems. The court proceedings caused enormous emotional harm and stress to both the parents and the medical professionals. Both wanted to do what they thought was best for Charlie. Instead of a smooth and efficient process aimed at resolving the conflict, we saw huge entrenchment, and precious time was lost while Charlie’s health deteriorated. Worse, parents and medical professionals were pitted against each other in the full glare of the media. That helped no one. Since then, Connie and Chris and have dedicated themselves to preventing the escalation of conflict and protecting the doctor-patient relationship.
Those conversations, and my observation of a number of similar cases, led me to produce the Bill. I am pleased to say that I have support from hon. Members across the House, as well as from doctors—including medical ethicists and former presidents of the British Medical Association—and the wider public.
Organisations such as the Medical Mediation Foundation are already active in trying to resolve disputes between parents and doctors in various medical settings. A study by the Centre for Health Economics from the University of York also shows that, as well as saving time and taking stress out of disputes, mediation could save trusts money by resolving issues concerning treatment quicker and without the need for expensive proceedings.
Broadly, the Bill does five things, which are all geared towards addressing disagreements quickly and clarifying the legal situation so that cases are less likely to end up in court. First, it requires the Secretary of State to put in place measures to improve early access to mediation services in hospitals where conflict is in prospect. Mediation has been proven to be an effective way of re-establishing trust between parents and doctors and helping them work together to make the best decision for the child, but currently access to, and take up of, mediation services is very low.
Secondly, the Bill would provide for access to appropriate clinical ethics committees, so that both doctors and parents could be supported in making difficult decisions by impartial ethical experts. Very few hospitals have access to medical ethics committees, meaning that parents and doctors often face a postcode lottery when looking to get the appropriate ethical advice. The Bill would put provision in place for committees to come together quickly when required and ensure that doctors and parents take the step of calling for a committee at an early stage when they are faced with difficult decisions.
Thirdly, the Bill would provide the means necessary to obtain second medical opinions swiftly, ensuring that, when requested, parents would receive access to the child’s full medical data so that those second opinions were fully informed.
Fourthly, the Bill seeks to provide access to legal aid to ensure that families are not forced to employ costly legal representation or to rely on outside interest groups in order to fund representation in the courts. Finally, the Bill would create a new legal test of whether an alternative credible medical treatment could cause a child “disproportionate risk of significant harm” in order to decide whether a parent is able to seek that treatment for their child. This test would replicate the legal test already used by social services considering whether to remove a child from their parents’ care and would sit before, rather than replacing, the current “best interests” test, which is very broad and can be subject to a number of different interpretations. The clarity brought by this test would, in turn, bring more certainty around the likely outcome of a legal decision and therefore prevent cases from ending up in court.
It is my view, and the consensus view of medical ethics, that if a treatment is not harmful and reputable doctors are willing to provide it, no one should be prevented from seeking that treatment, and the new test of “disproportionate risk of significant harm” aims to clarify this.
Most of all, the underlying aim of this Bill is to prevent conflict between doctors and parents and help support them as they work together during very stressful and upsetting situations. Conflicts are bad for doctors, bad for parents, bad for our NHS and bad for the children whose care is under consideration. The frequency of these cases and the obvious distress they cause all parties have led me to believe that the legal system in this regard is in desperate need of reform. I hope that my parliamentary colleagues will agree with me on this. I commend the Bill to the House.
Question put and agreed to.
Ordered,
That Bambos Charalambous, Seema Malhotra, Emma Hardy, Sir Roger Gale, Preet Kaur Gill, Ruth Cadbury, Mr Virendra Sharma, Sir David Amess, Tim Loughton, Kerry McCarthy, Kate Hollern and Taiwo Owatemi present the Bill.
Bambos Charalambous accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 20 June, and to be printed (Bill 119).
Opposition Day
Statutory Sick Pay and Protection for Workers
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Margaret Greenwood (Wirral West) (Lab)
I beg to move,
That this House has considered the matter of Statutory Sick Pay and protection available for all workers.
This is an international crisis, where countries need to learn from each other about what is working and what additional steps need to be taken. We also need to come together as a country to support each other as the severity of the crisis is becoming clearer. A Public Health England document estimates that the coronavirus epidemic in the UK will last until this time next year and could lead to almost 8 million people being hospitalised. The impact will be felt not just by those who become ill or have to self-isolate; this public health crisis has exposed the fault lines in an economy in which insecure, low-paid work is so prevalent.
In the Budget last week, and again yesterday, the Chancellor announced measures to support business, but there was a glaring omission when it came to workers on low income and those who are unable to work. PHE warns:
“It is estimated that at least 10% of people in the UK will have a cough at any one time during the months of peak Covid-19 activity.”
The revised health advice is that anyone with a cough should self-isolate for at least seven days, and for 14 days if they live with other people. It is right that people should not go on working when they are not well, but the Government’s measures so far still leave many people facing a cruel choice between their health and financial hardship, and it is a choice that has an impact on the health of the people with whom they come into contact.
In response to the questions from the Leader of the Opposition, the Prime Minister said that he would bring forward a package of measures relating to statutory sick pay. We really do need the details on that as a matter of urgency.
Mr Tanmanjeet Singh Dhesi (Slough) (Lab)
In order to claim statutory sick pay, workers need to prove that they are earning a minimum of £118 per week. So does my hon. Friend agree that rather than just regurgitating vacuous soundbites such as “whatever it takes”, the Government need to bring the statutory sick pay levels up from the current paltry £94.25 a week, which is not enough to even feed one’s family, to European levels and to extend it to all workers?
Margaret Greenwood
My hon. Friend makes a couple of important points about the levels of pay and the people who are able to access it, and I will be coming on to deal with those things in my speech.
Some 7 million people are not eligible for statutory sick pay: just under 2 million workers on low income do not qualify because they earn less than the £118 on average; and 5 million self-employed people do not qualify. Those on low pay are some of those who will be hit hardest by the crisis. Many of them work in retail, hospitality and leisure, and we are also hearing of people being laid off in these sectors. Others will be concerned that their jobs may be at risk, and these anxieties could also make them more likely to carry on working, even if they are unwell. Nearly 1 million people are on zero-hours contracts. Analysis by the TUC found that the earnings of about a third of them do not meet the threshold for SSP, compared with a figure of 6% for permanent employees, and women figure highly in the number of people on zero-hours contracts. Overall, about 70% of workers who would benefit from the removal of the threshold are women. A Government consultation published last year highlighted that workers who do not earn enough to qualify for SSP may be “working when unwell”. It said that the Government believed that there was a case to extend eligibility for SSP to people earning less than the threshold. So will they now extend SSP to all workers, including those on low pay.
Along with the just under 2 million people whose earnings are too low to qualify, others on low income in the gig economy are not eligible because they are classified as self-employed. They include careworkers, cleaners and delivery drivers, the very people on whom we will be depending to an even greater degree than usual in the coming weeks and months as people have to self-isolate in greater numbers. My hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) has rightly highlighted, in a letter to the Government signed by 100 colleagues, that although NHS England has issued guidance advising trusts to give full sick pay to staff who have to self-isolate because of the disease, careworkers on zero-hours contracts will not be protected. They make up a quarter of the social care workforce. Will the Government ensure that they also qualify for full sick pay? In the case of delivery drivers, the GMB has worked with Hermes to agree on a fund to protect the income of drivers who fall sick or who have to self-isolate, but there are other examples of companies offering derisory payments or even requiring drivers to continue to meet the costs of renting vans even while they receive sick pay. We should not need to emphasise how important it is that people in occupations where they are going from one house to another should not go on working when unwell. We depend on people such as carers and drivers, and the Government have a responsibility to protect them if they are unable to work because of the outbreak.
There is also a case to extend statutory sick pay to the self-employed more generally, as the Irish Government have done. Many people who are disabled and who have been ill, for example, choose self-employment because of the flexibility that it can give them to choose hours that are manageable. However, they also may be now more vulnerable to the virus.
The level of statutory sick pay is far too low at only £94.25 a week, so even those who do qualify for it are likely to struggle to keep on top of even basic household bills. Average weekly earnings are currently £512, meaning that the average worker who has to self-isolate for 14 days will see their income fall by more than £850 during that time.
Kirsten Oswald (East Renfrewshire) (SNP)
Is the hon. Member aware that research undertaken by the Institute for the Future of Work absolutely backs up everything she is saying about putting the statutory floor in place so that people can economically contribute when it is right for them to do so? There is much more resilience in the general population and they have more ability to work when they are fit to do so when such measures are in place.
Margaret Greenwood
The hon. Lady makes a really excellent point, and I thank her for it. Many workers on low pay are unlikely to have savings to fall back on either. In a recent YouGov survey, 48% of workers said that they would not be able to cover their rent or mortgage and other living expenses if they had to take two weeks off work at the current statutory sick pay rates. The European Committee of Social Rights found in January 2018 that statutory sick pay and social protections for the unemployed, sick and self-employed people in the UK were “manifestly inadequate”.
A worker in the UK on the national minimum wage who has to self-isolate will receive less than a third of what they would in Germany and less than half of what they would in Sweden or the Netherlands. The level of statutory sick pay is also set lower than the national living wage, which the Government said in the Budget that they want to increase. Will the Government therefore raise statutory sick pay to at least the level of the real living wage so that people are not pushed into poverty by doing the right thing?
The Government’s approach has been to say that people on low income who are not eligible for statutory sick pay can claim universal credit or new-style ESA. That is not the answer. Universal credit acts as a vehicle for cuts and the level of support is simply too low.
The four-year benefits freeze will only come to an end in April, and, as a result, families living in poverty have been left £560 a year worse off on average, so will the Government raise the level of social security payments in order to build resilience in people facing the virus? The five-week wait for the payment of universal credit means that there will remain a risk that people will go on working when unwell. The Government say that people can request an advance, but advances are loans that have to be paid back, often on top of other debts built up during that period, so will the Government commit to ending the five-week wait, and will they change their loan into a non-repayable advance?
The truth is that people often have to rely on food banks to survive as well as on advances during the first five weeks, and often after that, as deductions are made from the universal credit when it finally does arrive. However, there are reports that panic buying by the public is leading to food banks running short. People using food banks cannot afford to stock up and so are disadvantaged still further.
The Government should be taking measures to protect people in poverty in the current situation. Will the Government immediately suspend deductions from social security for anyone who becomes ill or is forced to self-isolate, and consider suspending them for all other claimants? Will the Government suspend work search requirements for anyone directly affected by the virus, and will the Government suspend all sanctions?
In the Budget, the Chancellor also suggested that some people who become ill but do not qualify for statutory sick pay could claim new-style ESA. That is £73.10 a week, even lower than statutory sick pay. Someone who is ill as a result of the coronavirus or for any other reason should not also be pushed into poverty and left worrying about how they will cope financially, so will the Government raise the level of new-style ESA payments? Even to get that, someone has to have built a contribution record over the past two years, which people in insecure work in particular may find difficult to do.
The Government announced that they were temporarily suspending face-to-face assessments for sickness and disability benefits. That is welcome as far as it goes, and Opposition Members have been highlighting the major problems with how assessments are carried out for a long time, but the Government have said that this approach would be replaced by telephone or paper-based assessments. That could risk increasing pressure on GPs at a time when they are already overrun, so can the Government tell us clearly how assessments will be carried out during the outbreak?
Media reporting of the virus highlighted that the most at risk had underlying health conditions, so what is the Government’s response to Mind’s call for all reassessments to be suspended to give people security of income at this time? What action will the Secretary of State take to protect people who care for a loved one who was already ill or disabled before the crisis began? Neither person may be directly affected by the virus, but attending a jobcentre could leave the carer at greater risk of contracting the virus.
The truth is that social security changes aimed solely at people who are self-isolating or ill will not be enough. Other people will be affected by the crisis. The Government have said that they will suspend the minimum income floor in universal credit for self-employed people directly affected. Will they also suspend the minimum income floor for all workers, given that many will be affected as a result of the crisis and the impact on the economy?
The demands on the DWP will be considerable, and its own staff may be forced to self-isolate or take time off because of illness as a result of the outbreak. What will the Government do to ensure that the service can continue? We are calling on them to do all that they can to introduce a form of robust, generous and comprehensive income protection for those whose hours may be cut or who may be asked to take unpaid leave because of the impact of the crisis. In some cases that will be because of a fall in the number of customers, but if schools have to close at some point, there will also be parents who are not ill and do not have to self-isolate, but who are unable to go on working, at least full-time. The Danish Government have just announced a scheme that would involve their paying 75% of people’s wages in those circumstances, and businesses paying the remaining 25%. A similar scheme successfully limited redundancies in Germany during the financial crisis.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
My hon. Friend is making some excellent comments. I understand that a major international fast food chain has told its employees that if a branch has to close because of infection, business being quiet or Government action, the employees will receive only statutory sick pay, and those on zero-hours contracts will get nothing. Does my hon. Friend agree that that will make it harder for employees to do the right thing, and that it constitutes exploitative behaviour on the part of the employers which must be condemned and stopped?
Margaret Greenwood
My hon. Friend has made a very important point, highlighting the vulnerability of people in insecure work who do not have enough support and also the levels of statutory sick pay, which are not sufficient to cover people during the crisis.
Matt Western (Warwick and Leamington) (Lab)
My hon. Friend is making a powerful speech. May I echo the point that she made about Denmark? I understand that both the French and the Italian Governments are seeking to introduce exactly the same system to support workers who would otherwise be laid off. The money is being paid directly to companies to ensure that they can retain those employees and the business can be kept alive as well.
Margaret Greenwood
That too is a very important point. The Labour party is working with the TUC and others on a package of measures, and looking at the Danish model in particular.
We want people to be reassured that they will not lose their jobs and their income, so they can go on spending. That would prevent a sharp fall in demand, and would also ease business confidence, as firms would see the Government take on part of their wage bill. It is an approach that involves employers, trade unions and the Government working together to preserve jobs and protect people from poverty. We are calling on the Government to explore these options, and we are prepared to work in partnership to make that happen.
There is a real danger that people who have already been pushed to the margins of our society will be worst affected by this crisis, and those who are struggling on low incomes, are disabled or are unable to work will be affected particularly badly. As I have said, we are working with the TUC and others on a range of measures to extend and raise statutory sick pay, abolish the five-week wait and sanctions, and provide income and wage support along the lines of the Danish model. We also wish to join in discussions with the Prime Minister about emergency universal basic income. We need leadership from the Government to ensure that all are protected if they fall ill, are forced to self-isolate, see their jobs at risk, or face unemployment. More than ever, we need leadership and policies that reflect the responsibility we all have for one another.
The Minister for Disabled People, Health and Work (Justin Tomlinson)
We are in extraordinary times. The coronavirus pandemic is the most serious public health emergency that our nation has faced for a generation, but the Government will do whatever it takes to get our nation through it. We all need to pull together. We can, must and will get through this.
Before I proceed to the main part of my speech, I want to pay tribute to all our fantastic staff, particularly those on the front line who are doing their level best, where they can, to enable some of the most vulnerable people in society to continue to receive benefits, and to enable those who now need to gain access to those benefits to do so. The spirit of this debate shows Parliament at its best—we are all seeking to work in partnership.
These are uncharted times, and there are new things coming forward. I have talked to lots of stakeholders in the past few days as we have made announcements about our Department. In normal times, we could spend 18 months developing policies—testing them, carrying out engagement up and down the country, and talking to people with real-life experiences to make sure there are no unintended consequences—but we are on a daily basis having to review things. It is a credit to the Opposition that this debate is being conducted in a spirit of partnership, so that we can look at and feed in things that need to be considered to provide further support—I know that more support will come forward on a daily basis.
Our policy is to protect lives and fight this virus with everything we have. Everyone should follow Government guidance to control the spread of the disease. Those who have a high temperature or a new contagious cough, and those who share a home with people presenting these symptoms, should stay at home in self-isolation for 14 days. Everyone should avoid unnecessary travel and social contact with others, and people who can do so should work from home. That will help to protect the NHS and safeguard the most vulnerable.
I reassure the House that the Government will provide a safety net and support for individuals during this testing time. Everybody will be supported to do the right thing, and the Government will help employers to support their employees to do the right thing.
Jim Shannon (Strangford) (DUP)
The Minister is very dutiful in doing his job, for which I thank him, but I have had contact today from a mother who is isolating because of her child. Is she eligible for sick pay from the Government, or does she have to take unpaid dependants’ leave, which would be very unfair? Just how can that work?
Justin Tomlinson
When people in work are isolating due to Government guidance, which seems to be the case in the circumstances that the hon. Gentleman describes, they would be eligible for statutory sick pay through their employers. In addition, it is always worth their looking on gov.uk to see whether they can get additional support through the welfare system, whether universal credit or new-style ESA.
Neil Gray (Airdrie and Shotts) (SNP)
Like the Minister and other hon. Members, I am looking to be collaborative, as I generally try to be, particularly in this type of circumstance, but the issue raised by the hon. Member for Strangford (Jim Shannon) typifies the confusion surrounding the guidance and support for people, which was why my right hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford) recommended at Prime Minister’s questions some form of minimum income guarantee that would cover all these issues and mean that people could just do what is right at the right time without having to worry about the financial consequences. Is the Department looking at that?
Justin Tomlinson
I thank the hon. Gentleman. I have said many times at the Dispatch Box that I admire the way that he contributes and offers support in trying to help some of the most vulnerable people in society. There were two aspects to his question, the first of which was about general communication. These are fast-moving events, and all constituency MPs are getting a lot of correspondence that asks very reasonable questions. We are trying to give answers that are as good as possible, but we really have to keep pushing people towards the gov.uk website, on which there is consistent communication. On the second point about a minimum net, that is where the welfare system comes into play, because statutory sick pay—it is important, and I will go over that—applies in only some cases, whereas the welfare safety net applies to all who need it.
Carolyn Harris (Swansea East) (Lab)
I believe the Minister will know that cross-party working is in my DNA, and I really do want to do everything I can to make sure we get this right. This is a personal but pertinent point: my son Stuart is self-employed; he has a wife who has had dialysis since she was 14, and a 10-year-old son, Liam. They are all self-isolating; Stuart does not have an income. They live in rented accommodation and utilities are essential to keep the dialysis going. I have a very frightened family and very many frightened constituents. We would be most grateful for any clarification on what we can do.
Justin Tomlinson
I have worked very closely with the hon. Lady on a number of issues, and I know that she is held in huge respect across both sides of the House.
Prior to being an MP, I ran my own business, so I understand the concerns of self-employed people who have suddenly overnight seen dramatic changes to their cash flow and ability to trade as a business. I absolutely understand the worries that people will have, which is why we are allowing access to statutory sick pay or, depending on people’s personal circumstances, looking at whether they can turn to new-style ESA—the contributory benefit—which is probably the case for the self-employed, or the wider support offer through universal credit and the welfare net. People would need to look at their circumstances and talk to the jobcentres. We are all trying to do our best to provide as much certainty as possible, as quickly as possible, through the daily updates.
Bill Esterson (Sefton Central) (Lab)
The Minister will know that many people are really worried about the financial impact of self-isolation, whether they are sick or not. He has mentioned sick pay a few times and the alternatives of universal credit and ESA, but those sums simply will not pay the rent or the bills, or put food on the table. The Minister also mentioned the speed at which action is needed and how much faster his Department is having to react then normal. If it takes till next week to put in place legislation, many more people will have not taken action to protect themselves and everybody else. Action is needed now and people need the money now. Will he please respond on that point?
Justin Tomlinson
I absolutely understand the point that the hon. Member makes. These are extraordinary times, and collectively we are all trying to identify the right levels of support as quickly as possible. In pure cash terms, the fiscal support that we have already provided at this stage of the curve is almost the highest around the world, but this is not complete. As events progress, we have to do more and we can expect more announcements. I understand that in an ideal world we could announce everything straight away, but we have to make sure that it is right, we have to react as things come forward, and we have to communicate as quickly and clearly as possible. We do understand that.
Justin Tomlinson
Let me make a little progress, because I think I am about to cover some of the things being asked about. I promise that I will take more interventions.
Extraordinary times call for extraordinary measures, which is why we have extended statutory sick pay to those who are self-isolating in line with the latest Government health guidance. The guidance is available online on gov.uk and ensures that eligible individuals, whether they are sick or self-isolating, will be entitled to statutory sick pay if they are unable to work because they are following Government advice.
The upcoming emergency Bill will mean that for people affected by coronavirus, statutory sick pay will be payable from day one, instead of day four, and currently it will be backdated to 13 March. We removed those waiting days to get support to people as quickly as possible. These are crucial measures to ensure that employees do not attend work when they should stay at home to help to keep themselves and others safe. The circumstances are exceptional and we urge employers to do the right thing, use their discretion and respect the medical need to self-isolate.
Statutory sick pay is a legal minimum, and employers can offer more. Where possible, employers should support their employees to work from home to help to slow the spread of the virus. If employers do feel the need to require evidence, people who are advised to self-isolate for coronavirus will soon be able to obtain an alternative to the fit note by contacting NHS 111 rather than visiting a doctor. We are all aware of the need to protect GP surgeries so that they can concentrate on key areas of work.
Accordingly, the Government will ensure that businesses are supported to deal with the temporary economic impact of the outbreak of coronavirus. Small and medium-sized enterprises are at the heart of our economy, symbolising the hard work and enterprising spirit of our nation. To support such employers with the increased costs of sick pay, the emergency Bill will provide that employers with fewer than 250 employees can reclaim up to two weeks’ statutory sick pay for sickness absences related to coronavirus. That includes those who are required to self-isolate in line with Government guidance. The measure could provide more than £2 billion of support for up to 2 million businesses, and will be crucial to ensure that our economy keeps running.
The measure on statutory sick pay is in addition to others to support businesses that were outlined by the Chancellor yesterday: £330 billion of Government-backed and guaranteed loans; additional cash grants of up to £25,000 for businesses in the retail, hospitality and leisure sectors with a rateable value of less than £51,000; and cash grants of £10,000 to 700,000 of our smaller businesses. The Government will do whatever it takes to support our economy.
Of course, not everyone is eligible for statutory sick pay, which is paid by employers. Gig workers and those on zero-hours contracts may be entitled to sick pay, and should check with their employer, but millions of hard-working people who are self-employed or in the gig economy will need our help, too. That is why we are making it easier to access benefits during this period.
The shadow Secretary of State talked about disability benefits and the announcement that we made earlier this week. The first decision was to remove face-to-face assessments, because we recognise that a significant proportion of those who could be claiming disability benefits are vulnerable. We want to avoid them needing to travel unnecessarily and to sit in busy waiting rooms, so we decided to stop face-to-face assessments. However, we do not want to stop new people gaining access to the support that they are entitled to, so we are seeking to continue to do paper-based and telephone reviews, but prioritising those who are new claimants, and looking at the workforce on a daily basis.
Stephen Timms (East Ham) (Lab)
I very much agree with the policy that the Minister is setting out. Will he clarify the intention for reassessments? He will know that Mind and one or two others have suggested that reassessments ought not to go ahead at the moment, partly because it is very difficult for people to get medical evidence in support of their reassessment claim at a time when doctors are very busy with something else.
Justin Tomlinson
I absolutely understand that point, and the right hon. Member and I discussed it when we first made the announcement. The absolute priority has to be new claimants who are seeking to get support through the disability benefit system, so we are looking on a daily basis at what we can do. I do not envisage that we will be able to do much beyond that, but I want to make sure that new claimants can get support. That was why, at the beginning of my speech, I paid tribute to the fantastic work of those who are working on the frontline, who—like all people—are anxious about events, but are still, when they can, coming in to make sure that the vulnerable people in society can access the support that they are entitled to.
Chi Onwurah
I thank the Secretary of State for giving way. He talks about statutory sick pay as part of the safety net. As such, he recognises that, as a safety net, it is a benefit of last resort, and he talks about the way in which companies can offer more. Does he therefore recognise that in this unprecedented situation, when so many people are likely to find themselves—either by choosing to self-isolate or being obliged to—in the position of claiming statutory sick pay, the level is not appropriate to drive the right behaviours or support people? It is no longer a question of last resort, but of supporting significant proportions of our population, so sick pay needs to be at a higher level.
Justin Tomlinson
I am not the Secretary of State—it is very kind of the hon. Member to elevate me to such a lofty position, but that does not apply. The broader point is that the Chancellor has made it very clear that we will continue, on a daily basis, to look at what additional support there can be. The Government will do what we need to do to protect the vulnerable in society and keep our economy going. Many Members will raise very important points in the debate but, as a broad principle, the safety net is wider welfare support, looking at an individual’s personal circumstances, and tailoring the level of support to them so that we can target help to the most vulnerable in society.
Those not eligible for sick pay, including the self-employed, are able to make a claim for universal credit or contributory employment and support allowance. Last week, we laid regulations to ensure that the contributory ESA is now payable from day one, removing the seven-day waiting period for people who are self-isolating on Government guidance or who are ill with coronavirus. Claims can also be made over the phone without the need for people to contact their doctor for a fit note. Those in self-isolation or sick with coronavirus who make a claim for universal credit can receive up to a month’s advance up front without physically attending a jobcentre. Everything can be done by phone or online, and that is a welcome position.
Sir Desmond Swayne (New Forest West) (Con)
What metrics has the Minister adopted to ensure that phone calls are dealt with in a timely manner? There are always complaints about people having to ring and ring, but not getting an answer.
Justin Tomlinson
We anticipate unprecedented demand, which is part of the reason why we have looked at the work that we no longer need to do during this period—for example, there was the announcement on ending face-to-face assessments for disability benefits—so that we can move health professionals on to the telephone systems to make sure that we can cope with demand and remove the need for people to unnecessarily visit jobcentres. We are keeping a very close eye on that on a day-to-day basis.
We are also removing the minimum income floor for self-employed universal credit claimants who have to self-isolate or who become ill as a result of coronavirus during this period. We are taking those measures to ensure that people are supported throughout this difficult period. We have increased access to sick pay, made it easier to access benefits and provided support for businesses to protect people’s jobs. This is a comprehensive package of support for some of the most vulnerable in society, but we are continuing to look at it by the day. The Chancellor has made it clear that there will be further announcements.
Gareth Thomas (Harrow West) (Lab/Co-op)
Two of my constituents who were both self-employed have had all their contracts brought to an end. They have a mortgage and two young children. Not surprisingly, as in many cases that hon. Members have raised, they are worried for the future. What support should I tell them the Government will make available to help their specific situation?
Justin Tomlinson
We are all hearing similar queries as constituency MPs. The key is for people to keep looking at gov.uk as announcements are made each day so that they have clarity about what they can and cannot get. The hon. Member talked about his constituents having a mortgage; obviously, we have already made the announcement about support for a mortgage holiday to protect people.
Part of the next step of our plan is to focus on providing support for people’s income and jobs. There will be further announcements, which will be shaped by all of us. As we flag up the issues being brought to our inboxes, that will help to shape the response. This is Parliament at its best, through partnership working. I hope that all hon. Members will give their full support to all the work that we and all our fantastic frontline staff are doing.
Neil Gray (Airdrie and Shotts) (SNP)
I thank the Labour party for devoting some of its Opposition time to allow us all to discuss this serious, pertinent, timely and important issue, given the uncertainty facing many of our constituents across the UK.
With your forbearance, Madam Deputy Speaker, I stress at the outset for anybody watching that people should follow the advice of their local health authorities, such as NHS Scotland or Public Health England. Regular updates are coming from the Governments across the isles. I recommend that, as best as possible, employees and employers follow the available guidance.
I commend everyone leading the response to the situation, including NHS staff, other emergency services, local authorities, the voluntary sector and Governments across the isles, who have been working together as best as possible to ensure that the best advice, based on science, and the best support is available at the right time. I particularly praise Professor Jason Leitch, a former dux of Airdrie Academy in my constituency and the Scottish Government’s national clinical director. Alongside the Scottish Health Secretary Jeane Freeman and the First Minister Nicola Sturgeon, he has been the model of calm, erudite leadership.
In the spirit of cross-party co-operation that we have seen emerge at Holyrood, I, too, have no desire to be political or criticise where working constructively can bring about better outcomes and engender greater confidence in the response of all Governments to the crisis. When I call for further action, therefore, it is not because I think the UK Government are deliberately holding back. I believe there is a genuine desire across all Governments to do the right thing at the right time.
The concerns that remain in large sections of society regarding the UK Government’s economic response to covid-19 essentially boil down to ensuring that incomes are protected when demand falls in huge sections of the economy. Renters, the self-employed, small business owners and people who are in or out of work just want to know that they will get the financial support they need to survive.
Constituents who are self-employed, such as taxi drivers, driving instructors, childcare providers and many more, have contacted me because they are worried about making sure that they do the right thing at the right time, while providing for their families and employees. My right hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford) and the shadow Health Secretary, the hon. Member for Leicester South (Jonathan Ashworth), have led calls for statutory sick pay arrangements to be improved to help workers who contract covid-19 or who have to self-isolate.
Although we welcome the UK Government’s move to make sick pay kick in from day one, and for the cost of sick pay to be met by them for companies with fewer than 250 staff for a period of 14 days, there is still more to do to support workers and businesses. Statutory sick pay is a reserved matter, as is employment law, so those areas are required to be decided upon here.
My right hon. Friend compared statutory sick pay rates in the UK with the rates of our European neighbours. As the House will be aware, that is not currently a favourable comparison for the UK Government. The UK rate is currently £94.25 a week—the second lowest rate when compared with EU nations. Ireland doubled its rate to £266 in response to covid-19, while Germany and Austria both pay £287 a week. At £94.25 a week, the UK Government are presiding over a system of poverty pay for those who are sick. One Tory MP was asked on Twitter whether she could live on £94.25 per week, and she simply responded “Get a life”.
This is really serious. We are asking people, even if they have mild symptoms, to self-isolate for the greater good, to contain and delay the spread of covid-19. We must be sympathetic with constituents who are asking legitimate questions about the advice and support they are getting. Statutory sick pay is an issue that should have been resolved before now, frankly. In response to this situation, the UK Government must act quickly.
At the Work and Pensions Committee hearing this morning, there was consensus among the witnesses that statutory sick pay should be raised. Citizens Advice is asking for it to go up to £180 per week. Scope is asking for it to be the equivalent of the national minimum wage. Others have said that the equivalent of the real living wage would be more appropriate, and Scandinavian countries are making it 100% of wages. The UK Government must act.
Alongside the rate of statutory sick pay, there are other specific areas where we want to see action from the UK Government.
Richard Fuller (North East Bedfordshire) (Con)
Just for clarification, is the hon. Gentleman asking for a permanent change in Government policy on statutory sick pay, or a temporary change for this period?
Neil Gray
We have to reflect on the fact that, even not at times of crisis, UK statutory sick pay rate is considerably lower than that of other European nations. A permanent change is required, but a temporary measure which might go beyond that permanent increase is required to deal with covid-19, so the answer is both, if that makes sense.
The Government must extend the policy further to ensure that sick pay is set at an hourly rate and available for everyone for 52 weeks instead of 28. Current rules on statutory sick pay are not flexible enough to meet real-life needs and fall far short of meeting a dignified standard of living, even with this new change. Disability groups have been especially vocal in calling for an overhaul of the sick pay system. Their concerns must be factored into the UK Government’s response to the sick pay consultation.
The UK Government should accept the TUC’s recommendations on sick pay for all. Those include abolishing the lower earnings limit, which would extend coverage to almost 2 million additional workers; permanently removing the waiting period for sick pay; increasing the weekly level of sick pay from £94 to the equivalent of a week’s pay at the real living wage; permanently agreeing that the legal requirement on fit notes after seven days of absence be extended to 14 days, with employers accepting self-certification for anything less than that; and permanently providing funds to ensure that employers can afford to pay sick pay.
The UK Government must do all they can to support businesses, to ensure that jobs are kept for the duration of this crisis. I would like to see the UK Government provide much greater grants, rather than loans, to help all businesses stay afloat, and attach conditions about ensuring that jobs are protected. We have seen that type of initiative in Denmark, and I hope the UK will follow.
Clearly, we all hope that these issues are temporary. The UK Government must do all they can to ensure that the attachment between employer and employee is not detached. That is important for workers, employers and the wider economy. Yesterday, Robert Chote, the chair of the Office for Budget Responsibility, urged the UK Government not to be “squeamish” about spending whatever it takes to prevent mass foreclosures, bankruptcies and millions of job losses as the UK effectively goes into lockdown. He said:
“When the fire is large enough you just spray the water and worry about it later.”
I turn to measures to support people who are self-employed and other business owners. The UK Government must do more. I echo the calls from my hon. Friend the Member for Glasgow Central (Alison Thewliss) last night. We must protect the incomes of people who are self-employed and do so quickly, to give them confidence. She was also right to raise issues around maternity leave, parental leave and support for people with no recourse to public funds; they are extremely vulnerable at the best of times, but right now they must be supported. The UK Government must give information to the devolved Governments as quickly as possible, and encourage much greater information sharing to allow all Governments to act swiftly and appropriately. At Prime Minister’s questions, my right hon. Friend the Member for Ross, Skye and Lochaber raised the prospect of some form of minimum income guarantee, such as a universal basic income. The Prime Minister appeared to accept the general premise, but time is now of the essence. Can the Minister give an idea of when he expects some form of announcement on people receiving financial support?
The UK Government should consider whether they will extend the normal deadlines for people to provide the necessary information to support social security applications, while paying people much more quickly as the demand is likely to be much greater. There is clearly a need to go further on social security. Ministers have heard me discuss the various issues that there are routinely with universal credit. The changes I want to universal credit, although they would undoubtedly help in this crisis, may not be practically achievable in a useful timescale—I am talking about scrapping the five-week wait, the two-child cap and increasing work allowances.
Instead, for the duration of this crisis, the UK Government need to ensure that those who are in or out of employment, those who are employed or self-employed, are paid an amount that allows them to get through. Universal credit advances, for instance, should now come in the form of a grant, not a loan. The Government should also look at urgently suspending the tax credit income disregard for reductions in earnings, at least for the 2020-21 financial year, to ensure that, where earnings fall, household tax credits entitlement takes account of that loss.
We now know that schools in Scotland and Wales are to close at the end of this week. That puts huge pressure on families who rely on free school meals, so I urge the UK Government to look at this area, as pressures are going to be on those families for the duration of the school closures.
Kirsten Oswald
One of the issues that constituents have contacted me about a number of times over recent days is the finance of households that rely upon prepaid meters for their energy. These households are likely to already be financially more vulnerable. It is very likely that they have to travel some distance to get the meter top-ups that they require. As part of their thinking, could the UK Government give serious thought to compelling the energy companies not to cut people off and to take account of the fact that there will be higher needs for energy and less money to go round while this is happening?
Neil Gray
I absolutely agree. Many calls are being made across the country today for direct payments to be made from the Government to utility companies to ensure that people in these circumstances do not miss out, but it goes back to my original premise: incomes for people, regardless of their circumstances during this period, are going to be hit, so the Government need to provide some form of minimum income guarantee to ensure that people in all circumstances are able to get through, whether that is via statutory sick pay or the social security system. If they are in work, the Government must ensure that, if people lose hours, those could be picked up again, so they continue to pay their bills and continue to live a sustainable life.
The monthly allowance for universal credit should also be increased dramatically and all other social security payment levels should be swiftly reviewed as well. Clearly now, this is not business as usual. We cannot continue to pay social security rates which impoverish in normal times, never mind now. We are going to have to accept that, to get through, the UK Government are going to need to inject a massive amount of money into the economy to make up for what is undoubtedly going to be a massive downturn across a wide range of sectors, the like of which I do not think we have ever seen before—a downturn that will result from the actions that the UK Government and other Governments are rightly taking in asking people to self-isolate and take other actions to contain the virus. We cannot tell people to stay away from work if they have symptoms, to stay away from restaurants, bars and cinemas and to work from home, and not expect an economic impact, an employment impact and an income impact. The UK Government must fill that hole to ensure that they fulfil the promises of the Prime Minister that nobody will be penalised and everyone will be protected for doing the right thing.
I wish to conclude with an encouragement to everybody who may be following this debate. Please be community-minded. We have already seen some fantastic ideas and responses to the crisis in all our communities. Watch out for your neighbours. Help if you can. Buy only what you need. If they have the means to buy more, add what you can to the food bank trolley and know that others certainly do not have the ability to stockpile. Many of my constituents are already worried about how they will access essentials because they are self-isolating, have lost their job or have other vulnerabilities. Now, like never before in so many of our lifetimes, we need the community-mindedness that got previous generations through such emergency situations.
We also need to start talking about how those of us who are fit and well—and who have contracted and come through the other side of covid-19—can help key sectors of the economy and emergency services to cope with what is to come. I suspect that, in time, with self-isolation and illness, we will need to mobilise that volunteer army. But that can only happen if we ensure that everyone has their income protected. Support for business is important, but at the end of the day it will be income protection, in whatever form that takes—a cash grant or a temporary universal basic income—that will finally give everyone the comfort to do the right thing by society. That will give the answers to the questions that we are all getting from businesses, the self-employed, renters and others.
I hope that, within hours, rather than days, the UK Government will do the right thing and guarantee incomes, as we have seen in other nations. We are willing to discuss any potential measures that the UK Government are thinking of in order to ensure that this is done properly and quickly.
Stephen Timms (East Ham) (Lab)
The hon. Member for Airdrie and Shotts (Neil Gray) mentioned in passing that the Work and Pensions Committee met this morning. We took evidence from five organisations: the Royal National Institute of Blind People, Mind, Scope, Citizens Advice and the Zacchaeus 2000 Trust representing the Disability Benefits Consortium. The main purpose was to take evidence about disability benefit assessments, but of course we took the opportunity to raise some of the current issues that we are discussing in this debate. I thank the members and staff of the Committee, and the witnesses from all those organisations, for being willing to take part in that useful session this morning, despite the current difficult circumstances.
I welcome the announcements that the Government have made. As the Minister for Disabled People, Health and Work, the hon. Member for North Swindon (Justin Tomlinson), has recognised, there is going to be a good deal more to do to protect individuals through this very difficult time; that is underlined by the examples from other countries that we have heard today. I very much hope, with others, that those additional announcements will happen very soon because we need them very fast.
I want to raise a couple of issues about universal credit. I put the point to the Chancellor yesterday that somebody who is self-employed and who self-isolates very often will have to forgo their income as a result. The advice is to apply for benefits, but if people apply for universal credit, they do not get any help for the first five weeks other than a loan that has to be repaid. It seems to me that people in that position are not going to be willing to give up their income if all they are going to get is a loan.
In answering my question, the Chancellor correctly said that people can apply for the new contributory employment and support allowance. I welcome the fact that that is now available not only to people who are sick, but to people who are having to self-isolate because others in their household are sick. However, as the Minister will recognise, there are going to be quite a lot of people in that position who do not meet the contribution criteria for ESA because they have not paid 26 weeks’ worth of contributions, having earned above the lower earnings limit, within the last two years. The only opportunity those people will have is to apply for universal credit. However, if they only get a loan, many will feel that they have no alternative but to carry on working—even though they know that they really ought to self-isolate.
The attraction of the proposal made by the hon. Member for Airdrie and Shotts—and which has been made by Citizens Advice and others—is that these advances should be made as non-repayable grants for the duration of this crisis. That is something that the Department could readily do. I recognise that expecting the Department very quickly to make big changes to its IT systems for supporting universal credit may not be practical, but it could quickly make the advances non-repayable.
I am pleased to see both the Minister for Disabled People, Health and Work and the Under-Secretary of State for Work and Pensions, the hon. Member for Colchester (Will Quince), on the Front Bench. They are very familiar with the Select Committee’s concerns about the five-week delay in universal credit anyway. There is growing evidence—including a striking article published in The Lancet this month—that people are being pushed into clinical depression due to being on universal credit rather than on legacy benefits. The Trussell Trust has found that many more people on universal credit need to go to a food bank compared with those on the predecessor benefits. Looking at what it is about universal credit that is causing those problems, the only big structural issue is the five-week delay. As the Ministers know, the Work and Pensions Committee will shortly begin an inquiry on that particular topic. That is a broader issue but, for the duration of the crisis, there is a powerful case for making the advances non-repayable.
I appreciate that this will not be the case everywhere, but it is the case in constituencies like mine. There are many working families who have leave to remain in the UK but do not yet have indefinite leave to remain. They are on what is called the 10-year pathway to securing indefinite leave, which means that every two and a half years they have to apply again for leave to remain. If they are working, they obtain leave to remain, but—I do not know whether this is universal, but it is certainly the case for a lot of my constituents—the card they receive making it clear they have leave to remain and are permitted to work in the UK also says they have no recourse to public funds. They are not allowed to claim any benefits at all, which in the current circumstance puts them in an extraordinarily difficult position. They are not allowed to claim ESA or universal credit at all. If they are in a position where they should self-isolate in accordance with the Government’s guidance, they will find that they suddenly have no income at all if they self-isolate.
There is a related issue with the habitual residence test, which is often applied, perfectly properly, to make sure people are habitually resident in the UK and are therefore entitled to benefits. I wonder whether there is a case for suspending the test, at least in some circumstances, because we want those who are working to be able to self-isolate when it is important that they do so. If they do not have access to public funds for one of those two reasons, they will find it practically impossible to self-isolate. I hope the Ministers and their Home Office colleagues will look at that.
Citizens Advice has argued that there should be a temporary repayment pause for claimants, which is a strong point in the current crisis. People currently have to repay their universal credit advances, or perhaps their past tax credit overpayments, through their universal credit, so there is a case for suspending those repayments.
The Minister for Disabled People, Health and Work said in his opening speech that “Everybody will be supported to do the right thing.” He is right to underline the importance of that but, as things stand, those who do not have recourse to public funds, because they do not meet the requirements of the habitual residence test, will not be supported to do the right thing, and it is very important that they should be.
In his Budget statement, the Chancellor said he is
“temporarily removing the minimum income floor in universal credit.”—[Official Report, 11 March 2020; Vol. 673, c. 280.]
When we came to read the Budget documents, we found that the position, as the Minister set out a few minutes ago, is that the removal applies only to those directly affected by covid-19 or by self-isolation according to Government advice. I think the Government should stick with what the Chancellor of the Exchequer actually said, which is that the minimum income floor will be suspended altogether, because a lot of self-employed people—my hon. Friend the Member for Harrow West (Gareth Thomas) gave us such an example—will see a big fall in their income because of what is happening in the wider economy, not because they are directly affected, as yet, by covid-19. Universal credit provides an opportunity to increase support where their income from self-employment falls. That could work very well, I think, if the minimum income floor was suspended altogether, as the Chancellor of Exchequer appeared to indicate would be the case in his Budget speech last week. I do hope that that will be looked at again, that the caveats that have been added to that commitment since might be taken away, and that the minimum income floor will be suspended altogether for self-employed people for the duration of this crisis.
I echo the point that was made a few moments ago by the hon. Member for Airdrie and Shotts (Neil Gray) about the tax credit disregard. As things stand at the moment, if someone’s income falls by less than £2,500, their tax credits do not increase at all. There is, in the tax credit system, a mechanism that can be used to provide people with help when their income falls, but to get the full benefit of that we would need to remove that £2,500 disregard. I appreciate that that is a matter for the Treasury, rather than for the Department for Work and Pensions, but I hope that it will be done.
Statutory sick pay is a big focus for this debate. The Government consulted last summer on extending statutory sick pay to those who are lower paid—to those who are earning below the current threshold—but the Government have not yet responded to that consultation, which was carried out several months ago. Surely now is the time to act. It was proposed then that statutory sick pay should be paid to people earning less than the lower earnings limit at 80% of their wage. That, I think, was the proposal on which the Government consulted. This is surely the time to fast-track that proposal—to bring it forward and put it in place. I appreciate that it will need legislation to do that, but it is very important that it is done, and I hope that it can be picked up in the legislation that will be published tomorrow.
Stephen Kinnock (Aberavon) (Lab)
On this point about statutory sick pay, there are two additional points on which the Government really do need to act. One is that this should be done in advance, up front, rather than making businesses reclaim, which is putting massive pressure on them. The other is that it is vital for the self- employed. Businesses in my Aberavon constituency are really under the cosh and they need both of these measures to be included in the rethink on statutory sick pay.
Stephen Timms
My hon. Friend makes a couple of very important points. I very much agree with him on the first, but on the second, my understanding is that self-employed people in this position can apply for this new employment and support allowance if they meet the contribution conditions, which, of course, some will not. That is where universal credit needs to be changed. One of those routes is likely to be a solution for them, rather than statutory sick pay, because that depends on there being an employer in place.
My final point is about the argument that has been made by many, and I am sure that will be made again in this debate, that the overall level of benefits should be higher, at least for the duration of this crisis, than it has been up until now. I just want to make one argument in favour of that proposition. We always say, and we have said it on both sides of this House, that work is the best route out of poverty, and the system is designed to encourage people to seek and find work but, at the moment, there are lots of people—and it will be a growing number over the coming weeks—whom we do not want to work. We do not want to force people into jobs. For many, the position will continue to be the same in the next few weeks as it has been in the past, but there is this large and very important group whom we really do not want to be working, and we want them to be at home. That, in particular, makes the case for Ministers who are looking temporarily at raising the levels of benefits—statutory sick pay and universal credit and the others.
I welcome what the Minister said about the suspension of face-to-face assessments
for disability benefits. I think he suggested that, in practice, his Department will not conduct reassessments for disability benefits either. If that is the practical reality, it would be helpful if he stated that explicitly. I think that would be reassuring to a lot of people who are in receipt of disability benefits at the moment and expect to have to be reassessed in the next few months. That is always quite an anxious time for people in that position. If the reality is that they will not be reassessed for several months because everybody is busy with everything else, it would be helpful for that to be made explicit so that reassurance can be provided.
Of course, if it turns out that there are ways of doing the new assessments that do not require face-to-face meetings, and if that works well for new applications, hopefully lessons can be learned for the system in the longer term. However, if it was possible to make it clear that there will not be any disability benefit reassessments in the next few months, I think that would be widely welcomed.
Several hon. Members rose—
Madam Deputy Speaker (Dame Eleanor Laing)
Order. It may be helpful for Members to know that Mr Speaker has received a message that we are expecting a statement at 5 pm, to be delivered by the Secretary of State for Education.
Rachel Reeves (Leeds West) (Lab)
It is an honour to follow my right hon. Friend the Member for East Ham (Stephen Timms), who made a powerful speech, particularly about refugees and asylum seekers. Their plight, and the specific issues they face, have not been discussed nearly enough in the past few days and weeks.
At times of national and, as in this case, global crisis, only Governments have the resources to protect our society and our health, to protect the most vulnerable, to protect businesses and production, and to protect workers. Markets cannot do that; only the Government can. That is why the Government must step up to ensure that we protect all our citizens, to direct our national economy, to help and support the people who most need it, and to ensure that resources get to where they are most needed.
I will talk primarily about issues with statutory sick pay, but let me first say something about the reports in the newspapers today that some Harley Street clinics are offering coronavirus tests for £395. That means someone can get the test if they have the money, but someone who works in a GP surgery cannot get it. That is utterly unacceptable. The role of the Government is to intervene to ensure that resources go where they are most needed—not to the rich and powerful, but to the people delivering our frontline services, who need protection. I urge Ministers to do that.
The measures taken by the Chancellor yesterday were necessary and worth while to protect our economic infrastructure and to support the most severely hit sectors of our economy. They were also necessary to support businesses, which are not responsible for the collapse in demand they are experiencing. The same is true of workers—they are not responsible for the predicament they find themselves in—yet support for them was missing from the Chancellor’s statement yesterday. The Minister has said today—the Prime Minister has said it too—that everybody will be supported to do the right thing. We all want that, but I am afraid at the moment that is not the case. People are not being supported to do the right thing. For many people, the right thing is not to go to work—not to spread this virus, but to stay at home.
If we really want people to do the right thing, we need to support them to make that decision, so let me turn to statutory sick pay. This point has been well rehearsed in debate both today and yesterday, but it obviously needs to be made time and again, because so far the necessary measures have not been taken. Statutory sick pay is not enough for people to be able to support themselves and their family. The level of statutory sick pay is insufficient.
The ineligibility is also a huge problem. If people are self-employed or earn below the lower earnings limit, they are not able to get statutory sick pay. Some of the people who most need it are denied the support that the Government say is necessary. Other people may not be sick, but also need support. If they are self-isolating, they might not have symptoms or be sick, but the right thing to do is to stay at home. If we want people to stay at home, they need support.
Similarly, we will have a statement from the Secretary of State for Education later and if, as now seems inevitable, many parents will have to take time off work to look after their children, they will need support to do the right thing, although they will not be sick. Of course, many people also face redundancy because their businesses cannot employ them anymore. Or if they are self-employed, the work is just not coming in. At the moment, those people are not able to claim statutory sick pay, and they will have to wait in the queue for universal credit or ESA if they have the contributions. That is not supporting people to do the right thing.
Chris Stephens (Glasgow South West) (SNP)
Does the hon. Lady agree that as workers have had their shifts cancelled, or have been told that their hours will be reduced—many of them are on zero-hour contracts—they, too, need the support that she is rightly saying should be given to workers?
Rachel Reeves
The hon. Gentleman is right. For many people, if they have a temporary reduction in their work, they can draw on their savings, but many of the people I represent—and many of his constituents as well—do not have savings to draw on. The Resolution Foundation published evidence last week before the Budget—to try to influence the Budget—that showed that 60% of people on low and middle incomes have less than £100 of savings. They do not have the resources to draw on even temporarily for a short time to pay the rent or the mortgage, or to put food on the table.
We must offer more support. That is what other countries are doing. In Norway, full pay is given to those laid off for 20 days. The self-employed get 80% of their average income over the last three years. In Sweden, laid-off workers are guaranteed 90% of their income: the Government will pick up half of that and employers are expected to pick up the other half. In Denmark, the Danish state will pay 75% of the salaries of laid-off workers. That is the same in many other countries. If it is good enough in Denmark, Sweden, Norway and other countries in the European Union and elsewhere, it is frankly good enough for workers in this country too.
It is now urgent that the Government come to the House and tell us that support is not just available for business—although that is very welcome—but is available to workers as well. Unless that happens, people will not be able to self-isolate and stop the virus spreading. The health crisis will become an economic crisis and many people will pay the price for the virus. It does not need to be that way. Let us look at income replacement, and quickly, to ensure that help is available.
As important as helping people now is, if we put in place income replacement so that people are not laid off or made redundant, it will also support the economic recovery. The pandemic will pass—we must believe that and we know it is the case—but when it does, and people want to go out again and to start spending in shops, restaurants, bars, theatres and cafes and to travel on aeroplanes, we need to ensure that the economic fabric of our country is still intact. The best way to do that is to ensure that workers remain attached to the firms that have been employing then. Income replacement can help people now, but it can also ensure that our economy gets back on a sound footing when the crisis has passed. To build the economy we need to see after this, I urge the Government to introduce urgently a system of income replacement.
The issue of renters has also been mentioned by Front Benchers and others. There was support yesterday for people with mortgages, and that is very welcome, but many people, especially those in precarious work or on low pay, do not have mortgages—they rent privately or in the social sector. In my constituency, fewer than a third of homes are owner-occupied; the others are either in the private rented sector or the social rented sector, and we need to do much more to support those people as well, because if they are on statutory sick pay now, or have seen a fall in their incomes or are expecting to be made redundant, frankly they are not going to be able to pay their rent in the days and weeks ahead. It was welcome that the Prime Minister said there will be support for renters, but we need to see the detail of that, and we need to see that support coming directly to landlords and renters to ensure that nobody is penalised because they do not have the money to pay their rents right now. That requires support for local authorities, who are big letting agents, and big providers of social housing; the support needs to go to the housing associations too and also large landlords, and we should be working with local government to ensure that we are reaching and talking to the biggest letting agencies and estate agents to make sure that support is getting to the people on the ground.
Again, I cannot stress enough how important this is; this action is needed urgently. The representative of the hospitality sector said last night that we are staring at hundreds of thousands of redundancies in that sector alone, so income replacement and support for people in the rented sector is crucially important.
The support for mortgages is a three-month holiday, and I say again that I am not sure that that is the right approach in the private rented sector, because a three-month holiday on a person’s mortgage which can then be added to their mortgage debt is one thing, but if in three or four months’ time someone has four months’ worth of rent to pay, that is not going to be much good if they have found their incomes have not recovered by then. We therefore need to be sensitive about ensuring that the support is there for the period of time that it is needed for.
Finally, I want to say something about gas and electricity and broadband and television licences. These are all essential services for people, and they will be more essential in the weeks and days and months ahead as more people are having to stay at home. Broadband is now absolutely an essential service, because the only way that many people can get food delivered is by ordering online. Again I urge Ministers to say to the providers of those essential services that nobody should be cut off from those essential services as long as the pandemic lasts, because otherwise people will find themselves without the basic infrastructure to be able to stay in their homes.
This global pandemic has thrown into sharp relief some of the problems in our labour market and in our social security system, so when this is all over we cannot go back to business as usual. If people cannot survive on £94.25 statutory sick pay when there is a global pandemic, they cannot survive on £94.25 at any other time, so we need to look at the waiting time for universal credit and the level of statutory sick pay, and who is eligible for it, and also, frankly, how our labour market works. We have 1 million people on zero-hour contracts and we have almost 5 million people who are self-employed—some choose to be, but many have no choice—so we need to look at how our economy works and who it works for, because whether we are in the midst of a global pandemic or not, there are too many people in our country that our economy, our labour market and, frankly, our society do not work for.
Wes Streeting (Ilford North) (Lab)
It is a pleasure to follow my hon. Friend the Member for Leeds West (Rachel Reeves) and my right hon. Friend the Member for East Ham (Stephen Timms), the Chair of the Select Committee, and I want to build on some of the points they made both about the practical challenges people face in the midst of this pandemic and about some of the fundamental questions posed to each of us as members of a society that has left far too many people far too dangerously exposed, not just in the face of this pandemic but in everyday life—a plight that has gone unanswered for far too long.
I want to begin by paying tribute particularly to the workers in the NHS who are putting themselves in harm’s way as they treat people in the midst of this pandemic, and I absolutely echo what my hon. Friend the Member for Leeds West said: it is crucial that NHS workers have access to the right kit to do the job and that, where there is any concern about the diagnosis of those NHS workers or their family members, they are considered priority cases for testing. Frankly, the Government’s claim to be among the best in the world at testing tells us only that the rest of the world has much more to do, because we are hearing of far too many cases where people who need to be tested are not receiving that test.
The crisis we face is not just a public health crisis; it threatens to be an economic one. The supply and demand-side shocks it will pose will be both simultaneous and severe, so it requires co-ordinated action on the part of Government and industry on a scale that we have not seen since the second world war. A wartime mobilisation is going to be required for this peacetime crisis. Many families, as they gather around the kitchen table this afternoon and this evening to consider what a loss of earnings or perhaps a loss of employment would mean for them and their families, are staring at the hard reality of a social insecurity system that has left far too many people grappling with poverty and insecurity, and ongoing crises as a result, for far too long. No one can or should be expected to live on SSP of £94.25 a week. No one should be expected to live on universal credit, which in some cases can be even less generous—if that is the right word—than SSP. So I echo the calls this afternoon for increases to SSP and UC to ensure that our social security system provides just that—social security, not just in the worst of times, but in the best of times for our country.
Ministers should ask, but so should people in our communities, how the political choices of successive Governments and the political demands of sections of the electorate ever allowed a position in which we allow people who have fallen on hard times to fall into harder times still because of the social insecurity system, which pushes people further into poverty, mental ill health and family crises, which make it harder, not easier, to escape from this. I suspect I am one of a minority of people in this House who know what it is like to grow up in a household that is reliant on the social security system; what it is like when there are more days left to the end of the month than there is money; what it is like when people have to beg, borrow and steal to put food in the fridge; what it is like when the electricity meter has run out and so has the emergency; and what it is like to feel a victim of the state, rather than supported by the state. We should resolve, in the midst of this crisis, that once it is over, never again are we going to allow our social security system to fail people in the way that it did before this crisis and that it threatens to do within this crisis.
Yesterday, the Chancellor set out a series of measures to help businesses and to try to get the economy through this. I welcome those measures, but we have to learn from past mistakes. It is not enough to bail out businesses, although that is important; we also have to bail out people. As we build the economic recovery, we have to ensure that the quantitative easing that helps provide liquidity to our economy to help things keep going as best they can in difficult times is also a quantitative easing for the people. By all means, let us call for an increase in SSP, UC and disability benefits, to make sure that people can live with dignity and have a good quality of life if they are unable to work. All those things are important, but instead of quibbling about piecemeal measures, with a bit of mortgage relief here and a bit of rental support there, why do we not just provide every household in this country with the security to know that the Government will provide protection for people’s incomes, so that they can continue to make sensible choices for their families, so that they know that when the end of the month comes and the mortgage or the rent is due they can pay it, and so that they know that when the bills are due and when they have to do their shop, they will be able to pay for this?
I have always been a sceptic about the principle of universal basic income, because I fundamentally believe in an economy and a social security system that redistributes wealth from those who have it to those who need it most. I am also cynical about it because although there are many principled and decent-minded champions of universal basic income on the left of politics, the left should regard the principle with suspicion when some of its leading champions have been right-wing economists, such as the father of free market economics, Adam Smith. There is a right-wing vision of universal basic income that is about dismantling the state and that says, “If we provide everyone with the income, we don’t need to provide the services centrally because people can pay for them.” That is one reason, I suspect, why the Trump Administration have not needed much persuasion to provide a form of basic income.
But although we should regard the principle with suspicion as an ongoing solution to how we provide social security for people, there is now a strong case for a form of basic income to see us through this crisis. It could be a universal payment made available to everyone, where the tax system is used to recoup the money from those who genuinely do not need it. It could be a form of basic income, where those who need it simply apply for it and then receive it. It could be a form of income protection, as my hon. Friend the Member for Leeds West described, which is already working well in Scandinavia. But one way or another, we have to make sure that families have incomes to see themselves through this crisis, because as we have already heard, the majority of people in this country tonight are one lost payday away from being in a real crisis, and the crisis for them will be a crisis for all of us if demand is further sucked out of the economy. I hope that Ministers will take that message back to the Treasury.
Finally, it is not just the social insecurity system that has left people exposed in this crisis. We have to make sure that this is a turning point. It could be that our political choices further entrench inequality in our society—just as, frankly, the coalition and Conservative Governments did after the last financial crisis, when too many of the political decisions and so-called tough choices meant balancing the books on the backs of the poorest.
Neil Gray
The hon. Gentleman is making a very good speech, and I agree with much, if not all, of what he has said. He is coming to the very important point about what happens after all this. There has been a massive fiscal stimulus over the last week, and we expect more to come. What none of us would expect is austerity mark 2 to see us out the other side.
Wes Streeting
I wholeheartedly agree.
Let me conclude on this point. In the aftermath of the last financial crisis, the Labour Government—and, in fact, the reputation of the Labour party—were utterly trashed because Gordon Brown’s Government took the courageous steps that were needed to prevent a financial crisis in America, which became a global financial crisis, from becoming a depression, which would have meant people being unable to take money out of the banks. The Government were right then not to be squeamish about borrowing to make sure that our country got through it, and this Government should not be squeamish now.
I suspect that by the end of this the Government will own such a large stake of the British economy that it will make Labour’s last manifesto look positively conservative in its ambitions by comparison. If that is what it takes to see us through this crisis, that is what the Government will have to do that. We are going to need a wartime response to get us through this crisis, so let us think now about the peace that will follow. Just as our generation looks back with pride at the decisions that the 1945 Attlee Government took and the legacy that they left, let us think now about the legacy that we will leave for our country. Let us make the choices now that lessen inequality in our country and provide genuine social security in the best of times, not just the worst of times.
Let us ask how it was that political choices left our social care system at breaking point and the people languishing in it more exposed to this pandemic than they would otherwise have been. Let us repair our broken social care system by making brave political choices. Let us care more about how we fund the living to lead a good life than about how we tax the dead. Let us make sure that, when people get to old age, they are not just looking back on a life well lived, but able to live life to the full until the end. Let us make sure that, when people get to old age, they are not just looking back on a life well lived, but able to live life to the full until the end.
Let us see this as a wake-up call. If a pandemic can seriously disrupt the labour market, and we have to provide serious income protection to see it through, let us think about what a technological revolution will do as it displaces, relocates and significantly changes the shape of the labour market. Let us make sure that we have the social protections needed now to face the next revolution, not just the current crisis. Let us not let the global pandemic distract us from the urgency of the climate emergency. Let us make sure that our recovery is a green recovery.
Finally, let us no longer listen to the siren calls of the populists and the nativists who believe that countries can go it alone, and that we have to build a world where we are all in it for ourselves. Let us recognise that global problems require global solutions and global leadership through global institutions. As the Attlee Government rebuilt the fabric of the country through a new welfare state and built international institutions, let us to resolve to do the same.
Bill Esterson (Sefton Central) (Lab)
We have heard some powerful speeches from hon. Members of three parties. I commend my right hon. and hon. Friends for what they have said.
It is a challenge to follow my hon. Friend the Member for Ilford North (Wes Streeting), because he spoke so powerfully. He started with his experience of growing up in the grip of the completely inadequate welfare system that we had then. The point he made that touched me was how dangerous it will be if we do not respond to the crisis by putting in place the necessary economic measures right now, because we run the risk of subjecting millions of our fellow citizens to long-term hardship. That is why the situation is so urgent and requires so much action from the Government. As my hon. Friend the Member for Leeds West (Rachel Reeves) said, only the Government can take that action.
We in this country face a situation where the number of fatalities had doubled in two days to 69 when I looked yesterday. If that is the growth rate of the number of fatalities, we will be where Italy is today by next Friday. That is the reality of what is happening, if those figures are right. That brings home to me, and I am sure to everybody, the need for the fastest possible action on health and on the economy.
My hon. Friend the Member for Ilford North mentioned the need to support health workers. That applies across the public sector. The No. 1 priority is to get them protection so that they can do their jobs and to make sure that the testing regime is there as quickly as possible. It will not wait any longer.
That priority is very closely followed by the economic response that is needed. If we are to reassure people across the country to take the actions recommended by the Government, and rightly spelled out by the Minister, we must also give them the financial assurance that they can do so. That has to happen straightaway. The SNP spokesman was right in saying that it should happen in the next few hours. Yesterday’s measures were only a start. I accept that the Chancellor rightly acknowledged that they were only part of a number of steps. As a result of this debate, Ministers are hearing further reinforcement of why it is important to get action for individuals today—not next week.
I will give some case studies. The bus driver in London who believes that he has coronavirus symptoms is still going to work, because sick pay would not be enough money to put food on the table, let alone cover the £1,200 in rent that he pays every month. He cannot afford not to work. The reflexologist who works in a care home now cannot go to work because she is a visitor. The dog kennel owner is not going to get any dogs to look after. Their income is gone. The tutor has lost all of her income.
My hon. Friend the Member for Leeds West talked about renters. They are often also the most at risk from income loss, because of the nature of the work they are involved in. The Government need to support landlords as well as tenants in the private rented sector, as well as supporting social housing landlords at the same time. We have heard reports about rough sleepers being on the tube in London and on public transport elsewhere. They are clearly in great distress. The support for people outside the system is essential straight away. At this stage, as far as I can see, it is not in place.
Jess Phillips (Birmingham, Yardley) (Lab)
Does my hon. Friend agree that for lots of the people he is talking about—the Chancellor repeatedly talked yesterday about those who are self-employed, for example, being able to claim universal credit instead of SSP in this circumstance—this simply is not good enough? Today I have had lots of reports of people trying to do that in my constituency, and they are being told by the Department for Work and Pensions that they have to go to a face-to-face meeting and go through a series of protocols in order to do that. Let alone the dangers of a face-to-face meeting, it is simply not the case that these people can get any access to universal credit at the moment.
Bill Esterson
I thank my hon. Friend for what she says. It reinforces the point, and she made the same point in the question she asked the Chancellor yesterday evening. I just hope that Ministers are taking on board how quickly things need to change. One of my constituents made the point that he does not qualify for statutory sick pay, as he is self-employed. That is a real problem for the 5 million people who are self-employed and have lost all their work. Whether it is universal credit or ESA, it simply is not anywhere near enough money. He is staying at home, observing advice from Government and not able to earn his weekly wage. Whatever is in the package from the Government, which the Minister has already referred to, it is nowhere near enough for what they need.
Another of my constituents, a nurse, asked me to raise the situation of principal carers who live with somebody in a vulnerable group. What is the advice for her? The example she gives is her son, who cares for his wife, who has a chronic respiratory disease. She is 26, but with that disease she is clearly in one of the highest risk groups. She cannot work and does not leave the house, but what is he supposed to do? He is still going to work, but with great anxiety, because he might catch the disease and pass it on to her. They have a mortgage and they need his income. Those are real-world examples. We have all heard them from our constituents and from others around the country, and they show why action has to be immediate.
I have mentioned the self-employed and freelancers, small firms and people on zero-hours contracts. The support just is not there. If someone is employed and they qualify, the £94.25 a week they get is not enough. Universal credit is not enough. The support announced yesterday for the hospitality and retail sectors for a few weeks is encouraging, but what is really needed is the kind of cash injection that a number of my hon. and right hon. Friends have already mentioned, and that was put to the Chancellor last night in the statement.
Loans are part of the answer, but there is a massive question mark with loans from a banking system that many businesses still do not trust because of how it behaved during the financial crisis. Loans have to be repaid. That was the point I made to the Chancellor in the question I asked last night. In reality, we have to avoid storing up problems further down the line with the actions that are taken now. These were very big numbers—eye-catching, headline-grabbing numbers, such as £330 billion—but the reality is that the £10,000 on offer to small firms will not last very long as a grant.
Then there is the question of information. The Minister mentioned the gov.uk website. Not many businesses—and I work with them across the country—are aware that that is where to go to get this information. The Government need to do a lot more to get the information out there quickly on a range of issues, using social media, television and radio.
The grant system for businesses announced yesterday appears only to be starting next week. Again, that is so much later than needed. Is there any way of bringing it forward? We have heard the examples from Scandinavia, with contributions towards salaries of 75% by the Government in Denmark, 90% in Sweden and 60% in Germany, or 67% for those with parental responsibilities. The Minister said that these things take time. Why is it that other countries have been able to put these measures in place so quickly, but we are not at that stage yet? What is holding us back if they were able to do it? It seems to me that if they can do it, so can we.
Are the Government looking at what the TUC has said about a real living wage and what Members have said about a universal basic income for a limited period? I tend to agree with my hon. Friend the Member for Ilford North on that period. We need to redefine what we mean by sick pay. It is not just whether someone is sick; it is whether they are in danger of becoming sick and infecting other people. It is about giving financial reassurance and making up for the lost jobs, the livelihoods that are at risk and the contracts that have gone in whatever sector of the economy, for as long as it takes.
Only the Government can intervene, and if we do not get this right, it will be so much worse for the health of us all and for the economy. The Government say that they will do whatever it takes—that is the three-word slogan of the moment. “Whatever it takes” means giving every single person in this country the financial security they need right now to ensure that they can protect themselves, their families and the rest of us.
Richard Fuller (North East Bedfordshire) (Con)
I am grateful to you for allowing me to speak, Madam Deputy Speaker, and I apologise to the hon. Member for Wirral West (Margaret Greenwood) that I was not in the Chamber for the first part of her speech. I wanted to listen and make a contribution, and I appreciate the opportunity to do so.
I thank the Opposition for holding this debate, which covers two of the things that are on most people’s minds: reducing the likelihood that I, anyone in my family or anyone I work with will get sick, and providing protection for me if that does happen; and trying to protect my job over the next few weeks and as we recover. The debate has raised a number of issues. I am not going to pick out any particular ones, but I want to make some observations.
The first is what a difference a week has made. It is seven days since the Budget, and these are very different circumstances. We should give credit for all the efforts made in this House and for the measures that the Government have taken to respond as quickly as they can on such a wide range of issues. None of us in this room has the power of the Almighty, and we should understand that we work within human frailties. I will come back to the frailties of the systems that we work within.
Secondly, I would like to add to some of the examples given by the hon. Member for Airdrie and Shotts (Neil Gray) about the public’s response. This week, I have met churches that are working on good neighbourhood schemes. I spoke today with a playwright in the village of Arlesey who is setting up a group to bring skills together in the community, to assist people. We are seeing the best of people, but as some Members have said, we are also seeing the worst of people. In a free society, we can see the best, but we can frequently see the worst. Harley Street doctors are reselling tests at a high price that will not be available to everyone. That is a disgraceful thing for anyone with a professional qualification to do. We have seen pictures of hoarders in shops, meaning that elderly and vulnerable constituents of mine—and, I am sure, of all Members—are not able to access the foodstuffs and other products they need. We have seen the reaction of the bosses of some of the largest companies.
Wendy Chamberlain (North East Fife) (LD)
On that point, I have been contacted by a constituent who has informed me that their employer is insisting that they cannot work from home because it is waiting for stronger guidance from the Government. Can the Government give clear guidance right now to my constituent’s employer and many others across the country that, if people can work from home, they must?
Richard Fuller
I appreciate the hon. Lady’s intervention. I am not speaking for the Government—I am sure the Minister will seek to address that—but I have to say that it sounds to me as though her constituent’s employer is just making an excuse, because the Government have been absolutely clear that it is the right thing to do socially for everyone in this country, if they have a concern, to be able to isolate themselves from others and to work from home. What more does that person need to understand what they should do? I hope they will get that message very clearly from the Front Bench.
On the point of leaders not doing the right thing, the experience of Virgin airlines has been raised. The owner or partial owner of Virgin airlines has suggested that employees should take eight weeks of unpaid leave, and I decided to look at how much that would cost. Eight weeks at the £94.25 rate of statutory sick pay would cost £754 per employee. There are 8,571 employees of Virgin airlines, so if all of them took eight weeks of unpaid leave, that would be a cost of £6.4 million. Sir Richard Branson’s net worth is $3.8 billion. If he is able to get 2% interest on that money for eight weeks, he will earn the equivalent of £9.9 million. So I say: Sir Richard Branson, give up the interest on your wealth for eight weeks, and pay your employees yourself their unpaid leave.
Big or small—a leader of a church in a small village or a leader of the large business—when it comes to looking at the protection of their workers, the time is now, and we will judge them all by their actions. It will be the same for the Government’s actions.
As I say, are we choosing the right policies? We have heard a lot about that today. I congratulate the Government on the staging of the announcements. There is so much pressure—all MPs are under pressure, with loads of questions: small or micro ones, and very large ones covering many issues—but I think the staging of announcements is a good approach, because we need this to bed in with people each day. If we put everything into an announcement on a single day, I would worry that, although we would feel we were communicating, we would find that it was not being received and understood as clearly as it should be.
Neil Gray
I commend the hon. Member’s speech thus far. To some extent I agree that, for preparedness in working through particular policies or interventions, there has to be some preparation and that does take time. However, in terms of people’s livelihoods, people are losing their jobs now and businesses are making decisions about their future viability now, so would he encourage the Government, as I have, to make an announcement about the financial impetus that could be given to protect individuals and jobs in hours, not days, so that this response can be adequate?
Richard Fuller
Yes, yes, yes, yes and yes. Those yeses are for each of the businesses in my constituency that I have spoken to in the last 24 hours that have asked for precisely that. We often think: how can a business suddenly be short of money to pay its own workers within a short period of time? But the truth is that, in some sectors, cash flow is of a nature that those issues do come up. More importantly, I say to those on my Front Bench that every single responsible private sector business right now will be thinking, first and foremost, “How can I protect cash flow for the long-term survival of my business?” One of the nearest short-term costs that can be reduced is their employee cost, so there is the sense that this is needed, as the hon. Member rightly says, in hours rather than days. To be fair, I think the Chancellor was very aware of that in his statement yesterday.
To that end, may I encourage hon. Members on both sides—there are slightly more on the Opposition Benches than on the Government Benches for certain reasons—to think more about using what is already in place, such as the systems that connect what the Government can do to those institutions and people that need it, rather than trying to broaden it out into a big and different debate about whether we should have this or that. There is of course a time for debating universal income, and there is time for us to think about ways in which we might look at a better overall system in the future.
Right now, I say to my right hon and hon. Friends on the Front Bench that we should be looking at proposals using the existing arteries of the financial system, of the benefits system and of the pay-as-you-earn and tax system that can reach people, either to amplify payments that are already made or to reverse flows from into the Government to back out to those who need them, and I ask them not to get too distracted by items along the way.
We should also recognise that in this period there will be a test for the labour market structure in the United Kingdom. The UK does have some not quite unique but nuanced features, particularly its reliance on flexible working and on self-employment. The changes that Governments have put in over the past 15 years to create a flexible market—there are benefits to that—will also be tested during this pause in the economy. After we have gone through this crisis, I would encourage the Government to see what lessons can be learnt from that.
This is also a test in terms of the enlightenment we have in our social insurance system. I was moved by the contributions from the hon. Member for Leeds West (Rachel Reeves), the Chair of the Business, Energy and Industrial Strategy Committee, and the hon. Member for Ilford North (Wes Streeting). It is absolutely right that this is an opportunity for us to look at those things and to reflect. We may have different perspectives on it, and we will definitely have different politics, but only a fool would say that we should not look at this and learn lessons. This is no time for fools.
My core message for the Government is this: the staging of announcements is absolutely right, so that they can bed in with people; use the systems we have to get money into the hands of the people and businesses who need it; and follow the advice from both sides of the House, which is that we would welcome the Government’s moving with speed between the announcement and the time that the money is available in the bank manager’s office in Arlesey, Bolnhurst or anywhere else in the country, or in that person’s pay packet, their bank account, or their benefits slip.
Alex Sobel (Leeds North West) (Lab/Co-op)
I thank the hon. Member for North East Bedfordshire (Richard Fuller), who has been uniquely brave in speaking from the Back Benches on his side of the House. I think that there was much that we on the Opposition Benches could agree with him about.
The scale of the coronavirus crisis means that we need to take action in many forms, and ensuring that people have economic security is second only to our response in safeguarding people’s health. The point will come at which we have mass isolation—I feel that that point is probably coming very soon—and that will happen whether people are symptomatic or not. This unprecedented challenge needs an unprecedented response, and we must work together to bring forward the right response, which safeguards people and brings future confidence, not just immediate wellbeing. A measure that will do just that is an emergency universal basic income, which will give everyone the basic financial support they need to provide the necessities of everyday life through this crisis.
My hon. Friend the Member for Ilford North (Wes Streeting), who has just left the Chamber, made some very good points. In normal circumstances, this might be a debate in which we would ask questions, explore different aspects of the situation and, particularly on the Opposition Benches, talk about the benefits of universal basic income versus universal basic services. I suggest to the Government that if we had universal basic services in areas such as childcare and social care, we would be in a much better place to weather this crisis than we are with just a single universal basic service, the national health service, taking the brunt of the crisis.
Putting that aside, and thinking about where we are and the phase of the coronavirus crisis that we are about to enter, we need to take this step. We just need to think about how our economy has changed fundamentally since 2008, with the number of self-employed people having risen over the past 15 years from 3.25 million people to more than 5 million people. They can only properly be protected through a universal basic income, as can those who will sadly lose their employment through redundancy, temporary lack of work or the failure and closure of businesses because of the crisis.
Let us think about the app-based driver, the zero-hours warehouse worker, the children’s entertainer and the agency-supplied care worker. None of them has an employer. The Government can incentivise by keeping them in work. A universal basic income would be more holistic and more effective than subsidising a company payroll, which currently seems to be the Government’s main tool in dealing with the crisis.
Finally, let me, just for a moment, look across the Atlantic to the United States of America. Normally, on this side of the House, we do not look to the United States of America, but just yesterday the US Treasury Secretary, Steve Mnuchin, said that cash infusions could happen swiftly:
“We're looking at sending checks to Americans immediately.”
That sounds very much like a temporary universal basic income to me. Well before this crisis, Andrew Yang, the former Democratic contender for the presidency, said that a universal basic income of $1,000 a month should be introduced. He is now speaking directly to the White House. Donald Trump himself has said:
“I think we’re going to do something that gets money to them as quickly as possible.”
This is a measure that will get money straight to people and give them that basic economic security. Let me say to Ministers that if Yang and Trump can work together, surely so can Sunak and McDonnell.
Matt Rodda (Reading East) (Lab)
It is a pleasure to speak in this important debate. Let me start by thanking my hon. Friend the Member for Leeds North West (Alex Sobel) and many other speakers, including the hon. Member for North East Bedfordshire (Richard Fuller), who spoke very eloquently, and my hon. Friend the Member for Ilford North (Wes Streeting),, who made some thoughtful and far-sighted points.
I want to address not just the policy responses that we need, but the underlying scale of the problem. We have heard today that as many as 5.5 million people in this country are self-employed. I want to describe my experience of that as a constituency MP, but also to set it in the context of the wider crisis that we face.
We face an unprecedented situation, and I fully acknowledge the action that the Government have taken. Measures to reduce the spread of the outbreak are vital, and I am pleased that Ministers have announced robust measures this week, including the measures to support businesses that they announced yesterday. However, I want that action to go much further and to be much more resolute, because of the scale and need of people who work for themselves, and those who are on low incomes or in the gig economy.
I support the range of measures outlined earlier by my hon. Friend the Member for Wirral West (Margaret Greenwood). Let me draw the Minister’s attention in particular to the approach taken in Scandinavia, and also by a number of other European Governments: we have heard mention of the Irish Government today. The UK Government now need rapidly to develop a comprehensive approach and provide a safety net for all workers, and, indeed, all renters, who are uniquely vulnerable in the current crisis. Let me explain what that means to local people in Reading and Woodley, the area that I represent. Self-employed people are the absolute bedrock of our local economy, carrying out a range of activities in the knowledge economy, public services and other forms of service, retail and distribution.
Let me begin by highlighting the role and the importance to our local economy of IT subcontractors. Some of the largest IT businesses in the world are based in our part of the Thames valley. Those large businesses subcontract to many, many smaller businesses, most of them one-woman or one-man bands who are very dependent on a relatively unstable economic situation. As a growing and rapidly expanding area close to London and the midlands, we have a large amount of construction taking place. We have many small builders and other tradespeople who are dependent on jobs and work which is relatively short-term, and who may see only a few weeks ahead economically. We also have a vibrant transport sector, with a large number of people employed in the aviation industry at Heathrow, many taxi drivers, and many people who work on the railways. All are part of a transport sector that looks set to be severely constrained because of the crisis.
Reading is the main shopping town for the Thames valley and the related parts of the south midlands, and we also have a vibrant gig economy, with a number of distribution centres and warehouses nearby. Many people in this group are also renters, so we have a double hit in our local economy. We have many people who are vulnerable because they have only one month’s guaranteed income ahead, whether they are professional people, people with trades, or people who have other skills, and in the same group of people we also have many young families living in rented accommodation, which is very high cost in an area that is similar in cost to outer London or the centre of major cities around Britain.
I draw the Minister’s attention to this local example, which reflects the situation in many towns and cities throughout the country. There is this collision and reinforcement: people have insecure incomes, are vulnerable and have not yet had their situation addressed by the Government’s measures—however helpful those measures are for larger businesses—and they are also renters in a high-cost local rental economy, where rental income can be as much as £1,000 a month for basic accommodation.
We need to take action and to take it urgently. Will the Minister reconsider the Government’s approach, focus on the needs of these groups of workers and renters, and think about the world from their perspective? Their income is not guaranteed and is vulnerable, and they are the bedrock of the local economy in so many parts of our country and, indeed, in the country as a whole. They deserve our support and respect. We need to come up with a realistic and workable plan, using whatever policy measures are necessary to protect them and their family income and to ensure their safety and security.
Navendu Mishra (Stockport) (Lab)
Has the Minister seen proposals from the Communication Workers Union, which yesterday called for Royal Mail to act in effect as a fourth emergency service? Royal Mail is the only organisation in the country that puts workers on every single street, six days a week, and postal workers are trusted in every community. Whether it is through the delivery of prescriptions or food bank parcels, or by checking on elderly people who might need support—particularly if care services cannot be provided to them—Royal Mail could play an important role, if appropriate precautions are taken.
Will the Minister join me in paying tribute to the Communication Workers Union? Does he agree that this idea should be explored as a matter of urgency? Will he commit to speak to the union and Royal Mail to discuss it?
Ruth Jones (Newport West) (Lab)
It is difficult to follow such powerful speeches and such great orators, who have made their points so eloquently, so I shall be brief. But I make no apology for reiterating the points on which we need the Government to act now.
Statutory sick pay will now be available for eligible individuals diagnosed with covid-19 or those who are unable to work because they are self-isolating in line with Government advice. It is right to commend the Government for making SSP available on day one, instead of day four, for affected individuals. However, at this time of intense worry and strife, it is also right to highlight where the Government must act to help those who need it.
Statutory sick pay is £94.25 a week, as we have already heard. The equivalent weekly payment on the national minimum wage is £307.88. How can the UK Government justify forcing potentially millions of people to live on less than a third of their usual weekly income? The Chancellor himself stumbled when asked whether he could afford to live on that sum, and I implore colleagues from all parties to ask themselves the same question—could they?
The UK Government’s covid-19 advice on statutory sick pay on the gov.uk website is a total of only 13 lines, but universal credit is mentioned three times. It is important that the Government seek to ensure that those who are not eligible for SSP, or those who are self-employed, are aware that they can claim for universal credit. That is fine, but my colleagues and I have spoken numerous times in this place about the difficulties inherent in the universal credit system. I refer to the fact that applications must be made online and claimants wait a period of five weeks for their first payment.
Will the Minister tell me what steps the Government are taking to assist those who are not able to leave their homes, and who are also unable to access the web, so that they may apply for the benefit? Furthermore, what steps are the Government taking to ensure that new universal credit claimants who are self-isolating, some for periods of up to 16 weeks, do not have to wait five weeks for their first payment? Alternatively, will the Government consider extending the period over which advance payments must be repaid?
The UK Government will refund SSP for small employers who employ fewer than 250 people. This refund, however, will cover only up to two weeks SSP per eligible employee who has been off work because of covid-19. How can the Government reconcile that with their current advice that some employees will have to self-isolate for up to 16 weeks? With thousands of local and independent businesses already scared for their continued existence, will the Government reconsider their policy and offer SSP refunds for the total period of time that employers are required to claim during this crisis?
I do appreciate that these are unknown and challenging times, but I urge the Government to consider people who are falling through the SSP safety net and to act quickly and compassionately now.
Rachael Maskell (York Central) (Lab/Co-op)
We conclude this debate on statutory sick pay and protection for workers at a time of immense uncertainty, as we are witnessing an implosion in our labour markets and people’s lives being turned upside down. As we have long feared, those in the most insecure work have little resilience to weather this storm. As we speak, thousands of people are being laid off, falling into hardship and fearful for their future. We cannot let the story of coronavirus also be the one about avoidable poverty, so, today, Labour is highlighting how Government must take a far more robust approach to create the safety net that we all need.
The Government have said that no one should be penalised for doing the right thing, yet without stronger underpinning of statutory sick pay and employment and wage protection, many will be plunged into serious debt, unable to pay their rent, their bills and even for their food, as my hon. Friend the Member for Reading East (Matt Rodda) set out.
I will, if I may, start with workers’ protection. We need all workers to be kept safe and to be protected from contracting coronavirus in the first place. Employers must maintain their duty of care. Too few workers still have access to appropriate PPE, as my hon. Friend the Member for Ilford North (Wes Streeting) set out while paying tribute to NHS staff, and I endorse what he said.
Yesterday, community pharmacists in my constituency highlighted to me how they have now become the frontline of healthcare, and yet they only had a tiny stock of plastic pinnies, gloves and masks. Tradeswomen and men such as plumbers will need to carry out urgent home repairs so will also need protection. Care staff need to be provided with PPE and not expected to pay for it themselves.
Workers must never feel that they have to choose between health—their own and that of others—and hardship. Even after yesterday’s announcement, they were offered little comfort. I have three asks on SSP, isolation leave pay and families’ and carers’ leave. First, no worker should be excluded from statutory pay protection for sickness or isolation no matter their employment status—employee, worker, self-employed, office holder or limb (b) workers. This should also apply no matter what a person earns, which is why the lower earnings limit must go, and no matter whether a person has already taken 28 weeks SSP. All who work should have statutory pay protection for sickness and isolation from day one.
If people are required to stay away from work, or are staying away to protect their health due to existing underlying health conditions, they should not be penalised and neither should their family members be penalised, as my hon. Friend the Member for Sefton Central (Bill Esterson) set out. Life must come first. We also need these measures to reach beyond the narrow application of coronavirus. People will be isolating because they have signs of the virus, but not the virus itself. Vulnerable people are at risk from all communicable diseases and so the application of the measures needs to apply to all sickness and isolation absences. While many companies are establishing full pay for those sick and in isolation, others are not. This inequality must be addressed. Universal credit is no substitute, as my right hon. Friend the Member for East Ham (Stephen Timms) and my hon. Friend the Member for Newport West (Ruth Jones) highlighted with their experience, and, as we have heard in the debate, it pays even less than SSP and takes five weeks to process. I am grateful to my right hon. Friend, who set out the plight of those who have no recourse to public funds; that must be resolved.
Simple changes to section 16 of the Health and Safety at Work etc. Act 1974 and section 64 of the Employment Rights Act 1996 would ensure that all workers were fairly remunerated and did not experience hardship; with the underpinning of statutory sick pay UK workers would be protected to levels we are seeing elsewhere.
Secondly, as life must come first, to reduce a worker to poverty levels of statutory sick pay at just 18.4% of the average wage will not be sufficient for those forced to make a choice between health and hardship. We cannot afford for anyone to go out to work if the determination is that they should isolate or are sick, but if they are battling to keep their head above water financially, they may lessen the severity of their sickness to justify just to themselves that they are not really a risk.
At a time when other countries are significantly raising their statutory sick pay, the UK, which pays the lowest rate of statutory sick pay compared with the EU27 countries, must now ensure that statutory sick pay provides vital protection. The TUC has highlighted how the real living wage is the right benchmark when full pay is not paid. Many in today’s debate across the House, including my hon. Friends the Members for Leeds North West (Alex Sobel) and for Ilford North, have highlighted the opportunities a universal basic income would provide. The Prime Minister earlier said that he is willing to look at that, and he must.
In light of the possible scale and duration of isolation and sickness expected to be taken, the £1 billion package announced by the Chancellor is totally insufficient. Will the Secretary of State return to the House this week and confirm that she will, through a poverty prevention measure, ensure that statutory sick pay is paid to take away the additional fear of financial hardship, so people will be able to pay their rent bills and fuel and food? Without this significant shift, people will be dependent on other sources of income support, perhaps food banks and other charitable support. However, we know that these are areas in themselves experiencing major challenges at this time. The infrastructure to underpin this completely avoidable poverty is so fragile, so statutory pay must rise.
Thirdly, parents and carers are also facing new challenges as they are having to significantly change their lives. No one should be denied the right to meet family and carer needs at such a time as this, so will the Secretary of State ensure that taking leave for family emergencies and for care provision becomes a right—not a right to ask, but a right to get—and that people remain fully remunerated while doing so? While most employers will be accommodating, this is a critical time, and we need to ensure all parents and carers are supported in this national effort.
I further want to raise the issue of pace. While welcoming the Chancellor’s announcement that he will work with trade unions and businesses to provide wage protection, this needs resolving now—this week. If Denmark and other countries have brought forward a scheme of wage protection, there is no need to reinvent the wheel; we can deliver a scheme through the emergency legislation being laid tomorrow. As my hon. Friend the Member for Leeds West (Rachel Reeves) said, if it is good enough for workers in other countries, it is good enough here.
Denmark’s first coronavirus case was on 27 February and New Zealand’s first case was on 28 February, and they have developed and delivered support already. The UK’s first case was on 31 January, and we still have nothing to protect people’s incomes. People are losing their jobs now, and it could be avoided; it must be avoided. Employers need confidence that the Government will deliver a package of wage substitution; workers need confidence that they will not face poverty. We need interventions now so that jobs can be saved.
Many workers, where there is a cessation of work through this crisis, may step up in the national effort to provide vital services elsewhere in the economy, for instance in health and care. They will be doing the right thing, so can the Secretary of State ensure their position in their substantive jobs is protected when they return so that like someone returning from maternity leave, they will be able to return to the job they left?
I endorse my hon. Friend the Member for Stockport (Navendu Mishra) in highlighting the extended role that others such as postal workers can play. I urge the Government to meet the CWU and to explore that terrain further.
The last few days have exposed the weaknesses in zero-hours contracts—workers who are reduced to zero hours, yet must still be available to work. Those workers are desperate. Some 1.87 million of them will not qualify for statutory sick pay, and 70% of those people are women. I ask the Secretary of State to end this insecurity in work. All workers need security, not least at a time such as this. Will she move to ensure that all employment become substantive, and that workers are placed on proper contracts underpinned by the same securities afforded to all employees?
Workers and employers are being called upon to take extraordinary steps to protect our country from the worst aspects of covid-19. They need a Government who recognise all the challenges they face, and who will provide the full protection that they need. The Chancellor promised to do this, so will the Secretary of State ensure that all the holes that continue to exist in the safety net are closed, with the publication of the emergency legislation. Will she ensure that workers get the support they need to save them from hardship? All these things are political choices. Making the right call today may save us from the worst aspects of an economic crisis, and reset the dial for a fairer and more equitable country to come.
The Parliamentary Under-Secretary of State for Work and Pensions (Will Quince)
First, let me thank all Members from across the House who have taken the time to attend this important debate, and to speak about their concerns in such a constructive and collaborative way. I will try to answer as many of the numerous points raised as possible, but I stress that—as hon. Members know—my door is always open and my phone is always on. If Members have urgent cases, please reach out to me and other Ministers on the Treasury Bench; we will look to take the appropriate action, as necessary.
As my right hon. Friend the Chancellor made clear yesterday, we will do whatever it takes to support people, jobs and businesses, and to help people to protect their loved ones. This includes the measures we are taking on statutory sick pay, in order to ensure that everybody is supported to do the right thing and follow the Government advice on self-isolation. We must come together to fight this virus and protect the most vulnerable, and statutory sick pay is part of our welfare safety net and our wider Government offer to support people in times of need. That is why we are ensuring that our welfare safety net provides the right level of support in these exceptional times. We have extended statutory sick pay to those who are self-isolating, in line with the latest Government health guidance, and the upcoming emergency Bill will make statutory sick pay payable from day one instead of day four. This is the right thing to do to ensure that eligible individuals are supported to stay at home in self-isolation, protecting themselves and others.
As my right hon. Friend the Chancellor set out, the Government will stand behind businesses, both large and small. As a DWP Minister, I know that the best way to support people is through protecting their jobs. Small and medium-sized businesses are the backbone of our economy, and we will support them to implement these measures. Employers with fewer than 250 employees will be able to reclaim up to two weeks’ statutory sick pay paid for sickness absences relating to the coronavirus—a measure that could help up to 2 million businesses. These changes will help to provide certainty and security for individuals and businesses affected by coronavirus.
Statutory sick pay is just one of the Government’s offers of support and protection. The safety net also extends to those who are self-employed or who work in the gig economy. Workers on zero-hours contracts or in the gig economy may be eligible for sick pay and should check with their employers, but we are here to support those who are not eligible, and they can make a claim for universal credit or contributory employment and support allowance. Last week, we made changes so that the seven waiting days for employment and support allowance for new claimants affected by coronavirus or required to self-isolate will not apply. That means that ESA is payable from day one, without the need to provide medical evidence and without the need to attend a work capability assessment. Those required to self-isolate or who are ill with coronavirus can receive up to a month’s advance from day one, with no need to physically attend a jobcentre—that point was raised by Opposition Members. Any individuals affected by coronavirus will have their work search and work availability requirements switched off, and affected self-employed claimants will not have a minimum income floor applied during this period.
A number of specific points have been raised, and I will try to cover as many as possible. The hon. Member for Sefton Central (Bill Esterson) raised the important point about the communication of changes. Everything is on gov.uk, and Departments also use social media, such as Twitter, to highlight changes. There are also daily press conferences where updates on coronavirus are given by the Prime Minister, and he is increasingly being accompanied by another member of the Cabinet. However, I take the hon. Gentleman’s point that communications in times like this are incredibly important, and I will certainly feed back to the Cabinet Office that where improvements can be made to Government communications, particularly for businesses—that is the point he made—that should be done.
Bill Esterson
I am grateful for that answer, and I know the Minister will do his best to carry out what he just promised. Will he also make sure that that information comes to us and to local authorities in a timely fashion, as we are often in a position to get it out to a great number of people in a short space of time?
Will Quince
I thank the hon. Gentleman for making that case. I know from my postbag and email account that a number of businesses and individuals affected, who are concerned on health grounds or who have concerns about their employment or financial status, will contact their Member of Parliament. We are not always the first port of call—we are sometimes the last—but we are one where people expect to be able to get a response quickly, so I will look at what further guidance and advice we can give to Members of this House and through local authorities. That point about getting the message out to local authorities may well have been heard, because the relevant Minister, the Under-Secretary of State for Housing, Communities and Local Government, my hon. Friend the Member for Thornbury and Yate (Luke Hall) , is sitting on the Treasury Bench behind me.
The hon. Member for Newport West (Ruth Jones) raised the point about SSP and the rebate for employees, and whether that could be for more than two weeks. I understand the point she is making. The current Government advice is for people to self-isolate for seven days or for 14 days if in a household, so we feel that the two-week limit on rebates is a proportionate response. She also asked why SSP is not at the same rate as the living wage. The current system is designed to balance support for the individual with the costs to the employer. As the Minister for Disabled People, Health and Work mentioned at the beginning of this debate, we have put £1 billion into the welfare system to provide additional financial security for people, and people on low income can get a top-up, where applicable, through UC.
Numerous hon. Members, including the hon. Members for Sefton Central (Bill Esterson) and for Leeds West (Rachel Reeves), raised a point about the private rented sector. Today at Prime Minister’s questions, the Prime Minister did say that we will be bringing forward legislation to protect private renters from eviction, and the Ministry of Housing, Communities and Local Government is considering whether we need to go further on that point.
The right hon. Member for East Ham (Stephen Timms) and the hon. Member for Airdrie and Shotts (Neil Gray) both raised a point about the consultation on the lower earnings limit. Our immediate concern in dealing with the covid-19 outbreak is to ensure that a suitable financial safety net is in place, and the benefits system does provide that. We estimate that about 60% of people earning below the lower earnings limit are already in receipt of benefits. Our longer-term aim in that consultation was about preserving the link between the employer and the employee so that the individual receives appropriate support upon return to work. That is less relevant when most people are facing short periods away from work. I or the Minister for Disabled People, Health and Work would be happy to meet those Members at a later point to discuss that further.
Numerous hon. Members asked why the focus so far has been on businesses and has not just been about individuals. It is so important that organisations are able to carry on trading, which is why the initial focus of Her Majesty’s Treasury has been on supporting business and keeping people in work where it is sensible and appropriate, based on Government guidance, to do so. Ultimately, that protects so many individuals in our society, but of course we are also looking at other measures for workers.
The hon. Member for Newcastle upon Tyne Central (Chi Onwurah), the right hon. Member for East Ham and the hon. Member for Airdrie and Shotts all made the point about raising the level of statutory sick pay. We continue to look at other support for workers to see what best mechanisms are available. Thankfully, a period of absence is likely to be short—we believe between seven and 14 days—but we know that some may need extra support, as Members across the Chamber have said. We know that low-paid workers are likely to be receiving additional support through universal credit, for example, and the advantage of universal credit is that it will go up if income falls to the equivalent SSP level.
Rachel Reeves
I thank the hon. Gentleman for giving way and for addressing the points that hon. Members have made. It is true that people will not have to take that long off to self-isolate for their recovery, but overall, there is likely to be a suppression of demand in the economy for a longer period. The idea that people may be off work for only one or two weeks is fine if that is for health reasons, but if it is because their business is closed or there is just not work available, it is likely to be a lot longer. That is the point that many Members have been trying to make.
Will Quince
I thank the hon. Lady for making that point. I reassure Members that the Government are doing all they can to ensure that everybody is supported to do the right thing. It is crucial that everyone follows the Government guidance on self-isolation—that has been clear throughout the debate—to protect themselves and others. The measures that we have announced and will put forward in the emergency Bill will support people to do so.
To come directly to the hon. Lady’s point, the Chancellor has announced that in the coming days the Government will go much further to support people’s financial security, working with trade unions—another point made by the hon. Member for Stockport (Navendu Mishra)—and businesses to urgently develop new forms of employment support to help to protect people’s jobs and incomes through this period. I know that the hon. Lady would like to tempt me to go further but, as I think she will understand, that is somewhat above my pay grade. It is very important, however, that debates such as this take place, because it will have been heard by Her Majesty’s Treasury and will be taken in the spirit of working collaboratively on a cross-party basis. I certainly take those ideas on board, and if Members have further ideas about how we can better support some of the most vulnerable people in our society, my door is always open, and I would welcome them coming forward with those.
The right hon. Member for East Ham, the Chair of the Select Committee, raised the point about the habitual residence test. The test has operational procedures already in place to expedite confirmation of eligibility, but I will take this point away and give it further thought—I had not given it consideration before he raised it and I would be very happy to meet him to discuss it further.
We have a safety net that helps people facing hardship if they cannot work or are seeking work. Depending on their individual circumstances, employees can claim universal credit and/or new-style ESA or JSA. As the Prime Minister set out, the Government will keep everything under review. The package that was set out at the Budget and the new measures that were recently announced should give some reassurance that support will be provided to support jobs, income and businesses. As the Chancellor said, we will do “whatever it takes”.
We are in extraordinary times. The coronavirus pandemic is the most serious public health emergency that our nation has faced for a generation. Our policy is to protect lives and fight this virus with everything we have, and the Government have been clear in their approach: we will do whatever it takes to get the nation through these testing times. We will protect people, their jobs and businesses through this period to ensure that we keep as many people as safe as possible.
Question put and agreed to.
Resolved,
That this House has considered the matter of Statutory Sick Pay and protection available for all workers.
Local Government Responsibilities: Public Services
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Barbara Keeley (Worsley and Eccles South) (Lab)
I beg to move,
That this House has considered the statutory and broader local government responsibilities for public services, including social care.
In the coming weeks and months, it is right that the Government focus on the fight against coronavirus. Local government will be on the frontline of that fight. Local services, from social care and public health to bin collections and now, most importantly, support for volunteering, will help us to overcome the challenge.
It is a time of uncertainty for many people across the country, and the Government need to provide as much certainty as they can. One thing we know is that older people, and those with underlying health conditions, are at greater risk from coronavirus than the rest of the population, as is clear from the social distancing guidelines issued for those groups this week. That means that, in the coming months, social care will be more important than ever because it not only helps to keep hospital beds clear for those who need them, but touches the lives of some of the most vulnerable. Care staff, therefore, will often be on the frontline of our efforts to stop the spread of the disease.
We are particularly concerned about home careworkers, who might provide care for up to a dozen older and disabled people in their homes every day. We want all necessary measures to be taken to protect care staff and the people they work with. As with the NHS, an important part of the solution is personal protective equipment and measures for infection control.
Care providers will face extra costs due to the need for more personal protective equipment and for enhanced cleaning of care homes and people’s own homes, and other measures to minimise the spread of infection—for example, zoning some staff in care homes. Last week, I raised with Ministers the fact that providers have faced great difficulty in obtaining personal protective equipment, and that also applies to infection control products, hand wash and disposable hand towels.
The care sector is extremely worried about being able to get essential supplies such as personal protective equipment. Commissioners can mitigate that by funding the extra costs and by helping providers to access personal protective equipment, perhaps by using some of their own contracts. The Government need to give guidance to local authorities and care providers, however, on the provision and use of personal protective equipment for careworkers and on whether help with accessing supplies can be given to reduce the spread of coronavirus.
We have just had a debate on statutory sick pay, which is particularly important for care staff, who are on the frontline of the outbreak. If they are ill, it is vital that they follow the public health advice and self-isolate, but the reality, as we heard, is that many care staff, like other staff, cannot afford to do so. Even if they are eligible for statutory sick pay, which we do not think they all will be, it is only £94 a week. The Minister needs to set out now what the Government will do to ensure that no careworker has to choose between doing the right thing and facing overwhelming financial problems.
Care providers are also facing increased cost pressures due to staff self-isolating or being off sick. It is right that statutory sick pay will start at day one, rather than day four, but that will increase employers’ liability for statutory sick pay. Requirements for workers to self-isolate will further increase financial pressures on employers. Given that, in virtually all cases, care providers will have to backfill sickness absence to ensure the continued delivery of support, that represents a real cost pressure on providers. With local authority budgets stretched, how can they support care providers to provide for extra statutory sick pay, the cost of backfilling care staff and the personal protective equipment and other materials that will be needed to get through the crisis?
Dame Diana Johnson (Kingston upon Hull North) (Lab)
My hon. Friend is making a compelling case for why the Government should announce specific support for the social care sector. I noticed yesterday that the Chancellor did not make specific reference to the social care sector which, as my hon. Friend points out, is in a fragile state and under enormous pressures. Is it not time for specific support for the social care sector to be announced?
Barbara Keeley
I agree with my hon. Friend. It is great to hear that the NHS will get what it needs, but what about the social care sector?
We know, as my hon. Friend just said, that many care providers were already on the brink of collapse. Many will not have reserves to fall back on. I ask the Minister, as my hon. Friend just has: what will the Government do to sustain care provision and ensure that care providers are able to carry on delivering care at this time?
Gareth Thomas (Harrow West) (Lab/Co-op)
My hon. Friend is making a good point about social care in the broader sense. I want to raise the needs of local charities, some of which provide social care, and others provide a range of other services. Does she know whether some of the funding that the Government have allocated to local authorities will be earmarked to support continued funding of those local charities and community groups, or whether that has not yet been considered?
Barbara Keeley
That is a very good question, and we should ask it in addition to the questions that I will ask, because the independent and voluntary sector is vital in our communities and in care provision.
I want to touch on the issues facing care homes across the country. We know that the Government are asking older people to avoid social contact for the next three months, but we need to be clear—clearer than we have been—about what that will mean for people in care homes. Will the Government recommend that all visits from friends and family be stopped until June? Can the Minister tell us what guidance on visits they are giving to organisations running care homes? Providers and their networks do not seem to have had any clarity yet.
The Care Quality Commission has announced a pause in its inspections, freeing up staff time to focus on care, but today it has published its independent review of Whorlton Hall. That was a shocking scandal. People with learning disabilities and autistic people and their families will want reassurances that, once this crisis passes, the CQC will focus its full efforts on ensuring that something like Whorlton Hall never happens again.
Many older and disabled people do not receive formal social care. Instead, they rely on unpaid friends and family. I know that many unpaid carers are worried that they will contract coronavirus or have to self-isolate and be unable to give the care they normally do. What steps should any unpaid carer who has symptoms of coronavirus take? If they are being asked to self-isolate, what alternative care can be provided at short notice? If someone cares for a person they do not live with, what steps can be taken if the carer has to self-isolate or if the Government have to further restrict travel, as many unpaid carers live some distance away from the people they care for?
Young carers—children and young people—may need more support than others in managing the changing situation in their lives, especially if their local supermarket or pharmacist does not have supplies. It is important that, if schools or years within schools close, it is understood which children within those schools are identified as young carers. It is often the case that a school or a teacher within a school is the only person who knows that one of their pupils is looking after someone at home. Schools could nominate a lead person to make regular contact with young carers during this difficult time when they are not in school.
Another major issue facing carers is the supply of medicines, hygiene products and food. Carers have to source supplies such as antibacterial wipes or disinfectant themselves. Unfortunately, we have seen panic buying of those goods, making them far harder to acquire. What can the Government and local authorities do to ensure that unpaid carers and the people they care for do not have to go without crucial supplies, including food?
The Government’s reasonable worst-case scenario implies that we can expect to see one in five workers off sick at the same time. There are an estimated 122,000 vacancies across social care currently—a workforce problem that we know forces existing care staff to cut visits short or work beyond their paid hours. It is understandable that people receiving care and unpaid family carers are very concerned about how care can be provided if we get to a situation where large numbers of care staff are off sick or self-isolating.
In the coronavirus Bill, the Government want to make changes to the Care Act 2014 to enable local authorities to prioritise the services they offer, in order to ensure that the most urgent and serious care needs are met, even if that means not meeting everyone’s assessed needs in full or delaying some assessments. I am sure that we will discuss those measures when we consider the Bill next week, but the guidance on the Bill says:
“Local authorities will still be expected to do as much as they can to comply with their duties to meet needs during this period and these amendments would not remove the duty of care they have towards an individual’s risk of serious neglect or harm.
These powers would only be used if demand pressures and workforce illness during the pandemic meant that local authorities were at imminent risk of failing to fulfil their duties and only last the duration of the emergency.”
I know that people who are worried about this will want to hear any further guidance on the circumstances under which the powers would be used. Finally, I want to touch on some of the issues facing specific groups who are receiving social care.
Gareth Thomas
I am grateful to my hon. Friend for giving way to me a second time. Is there not also a broader point about certainty of future funding for local authorities and certainty about which of the additional costs they face from coronavirus will be met by central Government going forward? My local authority, which is not by any definition well off, is concerned about when it will receive clarity from the Government on which costs it can reasonably expect Ministers to cover.
Barbara Keeley
My hon. Friend is absolutely right. We will need certainty about those things when we look at the coronavirus emergency Bill, which we will do shortly, but this lands on local authorities at a time when they do not have any certainty. There is much about their financial position that needs to be made clearer to local authorities. I also agree with my hon. Friend: my local authority has had budgets cut by more than 50% since 2010, and we were in what we were calling a crisis in social care even before this happened.
I want to talk more fully about people with dementia and people with learning disabilities. There are a million people with dementia in this country and many people with learning disabilities. Not all of them will be able to comprehend the importance of self-isolation and then act appropriately. What measures and guidance will the Government introduce to help people with learning disabilities or dementia to self-isolate? Many working-age people with disabilities may be more vulnerable. Conditions such as Down syndrome or multiple sclerosis could increase the risk of respiratory infection, and the guidance suggests that people with these conditions would self-isolate. Can the Minister tell us what financial support will be available for them and their families if they have to stop work to do that?
We understand that this is a difficult and challenging time for all, but the Government have talked of using volunteers in health and social care services. People with disabilities and older people who need care have some of the most complex care needs. How will the Government ensure that people with complex needs continue to receive the support and care they need to stay in their own homes?
Theresa Villiers (Chipping Barnet) (Con)
In this crisis we need to make the most of volunteers and that spirit in the community of helping out, but at the same ensure that things such as Disclosure and Barring Service checks are done appropriately and that vulnerable people are kept safe from other risks, including those of unscrupulous interveners.
Barbara Keeley
I thank the right hon. Member for that intervention. I think most of us are concerned in our constituencies to ensure that we have enough people to help out, but do not have the wrong sort of people getting involved. We do not want to start seeing scams and people defrauded, because that would be a terrible way to proceed.
We need to look at how far we can stretch the idea that volunteers can help in health and social care, because in certain situations—for example, an elderly person with very poor skin condition, with sores, who needed particular lifting, or somebody who was PEG-fed, using percutaneous endoscopic gastrostomy—we cannot even use DBS-checked volunteers.
Dame Diana Johnson
There are people who genuinely want to help and do their best for their community, but I am concerned to ensure that DBS checks are in place—an issue that has been alluded to—and also about infection control, which fits nicely with what my hon. Friend the shadow Minister has just said about some of the procedures that people may be asked to help with. There are real questions about the training and the infection control that need to be in place if we use volunteers.
Barbara Keeley
Very much so. I am following all the social media input from my constituents, and I am glad to see that people are very keen to help. However, we must be careful, because we are talking about very vulnerable people, often with complex care needs, and we do not want to put them into difficulties through the efforts of volunteers, so we need guidance on that point.
Let me turn to self-isolation. I had to self-isolate for five days last week, and I know it is not easy, but it will be particularly hard for people with anxiety disorders, who rely on a routine to cope. Both now and once we are on the other side of this, what support will the Government be offering to help address the mental health consequences of the pandemic and of self-isolation or shielding for long periods? I noticed in the media that there were programmes showing what is being done in Wuhan in China, with hundreds of counsellors talking to people on a phone helpline, talking them through the difficulties they were experiencing. I think we may have to be thinking about something like that. In particular, many older people are now looking at several months potentially locked down in their own home, so what can the Government do to ensure that those people do not become lonely and isolated, with all the mental health consequences that would cause?
The challenges facing local government over the coming months are not limited to social care. The Government finally published yesterday the public health grant for the next financial year. Between 2014-15 and 2019-20, budgets were cut by £870 million, although there has been an increase to the grant this year. While the publication of the allocations finally provides some certainty to local authorities, the reality is that their public health functions are likely to be focused on coronavirus for the foreseeable future. Public health services such as smoking cessation are vital to prevent people from acquiring long-term health conditions such as chronic obstructive pulmonary disease, which can make a future case of coronavirus more serious. Will the Minister commit to allocating further money to public health if local authorities need it to keep people safe during the crisis?
The other major area of concern is homelessness. The Secretary of State for Housing, Communities and Local Government announced a fund yesterday to help local authorities provide accommodation for homeless people who might have coronavirus, which is welcome, but given the scale of the homelessness crisis in this country, can the Minister tell us whether that fund will be topped up if needed? We do not want local authorities to have to ration support now because they think they might need some of it later.
I understand we are expecting a statement at 5 o’clock on education, and the Government are not yet closing schools—we may hear more at 5 o’clock—but we do see more teaching staff off work ill or self-isolating. Schools are being closed for certain years, and other closures look increasingly likely. I have seen that in my constituency. For many children, school is a place where they can get breakfast and free school meals. If children have to stay at home, they may go hungry. What support will be put in place to protect those children if schools are closed, whether that means providing food for them or ensuring that social services are monitoring their condition?
Lastly, I want to mention bins and waste collection. The safe handling of waste that could be contaminated by coronavirus will be a major challenge for public health and for the protection of the staff who work in that vital service. Will the Minister tell us what action is being taken alongside local authorities to ensure the continuity of waste collection services, given that the staff who work in those services will themselves be subject to illness and self-isolation?
We also need to think about council tax. If the Government are giving business rate relief for coronavirus, why not council tax relief for the general population? If people are out of work for an extended period, council tax is a big cost. Councils would need reimbursement for lost income, as they would with business rates. Additionally, we need councils to show some restraint with pursuing council tax arrears through the courts. Although loss of income for councils could be a very big issue at a time like this, depending on how long everything lasts, everything points to Government support and action for that. I should say to the Minister that I am happy to supply him with a list of all the questions I have asked, because it is very difficult for him to answer everything all in one go.
Coronavirus poses a unique challenge for this country. We will all need to work together to tackle it. The work that local authorities do will be central to addressing the crisis and will help to hold communities together as we do so. It will not be easy, and I am sure there are many issues we have not foreseen. I thank everyone working in local government and in social care and all our teachers and teaching staff, because they are a vital frontline service. I hope the Minister can reassure the House that local authorities will get all the help they need in the weeks and months ahead to tackle this crisis and to carry on providing the services that people rely on every day.
The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Luke Hall)
I thank the hon. Member for Worsley and Eccles South (Barbara Keeley) for the constructive and collaborative tone she has taken in this debate. She has raised a number of very sensible and serious questions. I will do my best to answer as many as I can, and I will try to make sure the ones I cannot answer are answered in the wind-up.
I join the hon. Lady in putting on record my thanks to local authorities across the country for their wholehearted response to the coronavirus crisis and for reassuring and supporting residents. I have seen that with my local authority, and I am sure Opposition Members have seen it with their local authorities, too. I know hon. Members on both sides of the House will join me in recognising the contribution local authorities will make in the weeks and months to come as we move through this difficult time for our country.
As the Prime Minister has said, this is the worst public health crisis in a generation. We are committed to responding, and our measures are comprehensive. We are offering UK-wide support to ensure people in all four corners of the country receive the help they need. Our fiscal action will support public services, households and businesses, and whatever resources the national health service needs, it will get.
I am working closely with the Secretary of State for Housing, Communities and Local Government and with ministerial colleagues across Government to ensure councils get the funding they need to see their residents through this crisis. Our priority response is to provide security and support for those who get sick, and for those who are unable to work, through the direct funding of public services. Of course, we stand ready to do whatever is necessary to support councils in their response to the coronavirus.
The Secretary of State addressed over 300 council leaders in England on Monday and outlined the three priority areas on which we are asking them to focus in the weeks and months ahead: social care, supporting vulnerable people and supporting local economies.
Mr John Baron (Basildon and Billericay) (Con)
I welcome this as a nudge in the right direction. Although I appreciate the “dear colleague” letter we have all received and what the Minister has just said, there is still a vulnerable group of people who risk being overlooked by the Government’s initiatives, and that is the elderly and vulnerable who live on their own, whether or not they are ill. There is a risk that they will be inadvertently overlooked in such a scenario and in such extraordinary times. As a society, we have to reach out to them.
I urge the Minister to look at this again because, at the moment, that group does not feature in any Government initiative. The Government should be sending a clear message that they will provide whatever support it takes for local councils to reach out to those people. Many may be in rural settings, but there may be a lot in the city, too. Local councils should reach out, locate them, identify them and offer help, if necessary tying in local charitable causes or charities to help them in that assistance. The message must go out to local government to reach out, because we do not want anyone to be left behind.
Luke Hall
I thank my hon. Friend for his intervention. I give him my assurance that the work has already started. We are already starting to compile those lists and, of course, we are working with local resilience forums and councils, which will be the fundamental units in administering that support. We will, of course, talk more about this in the weeks ahead.
Mr Baron
I do not want to test the Minister’s patience, but I want clarity on this issue. This is not just about those who may be self-isolating or who may be ill; it is about people living on their own who we simply do not know about, whether or not they are healthy. We have to reach out and find out. Is that what the Minister is saying from the Dispatch Box?
Luke Hall
Yes. I can absolutely give my hon. Friend that assurance. Our response measures sit alongside the well-versed contingency plans and frameworks we have for times of difficulty. Everyone here will appreciate that, perhaps now more than ever, we rely on our public services, and I am confident they are up to the task.
Matt Western (Warwick and Leamington) (Lab)
This is such an important topic, as the Minister appreciates, and our local services and local authorities are very much on the frontline. What will happen in terms of emergency legislation for the powers that local authorities have, and how will the democratic process work in this crisis?
Theresa Villiers
I hope the Minister and the House will take this opportunity to pay tribute to all the workers involved in local authority services, including those in the care sector—not only care workers but cleaners, too—as well as those who cleanse our streets and who collect our refuse. None of them can work at home, and all of them are putting themselves at risk by being in the public space to do their job to keep society safe and to keep society going. It is important to send out the message that we appreciate them, just as we appreciate our wonderful NHS staff, too.
Luke Hall
I thank my right hon. Friend for those words. She is absolutely right: we should commend our public servants and local authorities hugely for the work they will be doing in the days and weeks ahead, and I would like again to put on the record my thanks to them. If the hon. Member for Warwick and Leamington (Matt Western) will bear with me, I will touch on his point a little later.
We have already outlined an extensive package of support to combat the effects of this crisis. A lot of the points made by the hon. Member for Worsley and Eccles South and other hon. Members were, rightly, about future funding for local authorities. I completely understand that, and perhaps it is worth addressing that at the start of my remarks.
The Chancellor announced last week that £5 billion would be made available for the public service response, with more to come if and when it is necessary. Let me say right from the start that we know that councils are under considerable financial pressure in responding to this crisis. We know that they will need more financial support from the Government, and we will give them that support. We are still having conversations with the sector—the Local Government Association and councils —to refine exactly what that might look like, but we will outline further steps we intend to take in this area very shortly.
Rachel Hopkins (Luton South) (Lab)
Local councils do not get their income only from business rates and council tax; we should recognise that, in the context of 10 years of austerity, many have used their trading opportunities to generate income. For example, Luton Council relies on passengers going through our airport to generate income that funds council services. With the massive changes to airlines, that income will drop off. Obviously, that will need to be taken into account in any support offered by the Government.
Luke Hall
I thank the hon. Lady for putting that point on the record. She is absolutely right to do so. I very much hope that we will outline imminently the steps that we are looking at taking to support councils further.
Yesterday, the Chancellor announced in the House a series of measures to support communities in response to the crisis. The funding he announced amounted to more than £330 billion of financial support, equivalent to 15% of UK GDP. The £10,000 grants to small businesses that are eligible for small business rate relief and the £25,000 grants to retail, hospitality and leisure businesses operating from smaller premises will no doubt help to alleviate pressure on local businesses across the country, but we understand the pressures that are about to come. The Secretary of State for Business, Energy and Industrial Strategy will write to all local authorities in the coming hours to set out how exactly those are to be delivered and the mechanisms by which they can be administered.
Dame Diana Johnson
I am interested to hear that. My concern is that my council, Hull City Council, is under enormous pressure trying to deal with the surge that it seems we are about to see with covid-19. Will local authorities receive additional resources to allow them to do all the things that the Government are asking them to do to support the business sector? Are councils getting sufficient money to enable them to do that?
Luke Hall
I am sorry to give the hon. Lady a similar answer to the one I gave the hon. Member for Luton South (Rachel Hopkins), but we will outline a package of support very shortly. I can assure her that that guidance will be out by the end of tomorrow. I very much hope that by that time her local authority will have security to start financial planning.
Gareth Thomas
I understand the difficulty the Minister has in giving us the clarity we would all like on our authorities’ particular concerns. Certainly, my local authority would like clarity that this package of support will not be for just this financial year, albeit that the support, and clarity on what it can be spent on, is needed now. Given the impact that this situation will have on local authority finances beyond this financial year, it would be reassuring to have soon the beginnings of some certainty about financial support for the next financial year. Local authority staff would also like the ability to get in contact with people in Government so they can understand and pass on answers to some of the detailed questions that businesses and other organisations have about what the Government are announcing.
Luke Hall
Those are two points well made. On the hon. Gentleman’s second point, if he is having any trouble at all communicating with my Department, he should please let me know directly. I assure him that we are speaking to councils every single day to make sure that we communicate information as quickly as possible in this fast-moving environment. We understand that getting out the guidance as quickly as we can is going to be vital.
As the hon. Member for Worsley and Eccles South said, the Secretary of State for Housing, Communities and Local Government announced the initial £3.2 million targeted at rough sleepers and people who are in danger of sleeping rough, in case they need accommodation should they need to self-isolate. She asked for assurances about whether that was the totality of the amount; I assure her that that was the initial funding. We are of course continuing to look at what will be a complex matter as we look to support some of those people into accommodation during self-isolation periods.
Alexander Stafford (Rother Valley) (Con)
I am pleased that the Government have announced financial support, but support for local councils is about more than just money. We have to be serious: this is about the people who deliver essential services, whether it is sweeping the streets or being carers. What steps are the Government going to take to make sure that we have enough people working at councils if a lot of council staff have to self-isolate or are sick? We know, for instance, that a lot of airlines are currently laying off a lot of people; is there any provision to use people who have recently been laid off to provide some of the essential services to keep our country going?
Luke Hall
I thank my hon. Friend for making that point in the way that he did. All local authorities are, of course, working through their contingency plans, which include staffing plans. I am happy to sit down with him and ensure that we look in detail at his local authority’s contingency plans. It is worth confirming that additional military personnel will help local resilience forums with their coronavirus response plans. In order that local government bodies can focus on the priorities of supporting social care, vulnerable people and local economies, we must allow them to direct their resources into the key priorities on which we are working with them. We do not want to slow down their response times, which is why we are looking at giving councils greater flexibility. That is also why we have confirmed that routine Care Quality Commission inspections will be temporarily suspended. We will take a pragmatic approach to inspection and will, of course, continue to take the proportionate actions necessary to make sure that we are keeping people safe.
We are also allowing councils to use their discretion on deadlines for freedom of information requests during this period, and we have extended the deadline for local government financial audits to 30 September this year. We are considering bringing forward legislation to remove the requirement for annual council meetings to take place in person, and legislation to allow council committee meetings to be held virtually, online, for a temporary period. Legislation is also being prepared to postpone local elections until May 2021, with measures to be introduced by the coronavirus Bill. We intend the legislation to cover all local elections and by-elections during this period.
Sally-Ann Hart (Hastings and Rye) (Con)
Does the Minister agree that we have amazing communities in this country? I have been on the phone to local authorities and volunteer groups in Hastings and Rye today, and the way that our communities are pulling together to help in this crisis is absolutely phenomenal. It essential that we facilitate that as much as we can, and I know that that is what the Minister is doing.
Luke Hall
My hon. Friend is absolutely right: the community spirit that we see throughout the country, with people rallying to support friends, neighbours, vulnerable people and loved ones, is absolutely inspirational. I have seen it in south Gloucestershire and my hon. Friend has seen it in Hastings and Rye, and I know it is happening all around the country. I will touch on that later in my remarks.
We have given councils the flexibilities that I outlined to ensure that they are not required to divert staff from their urgent tasks, allowing them to get on with the priorities that we are setting out.
I also wish to talk about social care and the measures that we are taking with regard to that key priority area that the Secretary of State has outlined. We know that social care, especially for the elderly and disabled, will be at the forefront of our response to coronavirus. The Government will ensure that whatever our social care system and national health service needs, it will get. As I mentioned, we have already set aside £5 billion to support our NHS and public services. We also published on 13 March guidance on adult social care for care homes, home care providers and supported living providers. The guidance sets out how to maintain the delivery of care in the event of an outbreak of widespread transmission of coronavirus and what to do if care workers or individuals being cared for have symptoms of coronavirus.
As part of that essential contingency social care planning, we and local areas are also considering how best to harness the many people who are so keen to help as volunteers to alleviate the pressure on social care workers and the system. It is going to be critical that local authorities work very closely with the care sector to ensure that providers build on the existing plans and protocols that are in place to respond to the challenge. We are also confident that local authorities will work with the national health service in their areas and regions to make sure that people are cared for in the most appropriate setting. The health and social care workforce is under increasing pressure, and volunteers will be an invaluable resource for local areas to draw on in the event of emergencies. We will say more about this in the coming hours and days.
I am confident that all Members will support the Government’s efforts to make sure we have the best possible use of the fantastic skills and willingness to help of our citizens in responding to this crisis.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
I completely agree with what the Minister said about the reliance we will place on professionals and volunteers. One of the concerns that has been raised with me by my local authority is that many of those professionals are in the process of qualifying and they will be asked to see examinations that they expected to take—qualification processes—deferred, so that they can spend their valuable time now focusing on those who are most in need. Can the Minister provide some assurance to those professionals that the understandable interruption to their professional qualifications will not in any way disadvantage them in the progress they would otherwise have made, so that they can get on with that vital job today, knowing that they will be able to return to their studies, qualifications and professional development in due course, without inappropriate interruption?
Luke Hall
My hon. Friend makes a very important and sensible point, and I will make sure that that is given some further thought. I thank him for raising it in the debate today.
One of the questions the hon. Member for Worsley and Eccles South raised was about PPE, and she was right to do so. We need to make sure that the care sector has the PPE that it needs. I would like to update the House that free distribution of fluid-repellent facemasks from the pandemic flu stock will start today, with every care home and every care provider receiving at least 300 facemasks that will be distributed through the usual channels. It will take seven days to distribute the full amount, but it is a good start to make sure that people have the PPE that they need. We are of course also thinking about beyond next week, and we are working rapidly with the wholesalers to ensure the longer-term supply of all the aspects of PPE, including gloves, aprons, face masks and hand sanitiser, which the hon. Lady also raised.
Dame Diana Johnson
My issue is about the volunteers, and I wonder whether the Government have given any thought to removing the charge for Disclosure and Barring Service checks to hopefully speed the process up so that the cost is not incurred, to help to get the volunteers to where we need them to be.
Luke Hall
I reassure the hon. Lady that we are looking at speed and depth at all these issues to make sure that we get the approach right. Several hon. Members have rightly highlighted the fact that we are talking about protecting some of the most vulnerable people in our society, so of course we want to get that balance right. We are considering in detail how that is best achieved, but I will absolutely make sure that that point is taken away.
Barbara Keeley
I would just like to ask a further question on the protective equipment that we have just talked about. I am glad to hear that masks, hand sanitiser and any of the things that are needed are coming forward, because there has been a lot of concern in the care sector about it. I would like it to be a consideration that in some of the situations that care staff will be, they will need what is in very short supply in the NHS. They are going to need more, because it is not just a question of normal infection control. We need to protect the care staff themselves, because I think there is a very real fear that may cause more people to give up on the job if we are not careful about it. It is too risky for the staff to have that contact with maybe up to a dozen people in their homes every day. I hope we can expand our thinking to take into account that sometimes the more serious PPE that is used in hospitals will have to be used by care staff.
Luke Hall
I am glad the hon. Lady welcomes some of the immediate progress being made. She makes an important and serious point, which I will consider in depth. I am happy to discuss it with her in the days ahead.
We must also acknowledge that the crisis will not only put enormous pressure on our social care system and our most vulnerable people, but hit our local economies. We must play our part to protect those around us as well as to actively protect the local economies that underpin our communities. I will therefore set out measures the Government are taking to reflect that local priority.
Local venues, including pubs and theatres, are the pillars of local communities, and we understand the importance of giving them our wholehearted support in the weeks and months ahead. That is why we are giving all retail, hospitality and leisure businesses in England a 100% business rates holiday for the next 12 months and increasing grants to small businesses eligible for small business rate relief from £3,000 to £10,000; we are also increasing the planned rates discount for pubs to £5,000 as part of mitigating the social and economic effects of the virus.
Ben Everitt (Milton Keynes North) (Con)
We have two theatres in Milton Keynes. Understandably, they are incredibly worried about their future. What specific measures are being taken to support theatres at this time? Perhaps I could intervene with a further point to do with breweries in a minute.
Luke Hall
May I suggest that my hon. Friend and I meet after the debate, so I can outline in detail some of the measures relevant to his local establishments? I would be happy to do that.
It is important that as part of mitigating some of the effects of the virus, we are working with the 38 local resilience forums in England, which have plans and frameworks for pandemic influenza already in place. We will supplement our support for LRFs with a new taskforce to compare preparations, to identify gaps and to highlight where additional assistance might be required for local authorities.
Matt Western
The question from my local authorities, is will his Department issue guidance on how they join up the local authority resilience partnership with the local health resilience partnership?
Luke Hall
I assure the hon. Gentleman that the local resilience forums engage regularly with the local health partnerships—in fact, many health partnerships have a seat on the LRF. I am happy to take a look at his local LRF and discuss the matter with him, to make sure that that conversation is happening. We are working to ensure that LRF preparedness is ready across the country, including with tabletop exercises. We have Andy Battle, a retired deputy chief constable, looking through all the plans, and I am happy to look at the hon. Gentleman’s local plan specifically to make sure there is sufficient engagement with the national health service in his community.
The covid-19 LRF taskforce will also enhance LRFs’ abilities to respond to coronavirus by rapidly assessing preparedness. We are continuing to work closely with local authorities and their partners to prepare for the most intense phase of the crisis, and by helping local businesses and communities to plan, we will be prepared as a nation to meet the challenges we face.
We will take whatever action is necessary to ensure that local government can continue its vital function in the weeks ahead. We are committed to supporting local government to deliver our priorities of social care, providing vital support for vulnerable people and supporting their local economies. Local partners are keeping their plans under constant review and getting close support from this Government to ensure that plans are fully up to date and reflect the relevant scientific advice on coronavirus. For now though, it is clearly right that we focus on ensuring that local authorities can play their essential part in the wider national effort. We have taken decisive action already by providing additional funding to key public services and directly to the most vulnerable. We have acted by lightening the regulatory burden on local authorities. We have acted by reviewing and improving local resilience and economic preparedness efforts. I am, like other hon. Members, aware that we will need to do more in the coming weeks. We stand prepared to do that. I will ensure that I am available to any Member of this House who wants to discuss their local preparedness and to meet their local agencies. Our resilience teams are, of course, engaged with every local area to make sure that we have absolutely up-to-date intelligence in Government, to knit together at the national level.
Our commitment to ensuring that local authorities have the tools they need to respond to coronavirus is unwavering. We will give councils the support they need. We will be able to outline the further steps we intend to take very shortly. In supporting local authorities to deliver the services they need to deliver, we will do whatever it takes.
David Linden (Glasgow East) (SNP)
I start by thanking the Opposition for bringing forward today’s debate. I wish to approach my speech in two parts: first, to address the effect of the coronavirus pandemic; and then to finish with some comments on the social care system more generally.
I think we would all agree that this is an appropriate opportunity to thank, and indeed to pay tribute to, our public services workers, who are under enormous pressure at the moment, as we battle with the impact of covid-19. One of my big concerns as we deal with this crisis is that we run the risk of overlooking the needs of special populations within our society. That point was made by the hon. Member for Basildon and Billericay (Mr Baron) earlier. A great many people rely on our social care system and, understandably, they are very worried at the moment.
If we put ourselves in the shoes of someone who depends on visits by carers each day just to carry out our basic daily functions, we can imagine the anxiety felt. I know that organisations in Glasgow East are already scaling back some of their activities, and this will inevitably lead to increased isolation that will only serve to deepen their concerns. I very much endorse the comments made by the shadow Minister, the hon. Member for Worsley and Eccles South (Barbara Keeley), about PPE. For my own part, as a constituency MP, I am trying to co-ordinate and engage with community organisations and stakeholders to ensure that these issues are addressed and that problems of gaps in service are quickly addressed.
I am aware that today’s debate focuses specifically on local government and social care. Although that is devolved, I thought it would be helpful to outline briefly the situation north of the border. The Scottish Government are allocating resources over and above Barnett consequentials to support frontline spending on healthcare in Scotland, and they will be providing all the support that local authorities need in the coming months, as we face unprecedented demand. Although not necessarily to repeat what the UK Government are saying, we certainly endorse “whatever it takes” in that regard. We are increasing our package of investment in social care and integration by 14% to £811 million in the 2020-21 budget to ensure that health and social care services are fully joined up for patients and to ensure that the actions taken by local authorities have the desired effect of reducing demand.
There are some really good models across the country that I want to draw to the attention of the House ever so briefly. East Lothian health and social care partnership has put in place a short-term assessment and rehabilitation team to reduce delays. Along with other measures, this led to a 44% reduction in bed days lost between 2012-13 and 2018-19. Likewise, Inverclyde has introduced a “home first” approach to ensure that returning home is the first option in the majority of discharge situations. That model saw an 82% reduction in bed days lost between 2012-13 and 2018-19. In spring 2016, Aberdeenshire established virtual community wards as an alternative to hospital-based care, with 93% of GP practices participating, and it was estimated that 1,640 hospital admissions had been avoided.
It is therefore possible to do many innovative things to meet the challenges of social care, but the fact is that we are all living longer and we are going to have major workforce issues in social care, some of which have been discussed today. In the future, it would certainly be beneficial to have a UK Government who were more willing to listen to policy suggestions from the Opposition side of the House. If there is one thing that the current crisis has shown, it is that cross-party working is essential to tackle major problems. I hope that is a lesson we have all learned and that we will learn over the coming weeks, particularly as we emerge from the other side of the coronavirus outbreak.
I want to turn to local government and our support for statutory services. The Scottish budget for 2020-21 has increased revenue funding for local government, and the SNP has empowered local authorities to raise additional income if they wish. Additional revenue funding, taken together with potential council tax income, means that councils have the potential to access another £724 million of revenue funding in 2020-21. Throughout the coming weeks and months, it will also be vital to reassess our social care systems right across the UK to ensure that they are properly resourced to deal with the mounting and certainly unprecedented crisis.
Whether in social care or local government, in Scotland we are certainly meeting the challenges of the day with a focus on protecting budgets and supporting the most vulnerable in society. Although very uncertain, we will certainly rise to face the challenges of tomorrow in the weeks ahead.
Ben Everitt (Milton Keynes North) (Con)
These are unprecedented times. One thing that comes through quite clearly for me is community spirit. It was illustrated by my hon. Friend the Member for Hastings and Rye (Sally-Ann Hart), and will be the thread that runs through my remarks, and probably through everybody else’s remarks as well.
I must draw the House’s attention to my entry in the Register of Members’ Financial Interests as I am a councillor. I say that these are unprecedented times, but in local government we have had unprecedented times for quite some time. I remember back in the late noughties, we had the Barnet Council graph of doom. I do not know whether any fellow local government finance aficionados remember this, but it is the point at which the cost of adult social care rises and the amount of central Government grant goes down—it is the point on the graph at which those two things intercept. We are well past that now, so local government is used to reacting to changing financial circumstances and filling that gap with either locally raised revenue through taxation or locally raised revenue through commercial ventures.
The hon. Member for Luton South (Rachel Hopkins) mentioned the powers used by local government in Luton relating to commercial activities around the airport —[Interruption.] They have an airport, what can I say? The point here, of course, is that there are many ways of skinning a cat, and local government has had to face adverse circumstances in the past, and I am sure that our friends in local government will rise to this challenge as it stands today.
Jerome Mayhew (Broadland) (Con)
Is it not the case that this is the kind of situation where it is not just about local government? This is one of those rare occasions—the first time in my lifetime—where it is not sufficient for the community to dial 999 and leave it to local government or the emergency services. We, the people, will be on the frontline, directed and co-ordinated by district councils, or county councils, as in my constituency of Broadland. It is our opportunity to stand up and be counted to protect those who have to be shielded—the most vulnerable in our society including the elderly and those with underlying medical conditions—and that is both a wonderful opportunity for us to demonstrate our cohesiveness as a society and also our fundamental duty to look after those less fortunate than ourselves.
Ben Everitt
I could not agree more with my hon. Friend. The job of local government is on the frontline. Any job of a public servant such as ourselves, or councillors or council officers, is to look after the most vulnerable in society. If we do not do that, we are not a society.
Speaking of the most vulnerable, in Milton Keynes, we have a persistent problem of homelessness, which possibly provides one of the best examples of partnerships between local government and the voluntary sector. I have been very fortunate to visit many charities in Milton Keynes since being elected to represent Milton Keynes North. We have a winter night shelter, the YMCA, the Salvation Army and, of course, the Bus Shelter, which is run by volunteers, with a full-time on-site manager. It takes street homeless people off the streets. They get a bed for the night in Robbie Williams’ old tour bus, which seats, I think, 18, but it normally holds eight clients. It was wonderful to meet the clients, to see how they access the service and how the service helps them get their lives back on track and into work. Milton Keynes has received over £2 million of central Government funding for homelessness and rough sleeping since Christmas, which is incredibly welcome, because this is a critical time to support those who are on the street. That is a good example of how the voluntary sector, charity sector and local government can come together to solve a problem.
David Simmonds
Does my hon. Friend agree that that is a clear illustration of why we need to have the maximum possible flexibility for local authorities in deploying these resources at a local level? Those examples of creativity and innovation are replicated by local authorities across the country, but local circumstances vary enormously. Does he agree that we must encourage the Minister to take the view that the more flexibility and less bureaucracy there is for local authorities in using that money effectively at a local level, the more value we will extract from it in delivering for our residents?
Ben Everitt
Again, I could not agree more with my hon. Friend. I am sure that the Minister for Local Government, who is sitting on the Treasury Bench listening avidly to the pleas of councillors for more flexibility in the way that local government spend their finances, will heed that call.
Knife crime is a new problem for Milton Keynes, and it is incredibly worrying, but it is another example of where the public sector can work in partnership with communities and the voluntary sector. The police are on the frontline of knife crime, and I am pleased that they have extra money, officers, kit and powers, all of which are focused in Milton Keynes on solving the issue of knife crime. The extra money is incredibly welcome, and I will come back to that. There will be an extra 187 officers for Thames Valley, of which 36 will be in Milton Keynes. In terms of the extra kit, it really helps when the police know that they have a Taser to use.
There are also extra powers for the police. Parents say—again, this relates to the intersection between the public sector and the community—that, when the police use section 60 powers, it gives them confidence to know that an area is being policed. It also has a deterrent effect for young people who might think about going out with a knife.
It is through the extra money that there is an intersection with the public sector. Diversionary activities through boxing clubs, interventions in schools or projects such as the knife angel are incredibly good for bringing communities together. There is a demand management issue. There is also a data challenge, to enable the public sector, voluntary sector and charity sector to work together on a data-led response to a situation.
Helen Hayes (Dulwich and West Norwood) (Lab)
I would like to start by commending the work that our local councils are doing in response to the coronavirus pandemic. Faced with an unprecedented set of challenges across social care, education, children’s services, housing and homelessness, they are providing access to advice and support for many people who are distressed, worried and facing hardship as a result of the public health and economic calamity we are seeing, while sustaining day-to-day services such as bin collections, parks and libraries. Our councils are doing that in the context of 10 years of unprecedented cuts to their budgets and a total absence of coherent strategy for local government from central Government.
The Housing, Communities and Local Government Committee observed during the last Parliament that there has not been any assessment from central Government of the responsibilities of local government across its statutory and non-statutory functions and no objective assessment of the resources needed to fulfil the task at hand. Instead, our councils have been cut to the bone. Both my councils have lost more than 60% of the funding they received from central Government in grant. They have been forced to raise council tax, which is regressive and hits the poorest residents hardest, while demands on their core statutory services, adult social care and children’s services have continued to increase, and the need for housing and homelessness services has spiralled as a direct consequence of the welfare policies of a decade of Tory Governments.
In that context, the shift to reliance on business rates is of grave concern. Business rates have been the Government’s only game in town for local government, and we now face an economic calamity that may result in business rates revenue simply draining away. It is imperative that the Government come forward with proposals for how councils will be supported to sustain services in the context of the risk of business rates collapsing. Our councils are stepping up to play their part in multiple different ways, as the closeness and proximity of their relationship to communities make them uniquely placed to do so, but there is a lack of resilience across all our public services. After the last decade, that is completely predictable and therefore completely inexcusable.
I turn to a couple of areas of public services that are responding to the crisis as they relate to our councils, the first of which is social care. Our social care system was in crisis before the coronavirus pandemic struck. About 1 million people eligible for social care are not receiving any, and the sector needs about £3.5 billion of additional funding just to meet additional needs. Across the country, councils of all political persuasions are struggling to deliver the social care services that local residents need, and private contractors continue to hand contracts back to councils.
Now, social care workers are at the frontline of the response to covid-19, caring for some of the most vulnerable residents and working hard to take on additional caseloads as hospitals work urgently to discharge people to free up bed space needed for the pandemic, yet many social care workers are paid the minimum wage and remain on zero-hours contracts.
Last week, 100 parliamentarians from both Houses and many political parties joined me in writing to the Secretary of State for Health and Social Care to ask that social care workers be placed on the same footing as NHS workers with regard to sick pay during the coronavirus pandemic. NHS workers and contractors have been guaranteed full pay if they are ill or need to self-isolate, but no such commitment has been made to social care workers. It is vital that low-paid workers, whose jobs bring them into contact with many of the people most vulnerable to covid-19, are not forced to make an impossible choice between taking action to protect the safety of those in their care or putting food on the table and keeping a roof over their family’s head.
I have not received a response to my letter and, despite raising the issue in the Chamber, there has been no indication from the Government that they understand the urgency of the issue or that any action is being taken. Lives will be lost if low-paid, workers with precarious jobs are forced to make impossible choices. I hope that in responding to the debate, the Minister will provide a definitive commitment to social care workers in response to covid-19.
Dame Diana Johnson
My hon. Friend is making an excellent speech. On that point if, as seems likely, schools in England are going to close in the next few days, childcare will need to be provided to allow key workers who have been identified in the NHS to carry on working, perhaps through skeleton schools. Should that also be used for key workers who provide social care in local authorities, so that their children are part of any provision that is made nationally?
Helen Hayes
My hon. Friend makes an excellent point. Social care workers, together with healthcare workers, are at the frontline of the crisis. They must be offered every support possible to enable them to keep working throughout.
More widely, there are grave concerns about the extra capacity that will be needed in the social care sector in response to the crisis. Earlier this week, I visited Turney School in my constituency, an outstanding school for children with special educational needs aged four to 19. Of the more than 130 children at Turney School, 90% are eligible for free school meals, many have multiple and complex needs, and most have a diagnosis of autism. If, as we hear, schools across the country are likely to close shortly, there will be an urgent and immediate need for additional social care support for Turney pupils and many thousands of children with special needs across the country.
Schools such as Turney fulfil not just an educational role, but a social, emotional and respite role for children and their families. Many Turney families live in overcrowded, poor-quality accommodation. Self-isolation in such circumstances will be intolerable and the need for social care support will be critical. The same is true for all children in receipt of free school meals and those who are potentially at risk at home. The social care sector will need to step up to meet the needs of our most vulnerable children.
Finally, in relation to social care, I raise the issue of access to personal protective equipment. Vulnerable people with covid-19 will still need support with personal care, and no one should be made to put their own health at risk in the course of doing their job. I welcome the Minister’s comments on PPE, but will he set out the detailed plans to ensure that all social care workers, whatever setting they are in and whoever their employer is, will have access to PPE? There is serious concern about the impact of the crisis on autistic people and people with learning disabilities, more than 2,000 of whom are still trapped in inappropriate hospital accommodation. As hospitals restrict visitor access, and as the emergency legislation contains provisions to short cut detention under the Mental Health Act 1983, what steps are the Government taking to uphold the human rights of autistic people and people with learning disabilities and to ensure that community services being stretched even further do not result in more people reaching crisis point and being detained in hospital?
The second area of council services I want to raise today is housing and the homelessness service. Homelessness and housing need have risen dramatically during the past decade of Tory austerity. A failure to fund the building of new, genuinely affordable social housing or regulate private renting, combined with cuts to welfare and the disgraceful five-week universal credit wait have driven up homelessness.
I was proud during the last Parliament to be a co-sponsor of the Homelessness Reduction Act 2017, and a recent report by Crisis concludes that the new legislation has been making a difference, but London Councils has made it clear that the level of funding provided by the Government was far from adequate, estimating that the amount that London Councils alone needed to implement the Homelessness Reduction Act was similar to the total national funding the Government made available.
Now we face two additional challenges: the first is the vulnerability of rough sleepers to coronavirus and the impossibility of self-isolating when someone is on the streets. There has been no Government response on this issue. Will the Minister say what arrangements are being made to contain the spread of covid-19 among rough sleepers? Will funding be made available for emergency accommodation that is suitable for self-isolation in addition to the funding that has already been made available to tackle the endemic problem of homelessness, which existed prior to this pandemic?
Secondly, the economic crisis that threatens to engulf our country has the potential to increase homelessness further. The lack of attention to the predicament of private renters has been disgraceful, but without that thousands of people will find their homes at risk. Will the Minister commit to ensuring that no one will lose their home as a consequence of coronavirus?
Our councils are now being asked to administer large amounts of the financial support that the Government are providing in response to this crisis, yet they have not been provided with any guidance, and they are not being supported with additional capacity. Local authorities that have been cut to the bone might find additional financial administration very challenging, so will the Minister set out what support is being provided to councils to ensure that they are able to administer hardship funds and business support without delay and without impacting on other services?
Across many areas of responsibility, local government is at the frontline of this unprecedented public health and economic crisis. It is the job of our councils to ensure that the burdens of the disease do not fall on the poorest and most vulnerable in our communities. It is the job of central Government to ensure that they are properly funded, equipped and supported to do so.
Danny Kruger (Devizes) (Con)
I thank the Opposition for introducing this important debate, and the Minister for some very helpful information that he gave in his response.
Let me put on record my appreciation of the efforts of the ministerial team. This is an enormous crisis for everybody, but I want to congratulate them for the speed with which they are responding in ways large and small. Some of the information we have just heard is very helpful in small ways for councils, particularly as regards making it easier for councils to meet to do their business more flexibly given the crisis. That will be very welcome at local authority level.
I pay tribute to the spirit of the Opposition Front Benchers as well. It is absolutely tremendous to see how this House is coming together to address these issues. I want quickly to address two points. The first, which has been raised by other Members, is the amazing response of our communities to this crisis and to the impending demand for support from the elderly, in particular—it is absolutely wonderful to see.
I have some anxiety about how we will co-ordinate that effort in a way that does not stifle it. I was a community worker in north Kensington at the time of the Grenfell disaster. I saw a huge uprising and upsurge of voluntary support and effort—an outpouring of love and resources from the community—but there was a huge challenge of co-ordination. We are going to have to get that balance right in all our communities in the coming months. Today, I was speaking to council workers in my local authority of Wiltshire, where there is a good balance. Council staff are not attempting directly to co-ordinate the efforts of the volunteers and local community groups that are rising up. They are not trying to tell them what to do or how to do it. What they are doing is providing a hub for information exchange, and providing support when gaps do emerge.
David Linden
That has been one of my concerns throughout this process. Lots of organisations in my constituency are absolutely up for the challenge, but we need to ensure that there is no duplication, particularly when it comes to things such as food security. Does the hon. Member agree that although it is not necessarily for local authorities to do that co-ordination, it would be good if helpful tips and ideas were disseminated throughout the UK so that we avoided the issue of duplication?
Danny Kruger
I entirely agree. There is a huge role for social media in the sort of organic, spontaneous co-ordination that we are seeing, but there is also a role for the public sector, particularly local authorities. It would be very helpful for the public to hear a clear communication from the Government that we entirely support and encourage this sort of voluntary effort, but that anybody who wants to try to match volunteers with households and so on needs to plug into local government in parishes and towns, particularly in rural areas such as the one with which I am concerned.
Secondly, on local authorities’ lost income, I hear the points that have been made very powerfully about the additional burdens that will be placed on local authorities as a result of the demand that we are going to see, but councils are also going to endure lost income as a result of this crisis. In Wiltshire, we are worrying about up to £25 million-worth of income that is normally received through all sorts of activities such as leisure services, parking, council tax and so on. We are stepping in to support businesses with lost revenues, but we need to think about how to do that for councils as well—not just helping them to meet the additional demand for services, but compensating them for their losses.
Apsana Begum (Poplar and Limehouse) (Lab)
People are understandably very worried at this time of crisis. I am afraid that the Government still need to step up and provide the certainty that the public deserve. It is vital and urgent that they demonstrate that they are meeting all the challenges head on, not least because it is overwhelmingly clear that years of cuts and a failure to invest in services mean that we are extremely ill prepared for dealing with this type of large-scale health risk to our community.
The truth is that the Conservatives have let us down, and they have let down my constituents, who have been disproportionately disadvantaged by austerity. For example, spending on youth services has been slashed by 70% since 2010, with a real-terms cut of £880 million. Locally in my borough, spending on young people fell by a whopping 76.9% between 2011 and 2018. As a result, many people now believe that young people’s lives could be worse than their own generation’s, and some argue that children and young people in Britain are among the unhappiest, unhealthiest, poorest and least educated in the developed world. Yet, it is widely observed that soaring inequality fosters resentment and division. In fact, the all-party parliamentary group on knife crime explicitly linked knife crime to council cuts. Nothing in the Budget last week will solve the crisis facing young people’s futures.
Then there is the education crisis. Schools and early intervention services have faced significant cuts in particular, and parents of children with additional needs are struggling to have their children’s learning needs met. Only a few weeks ago, it was a privilege and an honour for me to stand with local special educational needs and disabilities campaigners outside Downing Street to present an invoice for £12 million—Tower Hamlets Council’s projected SEND budget overspend by 2022.
Parents, families and communities work very hard to support our children, but we are let down time and again by the system that we are forced to struggle within. When things do go wrong in families and relationships, the support so often is not there. For example, the availability of specialist support for those who report domestic abuse varies enormously around the country. According to Women’s Aid, 10 domestic abuse victims are turned away from women’s refuges every day because of a lack of space. While it is good to see that the long-awaited Domestic Abuse Bill includes a new legal obligation on councils to provide secure refuges for victims, it is important that the necessary resources are provided alongside that responsibility. In my local council, the number of recorded incidents of domestic abuse is above average, and nothing in the Budget will address the crisis of violence against women or mean that every case of domestic abuse is taken seriously and each individual given access to the support they need.
Social care is also in crisis in this country. Before the coronavirus outbreak, 1.5 million people were not receiving the care they need. As Members will know and have raised today, the majority of those who receive social care are older, disabled and vulnerable people—the very people who are most at risk from the coronavirus. It is still very unclear from the Government statements so far what additional support is being provided. In the meantime, providers and local authorities are already stretched to breaking point in many areas, so we need to know now how much additional support is being provided specifically for social care.
To be frank, I am truly shocked and surprised that those in the Conservative party still attempt to justify the cruel strategy of austerity, which has decimated local government funding over the past decade, forcing working-class people to pay for a financial crisis they did not cause. It is a shameful indictment of any economy that so many people are trapped in low-paid, insecure work and invariably failed by the social security regime. It is shameful that earlier this year, the Joseph Rowntree Foundation found that the proportion of people in work who live in poverty went up for the third consecutive year to a record high. It is shameful that, according to End Child Poverty, at 58.5% my constituency of Poplar and Limehouse has the highest child poverty rate in the entire country.
Yesterday, the former Secretary of State for Health and Social Care admitted that the Government’s harsh and uncaring policies have caused suffering and austerity, whose onslaught has been brutal. Cuts equal crisis, and by that I mean that every cut and every closure has had a real and serious human cost. As we speak, the people of my constituency understand the gravity of the situation they are faced with and are trying to support each other the best they can, as they always have done. Right now, public sector workers, who are the backbone of our communities, are working in the most extreme of situations to provide vital services. This is not a time for half-measures or indecision, but for those in power to step up and deliver the scale of intervention, leadership and co-ordination required to secure the funding and operation of local public services. That cannot be deferred to tomorrow, because people are falling ill and are in need today.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
I am sad to report to the House that, having spent 22 years as a member of a local authority and having been elected as a Member of Parliament, I have gone down in the index of public trust. When it comes to politicians and Members of Parliament, we are fortunate that we still sit above lawyers and estate agents, but local government is very much trusted by the people of this country. That is why what the Minister and the Government have done, not only in their approach to the coronavirus outbreak but to the bigger strategic challenge of how we properly resource our local services for the coming years, is very important.
One of the long-standing frustrations of my time in local government is that Parliament—it has the opportunity to be incredibly strategic on behalf of our country and to think about what it wants to achieve for the nation in many of these big-picture issues, such as housing, healthcare, social care and education—has sometimes been drawn into detailed debates about very specific issues, when we would achieve so much more by allowing our locally elected colleagues to demonstrate the leadership that they are demonstrating in response to this crisis. They need to have those resources to accept from this House the challenge to deliver against those ambitions and then to be left to get on with it.
Local resilience forums, which the Minister referred to on a number of occasions in his speech, are to me a very good example of exactly that kind of leadership. My experience as a councillor is in the London Borough of Hillingdon, although my constituency straddles two London local authorities. Going back to 2001, with 9/11 we suddenly had to deal with thousands of stranded travellers who had no means of getting back to their homes. They needed to be found somewhere to stay, to be fed and, in many cases, to be provided with medical care, communications and support. We saw local organisations––not just the local authority, but schools and the military––rallying around, co-ordinated by the local authority, to provide that crucial support.
In the decade since, we have had to deal with significant outbreaks of very serious illnesses, including severe acute respiratory syndrome, middle east respiratory syndrome, H5N1 and swine flu, from which a young girl in my local area sadly passed away. The local authority then had to step in to manage those communications, in order to reassure that community and make sure that the support was in place so that a school or community that was grieving could deal with the situation. It is impossible to do that directly from this House, which is why the Government have rightly taken the view that they will look at the strategic question of providing an appropriate level of resources and then enable those people in their local communities to route that money directly to where it makes the most difference.
My hon. Friend the Member for Milton Keynes North (Ben Everitt) referred to the provision of a bus to make emergency accommodation available for homeless people. Many of us have local authorities that have contracts with local voluntary organisations, for example, the YMCA, as in the case of my local authority, to provide that kind of emergency accommodation. In other parts of the country, such accommodation may be provided directly by the local authority itself. It is crucial, therefore, that the theme that runs throughout all this is the ability of local authorities and local resilience forums to deploy the money that is rightly coming from this Government in the most flexible way possible to meet those local challenges.
Lessons could be learned on that, and I am cognisant of what Opposition Members have said about the challenges associated with special educational needs and disabilities, and the educational provision for people in that situation. It is clear that the more local flexibility there is, the easier it is for those communities to rise to the challenge of meeting the needs of those individuals. The more we seek to control that from the centre, the less satisfied many of our residents and voters will be with the outcomes they are seeing. Given the amazing range of provision that we see—I am cognisant of the remarks about what was happening on youth services—we have fantastic voluntary organisations, which are providing brilliant opportunities to young people. A decade or two ago, their lives would perhaps have been lived in a youth club, but they are now being lived online, on a smartphone, where they talk to their friends in the privacy of their bedrooms. So something different is required in the modern world, and that is another example of where the leadership of local authorities, which know their communities, can deploy those resources, albeit more limited than they might have been historically, in the most effective way.
I wish to make a couple of specific observations about particular strengths of the Government’s response. The first relates to the announcements that have been made to support nurseries and early years providers. I should declare an interest: as a parent of two young children, I am a user of my local council-run nursery. There are many people, some employed in our public services and others who are going about their daily business who are dependent on the existence of those services to ensure that they can live their lives. Such services provide an opportunity for their children and the children who may not come from prosperous backgrounds to gain the best possible start in life. So I am pleased with the commitment that the Government have given to ensure that, even if children are having to step back from those places because of the immediate prevailing situation, funding will still find its way, and so when this moment of emergency passes families can find that those services and the opportunities for the youngest children are still there. That is an extremely wise move, and the more we can send that message to proprietors and managers of nurseries and parents whose children use them, the better.
The second thing I wish to refer to is the distribution of personal protective equipment. Because of my personal connections with the national health service and from what I hear as a local councillor, I know that there is, understandably, a high degree of anxiety among many of those staff who, unlike us in this Chamber, will be sent out to people who are known to be suffering from the coronavirus in order to provide direct, hands-on personal care. They are worried about whether they will be able to access the quality and standard of equipment that will be necessary to keep them safe. The announcement by the Minister that the distribution from national stocks of those products to those frontline workers is going to be absolutely crucial once again in providing that degree of reassurance.
That is not reassurance to those in the markets who are wondering which moves to make when they are trading their shares, and it is not reassurance to the international community; it is reassurance to people who are absolutely at the frontline of responding in a very direct and very human way to this crisis. Again, the more we can get out the message the better that, as well as a sum that is so mind-bogglingly large—over £300 billion—that it is hard to grasp, this House is thinking about the basics of face masks and gloves and aprons that people need to make sure that they are safe when they are doing an essential job, to bring this country together and to keep our people safe.
Matt Western
On that point, does the hon. Gentleman agree that it would be useful to understand from Government just how they are ramping up the production and supply of PPE, or ventilators or testing kits, so we understand where the base was and where we might be in two weeks’ time?
David Simmonds
The hon. Gentleman makes a very good point. I have been very much reassured by what I have heard from Ministers over a number of days about the initiatives that are taking place to ensure that ventilators, for example, and other equipment are available. One of the things I am particularly aware of because of my local government experience and knowledge of what local resilience forums do is that there are long-standing plans in place, backed up by stockpiles of various different types of equipment that may be required. It is welcome that the Minister has been very clear today that, based on need and local requirements, the distribution of that is going to begin, particularly for the volunteer groups that many colleagues have referred to, with people who are not familiar with some of the challenges and risks that may be involved in treating patients with serious illnesses; the knowledge that they can access good quality personal protective equipment supplied through central Government and by their local authority, is going to be absolutely crucial.
In conclusion, I would simply like to make the following point. We have seen examples up and down the land of local authorities consistently on a cross-party basis—I can think of examples from the response of Manchester to the Arena bombing to those of local authorities across the country to the refugee crisis in Europe—where our local government colleagues have demonstrated very capably that they will rise to any challenge which this House sets. It is most welcome that Ministers have been clear that they will provide the financial resources that are central to the delivery of that, and I trust that all hon. Members will be providing a similar degree of cross-party moral support to our colleagues in local government that at this time of national challenge, we need to work together and rise to it together.
Jim McMahon (Oldham West and Royton) (Lab/Co-op)
This is a very important debate at a very important time, and I thank my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) for her introduction in opening it. I also thank the Minister for the spirit in which he conducted the response. For Members across the House, a lot is going on at the moment: tensions are heightened and people are fearful in our communities, and we have all received an increasing volume of correspondence from people desperate to find out what happens next, what this means, and how they can get help and support. It is telling therefore that so many Members have stayed for this debate just to put on record our appreciation for the time given to this important issue.
In particular, I want to reference the Select Committee—and my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) in particular, previously a distinguished member of it—for the work it has done on a number of reviews. On almost every issue and in every policy area, a consistent theme came out, which was that the Government did not have a grasp of the scale of the impact of the decisions they were making on the communities affected by those decisions. Whether it was housing, planning, local government finance, adult social care, children’s services or homelessness—you name it—every review had that strand going right through it.
It is absolutely right to point out that a decade of cuts has taken its toll. Critically—and let us be honest, this issue has transcended different Governments—the absence of a proper assessment of the responsibilities placed on councils, which would then allow an informed assessment of the cost of delivering those responsibilities, is a glaring omission that we need to put right. It is staggering that we are carrying out a fair funding review without having reviewing the responsibilities. That cannot be a real, balanced assessment of the costs of view of delivering services.
Of course, the debate naturally goes on to social care workers and the genuine concern about the type of protection that they will get. This is a constant frustration. We all love the NHS: it is part of who we are as a nation. The NHS gives us help when we need it most, when we are at our most desperate; it brings new life into the world, and we all celebrate that; and it supports us when our loved ones are reaching the end of their time, and right in the middle of that experience, too. It is a frustration for local government, though, that social care is always placed in second or even third place behind the NHS. I just do not understand it: surely if someone is giving care in a hospital environment, they have the same value as if they were giving care in somebody’s home environment. The skill and compassion that person needs, along with their dedication to public service, are critical requirements.
Let us look at what it feels like to be an adult social care worker. First, they are often not treated with respect by the person employing them. We have only recently made progress on 15-minute visits, pay for travel time, not deducting uniform costs and all those types of issues, but even now many are paid the minimum wage or just above it, and that is not even enough to live on. It starts at the beginning: we say that we value care as an industry because it is so important to our society, but the apprenticeship levy rate for care is the lowest possible rate that can be paid for that skill and training provision, at £3,000 a year. A fencing installer who takes on an apprentice can attract £12,000 a year, but that adult social care worker on an apprenticeship attracts only £3,000 a year. There is a real question mark about how we value care as a career. Let us be honest: we have got away with it for too long. As a society and as a nation, we are not paying people a fair wage for their responsibilities and the importance of the job that they do. That just has to change. It will have a price tag, but we should really value the work that they do.
Christian Matheson (City of Chester) (Lab)
In the NHS and social care so many of these employees are taken for granted. Their skills in dealing with people—patients, clients, or whatever we call them—is taken for granted. The sector is to a large extent running on the good will of its employees.
Jim McMahon
That is absolutely the case, but it is also running on high levels of vacancies—there are 120,000 vacancies in adult social care. We are highly vulnerable to staff in that industry becoming ill and going into self-isolation, which is why the question of the protection and support they are given becomes so important. It is absolutely about making sure that, first and foremost, they are considered in the same way as hospital staff. Making sure that they get the proper protective equipment that they need is critical, not just to protect the patients who are being dealt with and the receivers of adult social care, but for the individuals who are placing themselves in a very risky situation, going into people’s homes without knowing who that person has been in contact with, but doing it anyway because they believe in the care they are offering.
My hon. Friend the Member for Poplar and Limehouse (Apsana Begum) made a really important point that went beyond adult social care: the fabric of our society has changed as a result of the cuts. The 70% reduction in youth services has almost certainly had an impact on knife crime, on county lines, and on whether people feel they have a stake in the future.
Helen Hayes
My hon. Friend is making an excellent speech. Does he agree that in this time of crisis central Government support for local government is urgently needed in respect of protection of our young people, who may be even more vulnerable to violence as a consequence of the lack of support systems, of activities and of the people who are normally are responsible for keeping them safe day-to-day?
Jim McMahon
That is absolutely true, and it is also true that many lives are lost, in terms of potential, through the criminalisation of young people who are effectively groomed into criminality by those in positions of power or authority in the community who attract them in and entice them. We need to do far more to make clear to young people across the country that there is a real alternative when it comes to leading a fulfilled life. Until then, we will never break the cycle of young people being caught in crime unnecessarily.
This goes right to the heart of the “cradle to the grave” approach to public service. We cannot ignore the impact on Sure Start centres, which were about investing in young people and giving them a taste of what opportunity was from the time when they were young and receiving that type of care. Taking it away has had a massive impact, and that is before we get on to primary school budgets and special educational needs. Young people are just not receiving the tailored support that they need.
However, today is also about thanking councils for the work that they do. Regardless of party affiliation, I want to place on record our thanks for the work that councillors do. They come into public service from their community because they really want to make a difference. Hearing from some of the councillors and ex-councillors who are now in this place about the passion and connection that they still feel, as I do, is very inspiring. We must also thank our council officers.
After 10 years of austerity, councils have experienced a very stressful period in trying to reconcile delivering balanced budgets to remain within the law with managing the huge demand for adult social care, children’s services and services for the homeless. People believe they pay council tax for the very neighbourhood services that are being taken away because councils cannot afford to make ends meet and provide those services. Councils are placed in a horrible position. They are trying to keep their heads above water, and providing targeted support for people who really need it, but at the same time the public are holding them to account for the real cuts that have been made locally. I do not think that that is a fair burden for central Government to place on local government.
That brings me to council tax, which is a hugely regressive tax. It has increased by a third, and what was hidden in the Budget papers was, within the lifetime of that Budget, an £8 billion increase in council tax income for the Treasury. The Government are not coming to the table and giving councils sufficient funds to deal with the demands of adult social care and children’s services in particular. What they are saying is “It is the survival of the fittest. If you can raise money through council tax or business rate retention, good luck, but if you cannot, I am afraid that you can no longer rely on central Government to step in and provide that partnership solution.”
That is just not a fair way of doing things. How can it be right that today, in England—and we have an English problem, because of the nature of how the country is governed—adult social care and people’s ability to access the care that they need will soon be determined by the house values in their area in 1991? How can it be right that they will be based on historic industrial and commercial land values and the business rate take in that area, when the council has very little control over that base? With every revaluation, we see many regions being devalued, and London and the south-east increasing in value. That will be the model, the baseline, of public service funding in the future.
I mentioned the survival of the fittest, but the fittest are not that fit. Local government still faces a £6 billion funding gap between now and 2025. There will still be people in the most affluent parts of the country who are living in absolute destitution and not getting the support that they need because councils do not have the necessary funds.
Matt Western
My hon. Friend is making an excellent speech. Having been a councillor myself, I can echo his comments. The difficulty for our local authorities is that in the absence of the central Government grant, they are having to be more inventive and creative in respect of how they bring in revenue streams. What we have found in the last couple of weeks and what is forecast is that certain revenue streams will be cut off, and councils will become more and more desperate to continue what few services they can maintain. When the car parking charges and the revenue streams for the local civic centre are not coming in, they will be under even more pressure than they were before. Does he agree that the local authorities need to understand urgently how the £500 million that the Chancellor mentioned will be distributed—and distributed fairly?
Jim McMahon
I think that is right. When councils have to look elsewhere for funding, a risk naturally comes with that. The National Audit Office produced a report on this and the Government share these concerns. The Public Works Loan Board interest rate was doubled overnight by the Government, because they are concerned about the exposure that councils face in buying assets as investments. The NAO expressed the same concern. In a two-year period, councils have been buying investment portfolio assets of £6 billion. Why? Because they are desperate to see income from other places, but this is office accommodation and in retail, sometimes not even in the area that the council is responsible for. The Government response is to double the Public Works Loan Board rate instead of addressing the fundamental reason why councils have to look elsewhere for funding, which feels illogical. We have to make sure that the base funding for councils is absolutely where it needs to be.
We are coming to the greatest test of local government, public service and society that any of us have seen in our lifetime. It will test us all. It will test the fabric of society and test public services to breaking point, at a time when they are built on extremely weak foundations. I am genuinely fearful for how we can continue this in a sustained period. For a short time, they will make it work. They will roll their sleeves up and work together. They will create a partnership at a local level and find a way through it, but the Government know full well that this is not a crisis that will last weeks or even months. A sustained response will be required and the Government will have to make sure that they give local government the funding that they need to provide the critical response. We also need to manage public expectation.
Siobhain McDonagh (Mitcham and Morden) (Lab)
Is my hon. Friend aware that only today, local government has received a directive from central Government to provide street sleepers—homeless people on the streets—with self-contained accommodation? Great idea, but where are they going to find it?
Jim McMahon
It is also the case, as I hope most Members know, that solving homelessness is not just about providing a roof. That is a critical part of it, but it is about how the ecosystem of public service works to make sure that the alcohol and drug addiction services, mental health support and physical health support are in place. We need to make sure that this is not just about giving someone a set of keys for a property—by the way, if that was possible, why did we not do it before this crisis? —but making sure that the wider support is in place.
The Government need to be honest about the scale of the challenge that public services will face. I still believe that at this moment, the public of this country do not understand the scale of what may face us all and particularly the impact that it will have on public services, and not just for the workforce. We need to remember, when we talk about public services and the community over here, that public servants are the community. They live and work in the communities where we all do. If people are off work because they have to self-isolate, are ill or have caring responsibilities, that will have a direct impact on the local government workforce. Many will have partners working in the private sector, as well as the public sector, and they may well face redundancies and hours being cut in the family. They will go through the same financial stresses and strains, and there will be an impact on family life in the same way. The Government need to be honest about what that means for day-to-day public services, and what the public can expect when we really have to pull through to make sure that we can keep the most urgent critical care going in this country.
The Chancellor said that money will be made available, but we see a drip feed of those announcements in a way that is not helpful for local government. The public health settlement for next year was released only yesterday, 14 days before the end of the financial year. Local councils were not even able to plan ahead about what that meant. We cannot have that when it comes to a crisis of this scale.
I have always believed that our local government is the first line of defence and the frontline in delivering public services. I have always believed that they are the glue that holds our community together, that they are the leaders of place and that they can stir us to a better future. We have seen that in the way that they bring communities together, invest in their local economies and deliver decent public services. What we will demand of those people in the coming weeks and months will test us all, and it will test their resolve. It will not be good enough just to say, “Thank you for all that you do,” without addressing the fact that, for 10 years, they have had to shoulder a disproportionate burden of austerity. Surely, now is the time to say to those people, “We will right the wrong of making you take on that burden of austerity. You were not the bankers, you did not create the financial crisis, and it was wrong to place you in a position where you had to bear a disproportionate burden.” We need to put that right today.
We need not just money for the current crisis but sustained funding so we can rebuild public services, invest in our frontline and do more than just give those people one word. By the time we get through this, they will not be just the frontline that we respect; they will be seen for the heroes that they are.
The Minister for Housing (Christopher Pincher)
May I first congratulate and thank hon. Members across the House for their valuable and important contributions to the debate? They have been largely co-operative and collaborative at a time of extraordinary emergency for our country.
I am sorry that I was not here at the beginning of the debate to hear the opening remarks of the hon. Member for Worsley and Eccles South (Barbara Keeley) and the Under-Secretary of State for Housing, Communities and Local Government, my hon. Friend the Member for Thornbury and Yate (Luke Hall); like the hon. Member for Oldham West and Royton (Jim McMahon), I was in a Westminster Hall debate discussing the Greater Manchester spatial framework. It is a great pleasure to have the chance to close the debate.
I join my hon. Friend the Under-Secretary of State in reiterating the Government’s unwavering support for local authorities across the country in responding to the covid-19 emergency. Like other right hon. and hon. Members, I pay particular tribute to frontline staff and other council officers for their tireless efforts in reassuring residents, protecting the elderly and most vulnerable, and helping keep the public safe. Let me assure the House that the Government will continue to work hand in hand with local partners, including councils and local resilience forums, to assist in this vital work and ensure that communities receive the support and help they need during this unprecedented and challenging time.
Hon. Members across the House described powerfully the incredible work that their local communities and local public services are doing. Let me say, on behalf of the Prime Minister and my right hon. Friend the Secretary of State for Housing, Communities and Local Government, how grateful we are for all the tireless work that people are already doing. I am particularly conscious of the vital contribution of local voluntary organisations, and I pay particular tribute to them, as other Members did. I was struck by what my hon. Friend the Member for Milton Keynes North (Ben Everitt) had to say about the support the local volunteer organisation The Bus Shelter is providing.
Our responsibility in Government is to knit that work together into a national programme to ensure that all communities and all vulnerable people, wherever they may be, have access to the right support at the right time, and we will do that. We will take every step necessary to support local communities, local authorities, all public services and the myriad volunteers who are coming forward to help, as my hon. Friends the Members for Ruislip, Northwood and Pinner (David Simmonds) and for Devizes (Danny Kruger) made clear.
We know councils need assurance from the Government that they will have the funding they need to play their crucial role in the coronavirus response, especially in providing social care services to those in greatest need, as a number of Members on both sides of the House have said. As my right hon. Friend the Chancellor has made clear, we will do whatever it takes—whatever it takes—to respond effectively. That includes making sure public services, including vital council services, have the money they need to respond. The Chancellor announced last week that £5 billion has been made available for the NHS, and more money has been made available for other public services, such as the half a million pounds made available to local authorities, with more to come if necessary.
We are urgently agreeing a funding package for councils, and we will make further announcements as soon as possible.
Barbara Keeley
The Under-Secretary of State for Housing, Communities and Local Government said earlier that the Government will make sure that, whatever social care and the NHS need, they will get it. Will the Minister for Housing repeat that? That is an important thing to say. It is not just the NHS that needs funding; social care needs it, too.
Christopher Pincher
I am grateful to the hon. Lady for that intervention. I will come on to talk about social care, but we will certainly be giving those who work in social care the help they need to contend with this crisis.
These measures, which follow on from the Budget and from the Chancellor’s announcement last night, amount to over £330 billion in financial support, which, if I may say gently, is more than just drip-feeding into the system; it is a significant amount of money. The Government are prepared to do whatever it takes to protect the economy, our NHS, our local services and our local authorities in weathering this storm.
Helen Hayes
Will the Minister specifically address the loss in core income that councils will experience if business rates revenue collapses? I know the Government have announced large-scale support, much of which will be channelled through local authorities to meet specific needs arising from the pandemic, but the threat to our councils is bigger than that—it is to their core budget. The Government have made councils reliant on business rates revenue in recent years, and it may now drain away from them.
Christopher Pincher
I am grateful to the hon. Lady for her further intervention. I know and understand the point she is making, and we have already made funds available to local authorities. The Chancellor, in his Budget speech, made clear the support we want to give. He made further announcements yesterday and, if she is prepared to bear with the Government a little longer, I suspect further announcements will be made as the situation evolves.
As the Under-Secretary of State made clear in his opening statement, this funding is in addition to extending SSP and a range of other measures by the Department for Work and Pensions.
Jim McMahon
Local authority base budgets are based on an assessment of council tax collection rates. If people are made redundant or if they move on to statutory sick pay, they will clearly not be able to afford their rent, let alone their council tax. We expect councils to withhold any enforcement action, because that is the right, moral thing to do, but surely the Government will provide compensation to protect the base income of those councils, and surely they must now consider whether people should have the protection of a council tax holiday, too.
Christopher Pincher
I am grateful to the hon. Gentleman for his intervention. As the Chancellor made clear, we will do whatever is necessary to stand behind our public services, our local authorities and our volunteers to get through this crisis. More announcements will be made in this fast-moving situation, so I ask him to bear with the Government in that regard.
As hon. Members will also be aware, yesterday, my Department announced £3.2 million in initial emergency funding to help rough sleepers or those at risk of rough sleeping to self-isolate to prevent the spread of this virus. The Under-Secretary of State, the homelessness Minister, made that point in his opening remarks; I just wanted to reiterate it to ensure that colleagues who have come into the Chamber more recently have heard it.
A number of Members from across the House raised the question of whether the Government have provided sufficient funding. The first point I would make—I have made it already—is that this situation is changing every day. The Government are responding at pace to the evolving challenges and working closely with the Local Government Association and other local authority representatives to understand the effects of covid-19 on the delivery of statutory services, including social care. The second point is to stress that the announcements that we have made so far, including those from the Chancellor last night, do not signal the end of the Government’s response; they signal its beginning. We stand ready to do more and we will go further as necessary.
A number of colleagues raised the question of our social care workforce, including those who care for the elderly and vulnerable in care homes and in their own homes. Building on our existing strong local relationships, the NHS and local authorities are working with care providers to make sure that people receive the specialised care and support they need during this outbreak. Councils will map out all care and support plans to prioritise people who are at the highest risk and will contact all registered providers in their local area to facilitate plans for mutual aid, and they will do this at pace.
Christopher Pincher
I will give way one more time, because I appreciate that the statement is to come.
Jess Phillips
I thank the Minister. This morning, in a conference call with the leader of Birmingham City Council, the biggest council in Europe, we discussed this exact thing. Currently in social care and across care homes in the city of Birmingham—I imagine it is the same everywhere—they simply do not have the personal protective equipment to do the job that they need to be doing. I was asked to raise that directly with the Government and press them on it, because people are being put in harm’s way.
Christopher Pincher
I am grateful to the hon. Lady for that point. Let me reassure her. We understand the point about social care providers and PPE. I think 7 million—I quote from memory—face masks are being made available to careworkers. At least 300 masks will be provided to care homes or care home providers to ensure that this necessary and essential piece of kit is available to them. If for whatever reason the normal supplier is unable to provide the kit, the national supply disruption response number is a way for providers to find other suppliers or receive an emergency parachute drop of those masks. I should also say that, although we would ordinarily expect those sorts of workers to have things such as aprons and gloves, we will do whatever we can to ensure that whatever they need is available. We are working with local authorities and care providers to make sure that those PPE pieces of kit are available.
We have also asked GPs to look at the possibilities of offering digital appointments to provide advice and guidance to patients and potentially to their families. I am confident that we are making every effort to provide for those eventualities.
A number of Members raised the 2020-21 settlement. I hope that we have demonstrated clearly to all Members that we are doing everything possible to give local government the right support and the right resources to respond to this unprecedented crisis. Of course, local authorities have already been put on a strong footing by the outcome of the settlement for next year. The settlement, which I am pleased that the House supported just a few weeks ago, responds to the pressures that councils are facing by providing them with access to the largest increase in core spending power since 2015. CSP will rise from £46.2 billion to £49.1 billion in 2020-21. That is an estimated 4.4% real-terms increase—well above the rate of inflation. In 2020-21, the final settlement makes £1.5 billion of new funding available for adult and children’s social care. That will support local authorities to meet rising demand and recognises the vital role that social care plays in supporting the most vulnerable in our society.
In conclusion, the role of local government in delivering social care and other vital public services has never been more important than it is now and will be in the days and weeks ahead. Through our immediate actions in response to this crisis and the broader work this Government are doing to help local authorities, I am confident that we are giving councils everything they need to deliver the services upon which we and our communities rely. We remain steadfast in our commitment to do whatever it takes to help communities to beat covid-19, safe in the knowledge that, together, we will rise to these challenges. Together we must, and we will, succeed.
Question put and agreed to.
Resolved,
That this House has considered the statutory and broader local government responsibilities for public services, including social care.
Educational Settings
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for Education (Gavin Williamson)
With permission, Mr Speaker, I would like to make a statement regarding changes to the operations of educational settings as a result of the coronavirus pandemic.
We are facing increasingly difficult challenges, and I would like to once again express my extraordinary gratitude to staff in all our schools, colleges, nurseries and universities who have been doing so much. I know that the situation has become increasingly challenging. I said before that if the science and the advice changed, such that keeping schools open would no longer be in the best interests of children and teachers, we would act. We are now at that stage.
The spike of the virus is increasing at a faster pace than anticipated, and it is crucial that we continue to consider the right measures to arrest this increase and relieve the pressure on the health system. The public health benefits of schools remaining open as normal are shifting. It is also clear that schools are finding it increasingly difficult to continue as normal, as illness and self-isolation impact on staffing levels and pupil attendance. I want to provide parents, students and staff with the certainty they need.
After schools shut their gates on Friday afternoon, they will remain closed until further notice. That will be for all children except those of key workers and the children who are most vulnerable. The scientific advice shows that these settings are safe for this small number of children to continue attending, but asking others to stay away will help us to slow the spread of this virus. Examples of key workers include NHS staff, police and delivery drivers who need to be able to go to work. Vulnerable children include those who have a social worker and those with education, health and care plans. Looking after these children will enable schools to support the country through this extremely challenging time. We are expecting early years providers, sixth forms and further education colleges to do the same. We are working with Her Majesty’s Treasury on the financial support that will be required. I am also asking that independent schools and boarding schools follow the same approach.
We will give schools the flexibility to provide meals or vouchers to children eligible for free school meals. Some schools are already doing this, and we will reimburse the costs. As soon as possible, we will put in place a national voucher system for every child who is eligible for free school meals. I know that all of this will not be easy. I am asking nurseries, schools and colleges to be at the forefront of our national response to this crisis.
Given the unprecedented asks that we are making of all those who are working in educational settings at this time, I recognise that we are asking so much of them. We will be asking them to provide for these settings to be open to children of key workers and to vulnerable children during the Easter holidays as well.
I recognise that what schools will be doing in these circumstances will look very different from the normal state of affairs, and will ensure that leaders have the flexibility that they need to face this challenge. In order to allow schools and other settings to focus on this new operational model and the support they can give to these young people, we are removing various duties. Ofsted has ceased all routine inspection of early years, schools, colleges and children’s social care services. I can confirm that we will not go ahead with assessments or exams, and that we will not be publishing performance tables for this academic year. We will work with the sector and Ofqual to ensure that children get the qualifications that they need.
My Department is working closely with local authorities, representatives of early years, schools and headteachers, regional school commissioners and bodies such as Ofsted and Ofqual about how to deliver this change as effectively as possible. We will do whatever is necessary to support local authorities, schools and teachers through the weeks and months ahead.
I know that many universities and other higher education institutions are already taking necessary steps to keep their staff and students safe and, where possible, keep providing education. I am confident that vice-chancellors are making the right decisions and my Department continues to support them in doing so.
This is a testing time for the whole nation, but by asking schools and other settings to look after the children of key workers and the most vulnerable, we will be directly saving people’s lives. Whether a parent or a teacher, I want people to know that their wellbeing and that of their children is the absolute priority for me and my Department. We are completely committed to ensuring that every child receives the best education possible, and we will be working with the BBC and others to provide resources for children to access at home.
I am deeply grateful for the civic spirit and selfless dedication that has been, and continues to be, shown by teachers and other school workers every single day. I am committed to giving my full support throughout every stage of this crisis to those who are doing so much for all of us. I know that our teachers and those working in education have the full support of the House and that hon. Members will do what they can to support schools and other providers in their own constituencies through this period of change. I wish to thank them in advance for the work that they will do. I would also like to take the opportunity to thank the Opposition, particularly the hon. Member for Ashton-under-Lyne (Angela Rayner), for their co-operation, advice and thoughts at this time.
Our headteachers and teachers are central to the country’s response to the current crisis. I am reassured by their readiness to step up and to take the lead in supporting families through this most incredibly difficult time. All of those who work in our schools, colleges and universities rightly take their place next to our NHS staff and other key workers as central to our efforts as a country in battling the virus, and I thank them from the bottom of my heart for all of their support and all they do. I commend the statement to the House.
Angela Rayner (Ashton-under-Lyne) (Lab)
I thank the Secretary of State for advance sight of his statement and for the discussions that we have had over recent days. As he knows, I have written to him with a number of questions about his Department’s dealing with the fallout of covid-19. I hope he will be able to provide some of the answers now, but I also look forward to his detailed response as soon as possible.
I know that these are extraordinary times, and that parents and carers are worried. Let me put on record our thanks to and support for all those working in our education and children’s services through this crisis. They, along with parents and learners of all ages, now seek both reassurance and guidance from Government. The steps that have finally been taken today are welcome, but can the Secretary of State tell us how the reduced service provided in schools will work? In particular, may I press him on free school meals. He says that he will give schools flexibility, but with millions of children in poverty, and many families now facing even worse, can he guarantee that free school meals will be made available to all those eligible, and will he take steps to extend that to breakfasts and over the school holidays?
Children with disabilities and underlying health conditions are at particular risk. Can the Secretary of State tell us what steps he is taking to support them and their parents and ensure that the guidance is easily found? Where is the guidance available for parents who have underlying health conditions? Can they take their children out of school if they are themselves in isolation or at risk, and will the new guidance be issued on fines for parents who withdraw their children from school? What advice and support is he offering to special schools serving those with particularly serious physical conditions, which are often residential?
The same is true for the education workforce. Will the Secretary of State make it clear to all employers that workers in the vulnerable categories identified by the Government must not now be placed under pressure to be in work and should be sent home? Staff are also worried about being paid. What reassurances can he give, especially to those sadly now on casual contracts or insecure terms, and what is his plan for supply teachers?
There is widespread concern about the exams. Clarity is required about pupils who were due to sit their SATS, GCSEs or A-levels and will now not do so. Can the Secretary of State tell us when decisions will be made and how they will be communicated?
The Secretary of State mentioned that he expects childcare providers to close. Many are already close to collapse. Can he confirm what support is available and whether emergency business rate relief will apply?
The Secretary of State also said that he will support vice-chancellors in their decision making in higher education, but is it not now time for him to avoid all doubt by issuing clear guidance, protecting staff and students alike? Can he share the evidence and modelling behind his decision not to do so?
Finally, let me turn to an area that the Secretary of State did not mention, but that is vital to the most vulnerable—children’s social work and youth services. Children’s services are already suffering from years of cuts. They will now face staff shortages at the time when there will be a greater need for them than ever before. The poorest and most vulnerable paid the highest price for austerity. We cannot allow them to pay the highest price for the latest crisis too. Will he commit to return to the House next week with a statement on that area of his responsibilities and, I hope, with new resources to support those on the frontline?
The crisis will test us all. Our communities and public services have all stepped up, and I am so proud of them. Schools are already working to assist parents and pupils in putting systems in place. The Opposition place the greatest priority on protecting the most vulnerable. I urge the Government to do the same.
Gavin Williamson
The hon. Lady makes the same point that every single Member on this side of the House would make. We are all acting to try to protect those who are most vulnerable. She raised a number of issues, including free school meals. To ensure that no child is in a situation where they will not receive free school meals, we will give schools the authority and the ability to issue vouchers to every child immediately for next week. I would like to progress to a stage where, in a large number of schools around the country, there is also the ability to provide meals there, but that will depend on staffing in each school.
On the serious disability guidance, that will be coming forward. We recognise the importance of it and we are working with Public Health England to get that published. On guidance for children who are absent, that will be included in the Bill that we will bring forward to the House, which will give clarity and assurance to parents and schools as to what the situation is.
The hon. Lady raised an important point about exams, the importance of exams and, most importantly, ensuring that every child gets the recognition that they need for the work that they have put in towards their GCSEs, A-levels or other applied general qualifications. We will make sure that every child gets the proper recognition that they deserve. We will obviously update the House on that. We are working closely with Ofqual on a detailed set of measures that make sure that no child is unfairly penalised.
The hon. Lady also touched on the point of how we ensure that early years providers are properly supported. We have already announced that there will be support through business rates. We have also written to all those providers that the funding that we have been giving to them will be maintained through this period, despite the fact that their operations will obviously be running quite differently from how they have in the past.
I should highlight the point about children who are most vulnerable. The reason we know that it is incredibly important to keep educational settings open, not just for key workers but for those most vulnerable children, is that those are the children every hon. Member has the greatest concerns about. Often, their school is the safest place for them. That is why we have taken the action that we have to make sure that they are included in the support alongside key workers. We recognise that there will be a lot of work to do with local authorities and social services to make sure that there is continued support for every one of those children in this difficult and challenging time.
Damian Hinds (East Hampshire) (Con)
I thank my right hon. Friend for the breadth of the statement today. Necessarily, there is still a lot of detail to be worked out, not least on qualifications. For me, in talking to headteachers today, it has been humbling—not surprising, but humbling—to see the depth of their commitment to supporting their family and the whole of our society through this crisis. May I ask my right hon. Friend for flexibility, where necessary, to add to the designations of vulnerable children, as schools know their families best, and to add to the designations of key workers, where appropriate? May I also ask for schools to work together, where appropriate, in pairs or in clusters, particularly in areas where there are small schools?
Gavin Williamson
We will very much be looking at working with schools to ensure that they are best able to operate together and deliver those services. The issue of flexibility is absolutely at the core of this. While we are looking at what we are having to deal with today, we equally have to recognise that some of the challenges and demands on the system are going to be substantially greater in the weeks ahead than they currently are, and we will need constantly to change our response. We will certainly work with headteachers and all of our organisations to make sure that we get this right. On key workers, the Cabinet Office will be giving a more detailed response about who those key workers are.
Neil Gray (Airdrie and Shotts) (SNP)
I thank the Education Secretary for advance sight of his statement. I declare an interest in that my wife is a primary school teacher in Scotland, albeit on maternity leave. I wish to put on record our thanks to all staff in the education sector for all they have done and will continue to do during this crisis to continue to provide the best service they can in the most challenging of circumstances. Pupils, parents and staff are worried, and that is understandable.
Education is devolved, but many of the decisions made here at Westminster in these critical areas have a knock-on impact on the devolved nations. Tomorrow, the Scottish Education Secretary, John Swinney, will be making a detailed statement to Holyrood, following on from the announcement made by the First Minister, Nicola Sturgeon, regarding school closures.
There are three key areas on which I wish to question the Secretary of State. First, to build on what he said about ensuring that children of frontline public service workers and those from key industries have access to childcare during these school closures, we need these workers at their work where possible—relying on family is not an option in these times—and now education staff themselves are actually in areas of critical importance. Has there been discussion with the private nursery sector about what educational closures mean for them? We know Government-supported hours will continue to be paid, but for many that will simply not cover the shortfall and will not be sustainable. Have the Government considered how the private nursery sector might be called on to provide the emergency childcare support that will be needed? Nicola Sturgeon alluded to this in her statement. Will the UK Government follow suit?
Secondly, there are millions of families across the UK who rely on free school meals for their children. For some, it will be the only guaranteed meal they have in the day. The policy is devolved—it is more advanced in Scotland—but what discussions has the Secretary of State had with some of his Cabinet colleagues, such as the Work and Pensions Secretary, to ensure that families who rely on school meals do not incur any further hardship because schools are closed? The Secretary of State’s suggestion of a voucher scheme was a bit vague, and perhaps cash payments via the social security or tax system might be considered as well. Has he discussed these potential flexibilities with the Scottish Government to ensure that we can all approach this situation as fairly as possible?
Finally, what discussions have been had with the qualifications authorities across the UK, and with university, college and employers organisations about how pupils due to sit exams are not disadvantaged by these closures? The closures are going to cover the exam period. Have the UK Government had any discussions with the likes of Universities UK about alternative ways of scoring to exams? It goes without saying that these decisions cannot be siloed; there must be cross-Government and cross-sector co-operation. I hope the Secretary of State will agree to that approach, and that dialogue and discussions with the devolved authorities will continue.
Gavin Williamson
I am very grateful to the Deputy First Minister in Scotland for the discussions we have had and the work we have already started undertaking together, recognising that the issues and co-ordinating a response across England, Scotland, Wales and Northern Ireland are incredibly important.
The hon. Gentleman raises the issue of the private nursery sector. We have established a working group with that sector and we have already been addressing key issues in making sure that it has confidence in the finance it is expecting to receive from Government—this will continue.
On free school meals, the hon. Gentleman raises the issue of direct payments from the Department for Work and Pensions. That is one of the things we are actively considering. We can do this either through that method or other methods that can be used to do it, but we would do it in consultation with the Scottish Government. On the issue of universities, we have a completely integrated system, where so many students from all four nations of the UK do not pause for a moment when they are thinking about where they may wish to go to university. We have had discussions with Universities UK about how best to deal with this. Part of the answers he and many others will be seeking we will not be able to give until we have a greater and clearer idea as to how this virus is going to pan out and how the actions we are taking are going to curtail it. But we are already in extensive discussions and looking at various ways of making sure that every child has the best opportunity of going on to the university of their choice.
Mr Speaker
May I just advise the House that I expect to run this statement until about 6.45 pm?
Tim Loughton (East Worthing and Shoreham) (Con)
Several heads have contacted me to say that they wanted their schools to remain open at all costs, so this will be a great upheaval for them, but I respect that schools are being kept open for certain people. What is crucial is where the definition of “key workers” comes in, so may I stress that giving some discretion to heads is essential, as is whether school premises can remain open for outside groups that use their facilities? Inevitably, informal childcare groups and arrangements will spring up and there are safeguarding considerations in that regard. So will the Department make sure guidance is given so that workers who continue to go to work and are able to have childcare arrangements are doing it in the safest way for them and for their children?
Gavin Williamson
I can absolutely give my hon. Friend that reassurance, and I very much take on board the point he makes about the need for flexibility for schools to be able to demonstrate some discretion.
Rachel Reeves (Leeds West) (Lab)
Parents may not be key workers but they will be key workers in their homes, because they are the ones who are paying the mortgage, the rent and the bills. So if parents cannot go out to work because their children cannot go to school, who will pay their salaries?
Gavin Williamson
In this statement, we are dealing with making sure that we have the provision we need for those key workers in order to sustain our NHS, but I very much accept that many wider issues are raised as a result of this. That is why we have had some reluctance to be in a position of closing schools rapidly, but when the evidence and the science point out the fact that we need to make changes, it is right that we do so.
Edward Timpson (Eddisbury) (Con)
The measures that my right hon. Friend has announced are profound, but it would appear that, in the circumstances, they are now a necessary step to take. Does the definition of “vulnerable children” include children in need, of whom there are about 400,000, and children on a child protection plan, of whom there are about 50,000? If it does, that will significantly increase the number of children whom we hope will still be able to go to school.
Gavin Williamson
This is for all those children with a social worker, so those are the categories that will be covered.
Fleur Anderson (Putney) (Lab)
Will the Secretary of State give further clarification on those taking A-levels and going on to university? Will the discussions with UCAS bear in mind the most disadvantaged children, to ensure that no one will lose out and that not just mock A-level results but wider considerations are taken into account? Will these results and answers come soon, because these children will be very worried about their future?
Gavin Williamson
The hon. Lady raises important points. Yes, we will be doing that. We will also be looking to ensure that those who do not feel that the result is truly reflective of their work have a proper and substantive appeal mechanism.
Caroline Nokes (Romsey and Southampton North) (Con)
The private nursery sector plays a crucial role in enabling parents, but in particular mothers, to go back to work. They are absolutely crying out for clarity and support from the Government, and they feel very strongly, in the words of my constituent Lou Simmons, that they have seen pubs and retail get a great deal more assistance than they have. Will my right hon. Friend provide clarity about whether they are entitled to the business rates holiday and whether he will consider extending more support to that sector so that it can continue to provide crucial support at a really desperate time?
Gavin Williamson
My right hon. Friend raises an important point. Nurseries are eligible for business rates relief and, even more importantly, for continued support of the revenue that they would receive from the Government for the cohorts of children they would have. That will continue, which is a key element that they need to have in order to continue to pay staff.
Christian Matheson (City of Chester) (Lab)
May I press the Secretary of State for clear guidance on the private nursery sector and whether the statement includes them? Can he also give clearer guidance to non-local authority youth groups and clubs, which presumably know that they cannot meet, but will require clear instructions from the Government so that they are covered in all circumstances, including those relevant for insurance purposes?
Gavin Williamson
It will not be suitable for them to meet, but there is an important aspect for the whole voluntary sector as to how it can look at playing an important role, contributing in many different ways to this national endeavour to deal with the crisis facing our whole nation. There will probably be a substantive role for many such organisations to look at playing within some school settings as, of course, those organisations will have individuals who are DBS-checked.
Mr David Davis (Haltemprice and Howden) (Con)
One of the categories who will have most difficulty with this decision are the parents of children at special needs schools. As the hon. Member for Ashton-under-Lyne (Angela Rayner) pointed out, some of them are residential. Is any particular provision being made to support those parents?
Gavin Williamson
We recognise that a small number of children will be in a special school that has a residential setting. In a number of those cases, it will be important and essential for that setting to remain open, and we will be looking at those individually to see how best we support them and, critically, how we ensure that they have the right type of staffing, as they will suffer the effects of the spread of this virus, as will other educational establishments.
Jess Phillips (Birmingham, Yardley) (Lab)
With regards to the voucher system that the Secretary of State pointed out, we are about to see an explosion in the number of people who are eligible for free school meals because of the downturn in the economy. Will he guarantee today that the voucher system will not just be for those who are eligible as of last week, but for those who would be eligible in the future? It has always been problematic to get people on the right benefits to claim free school meals.
Bill Wiggin (North Herefordshire) (Con)
This Easter holiday was, for good students, their opportunity to revise, so we do not have a great deal of time to give proper guidance for A-level and GCSE students. How long should they expect it to be before they know exactly what is going to happen?
Gavin Williamson
We will be giving very clear guidance for all schools and all students. There will not be exams taking place this year, and we will be making sure, for every child due to be sitting GCSEs, A-levels or any other form of qualifications and expecting results in August, that the work they have done is properly reflected in those GCSEs and A-levels.
Daniel Zeichner (Cambridge) (Lab)
Will the Secretary of State say a bit more about the advice being given to universities? He will also know that international students are hugely important in many places. Will he press UK Visas and Immigration to be flexible in the way they apply the tier 4 visa rules? We do not want students being told that they are being penalised because they switch to online learning.
Gavin Williamson
That issue was raised with me yesterday by Universities UK. We are in contact with the Home Office to take up the point that the hon. Gentleman raises. We must also recognise that we have a duty and an obligation towards the many international students who are here in the United Kingdom and not able to return home. We must ensure that accommodation in halls of residence continues to remain available for them until they are in a position to return to their loved ones.
Mr Andrew Mitchell (Sutton Coldfield) (Con)
All our constituents will be grateful to my right hon. Friend for his measured and practical statement, and in particular his words of support and gratitude for all those who work in our schools and colleges. He said that more information will be available from the Cabinet Office in respect of key workers and vulnerable children. Can he say a bit more about those two specific groups and how we, as a society, will exercise our duty of care to them?
Gavin Williamson
I feel as if I could be in danger of starting to draw up a list at some stage of who those key workers are. That will be done by the Cabinet Office and made available from tomorrow, to give those people clarity and ensure that school leaders have a clear understanding of who those key worker groups are.
Apsana Begum (Poplar and Limehouse) (Lab)
Many of my constituents live in incredibly overcrowded households. Grandparents will find themselves looking after children from Friday onwards, while parents who are not key workers will be going to work. Social distancing and self-isolation is practically impossible in those situations. What guidance and advice can the Secretary of State give in that regard?
Gavin Williamson
We very much recognise the challenges that many families will face. We have had to prioritise in taking every action possible to stem this virus. That is why we have taken this action, with a deeply heavy heart. Key workers’ children and vulnerable children account for approximately 10% of the school-age population, and we will be looking at provision for them. We have to look at what action can be taken to stem this virus, and the scientific advice is that this is the best step to be taking.
Richard Graham (Gloucester) (Con)
I appreciate that this is an incredibly difficult announcement for the Secretary of State, and it almost certainly raises more questions than it answers. On the detail, I want to flag up two things. First, in terms of special educational needs schools, there is an outstanding SEN school called Milestone School just outside my constituency, and it will be very difficult for those children’s parents to look after them. Any clarification he could give on schools that wish to remain open would be helpful.
Secondly, in terms of apprenticeships, many people leaving school with GCSEs in maths and English, which are essential for apprenticeships, will want to know whether they will still be eligible. What will happen to apprentices who are studying at further education colleges but will no longer be able to do so? Will they lose their apprenticeships?
Gavin Williamson
No one will be in a position where we take away the work that they have been doing in their apprenticeships. We have already made it clear to the college sector and the independent training providers who deliver so many apprenticeships that funding for apprenticeships is continuing. In terms of special schools, all children who have an EHC plan will be designated as vulnerable children.
Sir Jeffrey M. Donaldson (Lagan Valley) (DUP)
Can the Secretary of State advise us on the discussions he has had with the Education Minister in Northern Ireland? I understand that the Department of Education will shortly make an announcement about schools in Northern Ireland. Will he assure us that those discussions will continue if there is any review of this decision?
Gavin Williamson
Over the last week and more, I have been privileged to have a number of discussions with the Education Minister and the First Minister of Northern Ireland. We have done everything we can to co-ordinate our approach to the common challenge of defeating this virus. There will continue to be close dialogue between the Assembly and the Administration in Northern Ireland and my Department.
Lucy Allan (Telford) (Con)
I am grateful for the Secretary of State’s commitment to children in care and on the fringes of care. Teachers will be concerned about some children who do not have a social worker or an EHC plan. Can those teachers be involved in the decision-making process? Could he press for teachers and social workers to be included as key workers?
Gavin Williamson
I assure my hon. Friend that teachers and social workers will be included in the designation of key workers. I note that a number of Members have raised the issue of there being an element of flexibility, so that teachers and school leaders are able to show an element of discretion. We must not forget that the reason why we are taking this action is to limit the spread of the virus. The scientific and medical advice is that taking this action and reducing the number of children in education settings will have an impact in terms of reducing the spread of the virus. Nevertheless, I have heard what the House has said about looking into providing an element of flexibility, and I will certainly take that away.
Mr Tanmanjeet Singh Dhesi (Slough) (Lab)
As my hon. Friend the Member for Ashton-under-Lyne (Angela Rayner) pointed out, millions of children in our country live in poverty, which is why I particularly welcome the Secretary of State’s announcement about the voucher system. However, in his responses hitherto there has been a palpable lack of detail about the voucher system. How will they be redeemed? Where will they be redeemed? I fear that without attention to detail, the voucher system will become merely worthless pieces of paper.
Gavin Williamson
That certainly will not be the case. Members on the Government Benches recognise and completely understand the importance of ensuring that every child who is eligible for free school meals is able to receive them and able to get food. We recognise that we may be dealing with this situation not just for a few weeks but for quite a long and sustained period of time, and we would want to move to a more conventional system in order to be able to get money to families in the best possible way. Another aspect is that the reason why we came up with the process of free school meals is that we recognise that for a child to be able to go to a school and receive a meal is an incredibly powerful thing to be able to offer. We are going to look into whether there is a way to deliver that much more broadly in so many more schools, but that will be dependent on the number of schools we are able to have open and available.
Mr Ian Liddell-Grainger (Bridgwater and West Somerset) (Con)
The Secretary of State has answered two questions from colleagues on very special schools. I have two such schools in Bridgwater: Penrose and Elmwood. These children have some of the most difficult challenges in society, and I do not yet understand what the Secretary of State is going to do, if the schools are shut down, to make sure that those children are cared for through the county council system and the social work system. By and large, their parents are working. We need clarification —these children cannot be left without major help.
Gavin Williamson
I am sure that the schools to which my hon. Friend refers will have children who will have an education, health and care plan, which is the reason why they attend that school, so they would be included in the category of vulnerable.
Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)
Many parents will think that this is the right thing to do for their kids and for us to stop the virus spreading, but they will also be really worried that they just cannot afford to stop work to look after them and cannot get the grandparents to step in. Given that the Secretary of State said this situation could last for some time, will he look at urgent financial support for parents—not just of those on free school meals, but all parents in these circumstances—or at working with local councils on free childcare options in much smaller or one-to-one settings, which could help?
Gavin Williamson
That is certainly something we have been discussing with the Treasury and something that we will be highlighting as part of a wider range of economic issues that the Chancellor recognises he needs to address.
Mr Mark Harper (Forest of Dean) (Con)
On the issue of key workers, I think it is going to be a little more complex than the Secretary of State says. For example, what about those who work in our food distribution sector? However, I wish to ask about what he said about schools being closed until further notice— I am thinking back to the question that the Prime Minister was asked at Prime Minister’s questions by my right hon. Friend the Member for Maidenhead (Mrs May). Does he have any expectation that schools will open, for the population as a whole, at any time before the end of this year?
Gavin Williamson
Obviously, my greatest hope is that we could get schools opened very rapidly, but I am going to be guided by the best scientific and medical advice in terms of when we do that. My right hon. Friend also referred to the fact that the term key workers should not just be seen to refer only to NHS professionals—that it is much broader. That is very clearly understood by the Cabinet Office, and what we do will reflect that fact.
Bridget Phillipson (Houghton and Sunderland South) (Lab)
The Secretary of State has called on nurseries and early years providers to be part of a national effort to combat this. When will the Government set out what steps they will take to provide additional financial support to nurseries, going beyond the funding he set out for the continuation of funded places? My worry is that if we do not provide additional support very quickly, staff will be laid off and some of these nurseries might never reopen.
Gavin Williamson
As I alluded to earlier, we have already guaranteed the Government funding regardless of what their pupil numbers are in terms of continued funding for all those nursery settings. We have already done it.
Cherilyn Mackrory (Truro and Falmouth) (Con)
Will my right hon. Friend join me in thanking all the staff and everyone involved, including parents, for the effort they have made so far and for the common-sense and sensible approach that they have taken to keeping schools open? We need to understand that we are doing this as a national effort and everyone has to play their part to keep the NHS at a capacity at which it can cope with this virus, and this change is part of that effort. My one concern in my area, which is rural, is whether the school transport provision will still be in place for those children who still need to attend their schools because they are eligible.
Gavin Williamson
We are certainly very much hoping that the school transport system will be there, although that is dependent on other strains within the transport network. My hon. Friend highlights the importance of saying an enormous thank you to those many public servants who have been doing so much to support parents and families and, most importantly, to support children. We are incredibly indebted to them, but we recognise that we will still be asking an awful lot more of them in the future.
Layla Moran (Oxford West and Abingdon) (LD)
My mind is boggling at the logistical challenge that is about to face schools and I add my voice to those thanking them in advance for what they are about to do. This will raise more questions than anything else. Last week, the helpline set up by the Department for Education was overwhelmed with questions to such an extent that it stopped working. If schools have questions, where should they go?
On the point about EHCPs, the Secretary of State will know that it can take up to two years to get them. Nine out of 10 that go to the ombudsman are found in favour of the parents. Is it not time just to grant all EHCPs in the system so that all children, even if they are on the margins of being vulnerable, get the help that they need?
Gavin Williamson
The hon. Lady mentions the helpline, and we have put extra resource on to that and we have made sure that it is open at weekends. We will also be writing directly to schools with a clear set of guidance on how to proceed. Our regional school commissioners are working closely with local education authorities to provide all the information needed going forward.
Jason McCartney (Colne Valley) (Con)
I appreciate that the Secretary of State is trying to bring clarity. My question is on GCSEs. He has clearly said that they are not going to happen, and that there will be some kind of system for awarding them. When he comes back and tells us how that system will work, the year 11 students will presumably then know exactly what their grades are. In fact, they might know their grades in the next few weeks. This comes at an emotional cost to year 11 students who have been revising hard, studying hard and preparing themselves for the biggest educational challenge of their lives so far. What support will be put in place to help with the emotional challenge that those year 11 students are going through?
Gavin Williamson
Like everyone else, I recognise that this is not what one would call an ideal situation. I certainly did not want to be the Education Secretary who cancelled all exams. We realise we have to have a fair system in order properly to reflect the work that all pupils have put into their GCSEs, A-levels and the other qualifications they have been entered into. We recognise that this comes at considerable emotional cost, as they have been working together. We are in exceptional circumstances. We are not in a position in which we are able to provide the usual settings and support that one might expect in a school, but we are looking at different ways in which we can support young people through what will be a difficult and challenging time as they face up to the reality of the fact that the school or college that they are incredibly fond of and which has been part of their life for such a long time will not be part of their everyday life.
Mr Kevan Jones (North Durham) (Lab)
The Secretary of State said councils will play a key part in what he has announced. Yesterday, the Chancellor announced a whole range of new measures for the economy. Durham County Council spent all day trying to get guidance on that, only to be told that it will not be available until Friday. When will guidance on what the Secretary of State has announced be given to councils? Will he also answer the question from the shadow Secretary of State about supply teachers? Those people do not have permanent contracts. They are going to find they have no income. The Secretary of State spoke warm words about teachers; these are teachers too, and they need support.
Gavin Williamson
We will certainly write to all local authorities and all schools with guidance, and that will happen today. Before I came to the House, I spoke to the director of children’s services who represents the Association of Directors of Children’s Services about what we are doing. They were very clear about the need for local and national Government to work together. On supply teachers, there will be exceptional demand for the services of all teachers in the system—those on regular contracts and supply teachers.
Greg Clark (Tunbridge Wells) (Con)
We will pay teachers when their schools are closed, because the closure is not their fault and we will need them again, but that applies to many other employees across the economy. That could be addressed very straightforwardly if the Government brought forward urgently a package to support employees’ wages right across the economy. Will the Secretary of State, when he finishes this statement, talk to the Prime Minister and the Chancellor to ask them to turn their attention, within the next few hours, to making a statement on support for employees generally across the economy?
Wes Streeting (Ilford North) (Lab)
No one doubts the scale of the challenge facing the Secretary of State. Frankly, his job would have been made much easier had the Chancellor come forward last night with provisions for income protection for people right across the economy. I hope the Secretary of State takes that message back. However, his statement contains considerable holes too. What arrangements will be put in place for people sitting vocational assessments and those teaching them? Will he say more about what is going on in further education?
On vulnerable children, there are children in my constituency living in temporary bed-and-breakfast accommodation, for whom school is an escape from the awful conditions at home, who are not subject to EHCPs and do not have social workers. As well as coming forward with more detailed answers about key workers, will the Secretary of State set out in detail what we mean by vulnerable children? If we are asking people to prepare and not to panic, the Government need to be prepared; otherwise, statements like this one will lead to panic.
Gavin Williamson
The hon. Gentleman refers to his concerns about some of those children. I very much imagine that they would be included in those children who are most vulnerable.
Danny Kruger (Devizes) (Con)
I appreciate that children will not be sitting any exams this year, but is the expectation that they will continue to receive an education? Is there anything we can do to support schools to deliver remote teaching, and to support parents who want to help with home learning?
Gavin Williamson
As my hon. Friend will be aware, schools have been doing a lot to provide children with work and enable them to continue to study if the school closes. We are working closely with the BBC, and we are looking at putting more resources online in order to support children to continue to learn even if they are not in an education setting.
Alex Sobel (Leeds North West) (Lab/Co-op)
The Secretary of State spoke about teachers getting paid, but many others work in schools, including lunchtime supervisors, caretakers and cleaners, many of whom are contract staff. Will all school staff carry on getting paid, or will only teachers and those on full-time guaranteed contracts be paid?
Gavin Williamson
It will probably not surprise the hon. Gentleman that we will continue to fully fund schools, and that those people who are working in schools will continue to get paid.
Sir Desmond Swayne (New Forest West) (Con)
How will large numbers of young people released from school be persuaded to stay at home and avoid social contact?
Gavin Williamson
My right hon. Friend poses a challenge, and as the father of two teenage daughters I am acutely aware of youngsters’ desire to socialise, but what we are facing in this country is not normal. It is not something any of us have seen in our childhood, and it is not a situation any of us would like to see or be in, and we need to accept that everyone has to exhibit a different set of behaviours to be able to stem this virus. That comes with challenges, but we are only taking the steps we are taking because we believe they will go towards ensuring that this virus does not spread as widely as it could.
Clive Efford (Eltham) (Lab)
We have 48 hours before schools close, and we have no clear list of who is going to be able to send their children to school next week or after the Easter holidays. We have known for several weeks that we were going to reach this stage, so can the Secretary of State say what preparations he has made with local education authorities and schools to help draw up these lists and set out a plan to keep schools open? I think this is the right move, but I do not think the preparations have been done.
Gavin Williamson
The hon. Gentleman will probably have heard my response earlier: the list of key workers will be published tomorrow. That will be available for schools, and we are very conscious that we need to get that information to all schools as quickly as possible.
Andrew Lewer (Northampton South) (Con)
As chairman of the all-party group, I bring the positive message from the independent education sector that it is part of communities—it wants to help, and it wants the Department to know that. There is also a concern: will boarding schools be allowed or be expected to continue caring for any remaining boarders, especially international ones, who have not gone home or cannot do so?
Gavin Williamson
My hon. Friend highlights an issue that is quite common in the university sector for international students. As I have said with international students in university settings, we must recognise our obligations to those young people, and we recognise that in boarding schools as well.
Justin Madders (Ellesmere Port and Neston) (Lab)
Like many households around the country, ours was facing exams this year—both GCSEs and A-levels—and there is certainly some disappointment that my children will not be facing those challenges this year. They may be slightly happier at the moment, but I think once reality sets in they will feel disappointed as well. However, I understand why this process is necessary. Will the appeal process that is being envisaged be completed by the time options are chosen for next year?
Gavin Williamson
There is a standard appeal process on exam grades, and that has always been structured to ensure that it is completed before university begins. We are looking at putting in place additional measures, such as enabling a child rapidly to take a fresh set of tests or exams, but we have to be conscious of the fact that we do not know how the virus will manifest itself and in what sort of timescales we will see peak and reduction. I am not in a position to be able to say on what dates that will happen and the consequences that the virus may have in additional knock-on effects for other institutions and academic years.
Ben Bradley (Mansfield) (Con)
As a parent of two primary-age children, I know that the conversation about how best to provide routine and educational support at home has been going on in school communities for quite some time. As my right hon. Friend says, schools are working very hard to rush out resources that can be used at home. In my previous role on the Education Committee I met many education technology companies that have excellent apps and resources online. What can the Department do to help, promote and highlight some of those existing resources to parents?
Gavin Williamson
We already have an edtech strategy for promoting this, but we will see a much more rapid and speedy evolution of some of these learning aids and resources, and we must look at how best we can harness new technology to ensure that all children are in a position to be able to get the very best out of education, even in the coming weeks.
Liz Twist (Blaydon) (Lab)
Will the Secretary of State say more about special schools like Gibside in my constituency that have children with very special needs? Is he saying that schools like Gibside will remain open? If so, what support can be given to the staff?
Gavin Williamson
We have to recognise that schools such as Gibside will be facing considerable pressures in terms of staffing and the spread of the virus, but also in terms of pupils who may be unwell. Many children who attend special schools such as Gibside will be on an EHCP, which obviously puts them in the category of vulnerable children for whom we are looking to make sure there is continued provision.
Harriett Baldwin (West Worcestershire) (Con)
This has been a sobering statement, and I want to put on record how much I appreciate the tone used by the Secretary of State and the hon. Member for Ashton-under- Lyne (Angela Rayner).
My question is on behalf of university students. What will they pay for their tuition fees?
Gavin Williamson
There are currently no plans to change the tuition fees. Obviously, as has been highlighted, universities will continue teaching online. We will be working very closely with Universities UK to ensure students have their grades in a timely manner to ensure they are able to move on to the next stage of their lives.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
Our schools are not only amazing centres of learning but are centres of support for children living in poverty, including 48% of children in Newcastle upon Tyne Central. On free school meals, is the Secretary of State, like Newcastle City Council, looking at ensuring the continued delivery of hot meals to children’s homes? He talks of encouraging online learning, but there is a digital divide in this country and the libraries that help to close that divide are themselves closing. Will he guarantee access to broadband for all children whose schools are shut?
Gavin Williamson
We will certainly be looking at working with local authorities such as Newcastle City Council on making sure we have the broadest provision of meals for children and on how best that is delivered. As I touched on in the statement, we will look at how we can grow and expand that not just in Newcastle but in many other areas.
The hon. Lady highlights an important point about the digital divide in this country, and we will be looking at working with schools to ensure that pupils who do not have access to digital resources can have other resources that enable them to learn when schools are closed.
James Wild (North West Norfolk) (Con)
Until now, the expert advice has been that a consequence of closing schools is that children may have to stay with their grandparents, who are the most vulnerable people. What is now the advice for parents? Should they take advantage of grandparents? If not, may I urge that the support package being considered by the Chancellor addresses this issue?
Gavin Williamson
We ask all parents to look at the advice given by Public Health England. Obviously, there are many grandparents who are very young and healthy, but we need parents to consider the individual circumstances of their family to make the best assessment. We need to protect those who are most vulnerable and, of course, the most vulnerable are those over the age of 70 and those with underlying health conditions.
Matt Rodda (Reading East) (Lab)
I am grateful to the Secretary of State for his statement and for the tone in which he has conducted himself.
I have two questions. First, on A-levels, is the Secretary of State able to offer more detail on when the alternative form of assessment will be published? Secondly, on university admissions, can he update the House on what discussions he has had with the university sector to ensure university admissions are fair?
Gavin Williamson
We will be making sure that we publish further advice on A-levels next week. We have had discussions with Universities UK, and we need to look at how we can ensure universities are open and ready to take in a new cohort of students in the next academic year, but the fairness of the system and making sure young people do not miss out on opportunities for which they have worked so hard is at the core of what we will be doing.
Jane Stevenson (Wolverhampton North East) (Con)
I thank the Secretary of State for addressing the concerns that I raised about vulnerable children in Wolverhampton. All of these extraordinary measures have the aim of preserving life, and to do that we need to maximise capacity in our NHS. What will be the implications of these measure for our staff in the NHS?
Gavin Williamson
I thank my hon. Friend for raising this issue with me a few days ago. Obviously, as constituency neighbours, we were both acutely aware that this is something that we needed to tackle. We have taken these measures to reduce the chance and the spread of infection. The reason why we have taken the difficult decision to make educational settings available for key workers is to ensure that brilliant hospitals such as New Cross in Wolverhampton can continue to function and to offer the support and the vital healthcare that is needed not just for her constituents, but for my mine in South Staffordshire.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
It would be very helpful if the Secretary of State could give a clear timetable as to when he will make an announcement about A-levels in particular, but also GCSEs, because pupils will be worrying. I wanted to follow up on the questions from my hon. Friends the Members for Poplar and Limehouse (Apsana Begum) and for Ilford North (Wes Streeting) about children who are living in severely overcrowded conditions in my constituency. There are those, for example, in homeless hostels, where at least we can identify the situation they are in by their address, but more particularly there are those in overcrowded flats where there is one family in the living room and one in the bedroom and very often parents who have no recourse to public funds. There will be a very big problem for those vulnerable children, many of whom are not looked after and have no social worker. I am sure—I hope—that his Department has considered this, and will he please give us some information now about what he will do about it with colleagues across Government? If he cannot do so now, can he tell us when he will brief those of us who have this endemic problem in our constituencies?
Gavin Williamson
Certainly. The reason why we have announced the response that we have is to ensure that it covers a broad range of children, including not just those of key workers, but those who are vulnerable. The hon. Lady may like to write to me with specific suggestions and actions that she feels the Department should consider taking. My concern and interest is making sure that we do everything in the interests of both stemming this virus and protecting the interests of those children no matter where they live in this country.
Jacob Young (Redcar) (Con)
Will my right hon. Friend clarify whether the children he outlined earlier will continue to attend the same school, and what considerations have been given to children-teacher ratios and class sizes? Small schools such as Zetland Primary School in Redcar may struggle in the current climate.
Gavin Williamson
As part of the Bill that we are bringing forward, we will be removing the ratios that present some of the challenges to schools. I would be wrong, though, to give my hon. Friend the promise that children will necessarily be able to continue to attend their current school. We do not know at the moment the consequences of the spread of this virus, and we may need to show a high degree of flexibility in how we provide that support and care. Sometimes that may require children attending different schools, hopefully in close proximity to their home. None the less, we do recognise the challenges that are going to be raised as a result of this announcement.
Rachel Hopkins (Luton South) (Lab)
Universities are expecting a huge hit financially, because international students will not be able to come here, despite the provision of some online learning. What support will be provided to universities such as the University of Bedfordshire in my constituency to ensure that they do not go bankrupt? The Government and the Office for Students have previously said that they would not usually step in under such circumstances.
Gavin Williamson
The financial health of the university sector is obviously of key critical interest to us. We will be working closely with Universities UK to ensure the stability and strength of that important sector for not just learning but the economy. We urge universities who are going to face financial difficulties and pressures to start engaging in an early dialogue and be honest about some of the challenges that they are going to face financially. Otherwise, it is difficult to respond if something comes out of the blue.
The issue of international students is important. We have to be realistic and expect the number of international students who attend UK universities to be lower next year. How we work with the sector to replace that capacity in different ways is something that the Department is already working on. Certainly, we are already having those discussions with UUK.
Mr Philip Hollobone (Kettering) (Con)
There are six big secondary schools in the borough of Kettering. Does the Secretary of State envisage that, to continue the education of children of key workers, those cohorts will be educated in the six separate schools, or that some arrangement will be made between the schools for them all to come together and teach the children in one place?
Gavin Williamson
In the initial instance, we hope that provision can be provided in the school that the child attends, but we recognise that, with the spread of the virus, that will not be realistic all the way through, so we will have to look at how we show flexibility. I have no doubt that, as in many towns and boroughs up and down the country, there is already a deep level of co-operation between schools in the local community in terms of sharing resources and learning. There are often good partnerships, but we will work with local education authorities, as well as regional schools commissioners, to help to facilitate that.
Stephen Timms (East Ham) (Lab)
At the moment, every infant school child is entitled to a free school meal. In my constituency, that applies to all junior school pupils as well. Can the Secretary of State confirm that he envisages all those currently entitled to free school meals being able to receive them in the future, irrespective of the income criteria that apply in secondary schools? If a school opts for a voucher solution, what does he expect each voucher to buy?
Gavin Williamson
The entitlement will be for all children who would normally be in receipt of free school meals, as against a much broader entitlement. We hope that families with vouchers will make best use of that money to make sure that it goes as far as possible. We certainly hope that it is a nutritious and good lunch.
Going back to what the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) raised about how we can work with local authorities and schools to offer more hot meals on premises, that is something that we are looking at. We have to recognise that there will be constraints in the system, however, especially with the spread of the virus, which will mean that that will not necessarily always be possible.
Ben Everitt (Milton Keynes North) (Con)
Can the Secretary of State confirm that the forthcoming emergency coronavirus legislation will contain measures to disapply certain restrictions and regulations to allow schools to react and adapt to these difficult times?
Gavin Williamson
I absolutely assure my hon. Friend that that will be the case. That is why we are bringing forward the Bill.
Kate Green (Stretford and Urmston) (Lab)
I apologise to the Secretary of State if I have missed something or not caught everything he has said about early years settings. Is he saying that childminders, nurseries, both private and statutory, and all other early years provision, are advised or instructed to close, or is he saying that some should remain open? If they close, can he guarantee that all staff will continue to receive full pay, irrespective of the nature of the setting?
Gavin Williamson
It does apply across the board. We have already written to early years settings to inform them that the funding that we have been providing for them will continue, regardless of changes in the number of children attending those settings, which gives them some stability in terms of future funding.
Scott Benton (Blackpool South) (Con)
Many voluntary groups will be keen to work with schools and parents to provide additional support for vulnerable children—for example, in breakfast clubs. Will the Secretary of State thank voluntary groups for their work and encourage schools to continue to work with them to support vulnerable children in these difficult times?
Gavin Williamson
I know that my hon. Friend is a great champion of such issues in his constituency, and it was a great privilege to be able to join him on a recent visit to one of the high schools there. Let me take this opportunity to thank the many volunteers who contribute so much to our school system. We recognise, in these unique times, that we will be turning to whole communities in supporting one another and supporting those who are most vulnerable, whether they are young or old, to help them to get through the coming weeks.
Matt Western (Warwick and Leamington) (Lab)
According to Public Health Warwickshire, 43% of nurses have children in schools. That obviously accounts for a great number, which increases when those in other blue-light services and other key workers are added. As the Secretary of State has said, it will be interesting to see what emerges tomorrow, but it must be of concern that many workers who are parents will withdraw from employment because their priority will be their children, and that will have an impact on many sectors. Perhaps the Secretary of State could say a bit more about what he envisages.
In respect of vouchers, may I urge the Secretary of State to prioritise the use of community cafés, and to address the issue of child protection? Finally, may I point out that France is ahead of us in the provision of online education? Lessons are already provided online for all schools. Perhaps the Secretary of State could look into that as well.
Gavin Williamson
The hon. Gentleman highlighted the large proportion of those working in the NHS who have children of school age. That is why it is so vital that we have taken this action to help them to continue in our battle against this virus.
Robert Largan (High Peak) (Con)
I welcome the announcement of measures that will help to reduce the risk of the virus spreading, while allowing NHS workers who are parents to stay on the front line where they are most needed. Glossopdale School has already offered to deliver packed lunches to the homes of pupils on free school meals, which is a model that other schools might want to consider. I urge the Secretary of State to ensure that the full details of which children are vulnerable and which people are key workers are communicated to both schools and parents as soon as possible, so that everyone knows where we stand.
Gavin Williamson
We certainly will be doing that. My hon. Friend has highlighted the fact that schools, head teachers, other teachers and all the support staff constantly go above and beyond in supporting children who are in their care.
Abena Oppong-Asare (Erith and Thamesmead) (Lab)
The Secretary of State mentioned that he would work with Universities UK in examining the financial challenges that it may face. I am concerned about the lack of clear information about what direct support the Government will be giving to those in higher education. Has the Secretary of State thought about the changes that will happen to student finance payments? Has he looked into how degrees will be decided? Finally, what support will be given to international students should they wish to go back home?
Gavin Williamson
Yes, we have looked into what we need to do. The key point, which I made in response to the question from the hon. Member for Luton South (Rachel Hopkins), is that if universities are in financial distress they will need to highlight that at the earliest possible stage. so that we can establish how we can best deal with it. As for the issue of international students, we recognise our obligation to ensure that they have continued accommodation here if they are unable to return to their home countries. The university sector has been excellent in responding and ensuring that accommodation is available, but there will be some students who cannot return home, and we will continue to support them.
Rob Butler (Aylesbury) (Con)
My right hon. Friend said that he expected schools and nurseries to remain open during the Easter holidays for vulnerable children and the children of key workers. What sort of service does he expect them to provide, and what additional help will they be given?
Gavin Williamson
We realise that while we cannot ask schools and education settings to provide a normal school curriculum, it is important to provide activities that engage and encourage young people to attend. We will work across the board, but there are no better people than teachers to really understand what engages children and keeps them motivated.
Kerry McCarthy (Bristol East) (Lab)
Last summer, Feeding Bristol distributed 53,000 meals to children, 75% of whom would otherwise have been in receipt of free school meals, but it did so in collective settings such as summer play schemes. Now we are in a very different scenario, as we are talking about getting meals out to children in individual places. What support could the Secretary of State give to organisations such as Feeding Bristol to help them facilitate the work they have been doing?
Gavin Williamson
We will be working closely with schools to ensure that there is a proper distribution of support. We have also made it clear to schools—I hope that I made it clear earlier in the statement—that costs incurred by them will be fully reimbursed.
Felicity Buchan (Kensington) (Con)
In answer to a previous question, my right hon. Friend said that schools could potentially form together into clusters; that does make sense in central London, where schools are close together. What will be the process of organising all that? Who is going to take the lead—the local authority? Clearly, there is not much time to make these arrangements.
Gavin Williamson
A key element will be the local education authority, with regional schools commissioners working together to promote those clusters. There is already a high level of cross-working between schools, but we recognise that that level of working together will enable us to provide much more robust provision throughout this crisis.
Bill Esterson (Sefton Central) (Lab)
Children face additional risks when family relationships are under pressure. One way of reducing some of the additional strain felt by families will be the financial response to this situation, so I urge the Secretary of State to take forward the suggestion of the right hon. Member for Tunbridge Wells (Greg Clark) about income replacement. Will he also come forward with plans setting out how he is going to support the child protection workforce, and conduct a proper risk assessment of the additional challenges faced by children in this crisis?
Gavin Williamson
I will certainly take up the hon. Gentleman’s point, and ensure that representations are made to the Chancellor and the Prime Minister.
Andy Carter (Warrington South) (Con)
May I associate myself with my right hon. Friend’s earlier comments and pay tribute to the incredible work that teachers have been doing over the last few weeks? I have spoken to many heads in Warrington this afternoon, who have been fantastic. The last few weeks have really shown true spirit in the classroom—from teachers and support staff. Will the Government be reimbursing schools for any additional costs they incur through providing free school meals for children once schools have closed? Also, if schools choose to use voucher schemes, will he ensure that those families have priority access to supermarkets?
Gavin Williamson
I can absolutely guarantee that schools will be fully reimbursed for the costs they incur as a result of providing those meals. Obviously, we would look at ensuring additional help as a long-term measure. I will certainly take up my hon. Friend’s final point with the Secretary of State for Environment, Food and Rural Affairs, who will be looking at such matters.
Lilian Greenwood (Nottingham South) (Lab)
I welcome the announcement that education settings are being encouraged to continue looking after the children of keyworkers, and vulnerable children, during the Easter holidays. But the Secretary of State knows that many school support staff are only paid for term-time working. Although I know that those dedicated staff will do all they can to help in a national crisis, I am sure he does not expect them to work for free, so will schools be supported to meet those extra staffing costs?
Dame Diana Johnson (Kingston upon Hull North) (Lab)
May I pay tribute to schools and to Hull City Council, which has already been working on plans to deal with children who get free school meals in the event of schools closing? It is welcome that the Department for Education is now taking the lead on this, although obviously we need more detail. Would the Secretary of State feel able to make representations to the Treasury to take up the recommendation of the Child Poverty Action Group, which is suggesting that one way of getting extra money into families is to increase child benefit by £10—now?
Gavin Williamson
I will certainly pass on that representation. I also thank Hull City Council for the work that it is doing to support schools and communities throughout the city of Kingston upon Hull.
Claudia Webbe (Leicester East) (Lab)
I have been contacted by a great many nurseries in my constituency who are understandably quite worried for the future. It is worth being clear about the detail. They said:
“Most of us will not survive more than a month without fee income. For some, it will be a matter of weeks.”
Nurseries are already under severe financial strain after a decade of Government underfunding, and childcare insurers are refusing to support them. I welcome the Secretary of State’s commitment to maintain nursery funding, but will he go further today and reassure my constituents by pledging to protect the income of nursery workers for as long as is necessary?
Gavin Williamson
I believe that for early years settings and nurseries we have probably gone further than any other aspect of business in making it absolutely clear that we will continue to guarantee the funding that they are in receipt of from Government, regardless of where the roll is. We made that statement yesterday. I very much hope that that point has been percolating right through the sector, but I will certainly ask the Under-Secretary of State for Education, my hon. Friend the Member for Chelmsford (Vicky Ford), to continue to reiterate it to all nursery providers.
Sam Tarry (Ilford South) (Lab)
I welcome the details that the Secretary of State has provided and the provisions for key workers, including on childcare and the commitment to ensure that the children of our vital NHS staff can go to nursery or school. However, as my hon. Friends the Members for Houghton and Sunderland South (Bridget Phillipson) and for Leicester East (Claudia Webbe) said earlier, there is a serious question about the funding. In my local education authority in Redbridge, the council is prepared to meet the free funding places, but as the Secretary of State will know, much of the funding and the business plans that many nurseries have is based on the additional top-up of private places at those nurseries. Can the Secretary of State give more detail about the funding to ensure that that gap is bridged and that nurseries do not have to lay off staff in the midst of dealing this crisis?
Gavin Williamson
This is why we have made clear the continued funding that we would be paying to nurseries, but also why the Chancellor has touched on the issue of a business rate relief, which is obviously an important component in the cost base of many of these nurseries.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
As a representative of a borough that has suffered cuts of 64% under this Government, can I ask what additional assistance will be available to Ealing to absorb some of the consequences of this decision? Our libraries, for example, are volunteer-run on reduced hours, when they should be at more than full tilt—or will they be next to close? As the mum of a year 11 pupil, can I also ask whether his exams will now be indefinitely postponed? For all his cohort, can I ask whether their sixth-form admissions, which are not automatic nowadays, will now be based not on actual grades but on predicted grades, in a Mystic Meg kind of way?
Gavin Williamson
As has been outlined, we will ensure that all children, who have done so much work towards their exams both at GCSE and A-level will get a fair system for their grades. We recognise that there will sometimes be disagreement over that, so it is vital to ensure a proper and robust system and a means of redress for those children. That is something that we will have in place with Ofqual, and we have already had those discussions. On funding, we have been consistently clear in this statement that costs incurred by schools will be fully reimbursed.
Tracy Brabin (Batley and Spen) (Lab/Co-op)
On a point of order, Mr Speaker. I seek your advice on an urgent and important matter. On Monday, the Government advised the public to avoid large gatherings and gatherings in smaller public spaces, such as pubs, cinemas, restaurants, theatres, bars and clubs, rather than closing venues directly. The Creative Industries Federation has said that this is a “crippling blow” to the UK’s creative sector, and there was understandable anxiety that it would mean mass bankruptcies and long-term closures of venues. However, the Chancellor reassured us yesterday that insurance companies would help, saying that
“for those businesses that…have a policy that covers pandemics, the Government’s action is sufficient and will allow them to make an insurance claim against their policy”—[Official Report, 17 March 2020; Vol. 637, c. 932.]
He even went so far as to say that the Government had spoken to the insurance sector looking for support, yet many organisations have made representations to me today to say that insurance companies will not permit losses due to the covid-19 pandemic and that no theatre, restaurant, or small or medium-sized enterprise would ever be able to afford that sort of cover—cover usually associated with Apple and big companies like that. Therefore, what advice can you offer me on how Members might seek clarification from Ministers on this crucial issue, which is adding to the anxiety for businesses in the creative industries and more widely?
Mr Speaker
I thank the hon. Lady for giving me notice of her question. She is well aware that it is not a point of order for the Chair, but those on the Treasury Bench will have heard her comments and I would expect some response. Perhaps if we can also work through the Table Office, via email at the moment, or by picking up the phone to speak to someone, that may also help to resolve the situation.
House of Commons Commission
Resolved,
That Sir Charles Walker be appointed to the House of Commons Commission in place of Sir Paul Beresford in pursuance of the House of Commons (Administration) Act 1978, as amended.—(David Rutley.)
Public Accounts Commission
Resolved,
That Mr Richard Bacon, Jack Brereton, Mr Nicholas Brown, Clive Efford, Peter Grant, Sir Edward Leigh and Alan Mak be appointed, and that Douglas Chapman and Julian Knight be discharged as members of the Public Accounts Commission under section 2(2)(c) of the National Audit Act 1983.—(David Rutley.)
Business without Debate
Mr Speaker
With the leave of the House, I will take motions 6 to 9 together.
Motion made, and Question put forthwith (Standing Order No. 118(6)),
Terms and Conditions of Employment
That the draft National Minimum Wage (Amendment) Regulations 2020, which were laid before this House on 27 January, be approved.
That the draft National Minimum Wage (Amendment) (No. 2) Regulations 2020, which were laid before this House on 11 February, be approved.
Housing
That the draft Electrical Safety Standards in the Private Rented Sector (England) Regulations 2020, which were laid before this House on 13 January, be approved.
Local Government
That the draft Buckinghamshire (Structural Changes) (Supplementary Provision and Amendment) Order 2020, which was laid before this House on 24 February, be approved.—(David Rutley.)
Question agreed to.
Mr Speaker
With the leave of the House, I will take motions 10 and 11 together.
Business of the House (24 March)
Ordered,
That at the sitting on Tuesday 24 March, the business determined by the Backbench Business Committee may continue until 7.00pm or for one and a half hours after its commencement, whichever is the later, and shall then lapse if not previously disposed of, and Standing Order No. 41A (Deferred divisions) will not apply. —(David Rutley.)
Coronavirus Bill
Ordered,
That, if a Bill entitled the Coronavirus Bill is presented and read the first time—
Standing Orders Nos. 83J to 83O (Certification of bills, clauses, schedules etc) shall not apply to the Bill;
notices of Amendments, new Clauses and new Schedules to be moved in Committee in respect of the Bill may be accepted by the Clerks at the Table before it has been read a second time.—(David Rutley.)
Future of Farming: Somerset
(4 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Mr Ian Liddell-Grainger (Bridgwater and West Somerset) (Con)
I start my dissertation by firmly apologising to the Minister, who has not had a copy of my speech. I managed to send it to the wrong Minister, so I apologise unreservedly—that just shows quite how incompetent I can be.
Believe it or not, I am very grateful to have this rare opportunity to address the House about a subject that is very close to my heart and that of a lot of Members—farming. As I am talking about farming, I ask the Minister to make sure that we as a Parliament ensure that vets are taken in as key workers. I know that that was not mentioned today by the Prime Minister, and I take this opportunity to put that forward.
Adjournment debates are a bit like Opposition election slogans, especially if you turn them upside down—in our case, it would be, “For the few, not the many”. However, at least the few of us here this evening are demonstrating the best health practices. I am keeping a safe distance from the Minister and I promise that no offence is intended.
This is a difficult time for all of us, I am afraid, farmers included. Let me tell the Minister a bit more about the Bridgwater and West Somerset constituency. At the Bridgwater end, we have some of the lowest-lying farmland in the United Kingdom, and at the West Somerset end, particularly on Exmoor, we have some of the highest. Both areas have faced huge challenges even at the best of times. Down on the levels, we have so far managed to survive the winter without a repeat of the devastating floods that emerged in 17 miles of Somerset six years ago. Back then, the Environment Agency was led by deaf donkeys in blindfolds. It took a great deal of persuasion to convince them that rivers work much better when they are regularly dredged, and I pay enormous tribute to David Cameron for leading that charge. Any of my farmers on the levels could have told them that, and in fact, they did tell them that in no uncertain terms—I went to the meetings.
The thing about farmers is that they know the land. They respect the weather. They understand that climate is changing and that we cannot afford to sit back and do nothing. They, like me, speak their minds. For example, there is genuine concern about the long-term financial commitment to keep Somerset flood-free. Naturally, I am delighted—as is my whole area, and especially the levels—that the Chancellor’s Budget guaranteed proper funding of £114 million for the tidal barrage. That is incredibly welcome, and I thank the team.
But the Minister will be aware of the question mark that continues to hang over the future of the Somerset Rivers Authority. The SRA is a flood prevention organisation. It uses the expertise of local drainage boards and the most clued-up councils, such as Sedgemoor District Council. The authority gets its funding from various public organisations but also, crucially, relies on a precept that is added to council tax. That is rare, but not unusual. Without that tax element, all the ambitious plans to safeguard people from the horrors of flooding would be at risk. As of now, the precept is not enshrined in law. A private Member’s Bill to fix that passed through the House last year, for which I am grateful to colleagues, but it was then sabotaged by the Liberal Democrats in the other place for reasons that I still, to this day, do not understand.
However, the new all-singing, all-dancing Environment Bill could easily be tweaked to ensure that the SRA can raise what it needs through precepts. I hope that the Minister will be in a position—perhaps not now, but in the near future—to give me an indication of how and when that problem could be solved. I would be happy to have a discussion with him about that.
Meanwhile, farmers on the Somerset levels remain understandably anxious, as we all are, over our future trading relations with Europe. This is dairy country—although not exclusively—and the dairy industry is, as one analyst put it recently, “close to broke”. We have one of the largest milk companies in the country, Müller. We are also the home of Yeo Valley. That is why farmers are puzzled and concerned by the decision of the Secretary of State to potentially halt—it depends how we look at it—the culling of badgers in Somerset. I know that it is an emotive subject for all sides, but there is ample evidence that the cull in Somerset is significantly cutting the incidence of tuberculosis and proving its worth. That is because it is being done well. Badgers and their human supporters may take a different view, but I am slightly shocked and worried that the Secretary of State— I say this advisedly—appears to be siding with them.
Dairy farmers, like all farmers, love their animals. They know how bovine TB can rip through a herd. What kind of message are we sending them? The cull has effectively removed a major health risk. The prospect of vaccinations is still too vague and too far away. I wonder whether the Minister understands the economic tightrope that dairy farmers and beef farmers already face. The only way to make any decent money from milk is to turn it into butter, yoghurt and cheese. Many farmers would struggle or go bust if they could not do that.
Despite all the hurdles, Somerset cheese has developed a worldwide reputation, which is fantastic. But that was before this awful virus stopped worldwide travel, crippled airlines and squeezed economies right around the globe. A week or so ago, you could visit the swankiest cheese shop in the swankiest food mall in San Francisco and find an unpasteurised Montgomery’s cheese from Somerset displayed in pride of place. The only complaint the proprietor would have was that he could not get enough of it. Now he would be very lucky to receive any supplies at all.
Cheese makers such as Wyke Farms also export large quantities to Europe—or they did. Even at the best of times, the margins are uncomfortably tight, and these are not the best of times. There is a stupid urban myth about farmers: that they all plead poverty but still find the cash to buy flashy new cars each year. We have all heard that. I can assure the House—I think the House knows it anyway—that that is not true. Every farmer I have ever known works their socks off to break even. They are rightly worried about the impact of new trading hurdle that comes up. The latest threat is to suspend trade at the Sedgemoor auction centre, which is commonly known as junction 24—junction 24 being the junction on the M5. I have to say that that would be a financial disaster for local farmers. The centre attracts entries from all parts of England and Wales. The impact on the rural economy, if it closes, cannot be overstated. Farmers, by and large, buy and sell their animals at auction. That is the way it has always been done, and it would be almost impossible to do so at the end of a computer, even if one could get a connection, and I will come to that in a minute.
I appreciate that tackling the virus is the most urgent national priority, but I ask the Minister to consider whether there are sensible ways in which auction centres such as Sedgemoor can be allowed to continue trading. The public have already been discouraged from attending sales. The organisers are already considering limiting sellers and buyers. They are doing their bit.
I would like to have discussed the issue with Somerset County Council’s—believe it or not—£108,000-a-year director of public health. However, she is hard to reach and appears to be working at home, as indeed, I am afraid, most of our county staff soon will be. It does not inspire much confidence. I would have expected a decent county council to be making information videos, putting up posters and taking advertising space in the local press to keep us informed. In most counties, people are doing it. That is great. I certainly know that they are doing it in Bristol. I am afraid Somerset, with its fat cat top brass, is silent. This disease demands a better response from county councils. It seems that Somerset is wasting time and money on becoming a unitary authority and is not listening to what the people need. I appeal to the leader of Somerset County Council to please stop posturing and get on with the job.
When this dreadful virus is behind us, there is one other thing that farmers fear: a post-Brexit tariff war with Europe. Make no mistake, farming is a vital industry in Somerset. It employs, indirectly and directly, many hundreds of people, but it is forced to look over its shoulder and count the pennies all the time. We are no longer a member of the European Union, but until December we remain in the system, claiming the subsidies and following the rules. All that will change, particularly for farmers who will continue to farm on the uplands of Exmoor.
It has been recognised for the best part of a century that hill farming on Exmoor is viable only because of the subsidy system. Trying to make a living out of some Exmoor farms, if they were unsubsidised, would be like trying to make a living out of a window box. That is flippant, but true. It is not a comfortable living, and I invite any lowland farmer who thinks Exmoor is a featherbed to spend a hard, wet winter high on the moors. This year it has been hard and very wet.
What we get for our money is the preservation of some of the finest landscape anywhere in the United Kingdom—landscape that forms the key attractions of the south-west’s tourism industry. I can show the Minister plenty of evidence that the landscape is the No. 1 reason most people come to Exmoor on holiday, and rightly so. We welcome any Members of the House who want to come and see how beautiful it is. We must support the hill farmers as generously as we do now.
Without the hill farms much of Exmoor would revert to an ugly, unloved wilderness—all scrub and, to paraphrase, tumbleweed. Much of the moor is still a no-go area for any kind of modern communications. There are dead zones for mobile phones and internet speeds can be so slow that it is almost quicker to post a letter. I know that progress has been made and things have improved, but we are still in an unparalleled national crisis and the Government want people to work from home. That is rightly so and totally supported by the House, but we need a technical taskforce to be able to create a quick fix for Exmoor and other cut-off rural parts. Across the United Kingdom, broadband is a necessity. It is a miracle that our hill farmers continue to put up with it. Thank heavens they do.
Those who want the land to go back to the wild are not living in the real world. Rewilding may be a fashionable fiction in “The Archers”, but it is make-believe for places such as Exmoor. In any case, only proper farmers can make it work. They have to work the land, not learn it in a book. That is why I want the new Agriculture Bill to match every EU subsidy pound for pound, improve the way that farmers are paid and protect the quality of British products against foreign competition. I do not believe we should tolerate the importing of inferior goods with lower standards than our own. There is a long way to go before the new Bill is passed, and I would like the Minister’s assurance that there is still time for constructive change. I am sure that there will be in Committee.
I have asked a lot in this short debate—
Mr Liddell-Grainger
That will teach me to watch the time more carefully.
I have asked a lot in this short debate. In the weeks and months ahead, farmers will become more important to us all. We will rely on what they produce in ways that we have probably never considered but now need to because we are in a national emergency.
Kerry McCarthy (Bristol East) (Lab)
I have read that Somerset County Council has sold off nearly two thirds of its agricultural land in the past decade. The Agriculture Bill Committee is looking at how we can better support county farms, which the Government have promised to do in the past. Does the hon. Gentleman think it is a real shame that the council no longer owns those farms, which often provided an entry to farming for people who could not afford to buy huge swathes of land themselves?
Mr Liddell-Grainger
The hon. Lady knows me well—she tempts me, and I will rise to the bait. Yes, it is appalling that the council sold them off. I was totally against their being sold off. County farms were the way that young people got into farming—the way people could get on the farming ladder. The farms were not big—they were comparatively small—but they gave people a chance. Any county that sold them off is an absolute disgrace. Yes, of course, I know that they wanted the money, but we have stopped an entire generation of young people going into farming. I am 61, and the average age of farmers is my age. How long can we sustain real farmers? I do not think that the Government can be blamed for that—although I would probably quite like to blame them, they cannot be blamed—because it was done under many different Governments over many years. Places like Somerset, the old county of which we were all part in the old days, had a huge amount of farms, and they were enormous and did such a good job. They have gone over a long time, covering three generations—basically since 1945—but the hon. Lady makes an absolutely fair point and I agree with her.
I have one final appeal to the Minister. Sedgemoor auction centre is crucial to farmers, as it is—believe it or not—to all of us here. Whatever our party, whatever our age and however much we are at risk, just being here shows that we are still in session. We must support that and stay in business here, and that goes for our farmers, too: they want to stay in business there.
The Lord Commissioner of Her Majesty’s Treasury (James Morris)
I thank my hon. Friend the Member for Bridgwater and West Somerset (Mr Liddell-Grainger) for securing this important debate and for his contribution. He is a passionate advocate for his constituents.
We have a once-in-a-lifetime opportunity to strike a balance that works for our independent country—to let go of the railings of the sinking ship that is the EU’s highly bureaucratic common agricultural policy and its irrational system of area-based payments. I also recognise, as my hon. Friend said, that the farming sector currently faces huge challenges with the coronavirus crisis. Our environmental land management scheme will reward farmers for the vital environmental work that they do alongside feeding the nation, helping us to meet the targets that we will set through our Environment Bill so that we can fulfil our legally binding commitment to reach net zero by 2050 and leave the environment in a better state than we found it in.
We are working with farmers, foresters and land managers to make sure that we design a much better way of doing things that works as well on farms up and down the country as it does on paper. Forty trials are live in the first phase and a further 25 will follow in the second. Somerset is clearly part of that collaboration, and it will be critical to getting our policies absolutely right. The farming and wildlife advisory group in the south-west is helping us to consider an approach to paying farmers for their work on floodplain land and water management, and we will continue to refine our systems together over the coming months.
We are optimistic and we are aiming high, so that we create a coherent policy, designed for our farmers, which rewards them properly for their work to improve the environment, creating new habitats, reducing flooding and helping to tackle climate change, and enables them to become more profitable by investing in new equipment, adding value to their product and improving transparency in the supply chain. That is our approach—tackling the causes of poor profitability, not masking them with an arbitrary area-based subsidy, so that farms of every size and in every part of our country, including Somerset, have a chance to thrive. The smaller firms that my hon. Friend mentioned should feel equally optimistic about the opportunities this bespoke way of doing things will bring for their businesses.
Our food reflects who we are as a country. We care about animals hugely, including farm animals, and we value the high-quality, high-welfare, sustainably produced food and drink that we are fortunate to enjoy at home and that is recognised all around the world, including Somerset’s finest. My hon. Friend talked of some of the challenges faced by the producers, but it is fair to say that Somerset has been making cheddar since at least the 12th century, and what could be more quintessentially British than a hunk of west country farmhouse cheddar, washed down with a cold glass of Somerset cider brandy?
This Government will always back British farmers, who are some of the very best in the world, taking care of our landscapes and animals, all while feeding the nation, just as they have done for generation after generation. This is a time of opportunity, but I recognise the challenges for UK agriculture. We understand that these changes can be daunting, as well as presenting opportunity, and we are conscious that farmers need time to plan and adapt for their futures, and support to decide what is right for them and for their business. We will match 2019 levels in every year of this Parliament.
As my hon. Friend mentioned, our Agriculture Bill is making its way through Parliament, and our aim is that it will reach Royal Assent by the summer. This is of vital importance to the agriculture sector, in order to begin a fair, progressive, seven-year transition to a much better way of doing things in 2027.
My hon. Friend made several points in his remarks. On the Somerset Rivers Authority, I will write to him about the implications he described. He mentioned the badger cull, and I will talk to the Secretary of State about the points he raised about that and about the Sedgemoor auction centre, in the context of contingency planning for the coronavirus. He made some remarks about the challenges of upland farming. It is fair to say that the Government are confident that within the new scheme being outlined in the Agriculture Bill, upland farmers will stand to benefit considerably from the new arrangements that the Government are introducing in the Bill.
I would like to close by making this important point. Sustainable farming and food production can and, indeed, must go hand in hand. No one understands this better than our farmers right across the country. After all, the great outdoors is their office, day in and day out. After a hot summer and an incredibly wet winter, they are the first to feel the effects of climate change in our countryside, and they are hungry for change. This is our chance to do things differently and put our farmers, such as those in Somerset, at the very heart of our efforts to tackle the causes and consequences of climate change in a way that helps nature recover too. I hope that hon. Members will all support the ambitious Agriculture Bill currently making its way through this place, so that we can chart a new course for English agriculture for decades to come and a new way of doing things for the world to follow.
Question put and agreed to.
Westminster Hall
(4 years, 1 month ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Prison Staff: Health and Safety
(4 years, 1 month ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Mr Laurence Robertson (in the Chair)
Before we start, I must apologise: the screen on the left-hand side of the Chamber is not working. Hon. Members will have to look at one of the others, because I know that nobody would want to speak for too long.
Kenny MacAskill (East Lothian) (SNP)
I beg to move,
That this House has considered health and safety of prison staff.
It is a pleasure to serve under your chairmanship, Mr Robertson. I start by paying tribute to the hon. Member for Easington (Grahame Morris), because this debate is of his instigation. It was his idea, and it is regrettable that he is not here to move the motion, but he is doing the correct thing by self-isolating. I understand that the same is true for the ministerial Benches; it is the appropriate action to take. I thank the hon. Gentleman and his staff for the support and guidance they have given me, and for the opportunity to speak in a debate that is especially important not only at this juncture, but in the wider context of recent years.
We have to start with an explanation of who we are dealing with when we talk about prison staff, because there is a great lack of awareness, if not ignorance. As a young lawyer in Scotland many years ago—over a generation now—I would give a jury speech that would basically explain that the ladies and gentlemen of the jury did not know the jury system in Scotland. They knew more about Henry Fonda in “12 Angry Men” than they did about the fact that jury trials in Scotland have 15 members and three verdicts. Things are obviously slightly different when it comes to prison staff, but in many ways the context is the same. Many people’s impression of a prison will come more from “The Shawshank Redemption” than from the prison in the locality near them, or where people from their communities go. We have to challenge that.
The lack of awareness also extends to those who work in the Prison Service. That is why I put on the record the fact that they are a uniformed service; they are also an emergency service, although they are not classified in that way by Government. I think others will comment on that issue when we talk about how their pensions are treated: it is an outrage that people are expected to operate on a landing at the age of 68. Some jobs are age restricted, and being a prison officer should most certainly be one. They deserve to be treated the same as other services.
This is a historic issue. My good friend Professor Andrew Coyle served at both Peterhead prison in Scotland and Brixton prison down here in London, and is a global expert on prisons. I remember reading in his history of the Prison Service in Scotland that in the initial stages, police and prison officers had parity. The pay of a constable and the pay of a prison officer were the same until the latter part of the 19th century, but then that changed and since then prison officers’ pay has never caught up. To some extent, that is a tragedy, but it is where we are. I do not think we can reverse that, but we can mitigate it and take action, whether on pensions or other terms and conditions.
That brings me to the question of who we are talking about. As I say, there is a great deal of misunderstanding; I remember going into the Prison Service and chatting away to officers about this. There are many occupations at the present moment, such as health service workers, police officers or those who work with the children and elderly, where people will cross the street to thank them and shake their hand. That rarely happens for prison officers—they get a sharp intake of breath instead—but the service they give often mirrors that contributed by those other services, and the work they do is valuable.
There is also a sense of misunderstanding among those going into the service. I remember asking young officers at the training academy at Polmont in Scotland whether the job was what they had anticipated. They said they had gone in thinking their job would be like a security guard’s, but it was much more like that of a psychiatric nurse. Those of us involved in the prison estate know how much of the work is like that of a psychiatric nurse, even though these people are not properly trained or qualified for such work. It is about dealing with deeply troubled people; prison officers do have to deal with deeply violent people on occasion, but the work they do with young offenders, women prisoners and vulnerable prisoners is really quite exceptional. It is a matter not of brutality but of humanity, which is why we have to put on record our tribute to them.
We also have to remember that these people are not particularly well trained for this work, nor are they well paid. As I understand it, a prison officer in Norway goes through a degree course of four years. In Scotland, as in England, a person will be able to be active and working—albeit not necessarily on the landing—within a period of weeks that they can count on both hands. That is hugely different from what other regimes expect, but it is expected here. Indeed, once we include people’s toes as well as their fingers, they will be on the landing and expected to deal with frontline work. I do not argue that there needs to be a degree course, but I do think that we need to expect and understand the challenges that prison staff face, because they do that with sparse training and not for a king’s ransom, as has been mentioned in relation to a variety of other issues.
That takes us on to the particular issues. The first issue that I want to touch on is why the Minister and I are here. The reason is that the coronavirus is striking down Members of this institution as it will strike down members of our community.
John Howell (Henley) (Con)
Before the hon. Gentleman moves on to the coronavirus, will he accept that a large part of the problem that prison officers face is the working conditions and prisons’ terrible state of repair? On the Justice Committee, we estimated that the cost of the repairs would come to £900 million.
Kenny MacAskill
Yes, I fully concur. In many areas, the prison estate is Victorian; sometimes it even predates that era. It has to be upgraded. Good work has been ongoing in Scotland—that does not come cheap—and I know that work has been established here. Equally, we have to have the right institutions. Super-prisons are not the way to go. We have to have the right prison estate, and it has to be a suitable prison estate.
Alicia Kearns (Rutland and Melton) (Con)
The hon. Gentleman rightly talks about what we need to do to support prison officers because they are behind the wire, but deterrence is one of the key issues; it is vital in prisons. At a prison in my constituency, HMP Stocken, there was a nasty attack on a prison officer. It is extremely troubling that although the guidance is that for attacks on prison officers there should be consecutive sentences, too often prisoners are actually receiving concurrent sentences, which essentially acts as no deterrent and tells prisoners that they can go on attacking prison officers as they will.
Kenny MacAskill
The hon. Member makes a valid point. I am always of the view that these things are best dealt with by the independent judiciary; we must allow them to deal with the particular facts and circumstances. However, I have to place it on the record—the Prison Officers Association and the other unions would expect no less—that we cannot tolerate prison officers being viewed as punchbags, because people should not routinely be abused, albeit I do think that the judiciary have a duty to take cognisance of the issues and challenges being faced.
An analogy that I have heard when speaking to people is that prisons are a microcosm of our society. People will say, “Why don’t prisons educate prisoners like this? Why don’t they give them work training like that? Why don’t they care for them like this?” It is like going into a school or college and saying, “You’re going to do every class in the curriculum and you’re going to do it in this corridor,” because that is the situation in a prison. There is a requirement for education facilities, work facilities, health facilities and social engagement facilities; there is a requirement for kitchens. And those things are required in a confined space, so some of the things that can be delivered in a school, college, university or even a Parliament cannot be done, and certainly not to the same extent.
Equally, on the coronavirus, we have criteria being put down about social distancing, working from home and self-isolation. How can that be done by prisoners, let alone prison officers? There is a specific need there, and my request to the Minister is this. Can we get some guidance and assurance about testing and about the safety and security of staff and of prisoners?
The hon. Member for Rutland and Melton (Alicia Kearns) made the correct point. We have to deal not simply with prison officers and prison staff, but with prisoners, because if we create conditions, as the hon. Member for Henley (John Howell) mentioned, that are unacceptable, that creates a toxic cocktail that we have to address. I therefore ask the Minister to be specific about what assurances he can give to staff, because some of the anecdotal tales coming back from the trade unions are of staff members being expected to do things that would not be asked of staff here and that are unacceptable or unsafe, and prison staff have families and elderly relatives the same as the rest of us.
That does not take away from the reason why the hon. Member for Easington brought up this issue in the first instance. It has already been touched on in the two interventions: violence on the prison estate. There was an underlying crisis even before the coronavirus came upon us. This has been ticking away. It has not been an act of God. It has not been a global pandemic from which we cannot isolate our country any more than any other nation can. There have been wilful acts of neglect by this and past Administrations. There has been a failure to act timeously and appropriately. Money was tight, but it is tighter now. Money can be found for corporations, but apparently it cannot be found for custodians. That cannot be right.
We must look at the records on the issues raised, in terms of staffing and violence, and in terms of specific drugs, such as Spice, about which I have some sympathy for the Government. Even with the best regime, the ability to stop drugs coming into prisons is a social as well as an institutional problem, which we have to deal with.
It is clear from the Library briefing, which many of us have, that prison workforce numbers fell by a quarter between 2010 and 2014, from 25,000 to 18,000. To be fair, the numbers have come up again slightly, but they are still not back to where they were. In addition, the numbers were higher before 2010, although that figure includes support staff, and, because of contracting and privatisation, which I will come on to, the fall in numbers has been ongoing.
More critical has been the loss of experience. Becoming a prison officer is not something that people can pick up in 10 weeks; it is picked up over years of service. They need to know who to watch out for, who to look out for, who is vulnerable, who needs to be watched because they are up to various things, and all the tricks and turns that go on. In 2010, 7% of prison officers had been in post for less than 2 years, compared with 35% in 2019. When we are dealing with a crisis in numbers and the estate, to have over a third of the staff being inexperienced is simply scandalous. The proportion of prison officers who had 10 years’ experience or more went from 56% to 46%.
There has been an increase in the numbers of assaults, and the record on that is quite lamentable. It reached a peak of 10,424 assaults on staff in the year ending June 2019. Before 2015, there were around 3,000 recorded assaults. That is a threefold increase and more; it is simply unacceptable.
I have some understanding of what the Government are dealing with in terms of Spice and I cut them some slack. It troubles our communities and our estates. It needs checks and it needs to be rolled back. The hon. Member for Rutland and Melton made the point that no one should routinely be afraid of assault when they go to work. No one whose loved one works in the service should worry about them on a daily basis. Some occupations will always trouble us, such as those that went down the pits, went offshore fishing or serve as police officers, but we take steps to ensure their safety. Little has been done and the situation has worsened for prison officers, which is simply unacceptable.
What is said to police officers—that they cannot and should not expect to routinely be punchbags—must equally apply to prison officers. Whether it is by concurrent or consecutive sentences, or by increased sentencing, action needs to be taken. I agree with the hon. Member for Rutland and Melton that those perpetrating the assaults need to realise that their actions have consequences, and for prison officers such assaults cannot simply be viewed as being part of the job or par for the course.
It is frightening. The prison officers’ unions have provided testimony from individuals that is scandalous. A male private sector prison officer states:
“Prisons are totally unsafe for staff and prisoners. I have been a prison officer for over 20 years and its decline in that time has been shocking. This decline is down to the profiled staffing levels being reduced by 50%, with the same risk prisoners to work with.”
Another male public sector prison officer states:
“I have just returned from hospital after receiving treatment for yet another bite I received as a result of an assault by a prisoner. However, on this occasion the prisoner has been confirmed as being Hepatitis C positive!”
That is simply unacceptable. There is a whole catalogue of such comments and I could go on. A male public sector prison officer says:
“I have been in the Service for over 20 years and I have never felt scared to come to work - but now I fear for myself and my colleagues.”
That is scandalous, and we have to address it.
We must increase staffing levels and retain experience. That must mean looking at terms and conditions, and especially at pensions. We need to address those who perpetrate the problem. We need to tackle a culture of violence and the cocktail of drugs, which are mentioned by the prison officer staff unions in terms of how they want a charter implemented, and I ask the Minister to take that on board. It cannot just be soaked up by those who serve. Action must be taken by Government.
It would be remiss of me not to mention the private sector. I put on the record that I have great support for private-sector prison officers and staff, as I have for those who work in the public sector, but privatisation has been an unmitigated disaster, as it was in probation, and I would ask the Minister consider rolling back upon it. The best testimony that I ever received was the former inspector of prisons in Scotland, Clive Fairweather.
I do not think Clive Fairweather would necessarily have been a supporter of me or my party, as his whole background was having been a British Army officer—indeed, his final role had been as commander of the SAS—but I remember Clive telling me why he opposed private prisons. It has stuck with me ever since. He said, “When I was commander of the SAS, if I needed to authorise people to take the lives of others, I did so because of the authority I had and the cap badge that said I was acting on behalf of the Crown. If I need to take the liberty of an individual then I should do so not because it suits a corporation diktat or a corporation profit, but because of the authority of the Crown.”
People are complaining about money going to private hospital beds as we hit a coronavirus crisis. Let us remember that a lot of money has been going to private investors as we have had to fill up the private estate in order to balance prison numbers. That has meant that there has not been the money to spend on terms and conditions or to improve the estate, because so much is going out of the door in revenue payments that we cannot afford capital expenditure.
There are other issues I would like to briefly touch on. We have a growing elderly population. I said earlier that our prison staff are not trained to be psychiatric nurses, but nor are they trained to be geriatric nurses. Yet we now have—certainly not in Scotland, but in England—a centenarian in prison. In Scotland, I visited a prison where we had a particular ward that was for those who were septuagenarian, octogenarian or nonagenarian. It was a geriatric ward.
It caused huge difficulties for the staff, because most of those prisoners were in there for historic sexual offences. Accordingly it was not just the prison officers who were viewed as punchbags, but those prisoners too. It caused difficulties for the management of the prison to keep them separate and secure from those who would otherwise view it as an opportunity to “pay off”, as they say, some gratuitous violence.
Alicia Kearns
Does the hon. Gentleman agree that, despite the age of the sex offenders that he mentioned, they should rightly remain in prison, because the crimes they have committed will affect those children, and now adults, for the entirety of their lives? If they were not brought to justice until they were 70 years old, because the system failed in the past and we did not believe that those crimes had been committed, they must serve their time. The victims deserve to see justice being served.
Kenny MacAskill
Absolutely. I always remember that being put to me by the former Lord Advocate, Dame Elish Angiolini. She said, “They took someone’s childhood. They can forfeit their old age.” That seems to me to be a reasonable trade-off.
The question is not whether they should be punished—that is undoubtable—but where they should be retained. Many of our prison estates, as I have already touched on, are Victorian. I had this discussion with the chief executive of the Scottish Prison Service; we would be better acquiring a care home and making it semi-secure if we need to, although most of these people are hardly going to be running down our high streets on their zimmers, fleeing from a prison officer. The whole institution in which we retain them is inappropriate.
I mentioned the prison in Scotland because not only did they have to keep them secure from others who would have done them harm, but they could not even double them up. I thought it was funny at the time, but it was not really. They could not put them in a top bank because of their rheumatoid arthritis. It simply was not possible to double them up. It might be that as a society, we should be looking at acquiring different premises for those people.
The principle remains that they have to be punished, but the question is where they should be detained. Do we need to spend on that high security? For some of them, most certainly, but most of them are hardly going to be a threat. We could keep them under the same lock and key as a dementia ward in many instances, I would have thought. That would be easier for us and better for the staff.
There is also the question of throughput care. The great tragedy is the skills that prison officers have. I remember being at a showing of the movie “The Angels’ Share”, which I thought was quite beneficial in trying to challenge young people about their behaviour, and I remember a prison officer’s commenting that he spent more with time with those young people than he did with his own kids in his own family. Yet when they left the estate, despite the bond he had created and the fact that in many instances he had become a father figure, he could not relate to them. We have to get the balance. That officer would not want trouble when he is out with his family, taking them places, but there are skills that the prison officers can take out into the community.
First, we have to get other agencies to come into the prison earlier and more often—often they do not—to take their responsibility, as opposed to leaving everything with the Prison Service until the prisoner is discharged beyond the prison gate; and secondly, we should look at the opportunity for how we can use those skills and maintain the through care. We all know that the reason why so many people come back in through the revolving door is that they fall by the wayside and the person who was keeping them on the road was that particular prison officer.
I simply want to sum up, Mr Robertson. You have given me a great deal of latitude. I put on the record my thanks to the Prison Service and its staff. I ask the Minister: what steps will be taken not simply on coronavirus and the staff, but to address the underlying issues that are looming—and already exist—in the prison estate on staffing levels, staff morale, violence against prison officers and the drugs cocktail situation, as well as the growing issues of through care and in particular an elderly population? That is a big task, and we face many tasks at the moment, but we can no more expect our hospital staff to be heroic than we can expect our prison staff—who are being heroic—to be so. Not only must we give them the thanks to which they are entitled but, more importantly, in our privileged position as legislators, we must take steps to action plans to protect them.
John Howell (Henley) (Con)
It is a pleasure to serve under your chairmanship, Mr Robertson. It is also a pleasure to have two Front Benchers in this debate who have both been members of the Select Committee on Justice. They understand the sort of comments being made by the hon. Member for East Lothian (Kenny MacAskill), and I hope that they recall the report on prison governance that we produced, which covered a number of the issues.
We are in an enduring crisis of safety and decency in our prisons. As the hon. Gentleman pointed out, this crisis is not something that has just happened; it has been going on for a long time. Violence is at an all-time high. Up until March 2019, there were more than 34,000 assaults in the prison system and, of those assaults, more than 10,000 were on staff. That is an increase in assaults on staff of 15%.
A major contributory factor to the level of violence and the state that prison officers must endure is working conditions. As the hon. Gentleman pointed out, the prisons are mostly Victorian—or earlier—constructions. We need to tackle the level of accumulated maintenance in such prisons, but the focus of Government activity seems to be on 10,000 more prisoner places, rather than on curing the maintenance problem.
I give full credit for the £100 million put into the Prison Service to improve safety and security, and we should not lose sight of that, but the concentration on providing an additional 10,000 places has meant that repairs to prisons have taken a back seat. We can address much of that, and the prison in Leeds is doing so. Working parties of staff and prisoners together carry out maintenance activity within the prison. I would like to see something similar taken on board by other prisons, to get the work done. The Justice Committee looked at this and came to the conclusion that the backlog of maintenance required in prisons came to about £900 million—an increase from £716 million in 2018. That that is an incredible backlog, and it shows that not enough is being done to tackle this.
Several things contribute to the problem. One is a real crisis of leadership in prisons. There has been a tremendous amount of activity to try to give governors more power over what happens in their prisons, but I do not think that that has gone far enough. We need governors who really have control of their prisons, because after all, they see the detail of where maintenance is required and can deal with it continually.
Another significant aspect is space being made available for purposeful activity. There is no doubt in my mind that purposeful activity plays a strong part in prisons. I have said in the House before that, with previous Justice Committees, I have been to Denmark and Germany to see how prisons there deal with purposeful activity. In Denmark, one thing that made the biggest difference was not purposeful activity in the sense of making things, but the way in which the prisoners were treated. What made the biggest difference was that they did not eat communal style, as in the “Porridge” series, but were allowed to earn their own money and to cook their own food. There were some restrictions, such as knives having to be chained to the wall, but that made a huge difference in keeping the lid on violence in that prison and making sure that the prisoners were fit for rehabilitation. The German prison I visited—this goes back to the point that the hon. Member for East Lothian made about where in a prison these issues can be tackled—had a big warehouse for making furniture. The prisoners all played a part in making furniture, which had an enormous impact on their lives.
My last point, which I will just make before I leave space for others to come in, is that there has been too much ad hoc dealing with the problems in the Prison Service over the years. Nobody has taken a strategic direction, grabbed the issue by the neck and sorted it out. If there is one message that I would give to the Minister, it is that strategic direction needs to be put into the Prison Service. The issue needs to be addressed, because it is not just a question of prisoner safety, but of prison officer safety.
Wendy Chamberlain (North East Fife) (LD)
It is a pleasure to serve under your chairmanship, Mr Robertson. I congratulate the hon. Member for Easington (Grahame Morris) on securing the debate on this critical issue, and I wish him a speedy recovery. I also thank the hon. Member for East Lothian (Kenny MacAskill) for stepping in at short notice.
First, it is important to consider what we, as a society, believe the purpose of our prisons to be. I am a former police officer and have witnessed at first hand the wide, varied and complex reasons why people end up offending and, consequently, entering our justice system. Surely the main aim of our prisons is to rehabilitate offenders so that they leave and do not go on to reoffend and are able to make a positive contribution to society. Punishment is obviously a factor, but in the vast majority of cases it should be secondary to rehabilitation.
However, the challenges facing the Prison Service make that very difficult to achieve. Tom Halpin, chief executive officer of community justice organisation Sacro, commented:
“The current overcrowding in Scottish prisons means the focus is on security and safety…Rehabilitation—particularly for those on short sentences—is simply not a priority.”
Prison staff are central to achieving positive outcomes for prisoners and wider society. They need to be properly supported, and to receive good training and the right resources to help them to rehabilitate. Failing to deliver that contributes to the poor health and safety of staff, as we are discussing.
As Members have laid out, the current situation for prison staff is frankly intolerable. Assaults on prison staff have been rising for more than 10 years and for every 1,000 prisoners in England and Wales there were 35 assaults on staff in 2010; last year, the figure had risen to 121.
It should not be like that. Every person should have the right to feel safe at their place of work. We must do better. Ultimately, our prisons are under-resourced and overcrowded. As of last July, Scottish prisons were close to capacity after the number of inmates increased from 7,400 to more than 8,200. Although prison staff numbers in England and Wales have increased since 2014 to 23,000, that is still fewer than were employed in 2010.
Prison staff are working at capacity, so they do not have the time to access the training and development they need to do their jobs better. That means they are not developing. As the hon. Member for East Lothian said, it is about not just initial training but ongoing professional development. A member of staff in the prison sector said:
“I feel the poor environment in establishments has been caused by inexperienced staff training new staff. The training staff unfortunately think the state of the prison is just the norm, and are teaching the new staff the wrong way to deal with situations and making some very dangerous decisions”.
That problem is compounded by the fact that staff retention is challenging. Last year, 38% of those who left the workforce in England and Wales had served in the Prison Service for less than one year; the figure in 2010 was just 7%. Things have totally deteriorated, arguably to crisis levels. If the service cannot retain staff, the staff cannot gain the skills and experience to deal with and support the complex needs of many in our prison or justice systems. That results in a huge burden on staff’s mental health. We must remember that health means mental as well as physical health. If we believe that both are equally important, we must demonstrate that by giving the support required.
The largest cause of sickness absence in the prison service is stress. In 2018-19, the Scottish Prison Service lost more than 14,000 days due to stress-related absence, an increase of 32% on the previous year. Just as we are trying to create workplaces that conform to physical health and safety standards, we must ensure that we create mentally healthy workplaces. Another member of prison staff said:
“I have seen perfectly healthy people join in the last 12 months and become very ill due to prison work and the lack of discipline to create a safe space for prisoners to live.”
I am keen to hear from the Minister on what further steps are being taken in Her Majesty’s Prison and Probation Service. Does it have a mental health first aid programme? What steps is it taking to discourage presenteeism? Acknowledgment of mental health issues and early intervention can support better recovery and an earlier return to the workplace.
The “Safe Inside Prisons” charter, recently launched by the Joint Unions in Prisons Alliance, suggests some ways to help relieve the burden on staff. Primary among them is a proposal to introduce a single reporting system for violence in prisons, as the current system is very fragmented. Staff need to feel they can support any incident, and we need to make it easier for staff to do so. A new system should be accessible both internally and externally so that staff can report incidents away from the workplace.
I am pleased to have signed the early-day motion on this matter, tabled by the right hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts), which I am pleased to see has gained widespread support from all corners of the House. In particular, I highlight the part of the motion that refers to prison staff as “diligent, brave and committed”. I echo those remarks. The service they provide is remarkable and the Government need to recognise that by providing the resources required to help them.
I call on the Government to commit to a zero-assault ambition for prison staff and to use radical evidence-based policy to address the causes of violence in prisons. Everyone has the right to feel safe in their place of work. Although I welcome the Government’s commitment last year of £100 million to fund airport-style security for prisons, we must ask whether that is tackling the root causes of violence in prisons. It is not simply about preventing access to offensive weapons but about working to ensure that prisoners do not feel the need to carry them or use them in prison.
Prison will sometimes be the right outcome for certain types of offences and offenders. We need to ensure that it is safe and viable for everyone within it and that it delivers the outcome we want it to achieve, with people serving their sentences, coming out of prison and not reoffending. Overcrowding, under-resourcing and lack of training and development for those on the frontline of our prisons make that objective far more difficult to achieve, and that fails us all as a society. That is now more important than ever. The coronavirus pandemic that Members have referred to means we are entering a crisis that will have an increased impact on the health and wellbeing of both prisoners and staff. It is vital that the Government listen and take swift and decisive mitigating action.
Jim Shannon (Strangford) (DUP)
I thank the hon. Member for East Lothian (Kenny MacAskill) for setting the scene so expertly. It is a pleasure to follow the hon. Member for North East Fife (Wendy Chamberlain). Her contribution is based on the point of view of a police officer and her interaction with prison officers over the years. I want to add my support to what was set out by the hon. Member for East Lothian. The Minister knows I have every confidence in him and I look forward to his response to the issues we have brought to his attention.
The hon. Member for East Lothian referred to “The Shawshank Redemption” and “12 Angry Men” as examples of how we might form an opinion of the way in which prison officers and the legal system work. My knowledge comes from those two films and also from the comedy classic, “Porridge”, which the hon. Member for Henley (John Howell) referred to. That series is more about mischief than badness, perhaps because of Ronnie Barker, and is a gentle way of looking at the Prison Service. If only it was like that, but it is not. It is a matter of concern in every corner of the United Kingdom.
I am sure we were all dismayed to read the November article in The Daily Telegraph, which outlined the situation that prison staff currently find themselves in. The background information that we have today, including that from the Library, indicates the same thing. The article stated:
“Prison officers are being assaulted almost 30 times a day as violence, self harm and suicides in jails hit a record high, Ministry of Justice figures show. The number of assaults on staff rose by 10 per cent in a year to pass 10,000 for the first time since records began more than a decade ago in June 2009. More than 1,000 of these were serious assaults, up seven per cent on the previous year.”
There is clearly an issue to address within the Prison Service. Those figures are reflected in Northern Ireland, which the Minister does not have responsibility for, although perhaps not to the same extent. The article continued:
“There were also more than 24,000 prisoner on prisoner assaults in the year to June, equivalent to 66 a day and a three per cent rise on the previous 12 months. That is also the highest for a decade. It means the overall number of assaults is closing in on 100 a day with 93 every 24 hours—another record high.”
That is a record high we do not wish to record because we want to record the good things and how we are improving them.
“Of these, 3,928 were serious assaults, of which 2,984 were prisoner on prisoner attacks.”
There is clearly an issue that must be resolved. I have spoken to friends of mine who work or have worked in the Prison Service. I am in regular contact with prison officers in my constituency, some of whom are retired. We are losing good men and women who get to the end of themselves due to the abuse that they suffer, followed by allegations and the feeling of a lack of support.
There have been record high resignation rates among prison officers. They are treated abysmally not only by the prisoners they interact with every day, but by the Ministry of Justice. There is a fear of stepping into situations and getting into more trouble, which is what we must address. Prison officers need protection. They need confidence in the system, the governors and the prisons, and they need to feel confident that our Minister and our Government will support and stand by them. Prison staff must be able to use the force that has been deemed appropriate and know that they will have support if an inmate makes a complaint. Too many officers complain to me about being left “hung out to dry” and then carrying the stigma after they have been cleared. The officers and also the educators, nurses and cleaners all have the absolute right to be safe and secure.
Can the Minister explain why frontline prison officers’ resignations have soared to 9%? What is being done to address that? In January, four prison officers and a nurse were hospitalised after a terrorist attack by two prisoners. Again, what has been done to assure those prison officers that they will be safe and receive the protective body clothing they need, as well as the security they need? There are many examples—it would probably take until 10.30 am to read them all out, which would not be fair to the right hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts). I will not do that, but there are lots of other things that we could put on paper.
Let me be very clear: if an officer is at fault, there must be an investigation. There should be no potential for abuse, but neither can we continue to have staff feeling that they are fighting a losing battle in keeping the peace and winning the fight against bullying and drugs, which are rampant in our prisons. In my constituency of Strangford, there are many people—especially the young—who go to prison not being drug dependent but come out drug dependent. We have to ask ourselves why that is happening. Every month at justice questions, right hon. and hon. Members ask about the availability of drugs in prisons. Again, it is something that has to be addressed.
I accept that we need to rehabilitate prisoners—it is right that we should—but we also need to have control of prisons in the hands of the Prison Service, the governor and the officers. People’s concerns include the fact that when
“a prisoner assaults staff or other prisoners, they are back on the wing 20 minutes later.”
One prison officer said:
“Prisons are in a state of emergency!”
The following is from a male public sector prison officer:
“I have been in the Service for over 20 years and I have never felt scared to come to work—but now I fear for myself and my colleagues.”
If that is how prison officers feel, we have to address those issues as soon as possible.
We wonder why the health of inmates is so at risk. I believe the reticence of prison staff about their safety and mental health means that they are unwilling to intercede when they see signs of bullying and abuse of drugs. Some of the people who go to prison are very vulnerable. They find themselves subjected to peer pressure and surrounded by people who have stronger personalities and characters, and they may find themselves slipping into lawlessness and criminality inside the prison and then outside. It is really important that we have rehabilitation and help those people to get out the other side and to try to live a better life afterwards.
We are harming our inmates by preventing officers from doing their job. A lot of this is due to the lack of adequate numbers on prison floors. It is clear that an adequate number of staff is essential in order to provide strength in numbers, and to serve as witnesses to any allegations. The Justice Unions Parliamentary Group has provided some papers and made three recommendations, which I will read out. The first is:
“Adopt the new Safe Inside Prisons Charter developed by nine national trade unions representing the majority of prison staff, and move to a tripartite system to tackle prison workplace violence involving close collaboration between unions, employers and the Health & Safety Executive.”
The second is:
“Launch a national prison violence reduction strategy as a matter of urgency, fully resourced and in partnership with staff unions—including action to retain prison officers, who are currently resigning at record-high rates.”
The third is:
“Fully abide by the 1974 Health and Safety at Work Act and take all reasonably practicable steps to ensure the health, safety and welfare of all workers in prisons, including those not directly employed by HMPPS.”
We must invest in our staff in order to improve prison facilities. I look to the Minister, as I always do, because I know he is aware of the situation and wishes to reply responsibly and positively. We need to understand how this can be done UK-wide, not just in English and Welsh prisons. Has the Minister had any discussions with the Northern Ireland Justice Minister, Naomi Long? If not, I ask him to contact her. I know that our new Justice Minister has indicated her desire to improve the mental health of inmates, and I ask the Minister to liaise with her in a UK-wide effort to improve working conditions and the health and safety of staff, as well as that of inmates. I very much look forward to hearing what the Minister has to say.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
Diolch yn fawr iawn, Mr Robertson; it is an honour to serve under your chairmanship. I highly congratulate the hon. Member for East Lothian (Kenny MacAskill) on stepping in to lead the debate. I rise as co-chair of the justice unions parliamentary group, and I should also mention the Joint Unions in Prisons Alliance and its “Safe Inside Prisons” charter. I thank all staff in prisons. They are, in many cases, by the nature of their work, invisible and unheard heroes, which we should bear in mind.
Staff in prisons will be very aware of the criteria against which they are held to account by Her Majesty’s inspectorate of prisons. If safety is one of the four healthy prison tests at inspection, surely health and safety in prisons must be on every agenda all the time. Whether in the private or public estate—no matter who employs the member of staff—safety is a priority.
Safety of course means freedom from violence and from the threat of violence, and must apply equally to everyone in the prison estate. It is therefore a matter of surprise to me that inspection reports reference prisoner-on-prisoner violence specifically, while violence towards staff is much less of a priority. Yes, the purpose of a prison inspection is to assess the experience of prisoners, but the very nature of the prison estate means that the health and safety of prison staff is intrinsically bound to the health and safety of prisoners.
To me, it is self-evident that a workplace that sets so low a priority for its staff’s welfare as to fail to record every incident of violence against them will inevitably also fail on the welfare of prisoners. The culture of fear and reluctance around the reporting of violent incidents needs to be challenged and radically changed. If present priorities effectively reward under-reporting, every step must be taken to ensure that violence against all staff is recorded and promptly acted on. Currently, the system appears to contain perverse incentives that actively encourage under-reporting.
If the targets against which prison management is answerable are producing such results—effectively creating an environment in which violence against staff is ignored—those targets or contractual requirements must be changed —they are otherwise unfit for purpose. Raising the priority of staff safety will require a culture of change at all levels. The regular use of body-worn cameras, for example, would aid in the collection of evidence. To bring about their intended effect, challenge, support and intervention plans need to be rigorous, sufficiently challenging for violent prisoners and supportive enough of prisoners who are victims of violence.
There must be a record of every act of violence against any member of staff employed in a prison, as well as meaningful consequences for prisoners who commit such violence. Those consequences could come through judicial process or internal prison procedures. Attacks on staff can no longer be excused as collateral damage in the hidden theatre of violence staged behind high walls across England and Wales.
HMP Berwyn is the newest facility in the prison estate, having opened three years ago, and the second largest prison in Europe, with capacity for 2,100 prisoners —there are about 1,800 there at present. I will read from the exit interview of a member of staff who left last month after working there for just over two years—the attrition rate is between 10% and 14%. I will try to be as brief as possible, and will leave out the sections that I could not corroborate with others—I have checked what I am about to read out. He said:
“Most importantly the staff and friends who I have worked alongside have made the job for me. They are the reason us staff come in every day, and I will always thank the place for letting me meet these people. I have made friends for life and also met a partner within the service, who is fantastic and has been brilliant and supportive, especially after I was recently assaulted on Christmas day at HMP Berwyn.
I feel at HMP Berwyn everything always seems to be about the prisoners. So long as the regime is running, nothing else matters. Band 3 officers are not listened to, staff safety is not a priority and is constantly compromised and undermined. Recently I was assaulted with hot water on 25/12/2019 on Alwen B Uppers by a prisoner. This has been the final nail in the coffin for me. I was almost left blinded in my left eye and during my time trying to recover occupational health had been in touch at the start of January with me and have offered support and a meeting on the 25/02/2020, two months after the incident, by which point I will have left HMP Berwyn, so this is no use whatsoever.
More importantly, I called North Wales Police in the new year of 2020 to discover they had no record whatsoever that I had been assaulted or taken into A&E due to an assault, and I had to chase up the police, crime number, security and police liaison officers to make sure it was reported correctly, and find that the prisoner was not taken to segregation immediately, and the paperwork that was meant to reach the police liaison officer was lying around on a desk somewhere. Surely this should not be the case when I myself was blind in one eye, at this time recovering at home, feeling helpless.”
I will move ahead. Talking about his own work, this man said:
“I was always on time, I worked late, I tried to be proactive and I worked through lunch, yet some people would stroll in 20 minutes late (weekends and mornings), sit in the office, let prisoners get away with basic things…hide within the jail, but would never be pulled up or even spoken to. I made myself ill giving my all to my unit. Yet you have people doing the bare minimum and getting away with it, and this used to drive me crazy.
Also we are trying to tackle drink and drugs as a priority within the jail, yet you clearly have staff taking drugs at weekends and coming into work under the influence. Yet nothing is ever said or done in regards to this. Also, staff who have been given criminal convictions during their employment have been allowed to stay in their jobs.”
I will move ahead again to “evidence handling”, and we must remember that this is a man who has been assaulted during his work:
“Evidence handling is poor. Nothing is ever bagged or tagged correctly. Extra training, I feel, needs to be provided on this. I was assaulted on Christmas day, yet my clothing was not taken from me. This could have been vital evidence. We are always short on prison officer numbers yet we continue to take more prisoners into the jail, and compromise staff safety, and try to make do, rather than lock wings down. We put people onto wings or on key working shift to unlock, then, when it comes to feeding, we are scraping around, looking for a third member of staff rather than just shutting a wing down.
I am reluctant to complete this form, as many times we as officers speak up and nothing ever gets changed. I doubt this form will even get the chance to see the number one governor or senior management team or be looked at, due to negativity. But I can with my hand on heart say I gave my all, 100% all the time… I wear my heart on my sleeve and I take pride in my work, and this can be backed up by anyone you want to ask in the jail. Yet I will make these points to try and help you retain staff, as I can assure you many others are close to leaving and a high percentage of your prison officers (very good ones at that) are currently seeking employment elsewhere and will leave if things do not change.”
The last few things that this man says are really important:
“I really want to see HMP Berwyn do well and be a good place to work, so I have therefore let it all out and given my honest opinions and hope these will be considered and taken into account. I loved working with many people within HMP Berwyn, and you have some great characters, team players and personalities.”
But those people need support.
I have a few specific asks; some of them relate to HMP Berwyn, but I think they are relevant to other prisons too. Can the Minister confirm whether an unused wing in Berwyn might be put into use as an isolation ward to deal with the covid-19 crisis? If that is the case, it could be of support to other prisons. Also, can he confirm that all necessary personal protective equipment and training for staff is being provided?
In these circumstances, and considering the size of the prison, can the Minister commit to reviewing the merits of phasing out the use of double cells at Berwyn, and making it a single-cell prison, as I understand that is what is happening with the new private prisons that are being developed? There is capacity, with the number of prisoners presently there; it will certainly be a lot easier than when we go to full capacity. If this change on single cells could be made, it would facilitate many aspects of the work for prison officers.
I have a question on covid-19; I do not know if it has been asked yet. We have had a request from the unions and from the teaching staff—staff who are not directly employed staff working in prisons. Can the Minister give an assurance that there will be no penalties by Her Majesty’s Prison and Probation Service for non-delivery of teaching hours during education shutdown?
Finally, may I reiterate the call that the Minister’s Department adopts the “Safe Inside Prisons” charter, in the spirit of tripartite working between employers, unions and the Health and Safety Executive? Diolch yn fawr iawn.
Mr Laurence Robertson (in the Chair)
I remind hon. Members that we need to leave two minutes at the end of the debate for Mr MacAskill to wind up.
Patricia Gibson (North Ayrshire and Arran) (SNP)
I am pleased to participate in this important debate, and I share the concerns of the hon. Member for Easington (Grahame Morris), who is unable to be here today. I thank my hon. Friend the Member for East Lothian (Kenny MacAskill) for his insightful opening remarks in this debate, and I echo the gratitude that we all rightly have for our prison officers, as we have heard across Westminster Hall today.
We have heard much about the kind of environment that can prevail in prisons, where the most dangerous members of society are incarcerated. Being a prison officer is not a job for those of faint heart, but it can be an extremely rewarding career, as was made clear to me when I visited Greenock Prison last year. It is not in my constituency, but it houses some of my constituents, and some of my constituents work there. Prison officers work in a difficult physical environment, with high walls and locked doors. The clientele can be extremely challenging, as we can all imagine.
The undercurrent of violence is something that prison officers just have to learn to cope with, but doing so every day at work must take a toll on mental health, and the impact on staff should not be underestimated. The people whom prison officers deal with have often been convicted of the most heinous crimes. A violent way of life is the way of life for many of the people prison officers have to cope with. Those violent prisoners will not always be welcoming or obliging towards the prison rules and regulations that are disseminated to them by officers. Even those who enter prison for non-violent offences can become violent when in prison, out of sheer frustration—no one likes to be locked up, regardless of the crime they have committed. The company that those people are required to keep must also have an impact.
Prison officers live every day with the threat of assault at the hands of seriously angry and violent prisoners. That should be recognised across the entire prison estate of the United Kingdom. The prisons in Scotland face challenges, as do prisons across the UK. Members have spoken about that in detail. My hon. Friend the Member for East Lothian, who opened the debate, reminded us that prison officers are the forgotten service. We rely on them, but too often they are out of sight, through the nature of the job they do. They have to master a variety of skills. They are not just guards. They often have to take on such roles as psychiatric support or social worker, which they work hard to carry out but for which they are not properly trained, and certainly not properly paid. All the time, as they carry out that variety of roles, there is an undercurrent of violence. That is the nature of our prisons. No one, as my hon. Friend reminded us, should have to go to work and routinely fear assault; that cannot simply be viewed as part of the job. If prison officers do not feel safe, they cannot keep prisoners safe, and often many prisoners do not feel safe.
The hon. Member for Henley (John Howell) pointed out the need for prisons to be maintained in good repair. The environment matters for the health and wellbeing of prison officers and prisoners. The hon. Member for North East Fife (Wendy Chamberlain), who has particular insight as a former police officer, reminded us of the importance of rehabilitation. A greater emphasis on that would, in turn, create a better climate, ethos and atmosphere for prison staff and prisoners. The mental health of prison staff requires more attention. I do not think there is any doubt about that.
The hon. Member for Strangford (Jim Shannon) talked about the challenge to prison officers from the rate of suicide in prison. Surely that has an additional impact on the mental wellbeing of prison staff, in addition to all the other challenges they face. We all know that many people in prison suffer from mental health challenges that are not supported to the extent they should be. Prison officers are left to pick up the pieces, which has an undoubted impact on their own mental health. It is incredibly difficult, in the kind of work that prison officers do, to leave the job at the prison gates at the end of a shift.
The challenge of drugs in prison is an additional complication for prison officers. I do not understand, given that if anyone tries to bring the smallest amount of drugs through an airport they are caught at security, how it is that somehow we cannot seem to keep drugs out of prisons. That is a puzzle that I have real difficulty in reconciling in my mind. The right hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts)—I apologise for my pronunciation—pointed out that we cannot separate the mental health of prison officers from that of prisoners. Given that they are in such close confines, that seems a self-evident truth. The prison officer testimony that she introduced was a powerful addition to the debate. We are all worried about the coronavirus. Given the close confines in prisons, that virus must be an additional complication for prison officers, in seeking to keep themselves, and the prisoners they serve, safe.
The criminal justice system and prisons are devolved to the Scottish Parliament, but I will focus on an important health and safety issue for our prison staff that is reserved, and to which attention must be paid. A number of Members have referred to this really important aspect of the debate. Increasing the retirement age of our prison officers to 68, given what we have heard about the difficulties of their job and the constant threat of violence that too many of them face—if not actual violence, which is also far too common a reality for our prison officers—is cruel and betrays a fundamental misunderstanding of the important work that they do.
Prison officers, firefighters and police officers are all classified as emergency workers. The work that those groups do is essential to the smooth running of our society, and puts them in harm’s way. Why is it, then, that of those groups of emergency workers only prison officers are required to carry out their jobs well beyond the age of 60, until they are 68? Who on earth thinks that is a good idea?
We have talked about the health and safety of our prison officers. How can it not be as plain as the nose on our face that a prison officer who is, say, 66 years old should not deal with a young, fit, violent, angry prisoner who is aged 25? At 25, that prisoner, as well as being young, fit, violent and angry, is at the peak of his physical fitness. From a health and safety point of view, who on earth would think it acceptable for a 66-year-old prison officer to supervise or instruct that young prisoner, even if he were lucky enough to be ably assisted by his 65-year old colleague? It is completely unacceptable, and places the prison officer at unacceptable risk. Would any Member present seriously be happy with their 66-year-old father being placed in such danger because he was not permitted to retire?
I suspect, based on other debates, that the Minister will tell us, when he gets to his feet, that people are living longer. To that, I have to say, in this context: blah, blah, blah. What I mean by that, in case there is any confusion, is that it is just noise. I does not answer the question about ages. For the UK Government to tell prison officers that, despite decades of dedicated service, they must continue to work until they are 68 years old, knowing that that will directly place those older officers in danger, and potentially in situations for which they are physically unable to cope because of their advanced years, is negligent and not something that anyone present would want for their father or any other relative, because it is too dangerous.
If it is not advisable, desirable or safe for our relatives, or any of our loved ones, to work in such conditions at such an advanced age, it is simply not good enough for the prison officers in our communities who go to work each day. They are part of the emergency services, but they are not treated as such when it comes to retirement age, and apparently nobody can explain why that is the case.
Nobody can overestimate the impact that raising the retirement age to 68 is having on the morale of our prison officers. They feel undervalued, overlooked and forgotten about. When we consider how they are treated relative to other emergency workers, those feelings are perfectly justified, and that has to be addressed. Otherwise, we will exacerbate all the problems in prisons that we have heard about by haemorrhaging good prison officers, who will be a real loss to the service. My hon. Friend the Member for East Lothian pointed out that we are losing valuable experience from the service that is not easy to replace. Who benefits from that?
If as a society we believe that some people convicted of terrible crimes need to be kept away from society for a period of time, then as part of that we should automatically believe that those who supervise these people need to be treated in a way that reflects the importance of the job they do, and should be given parity with other emergency workers when it comes to retirement. It is quite simple: we do not want people in prison, but sometimes people need to be incarcerated, and that being the case, we need to appreciate and value the important work of our prison officers.
It really is time for this Government to do the right thing and stop deliberately refusing to see how illogical the retirement age of 68 is for prison officers in practical terms. They must give prison officers the ultimate health and safety protection that they need after dedicating their working lives to looking after those who the rest of society simply do not want to see. The UK Government need to deliver that parity, do the right and decent thing, and—to use a favourite phrase of the Prime Minister—just get it done.
Bambos Charalambous (Enfield, Southgate) (Lab)
It is a pleasure to serve under your chairmanship, Mr Robertson. I thank my hon. Friend the Member for Easington (Grahame Morris) for having secured this important debate, although he sadly cannot be here today, and the hon. Member for East Lothian (Kenny MacAskill) for doing such an excellent job in taking it up in his absence. I also thank all the right hon. and hon. Members who have spoken for their excellent contributions to this debate; they have made some outstanding points, which I will touch on in my remarks.
Let us be in no doubt: our prisons are now more dangerous for prison officers, offenders and other staff than they have ever been. Staff working in our prisons now go to work fully expecting to be assaulted. In the latest safety and custody statistics published by the MOJ, we find that there were over 10,000 assaults on staff in the 12 months to December 2019, and close to 1,000 serious assaults on staff over the same period. Those are dramatic increases on the 2010 figures—just under 3,000 assaults on staff and just under 300 serious assaults on staff—which demonstrates a marked decline in both health and safety in our prisons. Nobody should ever have to be fearful of assault when they go to work every day, and it is shameful that this has become such a common occurrence across the prison estate.
There is no doubt that this horrific decline of health and safety in prisons is due to the huge numbers of prison officers who have left the Prison Service since the Government took office. I particularly want to mention the remarks of the right hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts) about Berwyn jail, which I have visited; it is a new jail that has huge space. I also visited Cardiff jail with her a year ago, which was very different. Clearly, however, these issues are relevant no matter where a prison is, because as the hon. Lady said so eloquently in her remarks, they are issues of culture and of support for staff.
The 2018-19 annual report by Her Majesty's chief inspector of prisons stated that although
“There had been efforts to recruit and train new prison officers…many prisons still lacked a fully experienced workforce.”
That point has been made by all Members who have contributed. Even the Ministry of Justice’s own permanent secretary, Sir Richard Heaton, has said that the reduction in staff numbers
“has been detrimental to security, stability and good order in prisons”.
Since 2010, the Prison Service has lost close to 3,000 band 3 to band 5 prison officers, who work in frontline roles on the wings and the balconies, and over 6,000 prison officers in total. Between 2010 and 2015 alone, the Government oversaw a situation in which the number of band 3 to band 5 frontline staff fell by over a quarter.
Although there have been some recent signs of positive improvements, the latest statistics show that the overall number of officers is once again falling, demonstrating that the Government have reached the peak of what their existing recruitment strategy can deliver. The number of experienced officers who have left is particularly concerning, with the proportion of officers who have three or more years’ experience having fallen from almost 90% in 2010 to just over 50% in 2019. These are points that have already been made by the hon. Member for East Lothian and by the hon. Member for North East Fife (Wendy Chamberlain).
The role of a prison officer is not an easy one, nor is it one that can be easily taught in the classroom, so they urgently need training in order that they can gain experience. It is hard work, and it takes years of on-the-job training for new officers to learn their trade. The absence of experienced officers to mentor and guide them makes it even more of a challenge; the hon. Member for North East Fife emphasised the fact that it is not just physically demanding, but demanding on mental health, and the need for more support for those officers. The Government must not only redouble their recruitment efforts, but put in place a real retention strategy to stop so many new and experienced officers leaving the service.
The Government will inevitably try to lay the blame on other factors, including the widespread proliferation of drugs, particularly new psychoactive substances, as a cause for the rise in violence, and they have set out several measures by which they claim that they will be able to curb the trade in and use of illegal substance behind bars. The hon. Members for Strangford (Jim Shannon) and for North Ayrshire and Arran (Patricia Gibson) both spoke about why drugs are so prevalent in our prison estate.
We support any efforts to clamp down on illegal drug use in prisons, which is putting prison officers’ and offenders’ safety at risk, but we are clear that the situation has been exacerbated by having insufficient prison officers to keep the situation in check, and that the flash technology that the Government seek to introduce is no replacement for experienced prison officers.
The Government must immediately seek to curb the rate at which experienced officers are leaving the prison system, and incentivise those who have left to return. A first step in doing so, in partnership with trade unions representing staff in prisons, would be to sign up to the “Safe Inside Prisons” charter that has been drawn up by staff with first-hand experience of working in dangerous conditions in prisons—all hon. Members in the debate have noted the excellent work that the Joint Unions in Prisons Alliance has done on that. Doing so would show the prison workforce the respect they deserve for the work they do, and demonstrate that the Government take their welfare seriously.
On the issue of the prison estate, the hon. Member for Henley (John Howell), who I have served with on the Justice Committee, made some excellent points about the need for leadership and more funding in the prison estate, and also the need for purposeful activity. Those are absolutely essential points that need to be heard by the Minister about what needs to be done to ensure that prisoners have things to do, but in a safe environment.
Under the previous prisons Minister, the Government promised a range of items of personal protective equipment, such as police-style rigid handcuffs and body-worn cameras, but the roll-out of the equipment has been woefully inadequate, with insufficient training provided to officers in their use and many cases where the equipment just has not been provided to their prisons. A body-worn camera would also provide little comfort to a prison officer who has just been assaulted. They want and need the measures to stop such assaults happening in the first place, which is why it is so important to have sufficient experienced prison officers in our prisons.
Finally, the Government must address the huge problems that they have created for themselves by raising the retirement age for prison officers to 68. That point was made forcefully by the hon. Members for East Lothian and for North Ayrshire and Arran, and rightly so. With such a physically demanding role, prison officers must be fully fit and sufficiently able to react in quickly changing environments, as required by the fitness test that they must complete. The public expect nothing less from those keeping them safe.
Yet the Government seem to believe, contrary to the MOJ’s own admission, that prison officers are able to carry out their demanding roles as they get older, ignoring significant concerns over safety in the process. The simple truth is that they cannot and they should not be expected to; 68 is too late as a retirement age for prison officers. The Government should now meet the POA and other staff representatives to resolve the concerns that prison officers have about retirement and their safety in prisons as they get older, and not try to pin the blame for the rise on staff.
With the growing spread of coronavirus across the country, there are also significant concerns for the health of prison officers and prisoners, who are locked up in a closely confined space in which viruses can spread like wildfire if not effectively controlled. I know the Government published a statement on their preparedness for dealing with covid-19 in prisons last Thursday, but I would be grateful if the Minister, in his response, could set out what measures are in place to ensure a safe staff-to-prisoner ratio in prisons if prisoners are hospitalised or forced to isolate, and how many prison officers and prisoners are currently isolated due to covid-19, including how many have tested positive.
With prisons still operating normally as of last Friday, including allowing visitors, do the Government have any plans to change this? If so, by when? What are the contingency plans in place should a significant number of covid-19 cases emerge in prisons? We would also welcome regular updates from the Minister on the number of prisoners, prison officers and other staff who have isolated or tested positive for covid-19, and on how the MOJ is responding to the situation.
For years, we have been warning repeatedly against the savage cuts made to the Prison Service, and about the effect that they would have, and have had, for prison officers forced to work in increasingly dangerous conditions. We have called for the Government to implement a real retention strategy for prison officers, to stop the exodus of experience from the Prison Service and to help protect health and safety, but they have not listened. In light of the testimony of prison officers and of the challenges, abuse and danger they face that we have heard about this morning, it is time they listened.
The Parliamentary Under-Secretary of State for Justice (Alex Chalk)
It is a pleasure to serve under your chairmanship, Mr Robertson.
I thank the hon. Member for East Lothian (Kenny MacAskill) for leading this debate and for starting it in such a helpful and comprehensive way. I also thank the hon. Member for Easington (Grahame Morris), in his absence, for securing it. I entirely agree that he is doing the right thing, as is the Minister for whom I am standing in, my hon. and learned Friend the Member for South East Cambridgeshire (Lucy Frazer), who is also self-isolating.
The debate has been genuinely excellent. One of the points made early on was this business about “The Shawshank Redemption”—the extent to which in our constituency mailbags the conditions in prisons are not necessarily the No. 1 priority. However, everyone in this House recognises that the state of our prisons is a critically important aspect of a functioning and decent society. I am grateful to all those who have taken the trouble on this most difficult day to make their points as they have.
I will add my own perspective briefly. A meeting with a constituent that I will never forget was with an experienced prison officer from Cheltenham. He had been seriously injured by an inmate at HMP Bristol, and came to speak to me about what had happened. What was so striking was that, despite that ordeal, he remained in post, undaunted, unbowed and utterly committed to his job. He demonstrated the finest values of the Prison Service, to which I pay tribute—not just with the usual platitudes about dedication, but acknowledging the values of courage, compassion, judgment and professionalism. He also demonstrated what everyone in the debate recognises as important: the determination to root out what Winston Churchill referred to many years ago as the
“treasure in the heart of every man”.
As the hon. Member for North Ayrshire and Arran (Patricia Gibson) said, being a prison officer can be a rewarding career for that very reason—being able to turn lives around.
Perhaps the most important point that I have taken away from this debate, made by both Government and Opposition Members, is that we need people like my constituent to stay in the Prison Service, because there can be few jobs in which experience is more important. Those senior officers provide leadership to others and set the culture of a successful prison. Equally, as my hon. Friend the Member for Henley (John Howell) said, those governors who have been in post will make the difference too. That is just one reason why this debate is so timely and important, and I am grateful to the hon. Member for Easington for bringing it before the House.
I will set the context not by way of excuse but as a fact that we have to address. The prison population is more volatile than it was 10 years ago. That is partly down to drugs and partly down to various other social symptoms, I am sure, but that population is more volatile. That is part of the context.
Let me turn, however, to the issue of covid-19, which the Opposition spokesman, the hon. Member for Enfield, Southgate (Bambos Charalambous), rightly raised. Covid-19 is testing, and will test further, every part of our national life. Our prisons will not be immune from that. The most careful thought and planning has gone into preparing our prisons. That work does not emerge from a clear blue sky, but is built on existing and well-developed policies and procedures to manage outbreaks of infectious diseases.
Prevention is of course better than cure, and basic hygiene practice has been rolled out in prisons, as one might expect. For those infected, prisons are well prepared to take action whenever cases or suspected cases are identified. Plans include isolating where necessary. Turning to the point about HMP Berwyn made by the right hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts), the issue of whether specific prison wings can be used is a matter, quite properly, for consultation with the governor. That may be the appropriate thing to do, but it is not a diktat from Whitehall. I am grateful to the right hon. Lady for raising the issue. The governor will need to be looped into any such decision.
Liz Saville Roberts
I seek from the Minister a response to the concern locally that Berwyn will continue to fill. Its population is currently about 1,800, so it is slightly under capacity. It has been filled slowly, deliberately. At this time, it is even more important that there is not a rush to fill that prison, because it has the potential to do very good work in other ways.
Alex Chalk
I take that point and leave it where it lies. I thank the right hon. Lady for making it.
There is a long-standing national partnership agreement with the Department of Health and Social Care and Public Health England for healthcare services for prisoners. Under that agreement, people in prison custody who become unwell do, as hon. Members know, have the benefit of on-site NHS healthcare services, which provide the first-line assessment and treatment response.
This second point is really important. We recognise the importance of prisoners maintaining contact with their family during this difficult period. Public Health England supports our desire to maintain normal regimes for as long as we can. If those cannot continue, well-worked-up plans are in place to ensure that that continues by other means, to the fullest extent possible.
Keeping people informed is also essential. We are issuing regular communications to staff and all the individuals in our care to explain the steps that we may need to take to protect them from the virus, to minimise anxiety and ensure maximum understanding and co-operation as the situation develops. That means providing regular updates via National Prison Radio, issuing guidance to staff and governors, providing posters and so on.
Let me turn to the staff impact. Staff have been and will be affected by this disease. We are moving swiftly to make additional staff available to establishments so that if current staff are unable to work because of infection, we can continue to run as normal a regime as possible. Some contingency planning may include the need to ask staff to work in a different place and potentially do different tasks; that will be to ensure that we can maintain frontline operational delivery to protect the public and robustly manage risks. In addition, as and when required, operational staff currently working in headquarters will be redeployed to prisons to support the service to maintain minimum staffing levels. May I take this opportunity to thank the unions, which are engaging proactively and co-operatively in this national endeavour? We are hugely grateful for that support.
The point was made about not penalising non-delivery of teaching hours. That seems to me eminently sensible. I hope that the right hon. Member for Dwyfor Meirionnydd understands why I cannot commit to anything, but I take that point in the spirit in which it was intended and I hope that it will be given appropriate consideration.
Let me turn to the fair point that was made that existing safety measures are necessary to tackle a threat that exists, notwithstanding covid-19. There has been significant investment in increasing staff numbers. We recruited more than 4,000 additional full-time equivalent prison officers between October 2016 and December 2019. A fair point was made on pay. In July 2019, the MOJ accepted the Prison Service Pay Review Body’s recommendations in full. The pay award was worth at least 2.2% for all prison staff, and there was a targeted 3% increase for band 3 prison officers on the frontline. It is the second year in a row that we have announced above-inflation pay rises, over 2%.
However, pay is only part of it. I completely recognise that conditions are critically important, too. How do we go about improving conditions so that experience is embedded in the Prison Service and those valuable officers will remain in place, providing the guidance, the culture and the leadership that a successful prison needs?
The first point is about the key worker role. This critically important initiative allows staff dedicated time to provide support to individual prisoners. That will help us to deal with emerging threats and improve safety, and of course it is important for those individuals to feel that they are being listened to and their concerns addressed. That helps them to feel valued, and of course helps the safety and stability of the prison. Key workers have a case load of about six prisoners. They have weekly one-to-one sessions with their prisoners to build constructive relationships and reduce levels of violence. That has started in all 92 prisons in the male closed estate, with 54 now delivering key work as part of their business as usual.
My hon. Friend the Member for Henley made an excellent point about purposeful activity and gave the useful example of what is happening in Germany and, I think, Denmark as well. That is exactly what we need to be getting to, and I commend him for making that powerful point.
The second point is serious offender intervention. We also have a range of capabilities to manage the risk that the most serious offenders pose in prison, including rehabilitative interventions and separation centres. Mental health was rightly raised. There are mental health facilities, but, as per the entirety of British society, mental health is a bigger issue now than it was in 2010. In fact, one of the bright lights, if I can use that expression, in the prison estate is the improving quality of mental health provision. That needs further strengthening, of course.
The third point is about equipping prison officers. We are committed to providing prison officers with the right support, training and tools. One essential matter is that we have started to roll out PAVA synthetic pepper spray for use by prison officers, but we want to ensure that PAVA defuses tensions, not creates them. All roads lead back to having established and experienced staff, because they will need to use their discretion in a sensible way to operate it.
Liz Saville Roberts
The association between PAVA and key workers is understandable, but when many staff are away from duty and dependent on bringing staff in on detached duty to another prison, prisons end up, I am told, without that critical number of key workers—there is a vicious circle and PAVA will not be able to be implemented. Will he commit his Department to looking at how PAVA can actually be brought into prisons? The association between key workers and PAVA at present is not working in all prisons.
Alex Chalk
I will certainly look at that and escalate it to the right hon. Lady.
Patricia Gibson
Time is slipping away. I appreciate all the Minister is saying about what the Government are doing to make prison officers feel more valued and safe, but I must press him on the issue of pension age. A lot of forceful points have been made today and we have little time left to address them. I ask him simply to say whether he is sympathetic.
Alex Chalk
I absolutely take the point that the hon. Lady and others raised. The reality is that whether a prison officer is 68, 67 or 66, there will be challenging circumstances. If there is a 25 year-old prisoner and a 52 year-old officer, that will present real challenges. I do not have a glib response for the hon. Lady, but I have heard the matters that she has raised. To solve the issue of our prisons we need to ensure that there are enough staff of the right level of experience to deal with these challenges. That will be the most important point and, frankly, that will make more difference than whether somebody is 68 or 67. The reality is that we need enough people of the right calibre and the right experience to manage volatile situations.
Time is against me and I want to leave the hon. Member for East Lothian time to respond. I could talk further about the Assaults on Emergency Workers (Offences) Act 2018, which addresses the point that my hon. Friend the Member for Rutland and Melton (Alicia Kearns), who is no longer in her place, raised. It means that those who assault emergency workers, including prison officers, feel the full force of the law.
We are supporting the emotional and social wellbeing of staff, which is critically important, as well as protecting them from violence. They have access to an occupational health service. We are rolling out TRiM—trauma risk management—that, as hon. Members will know, is being rolled out among police forces as well. There are post-incident care teams, occupational health support, cognitive behavioural therapy, and so much more.
The health and safety of our staff and those in our care remains the top priority for the Ministry of Justice, and we are making significant efforts to ensure that the safety challenges in prisons continue to be addressed. Covid-19 presents a new set of challenges. We are tackling them, informed by the best scientific evidence available, alongside the existing health and safety pressures we are facing in our prisons. I take this opportunity to thank prison staff. They are being tested and they are going to be tested. We value, admire and support them, and we are going to get through this.
Kenny MacAskill
Thank you, Chair. It is a pleasure to serve under your chairmanship again.
I want to thank everyone here, although time constrains me from thanking each hon. Member individually. There has been a uniformity of purpose and a recognition that the virus is going to cause significant problems in the prison estate. It is but a microcosm of our wider society, and hopefully this will be the catalyst to allow us to address not just that particular issue, but the underlying problems.
I thank the hon. Member for Easington, who cannot be here but who was the initiator of the debate. I repeat my thanks to all who participated and to the Minister for his response, which we take in the spirit in which it was given. Once again, we thank all those who serve in difficult times, because prison officers are an emergency service. The challenges that everybody is facing are being faced by them in greater form and to a greater extent, because of the close proximity of those they work with.
Question put and agreed to.
Resolved,
That this House has considered health and safety of prison staff.
Supermarkets’ Role in Tackling Childhood Obesity
(4 years, 1 month ago)
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Steve McCabe (Birmingham, Selly Oak) (Lab)
I beg to move,
That this House has considered the role of supermarkets in tackling childhood obesity.
It is a pleasure to serve under your chairmanship, Mr Robertson. Even as we struggle with the threat of covid-19, I want to stress the importance of this debate, because childhood obesity is a subject whose importance cannot be overestimated. It is without doubt the time bomb that will increasingly affect the lives and wellbeing of our society in the years ahead. We need clear steps to address it. The report, “Healthy Families: The present and future role of the supermarket”, from the all-party parliamentary group on a fit and healthy childhood, sets out to contribute to the debate. It does not seek to cast supermarkets as the villains of the piece; rather, it recognises the influence that they have and how that influence can be used positively to help tackle health issues.
Supermarkets have always occupied a special place in our psyche. It was J. K. Galbraith who told us:
“A person buying ordinary products in a supermarket is in touch with his deepest emotions”,
and Jonathan Sacks who suggested:
“A Martian would think that the English worship at supermarkets, not in churches.”
Supermarkets are now widespread in many countries. This country’s development trailed behind that of the USA. Indeed, by 1947 our self-service sector consisted of a mere 10 shops, but by 1969 supermarkets numbered about 3,500 and were well and truly established as part of our shopping experience. Store layout, daily promotions and sensory cues are all part of a formidable arsenal designed to encourage customer purchases, often regardless of the nutritional value of the product.
Price promotion is a key element in the strategy. A Cancer Research UK report in 2019 argued that three in 10 food and drink purchases are determined by price. The households making the greatest use of price promotion bought more products high in fat, salt and sugar. The upper quartile of promotional purchasers are 43% more likely to be overweight than the lower quartile, irrespective of income and age demographics.
Jim Shannon (Strangford) (DUP)
I suspect that the hon. Gentleman shares my concern that supermarkets place chocolates just in front of the tills, so that there is almost a wish to buy them as people make their purchases. Does he feel that supermarkets should move them away from the tills, so that there is not that temptation for mothers and children as they come to pay for goods?
Steve McCabe
I certainly agree. There is quite a lot of research to show that children, almost irrespective of their age, are influenced by that, and that the placement of products influences purchases.
The Obesity Health Alliance’s 2018 report “Out of Place” focused on the prime locations in stores for selling particular goods—exactly the point that the hon. Member for Strangford (Jim Shannon) has just made. It found that 43% of all food and drink promotions situated in prominent places, such as entrances, checkouts, aisle ends and so on, were for sugary food and drink. Fruit and vegetables amounted to less than 1% of products promoted in high-profile locations.
Diabetes UK reports that one in three children in primary schools in England currently suffer from excess weight, increasing their risk of type 2 diabetes. Excess weight or obesity accounts for up to 85% of someone’s overall risk of developing the condition. The Obesity Health Alliance makes a similar point: as well as causing type 2 diabetes, obesity can lead to cancer, heart and liver disease, and associated mental health problems.
Jim Shannon
I think it is wise to reflect on diabetics. I declare an interest, as I have been a type 2 diabetic for almost 15 years. There are 5 million diabetics in the United Kingdom, and the number is rising. It is one of the greatest health problems for future generations. Does the hon. Gentleman agree that there should be a campaign to address the issue across the whole United Kingdom of Great Britain and Northern Ireland?
Steve McCabe
I do, because we have to educate people who could avoid this condition about to how to do so, not least because, as the Obesity Health Alliance points out, the annual cost of overweight and obesity-related ill health to the NHS is £6.1 billion.
Like other organisations, Diabetes UK acknowledges that products high in sugar are more likely to be promoted through price promotions. It argues that we must have a rebalancing of price promotions to favour healthier products, which would make healthier options cheaper and encourage people to buy such products. Polling conducted by Diabetes UK shows that 82% of adults favour front-of-pack traffic light labelling to help them make a more informed choice. As Britain negotiates new trade arrangements following our EU exit, there is an obvious opportunity to ensure that the UK can introduce legislation to mandate such labelling.
Supermarkets are showing that they have the capacity to reach out to different segments of our society and to play an important social role. In 2014 Sainsbury’s introduced a disability-friendly trolley, designed in conjunction with parents of disabled children. In 2018 Morrisons introduced a quiet hours scheme, with dim lighting and music switched off to help parents with autistic children. There is widespread agreement that the biggest driver of food poverty is lack of money, and that low-income families are therefore nudged by economic factors towards a diet characterised by highly processed, calorie-dependent foods with less fibre and less vitamin and mineral content. The consequent long-term health risks of such a diet can include heart disease, type 2 diabetes and cardiovascular illnesses.
Supermarkets are the sole largest food source for families in England and could support disadvantaged households in making healthy choices. There are good examples in other countries. Denmark, Norway and Sweden use a keyhole label to facilitate healthy choices. Since 2000 there has been a requirement in Finland for a “healthy heart choice” symbol to be displayed on over 11,000 products. In Israel, co-operatives sponsor community physical activity, as does Sainsbury’s in this country—it has helped raise over £186 million for sports equipment through its Active Kids scheme. In the United States, we have seen experiments with stocking healthier products at checkouts. In New York, 170 supermarkets participated in a study that found that displaying low-calorie drinks at eye level increased sales. In Australia, a study found that healthy signs on shopping baskets influence purchases. In New Zealand, supermarkets have co-operated on a health star rating and on programmes to encourage healthy eating.
Supermarkets have a major role to play in the drive to improve the nation’s health, but their potential is as yet untapped. In order to support families to make healthier choices, supermarkets must address the current retail environment by ensuring that healthy foods are available and conveniently located in stores. Snacks are popular across all income groups but tend to comprise a higher proportion of all food consumed by those on lower incomes. Major retailers could improve the availability of higher-quality snacks to low-income families by developing their own brand lines and diverting surplus waste food towards the production of affordable, healthy snacks. They could agree to place high-fat, salt and sugar products alongside like items, rather than supporting out-of-context promotions. Healthy products should be in prime locations, such as the end of aisles, at eye level on shelves and at checkouts.
I acknowledge the good that is done. Tesco’s free fruit for kids and “helpful little swaps” are welcome, as is Sainsbury’s investment in reducing the cost of fruit and vegetables and its measures to end multi-buy promotions. However, we need supermarkets to agree that all customers should have access to clear, accurate nutritional and value-for-money information on all products. Fruit, vegetables and other healthy foods should be positioned in prominent places. Price discounts and multi-buy promotions should be discouraged, or offered on healthy foods.
I do not want the Government to bludgeon supermarkets; I want supermarkets to be partners in this exercise. I want the Government to provide more information, in the context of health and education campaigns, about the psychology of shopping and the importance of lists and meal planning, but I also want the Government to consider legislative measures on price and multi-buy promotions. We can make a real difference here. I want supermarkets to use their influence to play their full part in helping us tackle the problem of childhood obesity.
The Minister for Health (Edward Argar)
It is a pleasure to serve under your chairmanship, Mr Robertson. I congratulate the hon. Member for Birmingham, Selly Oak (Steve McCabe) on securing this important debate, and on his work with the all-party parliamentary group on a fit and healthy childhood. I remember responding to him in one my first outings as a then Under-Secretary of State and finding myself, with a slight degree of nervousness for my ministerial career, agreeing with virtually everything he said. However, I am still here, and it has not done me any harm. I fear that I may be in agreement with a number of his points again today, but hopefully at no risk to my ministerial career.
Before turning to the detail of the hon. Gentleman’s points, I thank our supermarkets, particularly at this important time. They are very much in the frontline of our battle with covid-19, and I know that they, and particularly all their staff, in whatever capacity, are doing all they can to keep shelves stocked, deliveries going out and the nation fed. It is a complex job at any time, so I thank them. In parallel, I encourage customers and shoppers to be responsible, to purchase only what they need and to think of others. Working together, I am confident that the supermarkets will ensure that their supply chains remain robust and that shelves will continue to be full.
In its 15th report, “Healthy Families: The present and future role of the supermarket”, alongside the previous reports to which the hon. Gentleman referred, the APPG has provided a valuable contribution to the ongoing debate on improving children’s health and reducing childhood obesity—I have a copy here, and I very much enjoyed it as my bedtime reading last night. He is right; with more than one in five children entering primary school overweight or obese, rising to more than one in three by the time they leave, it is right that we take bold action to improve the nation’s diet. There can be no doubting the key role, as he has said, that supermarkets and other retailers play in helping consumers make healthier choices. I know that many supermarkets and businesses get this. They know that their customers want a healthier offer and that it makes business sense.
Although I am not familiar with the group that produced the report, I saw a recent report by ShareAction that highlighted the importance of investors’ decisions in the sector and factors such as those highlighted by the hon. Gentleman. With environmental, social and governance considerations playing an ever more important role in investment decisions by big investors more broadly, it is right that supermarkets recognise that this agenda is good not only for their customers, but for their business.
As the hon. Gentleman alluded to in various examples, many supermarkets have already taken the lead in the UK and feature the voluntary front-of-pack nutrition labelling on their pre-packaged foods, helping consumers make informed and healthier choices about the food they buy. The UK-wide voluntary front-of-pack traffic light labelling scheme introduced in the summer of 2013 is proving successful, but he makes a good point. It is important to ensure that UK labelling remains effective for UK consumers. We will always be willing to consider a range of measures to build on the success of the current traffic light system to ensure that it keeps up to date and continues to be successful. It is right that people are informed when choosing what they eat and what they buy.
As the hon. Gentleman mentioned, we have seen great work by supermarkets in a range of areas. I will add a few to the list. I hasten to add that if I miss any out, it is not because of any conscious decision; I have merely picked a few examples to illustrate the work that supermarkets do. For example, Aldi and Lidl—a point he touched on—were the first retailers to introduce healthier checkouts in 2015 when they removed all confectionery and sweets from checkouts and replaced them with healthier options, including dried fruit, nuts and water. I have seen that in Waitrose and other supermarket checkouts. It goes to the point made by the hon. Member for Strangford (Jim Shannon) about the importance of what is in the physical environment as we queue up at the checkout and the influence that can have at the last minute, with young children saying, “Mummy, Daddy, can I have that?” It is therefore important that supermarkets do their bit at least to gently steer people in the direction of healthier options.
Sainsbury’s has removed all multi-buy promotions on food and replaced them with lower regular prices on everyday items. Tesco has reformulated its entire soft drinks portfolio—the first supermarket to do so—to be below the level for the soft drinks industry levy, and has given away 100 million pieces of fruit to children in their free fruit for kids campaign. All supermarkets and many larger retailers have restricted the sale of energy drinks to children. In January, Aldi and Lidl announced that they will remove familiar figures from their own-label cereal boxes. All of that is important and positive and should be welcomed. However, as the report acknowledges, there are areas where supermarkets can go further, including doing more to promote and market a healthier food and drink offer more broadly.
As the hon. Gentleman pointed out, promotional marketing by price and store location can impact on the food purchases that we all make. Some can increase the amount of food and drink that people buy by around 20%, which can lead to overconsumption of less healthy products and can cost consumers more money in the long run. Obviously, parents want a healthier balance of offers and deals, but they are not helped by the fact that most deals and offers are currently for unhealthier products.
I am conscious that none of us wants to be hectored and lectured about what to eat. I feel strongly that people should have the right to choose freely for themselves and their families as they know best, but they need to do that on the basis of making an informed decision. People need information to make the choices about their and their children’s lives. It is not fair when all the promotions in store are mostly for unhealthy food, so the balance of the promotions needs to shift towards healthier options to make it easier to make healthier choices when shopping.
To respond to the point made by the hon. Member for Strangford (Jim Shannon), we hear the frustration of parents about what could be called pester power, particularly when queuing at checkouts. It can be hard to say no, so it is important that supermarkets do what they can to help parents in that situation. Again, rebalancing promotions in prominent locations such as tills and shop entrances towards healthier options can help reduce excess calorie consumption and contribute to reductions in childhood obesity in the long term. Many supermarkets are doing so, and I commend them for that, but there is more to do. I encourage supermarkets to continue down that path.
All of that is why in the second chapter of our childhood obesity plan we committed to consult on our intention to restrict promotions on products high in fat, sugar or salt by location and price in businesses that sell food and drink. The consultation closed last year and we will set out our response as soon as we can. I know that both hon. Members who spoke in the debate and the APPG will want to study the response carefully. They may well revert with their reflections on the adequacy of the Government response and whether it goes as far as they would wish. Indeed, I encourage that; it is part of what the House and debate are for.
We want a fairer deal for everyone wherever they live or shop, and whatever their background or financial situation. We want the healthy option to be an easier option for everyone so that we can help all our children grow up healthier. Indeed, as we look towards the future and the demands on our NHS and social care, we are always conscious of what changing demographic demands might do in the future and what children and young people may be letting themselves in for by virtue of their diet or lack of exercise, which in future may require longer-term care and have an impact not only on them but on the NHS and social care’s ability to meet those needs. It is right that, as well as ensuring that the social care and health system can meet those needs, we do everything we can to prevent long-term conditions coming about in the first place.
Steve McCabe
I have no desire to bludgeon supermarkets, and I understand the Government’s desire to work with them but, given the Minister’s point about long-term health conditions, I was struck that Public Health England’s report showed how some supermarket’s own food products—I will not name the supermarkets—showed increases in sugar content. An increase was found over the period of the report in sweet confectionary, chocolate spreads and morning goods. While the Government are trying to persuade supermarkets, should they also consider fiscal measures as an incentive to meet sugar reductions?
Edward Argar
The hon. Gentleman gently tries to tempt me into an area that is perhaps more properly the remit of my right hon. Friend the Chancellor of the Exchequer. I do take the point behind what he says: we need to use multiple means to encourage supermarkets—perhaps that is the best way to phrase it. Again, I encourage him and the all-party parliamentary group to wait for the consultation response and beyond that to engage fully. I am sure that he will. We may well find ourselves here in a few months’ time—or when the report is published—for another debate in the light of the Government’s response.
I think the hon. Gentleman will agree that we will need supermarkets to continue their good work, alongside the out-of-home sector, health professionals, schools, local authorities, families and individuals, who all play an important role. We must also be willing to encourage supermarkets, building on their good work to date, to be ambitious and go that step further. We all have a role to play in what we eat, keeping ourselves healthy and doing the right thing by our long-term health. It is important that supermarkets play their role, and it is important that all of us do as well.
Question put and agreed to.
Greater Manchester Spatial Framework and the Green Belt
(4 years, 1 month ago)
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James Daly (Bury North) (Con)
I beg to move,
That this House has considered Greater Manchester spatial framework and the green belt.
I am here on behalf of all my constituents in Bury, Ramsbottom and Tottington who believe that we should do everything possible to protect the green belt. The Greater Manchester spatial framework is described as GM’s
“Plan for Homes, Jobs, and the Environment…to deliver the homes people need up until 2037.”
The Greater Manchester Combined Authority website comments:
“This plan is about providing the right homes, in the right places, for people across our city region. It’s about creating jobs and improving infrastructure to ensure the future prosperity of Greater Manchester.”
In my view, however, talking specifically about my home town of Bury, the GMSF does not deliver that. Instead, it is a charter to build unaffordable homes in the wrong place, without ensuring that the necessary infrastructure will be in place to support such large-scale construction. Furthermore, the plan ensures the destruction of large areas of green belt unnecessarily and the devastation of important wildlife habitats. It is also a guarantee of congestion on our roads, which will increase along with air pollution.
This debate presents an opportunity for Members, specifically from Greater Manchester, to tell the Mayor and the leaders of the 10 metropolitan authorities that the draft GMSF is unacceptable. More must be done to ensure that the green belt is protected within the framework of the plans recently announced by my right hon. Friend the Secretary of State for Housing, Communities and Local Government to bring Britain’s planning system into the 21st century.
Next month, the Government will launch a register of brownfield sites that will map out unused land, as part of plans to encourage councils to make the most of such land first, backed by £400 million to bring mostly unused land back into use. Developers will be able to demolish vacant commercial, industrial and residential buildings, and replace them with well-designed homes, without the delay of a lengthy planning process. Crucially, £12 billion of investment is to be ploughed into building more affordable homes.
Kate Green (Stretford and Urmston) (Lab)
I congratulate the hon. Gentleman on securing this debate, which is of great importance to all our constituents. I apologise; I will have to leave early for another meeting at 3.30 pm. His point about brownfield sites is vital at New Carrington in my constituency. It is a massively contaminated site, but one with great potential. We will need very substantial investment to undertake the necessary remediation.
Will the hon. Gentleman join me in urging the Government to ensure that all the funds we need to remediate those brownfield sites are made available to Greater Manchester? Otherwise, it will be difficult for us to build the houses we need in the places where they could be constructed.
James Daly
I am sure the Minister will comment on the hon. Lady’s intervention when rounding up.
Given the drive to regenerate our town centres—through building beautiful, affordable homes more densely, in part—it is clear that the green belt in towns such as Bury is being sacrificed unnecessarily. The local environment of the residents of Tottington and Walshaw, and in the vicinity of Elton reservoir, is being decimated because the local council is a signatory of a planning document that is not fit for purpose. It has no plan to take advantage of the funding opportunities provided by this Government to reclaim and build truly affordable houses on brownfield sites.
Chris Green (Bolton West) (Con)
I appreciate the support given by the Government for the development on brownfield sites, but does my hon. Friend share my concern that the plan, the GMSF mark 2, was only to be published for public consultation and public challenge after the local elections? People would not have been able to judge councillors, local authorities and the Mayor on what they are proposing. Even though we want local democracy, this is hardly a good example of it.
James Daly
My hon. Friend speaks powerfully, and I agree with every point he made.
One of the great faults of the GMSF is that it does not require local authorities to be proactive or innovative in their planning policy. Instead, it allows them to go for the easy option of allowing developers to build three, four and five-bedroom houses all over the green belt—houses that will be totally unaffordable to the vast majority of my constituents.
Chris Clarkson (Heywood and Middleton) (Con)
My hon. Friend makes an interesting point about the nature of the housing being built. My local authority in Rochdale has signalled its intention to build more houses than required, and they will be mostly unaffordable. Does he agree that the strategy should take account of housing need?
James Daly
I agree with every word of my hon. Friend’s powerful point, which I am sure the Minister will address.
The proposals to build on the green belt come despite the Government’s alterations to the national planning policy framework, which have strengthened green belt protections. Why are local authorities such as Bury Council determined to build on the green belt rather than work innovatively to regenerate brownfield sites and provide truly affordable homes, by which I mean houses and flats with a value of less than £100,000? I believe that they are simply taking the easy option.
The defence to that charge by those who support the GMSF is that the Government are forcing them to build a certain number of homes in line with national guidance, and that to do so they must encroach on the green belt in Bury and elsewhere. That question was put to the Minister in a Westminster Hall debate the week before last, and has been put to Housing Ministers before him. Will the Minister confirm that councils are not mandated to build definitively the number of homes required under 2014 population projection figures? Those figures should be the starting point. Local authorities should conduct their own assessment of the number of homes that need to be built over the length of a local plan, and those homes should be affordable and in the places that people need them.
Chris Green
There is concern that as GMSF mark 1 was torn up, GMSF mark 2 will also be rejected—the Mayor of Greater Manchester should do that—so we will be in limbo. Local authorities should be respected and valued, as should their determination of what their communities need. The planners and developers should follow what the local authority wants.
James Daly
My hon. Friend speaks very powerfully on this issue and I agree with every word that he said.
I also bring to the Minister’s attention the fact that 2016 Office for National Statistics population forecast figures revised down Bury’s population by 43%, and recently released 2018 provisional figures show a further fall of 13%. On the basis of recent population projections, no homes would have to be built on the green belt in my constituency. Will the Minister confirm whether the Government will review the use of projections published six years ago?
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
I congratulate the hon. Gentleman on securing the debate. The issue of “brownfield first” quite rightly comes up all the time and, as an Opposition MP, I point out that, in fairness, that is the Government’s policy. Certainly, in my constituency and in the Borough of Tameside, almost every bit of brownfield land has been found for use, even if its viability is borderline. Is the hon. Gentleman saying that the Government should find more money to make unviable sites viable, or is he saying that we should build fewer homes in Bury, Tameside, Greater Manchester and so on? Those are two different ways to solve the problem, and I want to understand his approach.
James Daly
There are three questions in the hon. Gentleman’s intervention. I have already commented on the funding that the Government are making available to assist local authorities in remediating brownfield sites—that will be very important. The question comes down to housing need. It is the easiest thing in the world simply to say, “We need to build more houses,” but we need a robust formula that allows each local authority to build the number of houses that they need and where they need them over the course of a local plan. I am making the point that using the most up-to-date population projections reduces the need to build on the green belt, and in my borough—I am sorry, I cannot comment in respect of the borough of the hon. Member for Stalybridge and Hyde (Jonathan Reynolds)—that would allow properties to be built on brownfield sites.
The question, though, is the “brownfield first” policy. “Brownfield first”, again, is a statement, but there is nothing within the GMSF to force councils to build on the brownfield first. If the GMSF was in place, the green belt would undoubtedly be concreted over and no developer would be interested in building truly affordable homes on brownfield sites.
Coming back to the point, we have to build homes for people who need them, at a price that is affordable, in the right place. In the GMSF in respect of Bury, there was virtually no comment regarding building affordable flats in the town centres within my borough. That is one of many reasons why I believe the document is not fit for purpose.
Kate Green
Will the hon. Gentleman join me in asking the Minister—this is slightly tangential to the GMSF, but none the less pertinent—to look again at permission in principle? That is also being used in my constituency by developers as a means to try to build on green belt where the planning and obligations that the developers are required to meet are much less rigorous, and both the public and the planning committee have really no say in stopping such applications. Will he join me in asking the Minister to look again at that particular regime and what it might mean for building on the green belt?
James Daly
Again, I thank the hon. Lady; that it is a very strong point, and I am sure the Minister will address it in his closing remarks.
As you can probably tell, Ms Noakes, I could talk on this subject at great length, but a number of other hon. Members wish to speak. I have been contacted by numerous constituents, so in bringing my contribution to an end I ask the Minister to comment on the following points, which they raised.
First, does the Minister agree that housing occupancy rates should be used to calculate how many houses we require in Bury and elsewhere? The average occupancy rate, I believe, is 2.35 persons per home in Bury, against the national average of 2.4. For example, that would mean 5,733 new homes needed within the metropolitan borough of Bury, rather than the 9,500 currently indicated in the GMSF. That is taking into account the 2,000 current offset, and it would be the case even using 2014 figures.
Secondly, returning to a point that has already been raised, will the “brownfield first” policy be made a legal requirement, which it has to be if it is to have any teeth? How can local authorities access national funding to assist in clearing toxic sites and making them financially viable for development, which they have to be? Those sites are the ones where we can develop truly affordable homes. We must be aiming to build homes that are innovative and green, but that are truly affordable for £40,000, £50,000 or £60,000. We must have a real vision for ensuring that we have the houses our populations need.
Thirdly, what measures are the Government taking to ensure that developers contribute to local public transport and infrastructure requirements? Fourthly, what measures are the Government taking to ensure that there are no further impacts from flooding as a direct consequence of the construction of roads and housing? In my seat, it is proposed to build on fields within Walshaw. Those are areas that flood, and have flooded in recent times. If we build there, that is only going to get worse.
Finally, the Government are committed to protecting, restoring and expanding natural habitats. How can sites in GM gain access to the Nature4Climate fund to ensure the preservation of local mosslands and woodlands?
The one thing that all our areas have is vociferous, committed and passionate community groups, who have been at the forefront of the fight to protect the green belt. I finish off by paying tribute to the Bury folk, numbering in the thousands, who are passionate and determined to protect their environment, to protect their community and to do what they feel is best to ensure that we all have a positive future.
Barbara Keeley (Worsley and Eccles South) (Lab)
It is a pleasure to serve under your chairmanship, Ms Nokes. I congratulate the hon. Member for Bury North (James Daly) on securing this important and timely debate.
According to the 2019 draft of the Greater Manchester spatial framework—GMSF—Salford is to accommodate 16% of the overall housing requirement for the region. This allocation has risen compared with the 2016 draft, and Salford’s overall housing requirement is now second only to Manchester’s. The adoption of the GMSF in its current form would result in four sites being removed from the green belt in Salford—GM allocations 30, 31, 32 and 33—in order to deliver 2,350 homes and commercial space at Port Salford. All four green-belt sites allocated for development in Salford lie within my constituency, and my constituents have expressed a great deal of anger over plans in the GMSF to develop that green-belt land. I share their concerns and strongly oppose any loss of green-belt land in my constituency. I will briefly lay out why.
In July 2019, I presented a petition to the House signed by more than 1,000 local people objecting to GM allocation 31 in Boothstown. Green-belt land is precious in Salford, as it provides the green lungs for an urban city. It is vital that these green spaces are preserved in a city that has high levels of air pollution, low levels of physical activity and poorer health outcomes. I have objected to the two previous drafts of the GMSF because Salford has enough brownfield sites to satisfy the housing need outlined in the revised GMSF without the development of green-belt land, but today I will talk particularly about GM allocation 32—a proposal to build 1,600 homes on green-belt land north of Irlam station, in an area known locally as Chat Moss.
The 2016 draft of the GMSF recognised that
“the site has significant depths of peat…it still performs an important carbon storage function, and should be retained wherever possible.”
However, the 2019 draft of the GMSF removed that observation. I believe strongly that our mosslands should be managed and restored, to ensure that their carbon sequestration potential is realised. We should not allow pockets of this land to be lost for development.
Sir Graham Brady (Altrincham and Sale West) (Con)
Given the large sum of money that the Government allocated in the Budget just last week for the protection and restoration of peat mosses, it is surely absurd that we are still looking at building on peat mosses that are still in good condition when money is being allocated to restore ones that need to be improved.
Barbara Keeley
I absolutely agree. That is particularly relevant for Chat Moss because, for those who do not know it, large parts of the moss were destroyed, or nearly destroyed, by peat extraction. I fought that peat extraction and we won on that issue, so we should not be talking about losing any more peat. Some wonderful projects are restoring those lands affected by peat extraction, but let us not go back and do that again.
The land at Chat Moss is peatland, and its designation for development, interestingly, runs counter to certain policies. GM-S 2, on carbon and energy, encourages
“Increasing carbon sequestration through the restoration of peat-based habitats, woodland management and tree planting”.
GM-G 2, on developing a green infrastructure network, says we should
“Reduce carbon emissions, by sequestering and storing carbon, particularly in peat and trees”.
GM-G 10, on seeking a net enhancement of biodiversity and geodiversity, states that we should be
“Safeguarding, restoring and sustainably managing Greater Manchester’s most valuable soil resources, tackling soil degradation/erosion and recovering soil fertility, particularly to ensure protection of peat-based soils and safeguard ‘best and most versatile’ agricultural land.”
That last point is key, beyond the fact of the peatlands.
I have stated repeatedly that this land should be used in a sustainable way, but given the need for locally sourced food and fuel, which I think we will see much more of in the coming months, it would be much more productive and efficient to use the land for agriculture. The land has been recognised as grade 1 agricultural land—“best and most versatile”, flexible, productive and efficient, which can deliver food and non-food crops for future generations. That means that it is excellent-quality land with either no, or very minor, limitations for agricultural use. A range of agricultural and horticultural crops can be grown on this land, and yields are very high and less variable than from land of lower quality.
The mossland is also a tract of countryside of great value to those living in surrounding urban communities. In addition to its agricultural importance, it has great potential for informal recreation for those living in Salford, and it is important for nature conservation, particularly for bird life. For Members seeking to walk and maintain social distancing, it is possible to really get away from people when you are walking on Chat Moss. The loss of this land would set a worrying precedent. The framework states that remaining areas of moss land would be protected and preserved, but local people are sceptical of that claim.
The destruction of green-belt land is not the only thing drawing objections to the GM Allocation 32. Irlam is a town with one main access road, the A57, which connects Irlam to Eccles and the M60 in one direction, and Cadishead and the M6 in the other direction. It may no longer be true since I wrote this speech, but traffic is at a standstill on many days—more so when there is an event at the AJ Bell stadium; there may not be one of those for some time to come. If the development goes ahead, there are real fears that it could add at least 2,400 cars to what has been a gridlock in this area for years. Although we encourage people to leave their cars at home and use public transport, the Metrolink network does not get close to Irlam. Constituents describe local train services as appalling and a daily nightmare, and bus services have been severely cut.
It is important to view this alongside GM Allocation 33, the Port Salford extension. That is one mile away on the same A57 road leading in and out of Irlam, and that will in itself add hundreds of HGVs and transit vehicles to the local road network. In addition to the potential 2,400 extra cars each day, I cannot see how all of this works together to create a sustainable and greener environment for those living in Irlam and the neighbouring town of Cadishead. I have objected strongly and repeatedly to these aspects of the Greater Manchester spatial framework, because I have real concerns about these proposals for Salford. The framework earmarks substantial areas of green-belt land for large development and commercial space.
It is also essential that we have clarity from the Government on the basic housing figures that Greater Manchester should be using to calculate the housing need. Currently, there is no clear guidance on whether targets should be based on forecasts made by the Office for National Statistics, or on Government forecasts. Once that has been clarified, there needs to be an explanation on whether local housing need target is a minimum number, a target that the city region must hit, or if that is a buffer within which we can fall. These two issues are vital to my constituents, who face losing four precious areas of green belt.
Like the hon. Member for Bury North (James Daly), I pay tribute to local campaigners and people who persistently describe and value this wonderful piece of land. The impact of extra traffic and air pollution, which I hope I have outlined, together with the loss of recreation space brought about by any new development will be damaging to the people of Salford. This green-belt land is cherished by our local communities. There would be grave consequences if these four green-belt sites on my constituency were released for development.
James Grundy (Leigh) (Con)
I have grave concerns about how my own local authority, Wigan Council, has conducted itself during the Greater Manchester spatial framework process. When the plan’s first draft was announced, many local farmers and landowners were surprised to find that their land was earmarked for development. They had not put forward their land during the “call for sites” process. They had not even been consulted on whether their land should have been included in these plans.
When the landowners attended a public information event to protest the lack of consultation, they were told initially that, should they refuse to sell, the council would rely on the use of compulsory purchase powers to obtain the land. Following a public backlash against this approach, both the leader of Wigan Council and Andy Burnham, the Mayor of Greater Manchester, stated that they would not using compulsory purchase powers after all.
The council has still not removed all these sites from the plans, however, which raises two issues: first, the deliverability of these sites and secondly, housing supply if these sites are allocated but not deliverable. Wigan Council’s approach towards the GMSF has generated an unworkable plan because of the lack of due diligence in ensuring site availability, a lack of consultation with the affected landowners, and an unwillingness to compromise when this was highlighted. I hope that measures can be put in place to ensure that this situation does not arise again.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
I had not intended to make a speech—but if there is an opportunity, why pass it up? It is good to have this debate with new colleagues who have come in as a result of the election; obviously, that change of composition is not entirely favourable to the Opposition side of the Chamber, but it is good to be having this discussion again.
It makes sense to do this housing plan together. Between the two speeches we have just heard, I could not help but notice that one of the attractions of a GMSF-style plan for boroughs such as Tameside, Oldham, Bolton and Stockport is that it transfers that housing allocation into, in the main, Manchester and Salford. If we are not to have the plan for Bury and we are not to have the plan for Salford, that presumably means fewer houses for Salford, but more for Bury. That has to be acknowledged and admitted.
Mary Robinson (Cheadle) (Con)
Of course, we are discussing the Greater Manchester spatial framework in the round, which encompasses the 10 local authorities that would be working with the Mayor of Greater Manchester to put this in place. One problem has been that where there are some pluses—for instance around common ground, which would allow movements between the various areas—that is very much top-down driven, so we are waiting for the Labour Mayor of Greater Manchester to tell us what we should have. I have been working with local residents, my constituents and neighbourhood groups, including Woodford Neighbourhood Forum and Save Heald Green Green Belt, and they want to know what is going to be right for their area. That depends on having the right figures, so we really do need guidance on those figures, and to bear in mind that we want a spatial framework or local plans that fit the needs of our local populations.
Jonathan Reynolds
I am grateful for the hon. Lady’s statement, and I agree with her. There have been huge problems with process, and I cannot easily see how we correct those, because the honest truth about the way we do housing allocation in this country is that we start with a piece of agricultural land. The minute we make that a piece of housing land, we increase its value tenfold, and that value does not stay in the public sector: it goes to the private sector, despite the fact that there has been no productive capacity increase. It is simply an administrative change that makes people very wealthy, so how and when we release that information to prevent land speculation is clearly a massive issue.
The hon. Lady asked about the figures, which are really what the debate has been about for the past few years. To be honest, sometimes we have had clarification from Ministers, but when the written version has come through, it has been something completely different from what Conservative Back Benchers were told at the time. However, my understanding is this: the Government set a housing target figure for each borough. The hon. Member for Bolton West (Chris Green) said that local areas should do that, which would be a revolutionary change in how the Government approach housing allocation. I am not sure that is where this Government are going, for the simple reason that if that system were to exist, I cannot imagine that the Government’s housing targets would get anywhere near fulfilled. Many parts of the country, particularly in the south-east, would just refuse to build any houses at all, so I cannot imagine a situation in which there is not national Government guidance. If that is going to happen, we would like to know that, because it would be revelatory.
Once that housing target figure is assessed, it is possible to do something like what we are trying to do together in Greater Manchester: work out a different figure for each borough, based on re-organising and re-allocating some of that housing need around Greater Manchester. Once there is a figure for a borough, as we have for Tameside, we look at the housing land supply and try to get everything we can into that, so as to avoid touching the green belt. That is the Government’s policy: we cannot touch the green belt until we have as much of the brownfield land supply in as possible.
There are sites in my constituency that, to be honest, would require tens of millions of pounds to remediate, but we got them in there because building on them is the right thing to do. We presume that central Government will come to help remediate those sites and make them viable, but I am not sure that commitment will be infinite. I know the phrase “whatever it takes” is in vogue right now, but there are surely limits to what the Ministry of Housing, Communities and Local Government will give Greater Manchester to remediate all those sites. That is the point at which we get to the green belt.
Mary Robinson
The hon. Gentleman is being very generous in giving way. One of our issues in Greater Manchester is that these areas have been allocated. I have allocations of green-belt housing of over 2,000 houses, so this is having a huge impact on my area, and people are fearful that the green belt is going to be built on. I have been pushing for “brownfield sites first”, and for a register in Stockport that should be entirely about building on those brownfield sites, but unfortunately, while those allocations are still in the Mayor’s plan, people feel we are going to have this housing there.
Jonathan Reynolds
I completely agree, but it goes back to the difficulties of the process. There are green-belt sites marked for allocation in my constituency that I oppose; Apethorn Lane, effectively, is the land between Stockport and Tameside. I have nothing against people from Stockport, but I want to maintain that green-belt barrier between us. We are close enough as it is.
Robert Largan (High Peak) (Con)
I am grateful to my constituency neighbour for giving way. Members might look a little surprised, given that I do not represent a Greater Manchester constituency. However, my constituency is right on the border and homes built in places such as Tameside or Stockport have a big impact on commuters in my seat, particularly on the A6 or through Mottram to try to get on the M67.
A big complaint has always been that we put in houses without the infrastructure to cope with them. To praise the GMSF—slightly unusually—one good thing is the proposal for a Gamesley railway station that is included in it. Will my constituency neighbour have words with his colleague, Andy Burnham, to see whether he can throw his full support behind that station, and will the Minister have words with the rail Minister about getting a train station built in Gamesley?
Jonathan Reynolds
It is great to see the hon. Member for High Peak (Robert Largan) here. To be frank, in Tameside we might say it is houses built in Derbyshire that have put infrastructure burdens on to us, but the fact that it is relevant to his constituency and his towns shows why this debate is so important.
We all agree on the crucial point about infrastructure and about how housing, if it is not organised through a plan like the GMSF, will be developer-led and of a size and scale that we would not necessarily want to see in our constituencies. I often tease Conservative friends about how they believe the market should determine lots of things, but apparently not, in this case, housing allocation.
Development is a huge problem. The speculative aspect—often seen as something that does not meet local needs and is not connected to local transport—is the biggest problem. I could see it coming from the minute I was first elected to Tameside Council. I was a Longdendale councillor on the border with High Peak. When I looked at housing policy, it was clear that we were running out of brownfield land sites. In Hyde we had built on all kinds of former employment sites, which, again, was the right thing to do, but that cannot go on for ever.
When we looked at what would inevitably happen in Tameside, we got to thinking about a garden village, where we would insist that, if were to allow housing to be built, it would come with infrastructure investment up front in schools and in transport—all the things that reflect the only time this country has ever done housing policy well, which is when the new towns were built after the war and then a few decades later. They were built in exchange for the establishment of the green belt. That was the deal. We built houses where the state and society wanted them to be. We demanded the infrastructure that goes with them and we would protect the rest from speculative development, particularly in an age when councils were incentivised to build houses because they got rates comparatively greater than they do now for the more houses that they allowed to be built.
Control is the key issue. I cannot fathom rejecting the GMSF altogether because it would mean more houses being built in places such as Bury. It would mean less control and our not working together. I cannot see the logic in that. Whether houses are built in High Peak or Stockport or anywhere else in Greater Manchester, they will have an impact on my constituency, so we have to start by saying, “Let us have a plan and work on it together. If it is not acceptable in terms of infrastructure or sites, we will work on it.”
If we do nothing, certainly in Tameside, we cannot guarantee the five-year land supply, which, again, goes back to the national planning policy framework that determines much of how planning is developed. If we do not do that, developers will pick the sites and build the things that we do not want. We will get no infrastructure and no contribution to any of the things that we all want to see. If we go forward with this, I can understand why there has to be the permission and consent of every part of Greater Manchester, but the way it is sometimes talked about does not reflect the reality that there are decisions to be made about housing.
If we want to do all the things that all of us say we want to, it comes down to working on a plan together. Even if the Government radically changed their policy on the numbers, I think they would still want the kind of approach that we are all talking about. I understand why this has been such a powerful electoral issue for everyone, but we have to reflect the reality and not promise our constituents things that we cannot deliver. We will need new houses, we will need to work together, and we will need infrastructure. That should be the basis for going forward.
Jim McMahon (Oldham West and Royton) (Lab/Co-op)
It is a pleasure to serve under your chairmanship, Ms Nokes. I congratulate the hon. Member for Bury North (James Daly) on securing the debate. It might seem like a very localised matter, but it will affect 2.5 million people in Greater Manchester, and it is a huge issue for the Members of Parliament who represent them. It has been all-consuming for a few years now. I should probably declare my constituency position on this, which is that I do not support the spatial framework in its current form. The weight of responsibility for housing development is not evenly spread, either across Greater Manchester or within boroughs, and the process has led to mistrust. When I say that, I am just being honest about the weight of feedback that I get from local people.
The principle of a spatial framework is critical, and it was hard-wired into the Greater Manchester devolution deal: it was about Greater Manchester deciding for itself how it wanted to see its future. As to the idea that after being given that responsibility and power Greater Manchester should suddenly say to Government, “Actually, we don’t want to play anymore on this, because it is just too difficult,” I am afraid that that is not a mature way to do politics. We have to take responsibility for finding a way through. Ultimately, when housing development need is identified, it will affect our constituents, and we have a responsibility to ensure that the next generation will be provided for. We need to provide for the right type of housing in the right place in the future. There are no easy answers in this situation, but I think there may be an easier way to get where we want to go than the journey we have taken so far.
I have heard the politicisation of the issue, in terms of Greater Manchester having a Labour Mayor, among other things, but it does not matter what party the Mayor represents. There is a legal responsibility, passed down by central Government, to produce a spatial framework covering the whole of Greater Manchester —and, by the way, without a spatial framework the responsibility would fall on each of the 10 local authorities individually to create a new local plan, which would have a worse impact on most places, in terms of the distribution of development, and probably run a greater risk of a developers’ free-for-all if the plan was not in place at the right time. It is in our collective interest to try to find a way through.
My boss, my hon. Friend the Member for Denton and Reddish (Andrew Gwynne), should have been here today, but he is self-isolating. He has been clear from the outset about the balance between making the mature response and planning ahead, because that is the right thing to do, and giving voice to constituents. There are proposals to extend the Bredbury Park industrial estate into the Tame valley but he and local people have worked out that that could be accommodated at Ashton Moss. We have to find a different way of engaging the public, so that together we co-produce the future of Greater Manchester. We cannot have people believing that the future is being done to them or that the future of the places and communities where they live and grew up, and in which they have a stake, is being decided without them.
My first submission went to 70 pages. I have a quite geeky interest in some of the issues—and they are important. It was a call for the development of more neighbourhood plans. I would love people in my constituency to come together to co-produce the development of their area. The evidence from across the country is that when local people have the task of developing neighbourhood plans they come up with greater housing numbers than were originally proposed, because they know the infill sites that could be developed, and they know the community better. However, of course, for a geographical area as large as the one that the spatial framework covers, it is not possible to do those things within the timescale that has been announced.
I remember asking a previous notMinister in this Chamber whether the Government would give way and allow us to develop a new population evidence base. If we are not allowed to use the most up-to-date, bespoke evidence base for our population estimate, we will always provide more, because we will not believe the estimates are correct. I do not think that there is a single MP in the Chamber who believes that the current population estimates proposed by the Government are anywhere near the reality on the ground. They do not even take into account the impact of Brexit and the new immigration system, let alone other issues. There is also a general belief that even the employment land evidence base is not robust enough—and that is before getting on to the type of employment and the nature of the employment structure that we want in Greater Manchester. Time was, for a town such as Oldham, which was built on the mills, that tens of thousands of people came to work in the palaces of industry—to take a rose-tinted view of them. Now, square footage does not equal jobs. The rise of automation means that the huge factories and distribution centres that have been developed do not mean thousands of jobs. For a town such as Oldham, we want to be ambitious—realistic, yes—about the type of employment that we will get.
On infrastructure, as much as we talk about the need for schools, GP practices, hospitals, transport and all the rest, we should also talk about broadband and how the future world of work will be. What type of connectivity will people need? That is where Greater Manchester deserves great credit, because it is trying to connect the 2040 transport plan to ensure that we bring together how our conurbation will develop, in terms of planning, employment and physical development, and how people will get to work and share the area. There is no doubt that Greater Manchester cannot do that by itself.
Every Member of Parliament, regardless of which party we stand for—although I am afraid the weight falls on the Government—has to accept that if our shared belief is that “brownfield first” is a policy that we should pursue, we have to accept that a cost comes with that. It cannot be done on the cheap. It is not just about the cost of remediating a site that might be polluted; there is an issue in towns such as mine, where the end values are so low that the gap is even tighter. We need far more effort on that.
We also need a more radical plan to address the current housing stock, not just one that talks about building new stuff but ignores the substandard housing conditions that many people in Greater Manchester live in. The housing market renewal programme that was cancelled in 2010 intended to remove a lot of substandard accommodation—terraced streets in Oldham that were not fit for purpose—and replace them with decent quality family homes. When that money was taken away, nothing followed it. We have to address the poor quality that exists today and improve the standard across the board. Of course, we have to plan for the future, but that has to be done in partnership.
I genuinely hope that we will work together, not to pass the buck between Westminster and Greater Manchester, or between Conservative and Labour. The community expects us to be mature, to grow up and to work in partnership to find a solution. We need bespoke population data for Greater Manchester, in partnership with the Government and Greater Manchester, a more ambitious fund for brownfield sites in Greater Manchester, so the sites that we identify can be brought to market and developed in a reasonable timeframe, and far more ambition on the infrastructure investment that we need. I genuinely believe that if we work together, we can bring local people with us. But if local people continue to see debates such as this, where we pass the buck between different parties and from central Government to local government, I am afraid that will reflect badly on us all. Let today mark the change that our communities want, and let us begin to work together on it.
The Minister for Housing (Christopher Pincher)
I am pleased to serve under your chairmanship for the first time, Mrs Nokes. I should say Ms Nokes—I will get my coat. I congratulate my hon. Friend the Member for Bury North (James Daly) on securing this important and topical debate, and all colleagues across the Chamber on their contributions. I was particularly struck by the doughty defence that my hon. Friend made of his constituents and their concerns. I was also struck, as were all hon. Members, by the, as ever, thoughtful speech from the hon. Member for Stalybridge and Hyde (Jonathan Reynolds).
The debate may not be as full as it could have been for a matter of this importance, but I think we all understand why. We may lack in quantity, but we do not lack in quality. As I said, powerful contributions have been made. I look forward to visiting Greater Manchester; my hon. Friend the Member for Bury, North put in an early bid for a visit, which I will make as soon as circumstances allow.
I am sure that all colleagues will understand that I cannot make any comment on the contents or the merits of the draft Greater Manchester spatial framework, as that could be seen to prejudice the Secretary of State’s position at a later point in the planning process.
Sir Graham Brady
While the Minister cannot comment on the merits of the GMSF, does he accept that it is self-evident that it would be better for it to be based on up-to-date household projections, rather than ones that are six years out of date? Very soon, some projections for 2018 will be produced; can we assume that they will be the projections on which the future draft will be based?
Christopher Pincher
I congratulate my hon. Friend on getting in so early with that question. A number of hon. Members across the Chamber have raised the question of housing projections. I can understand the reasons why, but we believe that the standard method remains consistent with delivering the homes our communities need, and that means basing our guidance on the 2014 household projections.
However, I would say two further things. The Secretary of State confirmed last week that he will look at reviewing the formula for calculating the local housing need, so that we encourage greater building in or near urban areas, and so that we can meet our target of 300,000 homes built each year.
It is worth noting that the standard method is not mandatory; in exceptional circumstances, an alternative approach can be used, provided that that reflects the current and future demographic trends and market signals. If my hon. Friend the Member for Altrincham and Sale West cares to check paragraph 60 of the NPPF, he will find reassurance in that paragraph.
Robert Largan
My hon. Friend the Member for Altrincham and Sale West (Sir Graham Brady) makes an important point about housing projections, but it is also a county lines issue. Does the Minister agree that it is important not only that the GMSF has accurate population figures, but that it factors in houses being built just outside Greater Manchester when doing the figures? A large number of houses are being built in places such as Chapel Buxton, which puts a lot of pressure on the A6. I have talked an awful lot to my next-door neighbour, my hon. Friend the Member for Hazel Grove (Mr Wragg), who I am certain would be here today if he was not self-isolating right now, and those numbers also need to be taken into account by the GMSF. We need a lot more joined-up thinking when it comes to county lines.
Christopher Pincher
I certainly agree that local authorities should work together and should work collaboratively. Of course, they have a duty to co-operate, so I encourage local authorities in and around Greater Manchester to work collaboratively together.
Jim McMahon
On a point of clarification, it is not the case that the Government believe that 2014 is the most appropriate evidence base; it is just that they did not have faith in the more recent population data, because of some anomalies that came out of it. For instance, Cambridge showed an under-supply of housing as a result of the more recent population data. It is not the case that 2014 was the point to which we should go because it was more accurate in that sense. It was a mistrust of the more recent data. It makes complete sense to suggest that we now go to the 2018 population data, and that, for me, would seem to be the most appropriate route. The idea that we use data that is now six years old does not make sense.
Christopher Pincher
As I said, we believe it to be the better method. The hon. Gentleman has already pointed out that the more recent analysis has thrown up some anomalies, so we believe the 2014 figure to be the better one, but the Secretary of State has said that he will review the NPPF, so I hope that the hon. Gentleman will watch this space.
I would also like to highlight a number of Government priorities, which are reflected in our national policy, such as our protections of the green belt.
Jonathan Reynolds
Before the Minister moves on to Government policy and while he is still talking about the household projections, much of the argument in Greater Manchester has been based around what set of figures give us what set of outcomes. The ONS website clearly states that its household projections should not be the basis for allocating housing numbers; they are an analysis tool and, for example, do not take into account any policy objectives such as more affordable housing or higher levels of economic growth. Will he confirm that point, from a ministerial point of view? If we get to the position where we in Greater Manchester do not want a more prosperous Greater Manchester—more affordable housing—if we have a set of figures that gives us no room to improve things for our constituents, that is not satisfactory either. We have to get a clear view of that from the Minister.
Christopher Pincher
We want to ensure that we build more appropriate homes. We know that we need those houses and the right sort of houses, with the right quality. Local need needs to be determined locally. The starting point is the minimum, not the maximum figure. The Secretary of State will talk about potential changes to the NPPF in due course, so I encourage the hon. Gentleman to make his further points in his own unique and eloquent way when the time comes.
In a moment, I will speak about our priorities on the green belt—support for prioritising brownfield development and our desire to see plans in place—but my hon. Friend the Member for Bury North also mentioned flooding as an issue of concern. As he knows, in the Budget speech last week, the Chancellor announced £5.2 billion of investment in additional flood defences. That will seek to ensure that communities around the country know that future development will be safe from floods. We will assess whether existing protections in the NPPF are enough, and we will consider options for further reform in our wider ambitions for the planning system. I hope that gives my hon. Friend and other colleagues some reassurance.
My hon. Friend also mentioned housing type as an issue, with large numbers of four or five-bedroomed homes. I draw his attention and that of the Mayor and the local authorities in Greater Manchester to the NPPF, which is very clear that local authorities need to identify homes of the right size, type and tenure, as necessary for local people. That needs to be reflected in their planning priorities, which I am sure is a point that my hon. Friend the Member for Bury North will make to the Mayor and his local authority.
Jim McMahon
Will the Minister ensure that, when we talk about flooding, we do not jump automatically to the issue of sites that historically were flood plains or have the potential to be at risk of flooding in future? We must also consider the wider infrastructure. Much of our existing sewerage infrastructure is Victorian, and was not built to take on the type of capacity that it is now expected to with the developments that keep getting added on to it.
Christopher Pincher
The hon. Gentleman is right that infrastructure needs to be fit and proper for the purposes to which it is put. We recognised that in the housing infrastructure fund made available to local authorities around the country, and will do so in the HIF successor, the SHIF, the single housing infrastructure fund.
A number of colleagues mentioned brownfield sites in their contributions. In last year’s debate on the GMSF, brownfield cropped up again and again. Last week’s “Planning for the future” statement by my right hon. Friend the Secretary of State made it clear that we will invest £400 million to use brownfield land more productively. We want to work with ambitious Mayors—I suspect that Andy Burnham categorises himself as such—and with local authorities to regenerate local brownfield land and to deliver the homes that their communities need on land that is already developed. That built on our previous work with mayoral areas, such as the £300 million housing investment fund agreed with the devolution deal in 2014. That is entirely devolved to the combined authority, and can be put to good use.
We will also provide local authorities with greater funding for infrastructure, ensuring that those who strive to build enough homes for their local communities and make the most of brownfield land in urban areas are able to access sufficient resources. In Greater Manchester specifically and most recently, we announced £51.6 million of forward funding to unlock more than 5,000 homes and funding for 10 marginal viability schemes worth £62.5 million, unlocking some 6,000 homes.
The Government have a number of other funds that can unlock tricky brownfield sites. They can support small builders and provide necessary infrastructure for development. They include the small sites fund, land assembly fund, land release fund, home building fund and public sector land funding. I hope that addresses some of the points that the hon. Member for Stretford and Urmston made about her constituents in Carrington. I encourage colleagues of all political stripes and persuasions to encourage the Mayor and their borough leaders to ensure every opportunity is taken to get the funding for the communities that they want and need.
The Government have placed their faith in the people of Greater Manchester and their elected representatives to shape their own future. We have backed that up through the devolution of wide-ranging powers under the leadership of the elected Mayor, who in this case is our former colleague, Andy Burnham. It is his role to work collaboratively across Greater Manchester and the political divide to provide leadership and a coherent vision of what is required. I am sure that colleagues across the Chamber will want to play an important role in nudging the Mayor in what they believe is the right direction for the GMSF.
Sir Graham Brady
The Minister is being generous in giving way. The Government do have some overarching policy objectives, with one of them being, as I alluded to earlier, the preservation and restoration of peat mosses, and £640 million was announced at the Budget for that purpose. Does my right hon. Friend accept that it would be foolhardy to allocate huge sums of public money for the restoration of some peat mosses while allowing development at peat mosses in Carrington or Chat Moss?
Christopher Pincher
I do not want to comment on specific sites in the GMSF simply because that might prejudice my right hon. Friend the Secretary of State’s position later, but certainly local authorities need to give very careful regard to the areas in which they build. They should look at brownfield sites first, and there are very careful controls, which I shall come on to, about building on the green belt. I hope that gives my hon. Friend the Member for Altrincham and Sale West (Sir Graham Brady) some more general reassurance, if not on the specifics that he raised.
My right hon. Friend the Secretary of State announced that we will publish an ambitious planning White Paper in the spring, and we will take a fresh and sensible look at planning rules to support local areas—especially those that have urban areas where housing is most needed—to plan. Our starting position is that we trust local planning authorities—Greater Manchester, in this case—in many parts of the country. We respect them, and the groups of authorities that are working together to produce plans reflect the spirit of co-operation and joint working that we want to see and to which the hon. Member for Stalybridge and Hyde referred.
On the green belt, which I know concerns a number of colleagues, plans are subject to a rigorous examination by the independent inspectors appointed by the Planning Inspectorate. The examination includes testing their consistency with national protections for the green belt. Planning inspectors will assess plans and their soundness against the national planning policy framework and against any other material planning considerations before coming to their conclusions. That includes assessing the plan for its consistency with our policies, which maintain strong protections for the green belt.
The national planning policy framework, which was revised last year, sets a high bar for alterations to green-belt boundaries. A local authority—or a collection of local authorities in the case of the GMSF—can use the plan to secure necessary alterations to its green belt, but only in exceptional circumstances. The planning inspector will check at examination that any changes to green-belt boundaries are fully justified. As a matter of law, plans are subject to a range of engagement and consultation activities with communities and many other organisations. The Government believe that such consultation is a vital element of the plan-making process.
I am aware from the comments made by colleagues that Greater Manchester published feedback from last year’s draft spatial framework public consultation in October. The Mayor is proposing a further consultation this summer, before the plan is submitted for examination by a planning inspector. Although we all accept that the Mayor, local authorities and Members of Parliament have significant and serious distractions now and for some time to come, I trust that the Mayor will move as fast as he can and I hope that he will ensure that consultation is meaningful and delivers a plan that all Greater Manchester can support. I know that my hon. Friend the Member for Bury North and other colleagues will work tirelessly in the interests of their constituents to ensure that the Mayor comes up with the best possible plan.
A benefit of strategic planning is that, by looking at housing need across a wider area, it can be met in areas with greater brownfield capacity rather than in those with more green-belt land. That involves the sort of co-operation and collaboration that colleagues have mentioned. I hope the Mayor seeks to minimise green-belt development while meeting housing needs in line with national policy.
The Government fully recognise the need to plan for and build more homes. A crucial first step is ensuring that local authorities plan for the right number of homes. I appreciate that sometimes that means that communities have to make difficult choices about where homes should go. I believe that those decisions are for local communities to make through the plan-making process, so I encourage the Mayor to bring his amended plan forward so that the people of Greater Manchester can respond accordingly. I hope that, in doing so, he pays due regard to the NPPF, the national design guide and the forthcoming national model design code, and that he ensures that excellent quality homes are built, and are appropriate to their surroundings and as beautiful as possible—that should be baked in.
Before I conclude, I congratulate my hon. Friend the Member for High Peak (Robert Largan)—the interloper in this Greater Manchester debate—on his ingenuity in shoehorning a transport request into his intervention. If he cares to write to me, I will forward his letter to the Secretary of State for Transport, with what I hope will be a suitably helpful covering letter.
In conclusion, I appreciate that there are likely to be a range of views about the GMSF. We have heard some of them in the Chamber today. That is to be expected and it shows that people care passionately about what happens in their communities, which is a good thing. The current draft of the GMSF received an unprecedented number of consultation responses. So I say again, as I am sure he is watching this debate from his office, I hope that the Mayor has listened to the feedback he has received in the consultation and the words that have been uttered in this Chamber, and that when he puts forward an amended plan for consultation later this year, it reflects the feedback he has received.
There is still a chance to further refine the spatial framework, its policies and proposals, over the coming months. As part of that, we may see some of the important issues highlighted today by colleagues, including my hon. Friend the Member for Bury North, considered. I hope the Mayor will not delay before he takes his next steps, because, as a number of colleagues said, the people of Manchester have been left in stasis for several years. It is time they had a plan that worked. I hope the Mayor demonstrates real leadership in the months ahead, as he did when he was a Cabinet member in Government. I know that, based on the contributions that have been made today, many hon. Members will help him along the way.
James Daly
I thank all colleagues for their contributions and the Minister for commenting on the points that have been raised. This is not a party political issue. I agree with most, if not all, of what Labour Members said. The recent announcement by the Secretary of State that he will review NPPF guidelines is good. We can all play into that, and a number of us in this Chamber will urge him to consider using the most recent population projections from 2018 as a basis for local plans for housing need.
My final comment is that this is not simply a debate about housing projections, but about how we deliver truly affordable houses to the people who need them, in the areas where they need them. The GMSF is a charter to build very expensive houses on the green belt. At present, there is no legal mechanism within the GMSF to stop that happening. We can all unite to fight to ensure that that does not happen and that people get the houses they deserve in our areas.
Question put and agreed to.
Resolved,
That this House has considered the Greater Manchester spatial framework and the green belt.
Organised Crime in Rural Areas
(4 years, 1 month ago)
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Alicia Kearns (Rutland and Melton) (Con)
I beg to move,
That this House has considered organised crime in rural areas.
It is a pleasure to serve under your chairmanship, Sir David. I raise an extremely important issue for my constituents, but one that I fear has not been taken seriously enough by the Government in the past. To many in the UK, when I speak of rural crime, they probably think of fly-tipping or, at a push, young people joyriding farm equipment. At worst, “Midsomer Murders” springs to mind, which, while excellent TV programming, offers a rather idyllic portrayal of crime in rural areas. The settings are pristine, the criminals amateur, the stakes low, and the suspect is usually a relative of the victim.
In fact, in much rural crime the stakes are not low for our farmers, businesses and entrepreneurs. In the last year alone, rural crime has cost rural communities £50 million, the highest amount since 2011. According to the latest figures from the National Police Chiefs’ Council, more than £39 million of insurance claims were made in 2016 because of crimes in rural areas. That has a real, substantial and enduring human cost. For many rural people, especially farmers, their homes are their businesses, so when they are attacked, they feel that their families, children and livelihoods are under threat. They often live in highly isolated areas, on their own, where feeling under attack can cause long-term mental health issues.
A 2019 NFU Mutual report stated that one in four NFU Mutual agents knew someone who had to change the way they live or farm as a result of rural crime. That is not surprising, given that £10 million-worth of farming equipment and vehicles were stolen in 2018. A farmer who loses a brand new John Deere tractor or combine harvester will not only have high deductibles and massive up-front costs payable before insurance reimbursement, but could go months without being able to harvest their fields or till their land. These are not cheap vehicles; each piece of equipment is worth hundreds of thousands of pounds. Farmers can often only afford to buy second-hand equipment, let alone the costs of reinstalling security features or upgrading and repairing extensive fencing damage.
Rural crime also has a long and intense effect on mental health. Many rural people feel particularly vulnerable because the emergency services can be a way off. Rurality means that they feel more alone, which is not good for mental health outcomes. That is why 81% of farmers under 40 consider mental health to be the biggest hidden issue that they face, according to a recent survey.
When the costs of rural crime are this substantial, one can bet that it is not the work of amateur criminals—and the Government know that. The Crown Prosecution Service states that rural organised crime is often linked to organised crime groups, which target and exploit rural communities across a range of crime types, such as organised plant theft, livestock theft, burglaries targeting firearms, poaching and hare coursing. The NPCC states that:
“Ongoing livestock theft is raising concerns that stock is being stolen for slaughter and processing outside regulated abattoirs before illegally entering the food chain. Thieves are cloning the identities of large, expensive tractors to make them easier to sell and harder to detect. Small and older tractors are being targeted by organised gangs for export to developing countries.”
Sir David Amess (in the Chair)
Order. Does the hon. Gentleman have the permission of the mover of the motion and the Minister to intervene?
Jim Shannon
I do. I am pleased to have the opportunity to speak. I wanted to come down and support the hon. Lady because rural crime is also a massive issue in my constituency, which is urban-cum-rural, and I live on a farm. I declare an interest as a member of the Ulster Farmers’ Union. In my constituency, the police and the Ulster Farmers’ Union—in the hon. Lady’s constituency it would be the National Farmers Union—are identifying vehicles, trailers and machinery, and are therefore able to trace where they go. They have been very active and some of the stuff stolen in my constituency has ended up in the Republic of Ireland. Has that been done in the hon. Lady’s constituency?
Alicia Kearns
The hon. Gentleman raises a good point. In fact, many farmers are doing that, but the organised crime teams behind these thefts—I will get to the organised crux of the issue—find these trackers and identification things and strip them off. That shows that is not an opportunistic crime by people who are driving past and happen to see a highly expensive piece of kit that they can nick. These are organised crime units and they should be considered in the same way as groups involved in terrorism, county lines and child sexual exploitation. We can learn from how those things are handled.
One of my constituents found that his tractor, having started the night in quiet Melton, managed to make it to the shores of Poland by next morning. These are not the actions of small-scale groups but of organised crime units. There is also the example of the farmer who, having left his farm to go to the post office, found his Land Rover being stripped for parts in broad daylight. His livestock trailer was also stolen, as was its replacement a couple of months later, because thieves lay in wait knowing that he would inevitably secure a new trailer. Large flocks are being raided, and a few years ago, animals were being killed to harvest particular organs for cuisine. We found over 900 sheep killed across a couple of counties in just a few months, with their organs shipped abroad to feed particular international cuisines.
Criminal attacks on our farmers, whether on their livestock or their machinery, are targeted, professional and skilled. Given that our farmers and rural businesses know that the people who seek to steal from them are hardened criminals, the NPCC also says:
“Being watched or ‘staked out’ is the biggest concern for people living in the countryside”.
That is unacceptable. Farmers feel under attack and businesses are losing millions every year. Before this debate, I spoke to a representative of the National Farmers Union who said:
“Country people feel that they are under siege.”
We have to take seriously the phraseology they are using—“under siege”—because they do not feel that these are local likely lads who are jumping on opportunities. These are organised crime groups that will hurt them, seek them out, and often come armed when they come to steal from them. Why should farmers not feel under siege? Rural crime is up by 37% in Leicestershire and 74% in Kent, and in Buckinghamshire and Norfolk, crime has more than doubled. It is a crisis.
Rob Butler (Aylesbury) (Con)
I speak as a Buckinghamshire Member representing Aylesbury and its surrounding villages. Does my hon. Friend agree that fly-tipping, which she mentioned at the beginning of her speech, can be a very serious issue, because organised criminal gangs frequently bring virtually industrial amounts of waste from cities—often from London, in our case? They dump it in the beautiful villages of the countryside, and it is then left to the local authorities in those areas to clean up, literally and figuratively.
Alicia Kearns
My hon. Friend is absolutely right. To me, fly-tipping is the absolute rejection of personal responsibility and everything the Conservatives stand for. It is insidious, it is persistent in our communities, and it is happening on an organised level. Companies that do not want to pay to access waste disposal, or just cannot be bothered, repeatedly drop waste at the same sites, leaving farmers to pick up the cost and councils to try to deal with it.
I know too many constituents who do not believe that their real and justified concerns are being taken seriously. In particular, when farmers call the emergency services, they are often dismissed. One farmer, having found his flock of sheep significantly depleted, was asked by the 111 service, “Are you sure you actually marked them all? Are you sure they haven’t just wandered off, or that you haven’t confused them with the other ones?” Another who had agricultural equipment stolen was told, “Are you sure your child hasn’t taken it for a spin?” At best, crimes in these areas are assumed to be the actions of petty criminals; at worst, farmers are assumed to be fools. This response not only insults the intelligence of farmers and rural people, but completely ignores the steps they take to keep them and their livestock safe. Farmers invest in vehicle immobilisers and the latest CCTV technology, drones, remote tracking, five-lever mortice locks on buildings, alarms and keyless fobs. Farmers will keep fuel tanks in secure compounds and use multiple padlocks to lock their equipment, but this is still not enough.
As the NFU notes, these measures were adopted after the 2011 crime spree, because these criminals operate together, they adapt, they change, they are armed, and they get better. Too often, it appears that the emergency services and those meant to keep us safe do not keep up, which brings me to my real purpose today: we need to expand our rural crime-fighting capacity across the country. That means investing not only in services, but in strategies and training that will allow our Government and public services to better address the unique needs of rural communities when it comes to organised crime, because this is truly organised crime. We can bring together experts working in the areas of counter-terrorism—which is my field—county lines and child sexual exploitation to understand how these groups are operating. We can do some concerted research into how they operate, move together, and are able to bring together local people and convince or blackmail them to give them the information they need to undertake these crimes.
First and foremost, I call today for a dedicated rural crime unit and strategy, either within the National Crime Agency or the Home Office, or as a joint effort. It should incorporate the Plant and Agricultural National Intelligence Unit in some form or another, because of the data that it is able to bring to bear on this question. We also need to standardise policy approaches to rural crime across the UK, because responses can be inconsistent and patchy. The UK Border Agency should also review its role in tackling rural crime and what should be considered organised crime. Given that much of the proceeds of crime can end up in mainland Europe—or, as we have heard, Ireland, which is obviously part of Europe—we must ensure that large machinery stolen on a Monday does not end up on the continent on a Tuesday morning. I ask for 111 and 999 operators to receive specific and improved training to ensure that complaints and reports of crime are taken seriously and acted on appropriately. That is a small step that could make a big difference to our rural communities.
In a similar vein, I hope that the Home Office and police will introduce better guidance for the relevant services, so that investigations of the issues in question will be treated with the utmost seriousness. Police and crime commissioners should have to take account of rural crime specifically, and make sure that there is an element of rural crime strategy in their area.
Sir David Amess (in the Chair)
Order. I do not want to be pompous or pedantic, but it is not in order for a Member who was not here for the start of the debate to intervene. However, if the hon. Member for Rutland and Melton (Alicia Kearns) and the Minister agree, the hon. Lady may intervene.
Theo Clarke
I apologise, Sir David. My hon. Friend makes an extremely important point about the resources we need. I recently visited a constituent after masked intruders came to their farm with baseball bats. They were physically intimidated and they had no response from the police. Does my hon. Friend agree that police services in rural areas should have more resources so that the necessary support is available?
Alicia Kearns
I could not agree more. There is something I would like introduced in my area: we track police cars and know where they go and where those police spend their time, so why can we not do a review every six months to see how often rural communities get genuine visits from police cars? Having worked in the world of counter-terrorism, I recognise that police do not necessarily need to be on the beat or in the village to help those rural communities, but it is a matter of showing them that there will be an impact. In Cambridgeshire a rural crime team was introduced, which travelled around and made sure that every farm and every village was visited. It made an enormous difference and there was a reduction in rural crime.
There should be more work to address the impact on victims, and particularly the mental health of farmers, which I raised earlier. Many groups have been calling for improved services in that area, and those could include a dedicated mental health line for farmers.
Organised rural crime has a huge negative impact on my constituency and rural communities in every area of the UK. However, as with all crime, we can beat it by working together, creating a strategy and responding to the needs of our constituents. We can stop the fear and start taking their concerns seriously. I hope that the small but practical steps I have suggested may be feasible in the future, and I hope that the Minister will agree.
The Minister for Crime and Policing (Kit Malthouse)
It is a great pleasure to appear before you, Sir David, in an oasis of rigour, discipline, etiquette and calm in these troubled times. I congratulate my hon. Friend the Member for Rutland and Melton (Alicia Kearns) on securing this debate on crime in rural areas. I know that she is passionate about her area in particular and rural communities in general, and puts their needs at the heart of everything she does. She has raised some interesting points this afternoon, which I will study. I am obviously alarmed to hear about the incident in Staffordshire and, indeed, about fly-tipping, and those things are definitely of growing concern to rural communities across the country.
Many forms of crime, such as domestic violence, modern slavery, fraud and theft, know no boundaries and can be found in urban and rural areas alike. However, the Government recognise that certain forms of crime can, by their very nature, be a particular issue for those who live and work in rural communities—crimes such as hare coursing, livestock theft, fly-tipping and, of course, the theft of high-value agricultural machinery. That is very much reflected in the rural affairs strategy published by the National Police Chiefs Council in July 2018. It was developed following consultation with rural stakeholders and sets out operational and organisational policing priorities with respect to tackling crimes that predominantly affect rural communities.
The strategy is clear that tackling organised criminality is key to police success in tackling rural crime. An example would be targeting gangs that use stolen farm vehicles or machinery to rip out ATMs from their locations and then launder the cash through other activities. That is something I have seen in my constituency. It is worth noting that the strategy emphasises the importance of forces developing close partnerships with regional organised crime units, working across force boundaries and increasing intelligence sharing between stakeholders. That seems to me to be the right approach.
In addition, to support the police response, each Crown Prosecution Service area has a Crown prosecutor dedicated to wildlife, rural and heritage crime co-ordination, to ensure that the specialist knowledge needed to prosecute such offending is readily available. Moreover, the Government are committed to providing all police forces in England and Wales with the resources they need to do their crucial work, in rural and urban areas alike. On 22 January, we announced a police funding settlement of up to £15.2 billion for next year—an increase of up to £1.1 billion compared with last year and the biggest increase in funding for the policing system since 2010.
As far as the workforce is concerned, we have committed to recruiting 20,000 new police officers over the next three years; £45 million has already been committed to start the recruitment process and a further £750 million will be invested next year to enable forces across the country to recruit 6,000 additional officers by the end of March 2021. Of that £750 million, £700 million will go directly to police and crime commissioners.
In addition, the Crown Prosecution Service is receiving an extra £85 million to ensure that criminal justice system can support the work of those extra officers—and let us not forget the professionalism, dedication and sacrifice shown by special constables in their work. Special constables, along with a range of other volunteers in policing, make a vital contribution to keeping our communities safe, and over the next few years I hope that their numbers will expand, not least because they are incredibly useful in a rural community. Our ambition surely should be for every village and town across the country to have at least one constable or special constable resident in it; though they may not be in uniform, they are, of course, on duty 24 hours a day and therefore able to enforce the law, should that be needed.
By your leave, Sir David, I will take the points that my hon. Friend the Member for Rutland and Melton has raised in this debate back to the Home Office and study them, but I hope to reassure everybody in the Chamber that rural crime is one of the areas that we are keen to make progress on.
Kit Malthouse
It is traditional, I think, to give way to the hon. Gentleman, so therefore I will.
Jim Shannon
I am very happy that the Minister has given way to me; I am not sure whether it is traditional or not, but it happens very often. In her introduction, the hon. Member for Rutland and Melton (Alicia Kearns) gave an example of a tractor that within 24 hours was in Poland. I have examples in my constituency where within 24 hours the machinery has gone to the Republic of Ireland. Has there been an opportunity to discuss with other police forces—An Garda Síochána, for example—those criminal gangs that she referred to, which are operating and taking machinery mainland here and are also going into the Republic of Ireland? Has that been done?
Kit Malthouse
The hon. Gentleman raises an extremely important point, and he is quite right that our operations at the border are critical to our success in tackling in particular the theft of machinery, which takes place all too frequently. He will know that there is a specialist intelligence organisation, funded partly by the insurance industry, that looks for unexpected plant and machinery movements across the border and tries to identify them on behalf of finance companies. I should declare an interest, as the founder and majority shareholder of a plant and equipment finance company that has employed the services of that intelligence organisation from time to time.
While the hon. Gentleman is right that there will be movements across the border into Ireland, the market for plant is an international one, and left or right-hand drive does not really matter when moving a backhoe loader. The movement of plant and, indeed, other contraband and stolen items across the border is key. He might be interested to know that just this week meet I met the National Police Chiefs Council lead on acquisitive crime to talk specifically about some of those issues, not least ATM thefts in rural areas, the theft of plant and equipment and, indeed, high-value cars, which we are seeing more and more concealed inside containers and then shipped out of the country to other parts of the world.
From my point of view, as a constituency MP who represents 200 square miles of beautiful rolling chalk downland in Hampshire and who has in the past two or three weeks had meetings with members of the farming community to talk about exactly this issue, we have been discussing something close to my heart and on which I think we need to make progress. Hon. Members have my undertaking that we will.
Question put and agreed to.
Bank Branch Closures
(4 years, 1 month ago)
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Owen Thompson (Midlothian) (SNP)
I beg to move,
That this House has considered bank branch closures.
It is a great pleasure to serve under your chairmanship, Sir David. I will start my comments with a bit of nuancing. This debate was applied for and considered at a time before much of the current advice was put in place encouraging many of those in our communities who would be the natural users of a local bank branch to stay at home. Many of my comments calling for banks to remain open are therefore very much inclined towards the time when we get past the current situation and are returning to something of a more normal environment.
The debate is clearly taking place against the backdrop of an unprecedented public health crisis and grim news. One positive I already see emerging from that, though, is the mobilisation of communities to protect the most vulnerable among them. I hear tales of shops delivering groceries to older customers, of dog walkers dropping off prescriptions and of people sending kind messages to neighbours in isolation just to let them know that they matter. These are all hugely important to keep our communities functioning and working together through challenging times. It would be good to see the banks exhibit that same sense of public spiritedness, show a sense of responsibility to the communities they serve and at the very least call a halt to their closure programmes until we are through the current situation rather than quietly closing down branches never to open them again. I wrote to the Bank of Scotland urging it to consider that action.
The latest tranche of closures announced by Lloyds/Bank of Scotland comes after years of watching the vital network being decimated. Between 2012 and 2019, the UK lost 22% of its bank and building society branches. In 2017, about 10% of the rural population lived at least 10 miles away from their nearest branch. Scotland, with its highly rural population and more challenging demographics, saw a third of branches close in just nine years, with 610 closures between 2010 and 2018. The announcement in January from Lloyds Banking Group of 56 branch closures was still a little surprising as it came just a month after Bank of Scotland managing director Tara Foley was reported to have said at the opening of a hub in Glasgow that the bank was committed to its branch network and that branches were “not going anywhere.” Tell that to my constituents in Loanhead.
For hundreds of years, the Bank of Scotland was a respectable stalwart of the Edinburgh establishment, ahead of the field in finance and in finding innovative solutions to meet customer needs. Founded in July 1695 by an Act of the original Scottish Parliament, the independent one, the bank started opening branches back in 1774. It was the first bank in Europe to offer paper currency and, in 1826, fought a spirited campaign against attempts by the Westminster Parliament to outlaw its notes below £5. The campaign was much aided by the fantastic writer Walter Scott, whose head now adorns the bank’s modern notes, in tribute to that popular and successful campaign. I hope this campaign will be equally successful.
It is therefore disappointing to see the modern incarnation of this once proud brand making life so much harder for those who work with paper notes, wielding the axe so brutally against the communities that helped to build the bank. When the banks crashed in 2008, Lloyds Banking Group was one of the major recipients of the Government bail-out, to the tune of £20.3 billion and a 43% public stake. Now, public shares are paid back, profits are high and big bonuses have made a bit of a comeback. In 2018, Lloyds unveiled a £4 billion pay-out to shareholders, statutory profit before tax was up 13% and £464.5 million was given out in bonuses. Payment protection insurance pay-outs took its toll last year, with pre-tax profits down from £6 billion to a meagre £4.4 billion, so chief executive António Horta-Osório took one for the team, pocketing only £4.7 million, compared with £6.5 million the previous year. That is meagre, and it must be difficult to survive on such limited earnings. The idea that the bank cannot afford to maintain the existing branch network is therefore clearly nonsense.
My particular concern, as the MP for Midlothian, is the looming closure of the last bank in Loanhead. In fact, it affects not just Loanhead; that bank represents the only one in the communities of Loanhead, Bilston, Roslin, Rosewell, Straiton and Damhead. Many of my constituents beyond the town itself are clearly concerned about how they will access banking. The decision is staggering, with dire economic and social consequences for a town with a population of about 7,000 now, but set to rise rapidly with significant new housing developments. The Bank of Scotland has not taken that into account in coming to its conclusion.
Future growth will rely on start-ups and microbusinesses setting up in the area, so access to a banking service remains vital. About 20% of small businesses with turnover below £2 million use branches as their primary source of banking. Being able to get into the bank at a time suitable for them will clearly be critical. The sheer geography of Midlothian does not lend itself to a bank being even two or three miles away—the physical journey might not always be a straight or simple one.
The Select Committee on Scottish Affairs, in its 2019 report on access to financial services, stated:
“The impact of losing a bank is particularly is acute when it is the last bank in town”—
as in this situation. Statistics tell the same story. Research mapping branch closures against the British Bankers Association postcode lending data found that growth in lending to small and medium-sized enterprises was dampened by 63% on average in postcodes that lost a bank branch. When it was the last bank in town, that figure shot up to 104%. On average, postcodes that lose their last bank receive almost £1.6 million less in lending over the course of a year.
The Loanhead branch closing will without doubt damage this historic town economically, as it will the nearby communities of Bilston, Damhead and Roslin, all of which rely on that bank.
Andrew Jones (Harrogate and Knaresborough) (Con)
I congratulate the hon. Gentleman on securing this debate. I recognise that he is talking about the Royal Bank of Scotland and Bank of Scotland groups, but the issue is truly UK-wide. I particularly noted his points about the last bank in town closing, because I am seeing that in Knaresborough, in my constituency. Does he agree that access to financial services and advice, alongside the banking services that he described, is particularly important at a time of great financial uncertainty, when people are anxious about their financial futures because of the coronavirus emergency?
Owen Thompson
I absolutely agree with the hon. Gentleman. It is absolutely critical that people have access to the best possible advice, especially now, where none of us really knows what situation we will be facing in a month or two months, never mind next week. It is critical that there is access to information and advice, and that that is easily accessible for all our communities across the country, wherever they happen to be.
Losing the last bank in town will increase the financial exclusion of our older and less mobile residents. Being able to go to the high street to do their finances is an important part of staying independent for many people. It is a lifeline. It is fair to say that banking habits have changed and the Loanhead branch, like most, is certainly less busy than it historically was. The figures in the bank’s own closing branch review found a 4% drop in counter transactions from personal customers over one year and an 8% drop when businesses are included. To me, that appears to be a fairly manageable figure, especially when we consider the town is set to expand significantly in the coming years.
It is also true that the majority of the population will be able to do much more of their business online. I am not denying that, but we do not always want to do business online, and certainly there are a number of people in our communities who cannot do their business online. Most of us appreciate being able to check balances and do transactions whenever we want, although we do not necessarily like it when the IT breaks down or we stumble over the pass codes. Even with that change in behaviour, a significant number of bank customers completely rely on the local branch; they do not even have a digital option.
The bank’s review found that 76% of customers sometimes use other branches, internet or telephone banking. That leaves almost a quarter of their customers who never use those other methods and are solely reliant on the branch. Many of them are in older age groups—44% of customers were over 55, 26% over 65 and 13% over 75. It is quite clearly the older population who will face the worst disruption from the proposed changes. According to Age Scotland, 67% of people over 75 do not use the internet at all. Many older people expressed frustration with phone banking and lack of trust in digital options, and said that the cost of accessing the technology is in itself inhibitive. In some areas, fast enough connections are not even available.
I know that work has been done to improve banking services in our post offices and I welcome that. The post office network is a fantastic resource for our communities and it does whatever it can to pick up the pieces when a bank abandons a town. We are particularly lucky in Loanhead to have a very accommodating postmaster, who I have no doubt at all will do everything in their power to ease the transition for customers seeking another local place to perform day-to-day transactions, but the post office network is under pressure too. As great a job as it does, it does not have the resources, financial expertise or facilities needed to deliver the full range of bank services when the bank leaves town, nor should it be expected to do so.
Concerns were expressed to the Treasury Committee last year about the way the agreement with banks was operating, and that the Post Office would be put under added pressure, as it did not make a profit from those services. More than half of adults were unaware that they could even use it and said when asked that they would prefer to deal directly with their bank. There is a long way to go before that gap can be filled. We must protect for the future both the post offices and the branch networks. That is not just for the vulnerable, although that is a good enough reason to call a halt to this ruthless cull of face-to-face banking. Those who predict the relentless rise of automation sometimes forget another key factor—human nature. Digital banking has convenience on its side but will never replace the human interaction. It was predicted that e-readers, such as the Kindle, would kill off printed books. That did not happen. We see vinyl record sales booming for the younger generation, despite the ridiculous price tags and the simplicity of streaming. Digital and physical formats are finding a happy co-existence in the modern world; they complement each other, as they both have advantages and disadvantages.
The same goes for banking. There are many individuals who sometimes use a branch and sometimes use other means. We need both branch and online banking to thrive in a flexible, inclusive, modern society and we lose them at our peril. When IT goes wrong, as it does, we all return to the bricks and mortar of a branch. We need to protect those branches so that they are there for the future. The Treasury Committee in the previous Parliament warned that
“if no action is taken, the UK risks inadvertently becoming a cashless society. For a large portion of society, including some of the most vulnerable, this would have stark consequences.”
We have seen a rapid drop in free ATMs, as the reduced interchange fee made the business model less viable. Latest figures from LINK, the UK’s largest cash machine network, revealed that 1,300 ATMs were lost between the end of January and the beginning of July 2018. The consumer organisation Which? predicted that free cash machines would become a thing of the past, after it emerged that 1,700 ATMs switched to charging in the first three months of the year alone. We are being pushed towards a cashless society that we are not prepared for and do not want. That is not solely through consumer demand but financial incentives to go cashless, the creation of a cashless deserts and the continued running down of the branch network.
We are asking people to wash their hands a lot more these days, but it is no longer good enough for the UK Government to wash their hands of this serious issue. Like the politics of austerity, the decision to let things slide is a choice, not necessity. The current access to banking standard does not go far enough to protect customers from branch losses, and the alternatives just do not plug the gap. They will show customers how to sign into mobile banking or where to get a bus to the next town, but the loss of a branch is already a done deal.
Where the financial services markets fail, we need the Government to step up to the plate. We could introduce a public service obligation to protect the last branch in town, for example, and ensure that people have a right to a physical bank branch. The Treasury Committee agreed, saying that
“intervention by Government or the FCA may be necessary to force banks to provide a physical network for consumers.”
It suggested they could
“make changes to competition law to allow banks to share facilities”.
I would be keen to see that. For the Government to keep brushing this off as a commercial decision is to neglect their responsibility. There are options to intervene; in fact, they have a duty to do so, for the wellbeing of millions of citizens.
I look forward to the Minister’s response. I hope that we will see some action, and that the Bank of Scotland will reverse the decision to close so many branches.
Kirsten Oswald (East Renfrewshire) (SNP)
It is a pleasure to serve under your chairmanship, Sir David. I am grateful to my hon. Friend the Member for Midlothian (Owen Thompson) for securing this important debate. Like him, I have a sense of déjà vu, having spoken in similar debates a number of times before.
I am aware of the very serious situation that we are dealing with. People at home will be watching and thinking about the difficulties that the covid-19 crisis presents us. We are well aware of that, and I encourage people to follow the most up-to-date advice at every point. Bank closures is quite a pertinent issue at the moment. This is not quite the speech I might have given under different circumstances, but it is possibly even more pressing that banks do not abandon our high streets—goodness knows, they have troubles enough without banks upping sticks and leaving behind all the businesses that are struggling so much.
I am really scunnered on behalf of my constituents; there have been repeated bank closures in towns all over East Renfrewshire over the past few years. When I served a previous term as MP, East Renfrewshire was apparently one of the worst hit areas for bank branch closures, yet here I am again because more closures are planned. When MPs and members of the public are notified of bank closures, there is no acceptance or acknowledgement of the actual impact on local residents and businesses. There is no consultation; it just hard lines, and that makes a difference to people’s lives.
Knowing that I would speak in this debate, somebody told me that after the closure of a bank branch of which they were a customer in East Renfrewshire, they got some text messages asking what they thought about bank branch closures. They could only click the boxes provided—there was no free text option for whatever reason—and the options, to paraphrase, were, “They’re good,” “They’re fine,” and “They’re okay”. They are not okay. That kind of ridiculous box-ticking exercise really does not give people any comfort that they are being listened to, and will come as no surprise to any Member of the House who has had to deal with bank closures. It feels as if there is a disregard for the needs of our communities and often of basic geography.
In East Renfrewshire, we face three additional closures, which is the last thing that people need. According to Virgin Money, it is closing the Giffnock branch because it is shutting up shop in locations where it has duplicate provision. The difficulty is that there is no duplicate provision in Giffnock because Virgin Money closed the other branch three years ago—it is now a bistro, which I wish every success, and which I am sure could use the support of a local bank. Virgin has suggested that people affected by the closure in Giffnock can use the bank in Newton Mearns. The implication was that Newton Mearns is the same as Giffnock, but they are different towns. I wondered, “How might people get there? They could go on the bus.” I checked, and it is a 50-minute round trip on the bus. That is really not a practical solution or a sensible way for people to be told to proceed.
TSB is closing branches in Barrhead and Clarkston. To my surprise, TSB suggested that customers who used the Barrhead branch could use the one in Pollok. That is a round trip of at least an hour by public transport. I can only assume that TSB does not want those customers to remain its customers and anticipates that they will all march across the road to the first-class credit union in Barrhead, Pioneer Mutual, which I have no doubt will not abandon the people of Barrhead and will continue to provide the wide range of fantastic services for which we are grateful.
TSB suggests that when its Clarkston branch closes, people can go to Thornliebank, but they would need to take the half-hourly train or the hourly bus. None of those things are what people need. It is unhelpful in the extreme for banks to suggest that those are somehow substitutions. Like when someone orders teabags in their online shop and the supermarket sends a dishcloth, the solutions are absolutely ludicrous and really quite upsetting to people who are accustomed to banking locally.
The people who need the service most are always the worst affected, as my hon. Friend said. Among them are older people, who are accustomed to dealing in cash and who should not be prevented from doing so; people who are less mobile; people who do not have cars; and of course local businesses, which absolutely rely on high-street banking services. People who run local businesses are genuinely concerned about bank closures, which make a significant difference to what they can do.
As my hon. Friend said, despite the significant difficulties that businesses currently face, they are doing great things, such as delivering things to people and being flexible in their services. They are going above and beyond and being imaginative in the way that they do business, so this is the very time when they need an assurance that the banks are there and will still be there afterwards. They need the banks upping sticks like they need a hole in the head.
Businesses will rely on Government support in the coming weeks and months—that will be so important. If we hope—and we do—that our businesses find ways to sustain themselves, surely that necessitates the availability of banks so that discussions and banking can take place in communities where those businesses are rooted. The Government stepped up when we bailed out the banks, so now it is their turn.
Banks and bank bosses need to step up and recognise that the situation is unique. This is the time for them to reconsider any plans to close bank branches and to think about what they are really for and whether they should be turning away from our constituents. They should not be turning away from our high streets now. We need them to be with us when things are difficult; now is certainly not the time for them to walk away.
Alan Brown (Kilmarnock and Loudoun) (SNP)
Thank you for allowing me to catch your eye, Sir David. I congratulate my hon. Friend the Member for Midlothian (Owen Thompson) on bringing forward the debate. I want first to touch on the potential closure of the Bank of Scotland branch in Galston in my constituency. It is not just the last bank in Galston, but actually the last bank in town for nine settlements. Kilmarnock, the major town in my constituency, will be the only one left with banks. That is unacceptable. Settlements with a combined population of more than 40,000 people will be without access to a bank.
The Bank of Scotland always uses the same mode of operation; it sends out a letter to notify its customers and produces statistics that say that the branch has had a drop in numbers and performs less well than the average bank. I pointed out that if it keeps reducing branches and concentrating on big urban centres, the remaining rural branches will clearly have less footfall than the urban branches. They also have less overheads, and possibly less staff. It is not comparing apples with apples.
Kirsten Oswald
My hon. Friend is making some fundamental points. Does he share my utter dismay that banks repeatedly tell us that more people bank online while not realising that they of course have to because banks keep closing their branches?
Alan Brown
I agree 100%. The banks are forcing a change in behaviour. In Galston, Bank of Scotland also highlighted that businesses are now using the cash machine to lodge more money. Why is that? It is because the staff have advised businesses to do that. Guess what? It is now taking away that cash machine anyway, so that argument is completely undermined.
It is really frustrating for people when they get a letter with fancy pie charts and statistics that are frankly meaningless. I believe that I have got some analytical skills, so as an MP I contacted the bank to ask a number of questions about the statistics it provided on changing behaviour. I got the most ridiculous, bland response, all dressed up in woolly words and ignoring my questions. I call on the Bank of Scotland at the very least to up its game, increase engagement and answer questions that come from the likes of me and the members of the community who are lobbying hard.
In concluding, I would like to raise another issue that is pertinent to people who have worked for Royal Bank of Scotland. Many women who worked in banks were part-time workers who had less wages. They had to suffer redundancies through bank closures. Some of them might be WASPI women—Women Against State Pension Inequality—who will have to wait longer before they access their state pension. Those who were RBS employees discover that, once they access their state pension, RBS initiates a clawback on their private pension. I met constituents on Friday, and one of them loses up to 25% of her pension. It turns out that is legal—it goes back to an agreement that RBS put in place—but it is also immoral.
Royal Bank of Scotland is part of the NatWest group—that is how it is to be rebranded—and NatWest does not employ such a clawback. I urge the Minister to think about that and the impact it is having on people. Given that the Government are the major shareholder in Royal Bank of Scotland, and it is now returning a profit of billions of pounds, the very least they could do is look after those workers who were loyal to Royal Bank of Scotland but got a kick in the teeth when bank closures were implemented.
Jim Shannon (Strangford) (DUP)
First, I congratulate the hon. Member for Midlothian (Owen Thompson) on bringing forward the debate—I think there has hardly been a banking debate that I have not been at. The Minister is always in his place to respond, and I am sure he knows what we will say before we say it and that he shares our frustration over bank closures. As I mentioned earlier, my constituency has seen one of the largest numbers of bank closures in the whole of the United Kingdom of Great Britain and Northern Ireland. There has been some attempt to fill the gap with credit unions and post offices, which have done so to a certain extent, but not in totality. That is where my concern lies.
I joined in the debate last June—we had another one a few weeks ago—to express my frustration with the banks that were closing branches because they say there is another one just 15 minutes up the road, or 50 minutes up the road, as the hon. Member for East Renfrewshire (Kirsten Oswald) explained. That is not very helpful for people who are on their lunch break or reliant on public transport, which is not always available at the time that they need it to get them back to work, as she also suggested, especially in a rural constituency.
Physical branches are important to the consumer, but not to the bottom line, and it would seem that that is the only consideration for some of those at the top of the banks. How annoyed was I, last month, to find that yet another bank closure is planned for Newtownards, the main town in my constituency? This time it was Barclays. I got the obligatory email of intent, as we all do, and an offer to meet, going through the format of a visually arranged meeting. I have arranged it in my diary, by the way, and I will meet them, but the fact is that although the meeting might relieve some of my frustration, it will not make one button of a difference to Barclays.
I mean no disrespect—I try to be respectful to everyone as best I can—but I have no hope at all of persuading them to keep the Barclays bank in Newtownards open. I have sat in too many of those meetings, which is why I have become a bit cynical about meeting the banks. I think I have had some nine bank closures in total in my constituency. I have had a meeting with the banks on every one of those occasions, and with all the persuasion of stats and letters from customers that we had, we were not successful in turning things around.
As those branches have closed one by one, I have sat in too many of those meetings and been shown increases in online activity, as the hon. Lady mentioned. If we take the logic that she referred to, it is true that, if we close all the banks, more people will go online. But it does not suit everybody to go online—that is the point we are making, but it seems to fall on deaf ears. What is not explained is that the increase is because staff members have been pushing this, which they have. There is nothing wrong with pushing the online deal if it suits people, but it does not suit everybody, and the bank customers on whose behalf I went to all those meetings were not able to bank by logging on to the system. It is not always easy, either, when people do not have the broadband access to enable that to happen.
Over the years the bank closures in my constituency have been Kircubbin, Portaferry, Killyleagh and Ballynahinch—all Ulster Bank—Danske Bank in Kircubbin and Portaferry, Barclays bank now imminent, Bank of Ireland and Allied Irish. Those banks have all moved to other towns or moved out of the area completely. I remember when we used to have at least four banks on the Ards peninsula, but they have all been closed. There were some sub-banks, which would have been there on certain days a week, but they are away as well.
The hon. Member for Midlothian referred to credit unions, and we have been fortunate that credit unions have grown in my constituency, as they probably have in all our constituencies. They have tried to fill the gap, and they have done so to some extent, but they cannot provide what the banks offer to customers. We have a new credit union in Kircubbin; I am very pleased to see it, and it is very active and very able. The credit union in Portaferry has grown as the banks have closed, as has the credit union in Newtownards. I had the Minister over about a year and a half ago to visit the one in Newtownards, which is doing extremely well. The credit unions are filling the gap.
Then there are post offices. The Minister might say that post offices are able to fill the gap, and in some ways they are, but they cannot provide all the range of support and services that can be given in the banks. Post offices can only fill those in a small way. We need to have all the opportunities that the banks offer. I am becoming increasingly frustrated with the banks. I say that not as a socialist—
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
There is nothing wrong with that.
Jim Shannon
There is nothing wrong with being a socialist, by the way—I am letting you know that right now. I am not against the banks, but I get immensely frustrated when it seems that they make decisions in order to bring bigger dividends for their shareholders. I suspect that everyone who spoke and the shadow Minister will say the same thing, but to me it is simple: the wee man and wee woman need help, and they deserve to have their banks, yet it is all about the profit at the end of the year. Whenever banks are making a massive profit, in a way it is about getting more profit. Was it Jean Paul Getty who said that the only thing better than having £1 million is having another £1 million? Speaking about Jean Paul Getty probably ages me, but I am just making the point that banks focus only on their profit margin and how much they can make, not on delivering.
The hon. Members for Midlothian and for East Renfrewshire referred to online banking—I know that others will refer to it as well—but it does not suit everybody. I tried to help a number of customers of those banks to do online banking, but it was lost on them. I hope those people took their savings to the post office or the credit union, but I suspect that some did not, and I therefore fear money being stored under the blanket, the pillow or the mattress, or in some tin box somewhere, because those people want to be in control.
My wife’s auntie was in that situation. She had some money in the house, which we did not know about. One day she was out for only half an hour, but the thieves obviously knew, and they came in and stole her life savings—£8,500—which were probably to pay for her funeral. It is soul-destroying. The community came together to help as best they could. That happened to a couple of others in my constituency as well, and again the community reached deep into their pockets and made some of that money available.
I realise that time is flying. I was sitting here almost loth to speak, to again use the same words and rhetoric, because it is not stopping the closures. Then I realised that this is the place where changes need to take place. I have the utmost respect for the Minister, as he knows, but I urge him and his Department to give serious consideration to supporting those banks that support their local community. For Newtownards, that is the Danske Bank, the Ulster Bank—the one that is left—the Santander bank, which has filled some of the gap for some customers, and the Nationwide building society. Those are the last four banks in Newtownards. All pay rates and council tax, provide local employment and are all available for the vulnerable—for me, this debate is about the vulnerable; those who do not have access to banks—to open their first bank account or for those who want face-to-face advice, because we need that from the banks as well.
I ask the Minister what we can do to reward those banks that do right by local communities and keep an online thrust as well. I understand that some people want to go online. I am an old traditionalist; I will probably still write cheques for all my things every week, as I always do, and I will probably still carry cash in my wallet, because that is how I did it when I opened my first bank account at age 18. How can we encourage more banks to be part of local communities, instead of being removed and literally counting their pounds rolling in? I look to the Minister for guidance, because asking, reasoning and pleading with the banks is not working. Maybe rewarding community-minded banks is the way forward.
Patricia Gibson (North Ayrshire and Arran) (SNP)
I echo the thanks to my hon. Friend the Member for Midlothian (Owen Thompson) for securing this important debate. I feel as if I have spent quite a lot of time in the five years since I was elected bemoaning the stampeding of banks out of our communities without so much as a backward glance.
My constituency has several towns where there is no bank at all, and other Members have talked of similar issues. Ardrossan, Stevenston, Kilwinning—a town of 21,000 people—West Kilbride, Dalry and Beith are all without a bank, and Kilbirnie’s last bank has reduced its opening hours. That is the only bank left in the entire Garnock valley, which is three distinct towns with a collective population of more than 19,000 people. Losing the last bank in our towns is a severe blow to our communities. It undermines their commercial stability and has a significant social impact, which we have heard much about today.
My constituency, like that of every Member who has spoken, has been hit particularly hard, and I share all the concerns expressed by my hon. Friend the Member for Midlothian (Owen Thompson). In Scotland, according to research, we have lost more than one third of our bank branches since 2015. The consumer organisation Which? found that banks shut 396 Scottish branches between January 2015 and August 2019, reducing their number by 38%—an alarming rate of closure, by any measure. My hon. Friends the Members for Midlothian, for East Renfrewshire (Kirsten Oswald), and for Kilmarnock and Loudoun (Alan Brown) and the hon. Member for Strangford (Jim Shannon) have all said similar things.
As we have heard from my hon. Friend the Member for East Renfrewshire, it is clear that any consultations are simply window dressing. They are tick-box exercises so that the banks can reassure themselves and the Minister—“Oh yes, Minister, we have undertaken consultation”—when we know that is not true in reality. I remember the same thing happening in 2007 and 2008, when there were mass post office closures in my constituency. That was long before I was elected to this place, and perhaps innocently—perhaps even naively—I, along with other Scottish National party activists, set up street stalls. We went door to door with petitions. We did everything we could to get the post office to reverse those closures, but of course nothing changed, because the consultations were not at all meaningful. We have memories of these consultations from other times, and I say to the Minister that this has to stop.
The Treasury Committee concluded that
“there are still large sections of society who rely on bank branches to carry out their banking needs. A bank branch network, or at the least, a face-to-face banking solution, is still a vital component of the financial services sector, and must be preserved.”
I know that the Minister probably will not agree—I have said this to him before, during one of the countless debates on this topic I have participated in—but I genuinely believe that because there was no UK Government intervention when RBS announced its radical, eye-watering programme of closures, although we as taxpayers owned a significant stake in RBS, the fact that nothing was done emboldened the other banks that have no element of public ownership. If a publicly owned bank can do it, why can a private bank not do the same without any kickback or repercussions from those in the corridors of power?
If the Government are as willing as they have demonstrated to accept closures of bank branches—banks that they owned, in the case of RBS—that is extremely disappointing. Throughout RBS’s entire closure programme, I listened very hard, but I could not hear anybody in Government condemning those closures. All I heard was a distancing from any sense of responsibility, which is really disappointing for our constituents. It seems that other banks felt they could employ the same tactics and close down wherever they felt it was no longer convenient to have a branch, without any consequences or official condemnation from Government. As a result, the people who pay the price are those in our communities who are suffering for want of a bank, and will continue to suffer. We have heard a lot about that today.
Of course, we have these mobile banks, but they really do not answer the question of what we do without a bank. They are not disability compliant, their reliability is questionable at best, and they simply do not fit the bill or take the place of a bank. We also know that the gaps left by banks cannot be properly filled by post offices. That is no reflection on post offices, which work hard to provide a good service to our communities, but they are not banks and they cannot fill the gap. As the Minister will know, the Treasury Committee concluded that post offices
“should not be seen as a replacement for a branch network, but a complementary proposition”.
Other Members have talked about the fact that post offices simply cannot fill that gap.
Along with branch closures we are witnessing the demise of free cash machines, as we have heard. About 10 free-to-use ATMs a week have been shut down in the past year. As far as I can make out—although I hope the Minister will contradict me—the Treasury seems to have been deaf to all pleas for Government intervention to protect free cash. I hope that the Minister is able to offer some comfort today.
Patricia Gibson
I look forward to hearing from the Minister, who is speaking from a sedentary position.
The ATM Industry Association has warned that one fifth of Scotland’s free ATMs will start to charge consumers in the next year. That can be seen only as a cynical move to force us to become a cashless society. Picking up what has been touched on by my hon. Friends the Members for Kilmarnock and Loudoun, for East Renfrewshire, and for Midlothian, and the hon. Member for Strangford, bank closures have, as we now know—the game is up—been a tool to force people to bank online. As banks have quietly cut the fees that they are willing to pay machine operators to provide bank customers with access to cash, they are forcing us to go cashless and online. Banks are attempting to put pressure on customers who do not act in a way that they—the banks—find convenient. What happened to the customer being king?
Going cashless and banking online may, as we have heard, be the preferred option for some—and good luck to them—but some of us do not want to go down that route, and increasingly aggressive efforts are being made for it to happen, at breakneck speed. I and those of my constituents who do not favour those options will not be forced to bank online. We will not be bullied into doing so or into going cashless. It is a rum do when the service provider is bullying the customer—because that is how it feels. In any case, even among customers who may be interested in banking online there are some who simply are not able to, for a variety of reasons that the Minister will understand, and of which the hon. Member for Strangford reminded us.
I have corresponded with the Treasury about online banking in the past, and it accepted that broadband access is not yet good enough for everyone to rely on digital banking. The Government and the access to banking standard must ensure that banks have a social responsibility to provide banking facilities to all our towns. Such services could be provided relatively easily through the wide rolling-out of banking hubs. Indeed, I met the Minister in his constituency to discuss that very issue last year. I am hoping—I am quite excited about it—that he will be able to update me on progress with that. I am sure that the Minister will correct me if I am wrong but I cannot see any discernible obstacle to the option except for perhaps a lack of political will and, indeed, the arrogance and intransigence of the banking industry.
Our communities and constituents deserve better than they have had up to this point. Banks have to face up to their social responsibilities, get their heads together and create banking hubs in our towns, across the board. There is no real impediment to that, and I urge the Minister to use his good offices to bang some banking heads together and ensure that customers’ voices are heard. The Government have a role to play when the last bank in town is closed. They have said repeatedly that those are commercial decisions, but it is not just a commercial matter. It is about social responsibility and financial inclusion. I urge the Minister to reflect further on the strong feelings and concerns that have been expressed today. Will he finally bring forward legislative proposals to ensure that banks live up to their responsibilities to our communities?
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
It is a pleasure to see you in the Chair, Sir David.
I thank the hon. Member for Midlothian (Owen Thompson) for securing this debate on a topic of vital importance to people across the UK. Today’s debate takes place at a time of unprecedented national crisis, but, as the hon. Gentleman said, the conversations that we are now having about the social and health implications of compulsory isolation show how important our high streets and shared social spaces are. Bank branches play a fundamental part in maintaining contact for vulnerable people. Even in a time of rapid change, when we are shifting a lot of our lives online, we have to make sure that communities that need a physical bank branch are not left behind.
We have had many debates on the issue. We gathered here, by my reckoning, just over a year ago to address it; the hon. Member for Strangford (Jim Shannon) was definitely present. In the year since, the matter has become no less pressing. At the time, I shared with colleagues some of the experiences of my constituents and what bank branch closures have meant for them. Too often, we are distracted by the headline numbers and forget the impact of the closures on real people’s lives. I will revisit some of those comments today.
I represent the towns of Hyde, Stalybridge, where I live, Dukinfield, Longdendale and Mossley. They are exactly the kinds of towns that have suffered very badly from the closures in recent years. I have lost branches of RBS, Lloyds and Yorkshire Bank. Here are some direct quotes from constituents about how it has affected them. One constituent said:
“Losing the Lloyds in Stalybridge has been a blow. Yes there is one in Ashton and there is online banking. But there is no substitute for making an appointment you can walk to and talking to an actual human being.”
A constituent just outside of my area said:
“Here in Droylsden we now don’t have a single bank! We’ve gone from having Lloyd’s, NatWest, Royal Bank of Scotland and Halifax to having none!!! Our infrastructure dwindles by the day.”
For businesses in particular the closures have posed challenges. One of my local business owners said:
“You can do banking at the Post Office but, in order to pay things in, you have to get in touch with your bank first and get paying in slips sent out. Santander would only send me 5 and I have run out now. It means I can’t accept cheques for my business easily. I don’t have the time to keep ringing up for paying in slips…It’s a killer for small businesses who have to close their shops to go and stand in a queue for a lengthy period of time just to get change.”
I have also heard moving stories from those who care for others, who have inevitably borne the brunt of closures. One said:
“My mum with Alzheimer’s relied on her Lloyd’s branch in Droylsden before it was shut. The staff knew her well and helped her. They knew her condition and if she was in a bad way they would phone me and give her a cup of tea while they waited for me to arrive. The staff said there were lots of other people like my mum. The closure really affected her.”
The most recent disappointing news that I have had in my constituency is that Barclays will be closing its branch in Hyde, too. When I announced that on my Facebook page, it very quickly attracted more than 100 comments from local people. People really care about this issue, and they are right to do so. A common thread among the feedback that I hear from constituents is that nobody wants their community to become a ghost town.
Equally, no one is saying that they want to halt progress, but we must ensure that technology works for us and not the other way around. Some of the technological advances could be harnessed to include people who historically have had trouble interacting with traditional banking, such as offering remote video appointments or having speaking ATMs. However, the goal must be to strive to ensure that we use technology to benefit bank customers, rather than creating a pared-down automated banking sector that leaves people without the support that they need.
That is also true of access to cash, which many Members have raised. Although habits around cash are changing—when I am at work in London, I tend not to use cash very much—I certainly need it when I go home at the end of the week. Members are correct to say that we must not allow ourselves to sleepwalk into a system that leaves some communities stranded without ATMs. I know that the Government and the Minister are concerned about that, but communities must have the fundamental right to demand an access to cash review in their area, like the access to cash review proposed, so that the power is theirs to ask for a review of their cash arrangements.
Although, as habits change, we would anticipate that some bank branches would have had to close in recent times, the hon. Member for Midlothian is right that the rate at which the branch network is shrinking is accelerating, which is the primary concern. Figures from Which? show that 3,509 branches have closed across the UK since January 2015. That is at a rate of 55 a month. The scale of those closures seems disproportionate and does not necessarily match what people are saying to us about how they want to use their bank branches. Research conducted in 2016 by the Social Market Foundation found that there remains a strong consumer appetite for a physical presence.
Labour’s proposal in our recent manifesto was to change the law regulating banks so that no closure could take place without appropriate local consultation and without FCA approval. I share the concerns that have been raised about the existing nature of consultation. Crucially, a bank should have to consult with not only the customers of that branch but representatives of the local council. Fundamentally, it should have to publish details of the reasons for closure, including financial calculations showing the revenues and costs of the relevant branch.
The share of central costs, such as those for accounting systems, IT, security, personnel and so on, would have to be allocated to the branch and separately identified, especially as many of those costs are relatively fixed and are not proportionate to the number of branches. The FCA’s approval would then be needed for any bank branch closure. I urge the Government to think perhaps not about the specifics of that, but certainly about the transparency of information published by a bank when a branch is to close. In addition, we wanted to see the Post Office evolve from its current banking framework to being a bank in its own right. Many countries operate very successful postal banks, and that could have been the basis for the long-term future of the Post Office, too.
In the next few months, we will be shown the harsh realities of social isolation. This is an important moment to think about how important communities are, and the role that bank branches play in holding high streets and localities together. Regulators, banks and policy makers must work together to improve what we have at the minute and to ensure that we end up with a banking infrastructure that works for all customers, all communities and the future.
The Economic Secretary to the Treasury (John Glen)
It is a pleasure to serve under your chairmanship, Sir David.
I thank the hon. Member for Midlothian (Owen Thompson) for securing this debate on an enduring concern across this Chamber and the House as a whole. I thank him for our conversation yesterday, following up on his question during business questions at the end of February. Since the start of this year, I have had conversations about similar matters with the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) and my hon. Friend the Member for Colne Valley (Jason McCartney).
In the debate, I listened carefully to the speeches of the hon. Members for East Renfrewshire (Kirsten Oswald), for Kilmarnock and Loudoun (Alan Brown), for Strangford (Jim Shannon) and for Stalybridge and Hyde (Jonathan Reynolds). In my remarks, I will address the points they made.
The hon. Member for Midlothian, in opening, referred to the current context. At this time, obviously, banks will operate using contingency plans. In the light of such circumstances, we expect them to consider what that means for their branch closure programmes.
Customer-facing financial services are undeniably changing, as consumers and businesses opt for the convenience, security and speed of digital payments and banking. In 2018, almost three quarters of UK adults used online banking, half mobile banking and two thirds contactless payments. Meanwhile, branch usage fell by 26%, on average, between 2012 and 2017, with many communities seeing even more drastic declines.
Banks clearly must balance changing customer interests, market competition and other commercial factors when they consider their response. Many have proceeded in different ways. Sometimes they take the difficult decision to close branches in order to strike that balance. Although that is disappointing for communities, I have been clear that banks are best suited to know what works for their customers, and these must ultimately be commercial decisions.
That said, in January, I visited Yarm in Stockton to look at what Barclays is doing with its network. It has taken a group of more than 100 branches—102 or 112, I think—that are the last bank in their towns, and is working hard with the communities to secure a future. I encouraged it in that work, because models exist to sustain such branches, if transfers are made into that last bank. Barclays is optimistic about a large proportion of the cohort surviving for a significant time.
The Government cannot reverse changes in the market and in customer behaviour, and nor can we determine the commercial strategies of individual firms. I still believe that it is not for me in Westminster to decide the shape of a branch network or whether a bank should place a branch in Wolverhampton or Wick, but it is important that the impact of closures on communities is understood, considered and mitigated. I will set out some of the ongoing work in that area.
The access to banking standard is a key mechanism to ensure that customers are well informed about branch closures, and that banks set out their reasons for closure and the alternatives available to consumers. Since May 2017, the major high street banks have voluntarily signed up to the standard. However, I acknowledge that hon. Members have made representations to the effect that the application of the standard lacks transparency, is inconsistent and is insufficiently tailored to local conditions.
Last July, therefore, I met representatives of the Lending Standards Board and UK Finance, which enforce and own the standard, to discuss some of these concerns. As a result, they have agreed to two key improvements to the application of the standard. The first is agreement on a common definition of what constitutes an impacted customer when a branch closes, and the second is agreement on a number of common metrics to be used in impact assessments. Both of those will drive greater consistency of information among banks when they are closing branches.
In its recent annual report, the Lending Standards Board reported improved compliance with the standard among firms. It found that firms were providing more local information specific to the branches in question, and strengthening their relationships and engagement with the Post Office. In due course, the Lending Standards Board will publish examples of best practice to highlight positive approaches and provide a standard for under-performing firms to work towards.
Hon. Members will know the important role that the Post Office plays when branches close, and I have noted the comments of the hon. Member for North Ayrshire and Arran (Patricia Gibson) about the Treasury Committee’s report on this issue. I was therefore pleased by the successful renegotiation of the Post Office’s commercial agreement with the high street banks. That means that for the next three years at least, 99% of personal customers and 95% of small and medium-sized enterprise customers can continue with everyday banking at one of the UK’s 11,500 Post Office branches.
The agreement also ensures that local postmasters will see a considerable increase in fees for processing transactions, which will rise as volumes grow. I acknowledge the hon. Lady’s point about this being a complementary activity; I do think we are on a journey when it comes to the functions that post offices can provide, because they clearly cannot provide face-to-face banking services. Those are being aggregated generally across the industry, but these are issues that the banking industry must come to terms with. I will say more about that in a minute.
Post Office figures from between 2018 and 2019 show that overall transactions increased by 15.5%, deposits increased by just under 40%, and withdrawals grew by 16%. Increased income from fees will help the post office network become more financially sustainable and will allow for investment in automation, training and security. As high street entities, post offices face similar challenges when it comes to footfall and the changing behaviour of customers.
Turning to the issue of access to cash, three in 10 payments in the UK are still made in cash, and the Government want to ensure that cash remains available for those who need it. That is why in last week’s Budget, the Chancellor announced that the Government will bring forward legislation to protect access to cash. We will work with regulators and stakeholders as we develop our approach, including with LINK, the Payment Systems Regulator, and people such as Natalie Ceeney, who carried out the “Access to Cash” review last year. That process will also involve stakeholders such as Which?, who have taken a great interest in this issue.
Improving digital access must be an equally important part of our response. The opportunities created by digital and online products should be open to all, which is why we established the digital skills partnership to bring together the public, private and third sectors to address the digital skills gap in a more co-ordinated and collaborative way. Of course, doing so depends on physical connectivity; some 98% of premises in the UK can access decent broadband, but there is more work to be done. That is why the Budget announced a £5 billion commitment to support the roll out of gigabit-capable broadband.
Mobile coverage is also important; as the Chancellor has announced, the shared rural network agreement has been finalised, which will involve an extra £510 million of funding from the Government. That means that 95% of the UK’s landmass will have that connectivity.
Last year, I concluded a Westminster Hall debate on this topic with a call to arms for the industry, which I reiterate and re-emphasise today. We cannot reverse digital innovation—nor should we, given the benefits it brings. However, this House can agree that vulnerable customers must not be left behind or locked out of opportunities. Government, regulators and industry are already acting to ensure cash remains available. I have just come off a call this afternoon in which I discussed mutual banks, credit union reform—which was also announced in the Budget—and hubs and cash access, which is something I am actively pursuing the banks about.
We must keep putting energy into digital inclusion, and not let the process of innovation run out of steam. I will be working with the industry and pushing it to go further. I value all the contributions that have been made today; they reinforce the energy that I will continue to bring to solving some of these difficult problems, which differ across the country.
Owen Thompson
I thank all hon. Members for their contributions. The sense of déjà vu among many, most or all Members regarding the situation with banks is certainly of note. It is frustrating that banks’ consultations are so flawed—they are simply box-ticking exercises—and I welcome the innovative thinking that the Minister has outlined. Hopefully, we can press that thinking on banks, but more needs to be done to make sure we maintain that face-to-face connection with our communities.
Written Statements
(4 years, 1 month ago)
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Contingent Liability
(4 years, 1 month ago)
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The Chancellor of the Exchequer (Rishi Sunak)
In my oral statement yesterday I announced a new credit easing scheme called the Covid-19 Corporate Financing Facility (CCFF), which is expected to become operational in the week commencing 23 March 2020. This scheme will be run by the Bank of England (The Bank) on behalf of HM Treasury. HM Treasury are extending a full indemnity for the CCFF, which will create a new contingent liability for the Government equal to the potential losses of the Facility.
The CCFF will be a credit easing scheme targeted at easing the disruption to cash flows of companies following Covid-19. The scheme will focus on purchasing newly issued commercial paper from eligible companies, which are non-financial companies that make a material contribution to the UK economy and are rated investment grade. The CCFF is unlimited in size.
HM Treasury will monitor risks to public funds from the facility through regular meetings with the bank. The bank will manage the facility in accordance with a stringent risk control framework agreement between HM Treasury and the bank, which will be similar to existing frameworks such as that of the asset purchase facility (APF).
A departmental minute has been laid in the House of Commons providing more detail on this contingent liability.
[HCWS169]
Legacy Issues
(4 years, 1 month ago)
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The Secretary of State for Northern Ireland (Brandon Lewis)
Today the Government announced the introduction of legislation to provide greater certainty for service personnel and veterans who serve in armed conflicts overseas. Alongside this, we are setting out how we propose to address the legacy of the past in Northern Ireland in a way that focuses on reconciliation, delivers for victims, and ends the cycle of reinvestigations into the Troubles in Northern Ireland that has failed victims and veterans alike—ensuring equal treatment of Northern Ireland veterans and those who served overseas.
We have heard from many across Northern Ireland and the rest of the United Kingdom that the current approach is not working well for anyone, and that it erodes confidence in public institutions that exist to support society as a whole. Discussions about how to change this have been ongoing for many years. The Stormont House agreement in 2014 was an important milestone, but it did not stop the debate continuing.
Many families have waited too long to find out what happened to their loved ones, while those who defended the rule of law deserve certainty that there will be an end to repeated questions about what happened during their service. A better way to deal with the past is necessary if we are to help the whole of society to effectively heal the wounds of the troubles and become better reconciled with our difficult history.
In 2018, the Government carried out a public consultation on ‘Addressing the Legacy of Northern Ireland’s Past’, inviting views on proposals based on the Stormont House agreement. The consultation attracted over 17,000 responses—summarised in the Government’s ‘Analysis of the consultation responses’, published in July 2019. We have carefully considered each and every one of these, and sought to identify a way forward that will deliver for all those affected by the legacy of the Troubles and enable all sides of the community to reconcile and prosper. It is clear that, while the principles underpinning the draft Bill as consulted on in 2018 remain, significant changes will be needed to obtain a broad consensus for the implementation of any legislation. We believe that the proposals set out below provide a framework for doing this.
It is the Government’s view that to best meet the needs of all victims and of wider society, we need to shift the focus of our approach to the past. While there must always be a route to justice, experience suggests that the likelihood of justice in most cases may now be small, and continues to decrease as time passes. Our view is that we should now therefore centre our attention on providing as much information as possible to families about what happened to their loved ones—while this is still possible.
Our proposals have therefore evolved to remain true to the principles of the Stormont House agreement but with a greater emphasis on gathering information for families; moving at a faster pace to retrieve knowledge before it is lost; and doing more to help individuals and society to share and understand the tragic experiences of the past.
It is proposed that these measures should be carried out by one independent body to ensure the most efficient and joined-up approach, putting the needs of the individuals most affected at the heart of the process. This body will oversee and manage both the information recovery and investigative aspects of the legacy system, and provide every family with a report with information concerning the death of their loved one.
The Government want information recovery and reconciliation to be at the heart of a revised legacy system that puts victims first. The Government are committed to the rule of law, but given the considerable time that has elapsed since many of these incidents took place it is vital that we swiftly implement an effective information recovery mechanism before this information is lost forever.
The Government will ensure that the investigations which are necessary are effective and thorough, but quick, so we are able to move beyond the cycle of investigations that has, to date, undermined attempts to come to terms with the past. Only cases in which there is a realistic prospect of a prosecution as a result of new compelling evidence would proceed to a full police investigation and if necessary, prosecution. Cases which do not reach this threshold, or subsequently are not referred for prosecution, would be closed and no further investigations or prosecutions would be possible—although family reports would still be provided to the victims ’ loved ones. Such an approach would give all participants the confidence and certainty to fully engage with the information recovery process.
The Government believe that this approach would deliver a fair, balanced, and proportionate system that is consistent with the principles of the Stormont House agreement and deliver for all those who have been affected by the events of the past; striking a balance in enabling criminal investigations to proceed where necessary, while facilitating a swift transition to an effective information recovery mechanism before this information is lost forever.
The Government are committed to introducing legislation in line with our commitments in ‘New Decade, New Approach’, to move forward and deliver for all communities in Northern Ireland and beyond.
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House of Lords
Housing Delivery Test
Baroness Thornhill
To ask Her Majesty’s Government what assessment they have made of the results of the Housing Delivery Test, published on 13 February.
Baroness Thornhill (LD)
Weird, isn’t it? My Lords, I beg leave to ask the Question standing in my name on the Order Paper and declare my interest as a vice-president of the Local Government Association.
The Earl of Courtown (Con)
My Lords, following the publication of the housing delivery test results, we are engaging with those authorities facing challenges and, through the Planning Advisory Service, providing guidance to those authorities needing to produce action plans. Action plans published from last year’s results show that the authorities are taking the right steps to identify the causes of reduced housing delivery and will be working proactively to address these issues.
Baroness Thornhill
I thank the noble Earl, but will he take seriously the concerns about the housing delivery test? Councils are now not only responsible for the delivery of homes in their area; they get punished if they fail to do so, including through the removal of their planning powers. Yet councils—this is the rub—have zero powers to ensure that planning permissions, once granted, are built out. In fact, none of the eight interventions that the Government suggest in the relevant planning guidance pertain to the delivery of homes after planning permission. Can the Minister assure me that this test and its effectiveness will be looked at specifically in the forthcoming planning White Paper? You do not fatten a pig by weighing it.
The Earl of Courtown
My Lords, I thank the noble Baroness for her question. The fact is that the country needs houses. There is a commitment to 300,000 new houses, we have announced work in the Budget and, as she says, there will be White Papers on future planning and housing. All these are aimed at moving on so that we can achieve this challenging—I must agree with her—target.
She also asked about the test and how it will progress. As she knows, where delivery falls below 95%, the local authority should prepare an action plan proactively to identify the causes, but only when it falls below 45% does the presumption in favour of sustainable development get applied.
Lord Young of Cookham (Con)
My Lords, the housing delivery test applies to those local authorities that have an adopted local plan against which to measure progress. Can my noble friend tell the House how many local authorities have not got an adopted local plan, how the delivery test applies in those cases and what action the Government are taking to ensure that those local authorities produce an adopted local plan?
The Earl of Courtown
My Lords, I thank my noble friend Lord Young for his question about local plans. Those local planning authorises without an up-to-date local plan will be set a deadline of 23 December to adopt a new plan. At present, 90% of local planning authorities have adopted a local plan, but I should add that it is slightly more nuanced than that. If the five-year review looks at the plan and decides that it does not need to be updated, it can carry on; so, technically, it is feasible to have a plan older than five years that is still up to date. As my noble friend says, it is most important that local authorities have an active and current local plan.
Lord Kennedy of Southwark (Lab Co-op)
My Lords, I declare my relevant interest as a vice-president of the Local Government Association. We often discuss housing and planning in this House but I want to take the noble Earl back to the fact that well over 250,000 planning applications have been approved by local authorities with not a brick laid. That is the problem: getting these homes built.
The Earl of Courtown
My Lords, the noble Lord makes a good point. Where these planning permissions are current, the building process must continue. This is why we have committed £44 billion of funding over five years to build more houses, simplify the planning system for the public and small builders, and renew the affordable homes programme to build thousands of affordable homes. This is all about trying to get more bricks put in the ground so that we can have more houses for everybody who needs them.
The Archbishop of Canterbury
A distinction without a difference, my Lords. The Question from the noble Baroness, Lady Thornhill, is pertinent. Last year I set up a commission to look at the building of housing and communities. Simply the delivery of more houses does not create better communities. The mere existence of houses is not in itself a virtue. It comes back to fattening the pig, as the noble Baroness put it so well. What powers will the planned legislation give to local authorities to ensure that affordable housing is delivered? The experience is that, although there may be a commitment to it in the early stages of planning, as the process goes on the number of affordable houses diminishes very severely. There is a lack of imagination over the forms of ownership. If we are to have communities, we must have facilities and the capacity to build those communities together. Does the Minister agree with that, and what are the plans?
The Earl of Courtown
Yes, I agree with the most reverend Primate. Communities are of prime importance. There has been much movement over the last few years in various areas where there has been large-scale development. Communities have been very much at the forefront in how many of these planning development areas have been established. I know in particular about an area in north Swindon. I declare an interest: I was a landscape contractor there. I did a lot of the planting of trees and the general landscaping. There, it was very important that these developments had a community at their centre. The most reverend Primate also commented on what the noble Baroness said—I cannot remember what she said. I apologise; I will write to the most reverend Primate on that issue.
Lord Alton of Liverpool (CB)
My Lords, in addition to the eight local authorities being immediately sanctioned, what will happen to the 26 local authorities that have been told they will have to produce action plans? How long will they have to do that for and what sanctions will be applied to them if they fail to comply? After all, as the noble Baroness, Lady Thornhill, put it, we need carrots as well as sticks.
The Earl of Courtown
The noble Lord, Lord Alton, makes a very good point. As he said, 26 local authorities have achieved between 85% and 94% of delivery. They need to produce an action plan to remedy this. We look forward to the planning White Paper, but one should remember that we will also be reforming the fees process for planning applications. This is to ensure that local planning authorities are properly resourced.
Contraceptives and Hormone Replacement Therapy Drugs
(4 years, 1 month ago)
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Baroness Thornton
To ask Her Majesty’s Government what assessment they have made of the shortage of supply of (1) contraceptives, and (2) hormone replacement therapy drugs, in the United Kingdom, and when they expect that the normal supply of these products will resume.
The Parliamentary Under-Secretary of State, Department of Health and Social Care (Lord Bethell) (Con)
My Lords, we are aware of ongoing supply issues with some HRT drugs and a limited number of contraceptives. We are sympathetic to those affected. I am pleased to say that the supply situation for HRT started to improve at the end of February and continues to improve during this time. However, we will work closely with all suppliers and share relevant information on availability to the NHS on a regular basis to ensure that patients can access the medicines they need.
Baroness Thornton (Lab)
I thank the Minister for that Answer. I am very happy that things are improving, because a number of HRT medications and contraceptives remain unavailable until the end of this year, some patients have been told, or until they do not know when. I understand that some of the shortages are triggered by supply problems in China, with some of the components of the popular HRT patches being increasingly in demand for other types of treatment that, in their turn, have become scarce. Of course, one guesses that further disruption in China in the wake of the coronavirus will affect the production and supply of prescription drugs. Does the Minister share my concern that online pharmacies are exploiting desperate women by charging up to four times NHS prices for HRT and contraception?
Lord Bethell
The noble Baroness, Lady Thornton, is entirely right that supply problems persist. The NHS looks after 11,000 drugs and at any one time around 100 or 150 have supply problems. It is a great frustration to those concerned and we are cognisant that HRT has been a persistent problem for more than a year. However, the outlook is positive. I reassure the House that Covid-19 has not had an impact on the supply of HRT. We do not envisage there being a connection or a problem. I share the noble Baroness’s concerns that online pharmacies might take advantage of the situation, but it is a marketplace: it provides choice and is regulated.
Lord Alderdice (LD)
My Lords, when women go to the chemists to get their prescription, they might well find two problems. The first is the one the noble Baroness mentioned—inadequacy of supply—but it is also increasingly likely that pharmacists themselves will fall ill, so not only the advice, but even the dispensing of available pharmaceuticals will be impossible because they will have fallen ill. Can the Minister tell us what conversations Her Majesty’s Government have had with the Royal Pharmaceutical Society to free up some of the normal professional regulations and requirements for exemption and insurance so that relatively recently retired chemists may come back to fill in the gaps that will undoubtedly be there and which will make many pharmacies ineffective because there is no chemist to dispense?
Lord Bethell
The noble Lord is entirely right to focus on pharmacists. I pay tribute to the important role they play in communities. Their role will be essential in the forthcoming months when enormous pressures will be put on hospitals. We will be encouraging people to avoid areas of infection. A typical pharmacy where there are two pharmacists, who might be related or even married, will clearly be under pressure. Two people working closely together are clearly an infection challenge. That is why we have engaged very closely with the pharmacy industry. The noble Lord is entirely right that the possibility of using recently retired pharmacists is being considered. Soon-to-qualify pharmacists might face early call up. Many have already been written to and there might be provisions in the forthcoming coronavirus emergency Bill to expedite the regulatory changes the noble Lord suggests.
Baroness Symons of Vernham Dean (Lab)
My Lords, the Minister just told the House that HRT has been in short supply for over a year. Why have the Government not taken effective action on this before now?
Lord Bethell
The noble Baroness is entirely right to express her frustration. It is enormously frustrating for those concerned and for our medicine supplies. Medicine production is a long-term business. There was a point when HRT consumption went down, but then demand grew exactly when some production facilities had backed off their supply. It was an incredibly unfortunate combination of events that has led to this situation, but I reassure the House that we are working extremely hard to provide alternatives and to replace those most favoured products that are in short supply at the moment.
Lord Kakkar (CB)
My Lords, I remind noble Lords of my declared interests. Has thought been given to whether novel therapies that might soon become available from research elsewhere in the world might be applied to the management of patients infected with coronavirus in our own country? Is the Minister content that the current regulations that govern the use of medicinal products in man are sufficiently flexible to allow for drugs that not only currently exist but might be repurposed for this, and for novel and innovative therapies, neither of which might be licensed for use in the United Kingdom at the current time, to be made available without further impediment if that was thought to be a useful intervention?
Lord Bethell
The noble Lord, Lord Kakkar, is entirely right to stress this point about regulation. I assure him and the House that we are working extremely closely with Public Health England and the MHRA to ensure that there will be no regulatory hurdle that prevents the swift introduction of proven, safe products into the UK market. This is a massive priority that has had great scrutiny from both the department and Downing Street. It is one that we are focused on and will continue to focus on.
Higher and Further Education: Rural and Coastal Areas
(4 years, 1 month ago)
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Lord Bassam of Brighton
To ask Her Majesty’s Government what support they plan to put in place to assist universities and further education colleges to address issues with higher education provision in rural and coastal areas.
Lord Watson of Invergowrie (Lab)
My Lords, I beg leave to ask the Question on the Order Paper in the name of my noble friend Lord Bassam of Brighton, who is in precautionary self-isolation.
The Parliamentary Under-Secretary of State, Department for Education and Department for International Trade (Baroness Berridge) (Con)
My Lords, we want everyone to benefit from a fair chance, and no part of the country should be left behind. Anyone with the potential to succeed should have the opportunity to benefit from high-quality university education, regardless of their age, background or, importantly, the part of the country they grew up in. We plan to expand technical and vocational provision at higher levels through the institutes of technology, of which there will be 20 spread across all regions of England.
Lord Watson of Invergowrie
My Lords, I thank the Minister for that response, because there are a significant number of further and higher education cold spots in England, including coastal regions in the east and north and rural areas of the south-west. According to the Social Mobility Commission, those areas have little or no sixth-form provision within a commutable distance, which—predictably—means they have significantly lower percentages of pupils than the national average going on to higher education. That is leading to a poorer qualified, less well-trained, lower aspiration workforce in these areas. Will she explain what additional sustainable support the Government will provide for further and higher education institutions in the seaside towns and other left-behind parts of the country, to redress the education inequalities they experience?
Baroness Berridge
My Lords, the Social Mobility Commission made mention of the Government’s opportunity areas. That programme has been extended; there will now be a total of £90 million. Many of those areas, including Blackpool, Hastings and Whitby, are part of that programme. We are pleased to know that that programme is also in Opportunity North East, where there is specific funding. A number of factors affect access to the best education provision, and we are particularly looking at the transport offer. A discounted rail ticket has been introduced for 16 and 17 year-olds. From 2021, apprentices and jobseekers will benefit from discounted bus travel as well.
Baroness Nicholson of Winterbourne (Con)
Might the Minister look into coastal towns provision for disabled students? It may not be a question of the provision from the Government; universities may not be implementing the law. I give the example of Anglia Ruskin University, which has superlative education provision access for disabled students—compared with Hull University, which is more than inadequate; I believe it is actually breaking the law. Might the Minister be willing to have a word with me sometime on this?
Baroness Berridge
My Lords, my noble friend is correct that universities are bound by the Equalities Act and should make provision for students with special education needs and disabilities. Funding is available for them to do that, but I am happy to meet her at an appropriate time.
Lord Patel of Bradford (Non-Afl)
My Lords, while I applaud the Government for doing all they can for further and higher education in coastal and rural areas, we are seeing a mass exodus of young people from those areas because, even if they get the education, there are no jobs. Are there any initiatives under which we are incentivising businesses to establish themselves in those areas? Could Civil Service relocation plans look at coastal and rural areas as well?
Baroness Berridge
To ensure job opportunities for young people, skills advisory panels have now been set up that bring together the HE and FE provision in the area with an employer, specifically to make sure that the training is there for young people to remain and to keep the supply of relevant skills in the local area.
Baroness Garden of Frognal (LD)
My Lords, following on from the previous question, can the Minister say what provision the Government are making to ensure that disadvantaged students from rural and coastal areas have access to the work experience that is a key part of the untried and untested T-levels?
Baroness Berridge
The first three T-levels will be introduced later this year. There has been specific investment of capital to ensure that these will be basically 80% classroom and 20% work placements. Providers have been given the money to establish good-quality work placements, which are an essential part of T-levels.
Lord Blunkett (Lab)
My Lords, I wonder whether the House will indulge me. Will the Minister have discussions with her Secretary of State and perhaps come back to the House in relation to the survival of these further and higher education institutions across the country, which may be affected detrimentally in the months ahead by the final incremental payments of fees, leaving them with a considerable shortage of funds? Can she also find out whether the Secretary of State will discuss with the Office for Students the way in which it approaches this as a supportive mechanism, not as a critic?
Baroness Berridge
My Lords, I understand that matters to do with education are being addressed. The issue of early years providers and further education colleges—they are similarly funded, by the activity through the door—is keenly on the department’s radar at the moment.
Baroness Hooper (Con)
My Lords, ed tech and the new systems and opportunities provided by distance learning, without the need for major infrastructure projects, are obviously an important way forward. In addition to the advantages that my noble friend the Minister has already outlined, would she not say that ed tech gave a valuable opportunity for international co-operation between institutions in other countries? I declare an interest as the honorary president of BESA, the British Educational Suppliers Association.
Baroness Berridge
Ed tech is literally just beginning to show us what is possible in relation to education—in international collaboration, yes, but particularly in flexible and distance learning, which can help students from disadvantaged backgrounds to access education further away from home, if they have caring responsibilities, and particularly in relation to special educational needs. We are having a rapid evidence assessment, because teachers need to understand fully the technology now available to best apply it to the students they are trying to teach.
Baroness Blackstone (Ind Lab)
My Lords, transport costs are often a barrier to students living some distance away, especially from FE colleges. It was gratifying to hear that some consideration is being given to support students with transport costs. Can the Minister say a little more about that, particularly in relation to students over the age of 19, and whether part-time students will be included in any support planned?
Baroness Berridge
Yes, what I have outlined covers both bus and rail, but the noble Baroness will be aware that the bursary funding given to institutions can also be given to disadvantaged students. I will have to come back to her about the part-time comment.
Operation Midland
(4 years, 1 month ago)
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Lord Lexden
To ask Her Majesty’s Government what assessment they have made of the report by Her Majesty’s Inspectorate of Constabulary and Fire & Rescue Services, published on 13 March, which concluded that the Metropolitan Police Service has made slow progress in learning the lessons that arose from Operation Midland.
The Minister of State, Home Office (Baroness Williams of Trafford) (Con)
My Lords, the HMICFRS report commissioned by the Home Secretary is an important step in ensuring that lessons are being learned from the failures of Operation Midland. She recognises the critical importance of public confidence on this. Both HMICFRS and the IOPC recognise that the Metropolitan Police Service has responded positively since the publication of the Operation Kentia report in October 2019. The Home Secretary will continue to seek assurance from the Metropolitan Police Service that it is acting on the inspectorate’s findings.
Lord Lexden (Con)
My Lords, first, I pay tribute to the Home Secretary for ordering this very important review. But how can it have been that two Metropolitan Police Commissioners were asleep on their watch, largely unconcerned, it seems, by the misdeeds and malpractices of officers during Operation Midland and, presumably, content that lessons that ought to have been learned swiftly were ignored for so long? Can my noble friend give the House three or four specific examples of the lessons that have now been apparently and belatedly learned? Finally, I return to one aspect of these police scandals that concerns me particularly as a political historian. Will the Government now stop blocking an independent inquiry into Operation Conifer, which left an unwarranted slur on the historical reputation of Sir Edward Heath? I put it to the Government that they have not given the House reasons for vetoing the inquiry but the opinions of a number of recent Home Secretaries, none of whom is a lawyer.
Baroness Williams of Trafford
My Lords, there is quite a lot in my noble friend’s follow-up question. I join him in paying tribute to my right honourable friend the Home Secretary, who took very swift action in dealing with this. It is regrettable that there was no plan in place to deliver sustained improvements after Sir Richard’s review. Both HMICFRS and the IOPC have now found that the MPS has delivered significant improvements but, with respect to keeping track of those improvements, the Home Secretary will continue to seek assurances from the MPS that those improvements are being embedded across the force. On whether we will launch an inquiry into Operation Conifer, Operation Conifer and Operation Midland were quite different investigations. Operation Conifer has been subject to significant scrutiny. As Wiltshire Police has made clear, Operation Conifer did not pursue further inquiries into Carl Beech’s allegations after deciding that there was undermining evidence.
Lord Kennedy of Southwark (Lab Co-op)
My Lords, I see the point made by the noble Lord, Lord Lexden, about Operation Conifer. In respect of all the allegations of historical sexual abuse, can the Minister tell the House how many convictions there have been to date?
Baroness Williams of Trafford
I am glad that the noble Lord raises this because we need to see this in the broader context of historical abuse against children, of which there have been 11,346 non-recent allegations; that is a significant number. In total, 4,024 convictions have resulted from this. It has most definitely been something worth pursuing.
Lord Robathan (Con)
My Lords, following the shocking episode of the police being misguided—shall we say?—in their actions, does Her Majesty’s Government have any position on those who used hysteria in the media or online, or indeed used parliamentary privilege, to destroy the reputations of decent public servants alive and dead who are unable to defend themselves?
Baroness Williams of Trafford
My Lords, I think it is important to say, as we have said before, that false accusations devastate the lives of those against whom they are meted out, but let us also look at some of the remedies. Carl Beech was sentenced to 18 years in prison. That does not take away from the devastation that has been caused by false allegations, but I go back to the point that there have been thousands upon thousands of non-recent allegations of child sexual abuse, many thousands of the perpetrators of which have now been convicted.
Lord Addington (LD)
My Lords, would it not be a good idea for us to take on some better practice here? I pray in aid my noble friend Lord Paddick’s Private Member’s Bill, which suggests we ensure that somebody’s name is released not when the arrest is made but when a charge is made. Making sure that this happens will get rid of some of the bad practice that gets in the way of the rightful convictions of people who have done the wrong thing.
Baroness Williams of Trafford
My Lords, there is generally a presumption of anonymity but there may be policing reasons why, in the course of an investigation, police may release names. Quite often, it is the media that releases those names. There has been updated guidance for the media and the police on this.
Lord Lea of Crondall (Non-Afl)
My Lords, does the Minister believe that there is enough information in the public sphere about how such inquiries are supposed to be carried out? I took a particular interest in the Edward Heath case when I got a note through my letterbox in Crondall asking me to ring a Wiltshire police station. I did and was asked whether I had known Sir Edward Heath through the TUC and whether I had stayed at Chequers and so on. I was struck by how amateurish it all was. It is all very well our thinking about transparency in retrospect, but is enough known in the public arena about how such inquiries are supposed to be carried out?
Baroness Williams of Trafford
My Lords, I think that that is what IICSA has spent the last four years trying to establish.
Non-Domestic Rating (Lists) Bill [HL]
Wednesday 18th March 2020
(4 years, 1 month ago)
Lords ChamberRead Full debate Non-Domestic Rating (Lists) Bill [HL] 2019-21 View all Non-Domestic Rating (Lists) Bill [HL] 2019-21 Debates Read Hansard Text
National Minimum Wage (Amendment) (No. 2) Regulations 2020
The Earl of Courtown
That the draft Regulations laid before the House on 13 January, 3 and 11 February be approved.
Relevant documents: 4th, 6th and 7th Reports from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 16 March.
Armed Forces Act (Continuation) Order 2020
The Earl of Courtown
That the draft Order laid before the House on 3 February be approved. Considered in Grand Committee on 16 March.
The Earl of Courtown (Con)
My Lords, in the absence of my noble friend Lady Goldie, I beg to move the Motion standing in her name on the Order Paper.
Civil Liability (Information Requirements) and Risk Transformation (Amendment) Regulations 2020
The Earl of Courtown
That the draft Regulations laid before the House on 3 February be approved.
Relevant document: 6th Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 16 March
The Earl of Courtown (Con)
My Lords, in the absence of my noble friend Lord Parkinson of Whitley Bay, I beg to move the Motion standing in his name on the Order Paper.
Arrangement of Business
The Earl of Courtown (Con)
My Lords, there will be a short adjournment between the end of Questions and the start of the debate on the Budget to allow Members to maintain social distancing if they are taking part in that debate but do not want to be present for Oral Questions. I beg to move that the House do now adjourn during pleasure for 10 minutes.
Budget Statement
(4 years, 1 month ago)
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Lord Agnew of Oulton
That this House takes note of the economy in the light of the Budget statement.
The Minister of State, Cabinet Office and the Treasury (Lord Agnew of Oulton) (Con)
My Lords, last Wednesday, the Chancellor laid down a Budget that backed business and innovation and gave support to public services with the aim of levelling up the entire country. But in the course of a week, the world has changed. Many of the things that I will say will appear out of date, but we need to see beyond the hopefully short-term impact of this pandemic.
To start with coronavirus, the Budget set out the initial economic response, but this has quite rightly been overshadowed by a far more substantial package announced over the last few days. The initial plan included a £30 billion plan: to support the NHS needs in staff and the search for medicines; to support workers, with expanded guarantees for statutory sick pay; and to support businesses with a comprehensive and coherent package of tax reliefs and loans.
But with the worsening situation, the Chancellor has responded with further urgent action. He has expanded the amount that businesses can borrow from the new temporary coronavirus business interruption loan scheme from £1.2 million to £5 million. For those businesses affected most by essential distancing measures in the retail, hospitality and leisure sector, including shops, cinemas, restaurants, music venues, museums, art galleries, and theatres, the Government will, for this coming year, abolish their business rates altogether.
Alongside this, the Government are increasing grants to small businesses eligible for small business rate relief from £3,000 to £10,000. To cope with cash-flow problems, the Chancellor has announced a programme of loans and guarantees to support firms through the economic emergency. In total, he will make available an initial £330 billion of guarantees, equivalent to 15% of the UK’s GDP. These are extraordinary times and the Chancellor has responded at a scale to reflect this. The plan recognises that coronavirus will have a significant impact on our economy. This is a serious and sensible effort to make sure that the impact will be temporary.
This brings me to the growth forecasts. I recognise that the OBR’s calculations were completed before the full extent of the impact of coronavirus became as clear as it is now. But, even before coronavirus hit, we were facing a slowing world economy. When combined with the political uncertainty over the last few years, the OBR had trimmed our productivity forecast over the relevant period and slightly reduced forecast GDP growth, compared with the March 2019 forecast. This makes it all the more important that the Government act bravely and take decisions now for our future prosperity. Outside the coronavirus intervention, the Government are investing an additional £175 billion over the next five years in infrastructure and innovation. At the time, the OBR said that these plans could boost growth over the next two years by 0.5 percentage points. It had expected that half a million more people would be in work by 2025 and that wages would grow in real terms in every year of the forecast period. The OBR had forecast 1.4% for this year, increasing to 1.8% next year and then, for the rest of the forecast period, remaining on or around target.
Let me turn to the fiscal forecasts. The impact of coronavirus, and the Government’s necessary response, will lead to a significant increase in borrowing. But we are equipped to manage this need. The hard work of the last 10 years has left our public finances in a strong place, with the deficit down from above 10% in 2009-10 to less than 2% last year. While borrowing will increase this year, we expect this spike to be temporary. As the OBR has said, the medium-term impact on borrowing will likely be limited. The Government were elected on a manifesto that promised to maintain fiscal prudence; we are doing everything we can to honour that while also facing down the immediate risks and planning for longer-term prosperity.
The Government’s plan for prosperity starts immediately by helping people with the cost of living. Changes to the national living wage, income tax and national insurance mean that someone working full-time on the minimum wage will be more than £5,200 a year better off than in 2010. The Chancellor also confirmed that, from January next year, there will be no VAT on any women’s sanitary products, fuel duty will remain frozen for another year, the planned rise in beer duty will be cancelled, and the Government will freeze duties for cider and wine drinkers as well. For only the second time in almost 20 years, that is every one of our alcohol duties frozen. This Government promised to cut taxes and the cost of living, and we are aiming to deliver on this.
Nothing helps more with the cost of living than putting more money into people’s pockets through a thriving private sector. The Chancellor gave his full backing to business with £130 million of new funding to extend start-up loans, £200 million for the British Business Bank to invest in scale-ups, £200 million for life sciences and £5 billion for new export loans for businesses.
This was a Budget that also showed support for business through the tax system. The research and development expenditure credit will be increased from 12% to 13%—a tax cut worth £2,400 on a typical R&D claim. The structures and buildings allowance will be increased from 2% to 3%, giving an extra £100,000 of relief for those investing in a building worth £10 million. To cut taxes on employment, the Government will increase the employment allowance by a third to £4,000. That is a tax cut, this April, for nearly half a million small businesses.
The next part of the Government’s plan for prosperity is to invest in ideas, in brilliant scientists and in cutting-edge technologies that will shape the economies of the future. The Budget will increase investment in R&D to £22 billion a year, the fastest and largest increase in R&D spend ever. Detailed allocations of our new investment in ideas will be set out in the spending review, but the Budget gave us a flavour, including over £900 million in nuclear fusion, space and electric vehicles and at least £800 million in a new blue-skies funding agency to conceive the next world-changing technology. There is a further £800 million to establish two or more new carbon capture and storage clusters by 2030. This work will be needed to create the high-skilled, high-wage jobs of the future all around the country. It will also be needed to help us transition to a low-carbon economy with new green technologies.
The Budget has helped us on our journey to net zero by 2050. It will raise the climate change levy on gas, extend the climate change agreements scheme for energy-intensive industries for a further two years and introduce a new plastics packaging tax that will increase the use of recycled plastic in packaging by 40%. We are also abolishing the red diesel relief for all but a few specific sectors.
As well as taxing pollution, the Government will invest in and cut taxes on clean transport with a package of reforms to make it cheaper to buy zero or low-emissions cars, vans, motorbikes and taxis. We are providing £500 million to support the rollout of new rapid charging hubs so that drivers are never more than 30 miles from being able to charge up their car. Taken together, this Budget invests £1 billion in green transport solutions.
We are providing £640 million for a new nature for climate fund to plant around 30,000 hectares of trees—a forest larger than Birmingham—and to restore 35,000 hectares of peatland, all of which helps capture carbon. This Government intend to be the first in history to leave our natural environment in a better state than we found it, while making sure that we have the means to protect ourselves when the natural environment shows its power. The recent floods devastated homes and businesses across the country; the Budget made available £120 million immediately to repair defences damaged in the winter floods and £200 million of funding to local communities to build flood resilience, and we promised to double our investment in flood defences over the next six years to £5.2 billion.
This Government have spoken a great deal about levelling up. Last week’s Budget began to make the picture much clearer. Over the next five years, this Government will invest more than £600 billion in our economic infrastructure. Public net investment will, in real terms, be at its highest since 1955. The detail will come out at the spending review, but the Chancellor laid down a few guiding principles.
First, the Government will review the Treasury’s Green Book to make sure that economic decision-making reflects the economic geography of the country. Secondly, the Government will invest more in our nations, cities and towns. We are committing an extra £640 million for the Scottish Government, £360 million for the Welsh Government and £210 million for the Northern Ireland Executive. We are providing £242 million of funding for new city and growth deals. In addition, there will be a new devolution deal in West Yorkshire, with a directly elected mayor and a funding settlement of £4.2 billion. The Government are also investing £1.2 billion in local transport in 12 further cities, including Stoke, Preston, Derby, Nottingham and Southampton.
We are investing in broadband, railway and roads. We are committing £5 billion to get gigabit-capable broadband into the hardest-to-reach places. Work is starting on HS2. There is funding for the Manchester to Leeds leg of Northern Powerhouse Rail—the biggest ever investment in strategic roads and railway—and a new £2.5 billion pothole fund.
The Chancellor made it clear that we will boost public services, recognising them as the tools by which the Government can level up and spread opportunity. In education, the Budget provided funding for specialist 16-19 maths schools and £1.5 billion of new capital over five years to dramatically improve the condition of the FE college estate.
In housing, the Government extended the affordable homes programme with a new, multiyear settlement of £12 billion. We have confirmed nearly £650 million of funding to help rough sleepers into permanent accommodation and created a new building safety fund worth £1 billion to make sure that unsafe combustible cladding will be removed from every private and social residential building above 18 metres in height.
In health, we announced over £6 billion of new funding in this Parliament to support the NHS to deliver 50,000 more nurses, 50 million more GP surgery appointments and work to start on 40 new hospitals. We are backing all that up with extra funding for HMRC to clamp down on aggressive tax avoidance, evasion and non-compliance to make sure that we have the funds we need in the future. This all means that, by the end of the Parliament, day-to-day spending on public services will be £100 billion higher in cash terms than it is today.
This is a Budget delivered in difficult times, but one which will help the country meet the challenge of the coronavirus. When this disaster is behind us, it will lay the foundation for a new decade of regeneration
Lord Tunnicliffe (Lab)
My Lords, I thank the noble Lord for introducing this debate, in particular for his intelligent and pragmatic approach in addressing not only the Budget but the Statement made last night. I assume that he will be responding to questions from noble Lords on last night’s Statement as well as the Budget itself. I note that he nods as I say those words.
Our post-Budget debates are often interesting affairs, not least because an extra week or two allows for greater scrutiny of the famous Red Book. I expect that this one will be even more enlightening, even if for the wrong reasons. As the Chancellor acknowledged in his Statement last week, the Spring Budget took place against an unconventional political and economic backdrop. Not only was it delivered by a Chancellor who had not expected his promotion, but it came as the global Covid-19 pandemic required a series of extraordinary actions from the Government.
We have since had a supplementary economic Statement from the Chancellor in which he announced additional measures to assist some of the businesses that will be worst affected in the weeks and months ahead. I want to be clear: to a large extent we support the action being taken. There are areas where we have concerns, but we appreciate the spirit in which Ministers have approached this challenge. Many of my noble friends have been engaged in meetings with their opposite numbers in recent days and have been able to put forward concerns and suggestions, which appear to have been taken seriously.
Before turning to our analysis of the economy, I place on record our thanks to everybody across the UK who is working to minimise the wide-ranging effects of Covid-19. Our NHS workers are once again demonstrating their heroism in the face of unprecedented demand. Public health and other authorities are reacting swiftly and decisively. Many members of the public are supporting friends and neighbours, helping them navigate these most unusual times. We thank them for all their hard work and community spirit.
I am grateful to all noble Lords who are due to participate in this debate and to those who have considered their own circumstances and decided to stay away on this occasion. We may not get to hear their words of wisdom this time, but we look forward to doing so in future.
As I have mentioned the coronavirus, I will raise our concerns about it now. As I have said, we largely support the measures that have been announced, but noble Lords will not be surprised that we have some concerns. This is a fast-moving situation and there will be more to come. Although it is perhaps a little late, we welcome the establishment of new government committees to enable swifter, joined-up responses to new developments.
Nevertheless, as we discussed in yesterday’s PNQ on entertainment venues, some recent announcements have caused confusion rather than offering clarity. The issues relating to insurance seem to have been resolved, but in such turbulent times it is vital that the Government are a calming influence, rather than causing further uncertainty. There remains the question of unequal treatment; banks are offering mortgage customers the ability to negotiate payment holidays, but there is a lack of action to ensure that renters are not adversely impacted by temporary cash-flow problems. We have been promised a statement by the Secretary of State for Housing, Communities and Local Government. When will this take place?
We have previously relayed concerns over the current level of statutory sick pay, which we believe introduces a risk that some will have to choose between health and financial hardship. This should concern us all. We have also expressed alarm that some firms have moved swiftly to lay off staff, pushing them towards benefits rather than guaranteeing stronger levels of protection. As the director of the Institute for Fiscal Studies has noted, it will remain expensive for businesses to pay their staff, particularly if demand drops. Therefore, we urgently need targeted government intervention to protect workers.
The crisis will inevitably create incidents of real hardship. We therefore welcome the funding of local hardship funds, but while the headline figure of £500 million sounds significant, it will be spread across hundreds of authorities. Will a top-up be available if required? What of the administrative side? Will costs be reimbursed by central government, or will councils have to deduct them from the funds allocated? We welcome the changes to the benefit system to improve access for those who fall on hard times. However, questions remain over universal credit, particularly regarding the five-week delay; is that being lifted?
As this is a debate on the state of the economy, I want briefly to touch on the overall economic picture. Last week’s Budget was delivered on a day when the Office for National Statistics estimated flat GDP growth for the last quarter. Manufacturing figures continue to cause alarm, and growth in services has been inconsistent. As the Resolution Foundation noted, pre-coronavirus, the Office for Budget Responsibility forecast average annual growth of just 1.4% in the coming years. This is even weaker than the sluggish rates we have seen in the post-financial crisis era. The economic hit from weaker growth, even on these incomplete forecasts, is around £300 per household this year, rising to almost £600 per year by the middle of the Parliament. To people up and down the country, this outlook, which must now be seen as a best-case scenario, does not sound like the Government fixing the roof.
Yesterday, the OBR’s Robert Chote warned that Britain faces “a wartime situation” and must do more to support households and businesses through the current health crisis, even if this leads to increased borrowing and national debt. Charlie Bean, a former deputy governor of the Bank of England said:
“If you damage the economy, you damage the public finances further down the road.”
Whether it is a financial crisis or something such as this, all the evidence shows that big action taken early is better than half-hearted action delayed. Last night’s economic Statement provided a step forward, but it is not yet clear whether Ministers have a firm grip on the scale of the challenge our economy faces. If we get one thing from the Minister’s response this evening, it is that I very much hope I am proved wrong.
Returning to the spring Budget, I was disappointed that we saw nothing substantive on social care. In his first Downing Street address, the Prime Minister told us that he had a plan that was “oven-ready”. It was said that the Government have recently decided to convene cross-party talks on the future of care. It has taken years to get to this stage, and while a level of consensus is clearly needed to address the long-term challenges we face, local authorities and care providers will continue to face an uphill struggle in the meantime. According to the Local Government Association, adult social care faces a funding gap of £810 million in 2021, rising to £3.9 billion in 2024-25. That gap accounts only for core pressures. When factoring in unmet and under-met needs, and workforce challenges, the cost will be much higher.
Speaking of local authorities, I note that other than one-off schemes relating to the virus, and the commitments to reviewing business rates, there is little to offer long -term reassurance on the provision of local services. Indeed, the LGA expressed disappointment that next year’s public health budget was not confirmed, despite the new financial year being just weeks away. This was addressed yesterday, but the cause of the delay is not clear.
While there have been real-term increases for the year ahead, these do not compensate for funds being reduced by £700 million over the past five years. After the cancellation of the last comprehensive spending review, the Chancellor has finally launched a new exercise. I hope that it addresses the fact that England’s councils face an overall funding gap of almost £6.5 billion by 2025, which is only to meet demand and inflation pressures. Improving local services will require significantly more. I hope that it will also enable the Government finally to get to grips with the many big challenges that our country faces. After calling and winning called an election, more was expected from the Prime Minister and his Chancellor. We have heard that the Government want to tackle low pay by increasing the national living wage, yet workers will have to wait five years for a modest increase, and only if the economic conditions allow for it. Even then, the basic wage will remain far below the level suggested by the Living Wage Foundation.
We are told that the Government want to tackle rough sleeping, which has increased exponentially since 2010, but did homeless services receive the £1 billion they needed to reverse previous cuts? No, they did not. Neither did Ministers commit enough money to tackling domestic violence. The £10 million provided for
“innovative new approaches to preventing domestic abuse”
would need to be multiplied more than 15 times to meet the needs of refuges.
Ministers say that the UK has the most ambitious climate-change agenda in the world. However, this Budget barely mentions the climate crisis. The IFS said that in terms of reaching net zero
“the decisions made in this Budget don't provide great confidence that the government is willing to grasp the nettle.”
This is particularly disappointing since the UK is to host the COP 26 conference.
While I reiterate our general support for the actions relating to Covid-19, I express our disappointment that this Budget represents another missed opportunity. We hope that the negative consequences of a decade of austerity will finally begin to be addressed when we see the outcome of the spending review. We desperately need progress on social care, more funds for councils and steps forward on a variety of societal issues. However, on current form, and given the challenges facing the UK and global economies, there is little cause for optimism.
Lord Oates (LD)
My Lords, Harold Wilson advised us that a week is a long time in politics. Never has that adage proved truer than in the seven days between the Budget and this debate. Today we face not only a public health crisis, but also a national and international economic emergency without parallel, something which I am afraid did not seem to be fully recognised in the speech from the Government Front Bench.
Having said that, we on these Benches welcome the proposals made by the Chancellor yesterday and pay tribute to the dedication of civil servants across Whitehall as they seek to protect the health and economic well-being of the nation. The Government will have our support as they tackle the crisis ahead. This is a time to come together. It is what the public will expect, and it is what we should all deliver. I hope that the Government respond to our questions and constructive suggestions in that spirit.
We need to address the immense challenges that we face through a number of different lenses. The first is around people, the second around supply chains and the third around demand. First and most important is people. As we speak, millions of people are facing the future with deep anxiety, because of not only the threat to their health, but also the threat to their livelihood. The Government’s announcement of mortgage holidays and government-backed loans, rate relief and grants to support business is welcome, but we must go much further in the coming days. We must address the concerns of those who are not owner-occupiers but in the rented sector, and, as the director-general of the CBI, Caroline Fairbairn, said today, our top priority must be to keep employees in work. It is critical to those individuals and to their ability to pay their bills and look after their families, but it is also essential to the economy. People are being laid off now and people’s businesses are going bust.
For many businesses, taking out a loan to meet the wage bill is not an option. Many small businesses operate on wafer-thin margins, and it makes no sense for them to rack up debt at a time when demand for their services has collapsed, or in many cases, where they are no longer able to provide them at all. Speed is of the essence. Cash flow over the next week or two will be critical. Businesses do not have the luxury to wait for loan or grant applications to be processed; they need help now.
As I understand it, the grants of £10,000 for small businesses are available only to companies that pay rates directly. Many businesses do not. Will the Minister clarify that, because it is cause for concern for a number of people?
I ask the Government to look also at how they can direct money to support payroll immediately and directly. Can they look at ideas to reverse the NIC system to support employment, and at whether we can pay directly through PAYE? We must know how much everybody is paid, and perhaps the Government can come up with a scheme where we pay a percentage of the wage bill, so that businesses can keep people in employment at this time.
There is no perfect solution to this, but we cannot afford to let perfection be the enemy of the good. Speed is of the essence and we will have to learn along the way, because if we are not able to provide urgent support to keep people in employment, we will rapidly face much bigger problems across our economy, including in our supply lines.
This morning, on the “Today” programme, I heard the CEO of Swissport, Jason Holt, speaking about his concerns for his business. Swissport handles 90% of all air passengers and air freight and employs 25,000 workers. It is facing economic catastrophe. If it is not able to pay its workforce and remain in business, we will in turn face major problems in our supply chain, including for vitally needed medical equipment and computer equipment. The Government need to look urgently at how they can support these businesses, which are absolutely critical to the economy.
We also need to relieve unnecessary burdens on business. Business groups have told me that they are receiving similar asks from across government departments, and sometimes from within departments. The Government have to establish a co-ordinated approach to minimise the energy being expended by businesses responding to them. All consultations on regulations, unless absolutely essential at this moment, should be put on pause while we deal with the crisis.
This crisis is making us all increasingly reliant on our digital infrastructure, not all of which is designated as critical national infrastructure, and much of which is underpinned by small businesses. Representing 850 large and small companies employing over 700,000 people, techUK has highlighted the fact that maintaining this infrastructure is not just about hardware but about people. Urgent thought needs to go into how we handle these critical workforces. A government-led testing and management regime needs to be put in place to ensure that we can maintain systems operationally. We cannot just rely on individual engineers to determine whether they are sick or not. Such a workforce testing regime is obviously also critical for our NHS workforce, who must be an absolute priority.
Finally, I turn briefly to demand. We face a paradoxical situation, where our economy is facing overall collapse in demand, while at the same time suffering an excess of demand in specific areas. As we have seen, panic buying begets panic buying. The anxiety of seeing empty shelves converts even sensible people to conclude that they need to grab stuff when they can. The Government need to get ahead of this. It is illegal for retailers to co-ordinate with regard to their response to rationing and goods to customers, so the Government should step in and provide clear guidance and, if necessary, take enforcement powers to ensure that people get what they need and do not take what others require.
This is a huge area, but time does not afford us to cover it all. I fear that the impact of Covid-19 will be rather more profound and long-lasting than the Minister seems to envisage. He is right, of course, that we must continue to look beyond the current crisis, in particular to how we can build a net-zero economy for the future. But as we look to build that economy of the future, I think it is likely to be a very different economy than the one that we envisaged just a week ago.
The Archbishop of Canterbury
My Lords, a Budget is social morality in numbers. Whatever we say we believe about the dignity of human beings and about the existence or otherwise of society, the reality of our belief is demonstrated by the way we act, and especially by the way we act with money. The crisis through which we are passing will change this nation in deep and unpredictable ways, as the noble Lord, Lord Oates, has just said. Like a nuclear explosion, the initial impact is colossal, but the fallout lasts for years and will shape us in ways we cannot even begin to predict at the moment.
The Budget and the extra package announced yesterday must be both adequate in amount and sufficient in their aims to ensure that this country emerges confident from overcoming the virus—positively better than before it began. We will overcome the virus. The noble Lord, Lord Tunnicliffe, commented that small groups all over the country are showing fresh signs of community spirit and collaboration, and it is from those small groups, through to the large-scale government measures, that things will change.
During a crisis, keeping the long-term direction is as important as tackling the short-term problem. The enormous package of short-term measures is, by its very size, sufficient to raise hope, and for that it is welcome. Fifteen per cent of GDP is a war Budget commitment. The obvious questions, which have already been raised, are: how will it be distributed and how will it be used effectively? If we are to put confidence as the aim and people at the centre, the distribution and the impact must be both swift enough and imaginative enough to maintain confidence right across the economy, not only in the big cities with their own self-sustaining economies, but in the myriad towns and smaller communities across the country.
For many of them, there has been decline for many years, particularly, as we all know, those on the coast and in remote areas. Covid-19 may well be the last straw for some. Even exceptionally beautiful and normally tourist-filled cities, such as Canterbury, with good pedestrianised city centres full of bars and restaurants, and with major chains and everything in between based there, have seen this decline. In the past 12 months in Canterbury, Debenhams has closed and the number of vacant stores is noticeably larger. This could be repeated across the country. Shutting down the hospitality industry, necessary though it is, will empty the city centre. The cathedral, in which I should probably declare an interest, with its 300 employees, is one of the largest private sector employers in east Kent. It has apprentices, people with unusual skills and many other workers, but it depends from week to week and month to month on the income from tourism. Its solvency protects much of the local economy. Its 2 million visitors a year are at the beating heart of what makes the east Kent economy work. The same could be said about so many other places, from Durham south. A local economy is people, and an ecosystem as well. It is a complex structure, and losing one bit leads to overall decline. The package that has been announced and the Budget must be used with the vision of preserving the most fragile parts of the system, or we will lose all.
The use of these sums, so enormous and unprecedented, must be seen as being based in a clear moral and ethical structure, aimed at enabling those excluded by lack of adequate training and skills, the misfortune of being in declining industries, social change or other reasons to renew aspiration and to have jobs and secure homes in mutually supportive communities. We see the importance of community at this time.
It has been said that we should be especially concerned about the five-week gap in the payment of universal credit. That remains a significant problem in many areas. Thanks to the hoarding and panic buying that has been going on, food banks are desperately short of supplies for those who need them. They do not need money; they need the physical goods to give out, but they are not available. They are most needed when people move on to universal credit; 45% or so of those who come to food banks come because of problems with credit.
Free school meals have hardly been touched on. We will hear a Statement later today which may speak, as in Wales, of the closure of schools. For many children in the most deprived areas, school is where they get not just education but food. That needs to be addressed. What possibilities can the Government offer to enable free school meals, for instance, to continue during the gap? There has been talk about the need for provision for those who are self-employed and of statutory sick pay; I shall not repeat it.
To be moral and ethical, there has to be a vision on a scale with the spending, a vision that recovers “us” and “we” from the era of “I” and “me”—in short, a vision to recreate the notion and reality of society. That vision requires the mobilisation of not only the economy but of partnerships across society. In the Church of England, with 1 million children in schools, we are already planning and thinking about what education should look like to give abundant life. The phrase “abundant life” comes from the words of Christ. It marks the deeply embedded Christian tradition in our society to do with human flourishing, but human beings are responsible for making it happen. We are going to see huge change. It can be towards what we choose, or it will be what the strong make it.
Lord O’Neill of Gatley (CB)
My Lords, I welcomed the broad spirit and nature of the Chancellor’s Budget, much of which was, of course, designed before the realities of Covid-19. It was focused on a policy to significantly boost investment spending, so-called levelling up and giving proper attention to the northern powerhouse, all of which I hugely welcome. However, there have been events. The rest of my speech will be a brief, adapted form of an article I posted on Monday on the website of Chatham House, which I currently chair.
Linked to the call that Robin Niblett and Creon Butler of Chatham House and I made the day before—Sunday—for a global response to the Covid-19 pandemic, the case for a specific dramatic economic policy gesture from many policymakers across the world is prescient. This should involve most, if not all, G20 nations and should certainly have the same force as that led by Gordon Brown in 2008. We need some sort of income support for all our citizens, whether employees or employers, for the next two months. Perhaps one might call it, as I have done, truly a people’s QE— quantitative easing.
Both so-called modern monetary theory, MMT, and universal basic income, UBI, essentially owe their roots to the judgment that conventional economic policies have not been working, especially since 2008, in the way we are all trained to believe. At the core of these views is the notion of giving money to people, especially those on lower incomes, directly paid for by our central banks printing money. Until recently, I found myself having many doubts about, or not much sympathy with, these views, but, as a result of Covid-19, I have changed my mind.
This crisis is extraordinary in so far as it is both a colossal demand shock and perhaps an even bigger colossal supply shock. The crisis epicentre has apparently shifted from China, and perhaps much of the rest of Asia, to Europe and the United States. We cannot expect policies, however unconventional by pre-2008 standards, including the dramatic monetary steps announced by the Federal Reserve Board and other central banks, to put a floor under this crisis. We are consciously asking our people to stop going out, stop travelling and not go to their offices—in essence, curtailing most forms of normal economic life. The only ones not impacted are those who spend their entirety in cyberspace but even they have to buy some form of consumer goods, such as food, and, even if they order online, someone has to deliver it.
To give a flavour of the kind of challenge that we are now in, data published at the weekend shows that on most measures the Chinese economy probably fell by about 20% year on year in February alone. That equates to taking off something close to $3 trillion worth of GDP in a month. We in the UK, and much of the rest of the Western world, are adopting or have adopted some version of that same policy in March. It would be not at all surprising if we did not do something bolder, and the economic consequences will not be so far different from those in China.
As a result, markets are correctly worrying about a complete collapse of economic activity and with it a collapse of companies, not just their earnings. In my view, an expansion of central banks’ balance sheets in the way that has been done since 2008 is not going to do anything to help to arrest this, especially unless we go beyond just trying to underline the security of our banks, although that is still important. What is needed in the current circumstances are steps to make us believe with high confidence that if we take the advice of our medical experts, especially if we self-isolate and deliberately restrict our incomes or have them deliberately restricted for us, then this will be made good by our Governments. As I have said, in essence we need smart, persuasive people’s QE and quickly.
Having discussed this idea with a couple of economic experts I know, I realise that there are of course some challenges in the implementation of such an idea. For example, I gather that in the US it is probably currently illegal for the Federal Reserve Board to directly transfer cash to individuals or companies, and that could be true here and elsewhere. In my view, though, that is easily surmounted by our fiscal authorities by issuing a special bond, the proceeds of which could be transferred in the manner that I have suggested to both individuals and business owners, and our central banks could easily finance such bonds. It is also the case that such a step may encourage both the perception and the actuality of central bank independence, but I now find myself among those who argue that central banks can operate such independence only if done wisely and when needed.
Others may argue, in the spirit of the equality debate, that any income support should be targeted primarily if not entirely at those on very low incomes, while higher earners or large businesses should be given none or very little. I can sympathise with such spirits, but in my view that ignores the centrality and scale of this particular economic shock. All our cafes, pubs, restaurants, airlines—where do you stop?—indeed, all our businesses are currently at accelerating genuine risk of not being able to survive, and of course all these organisations are enormous employers of people on any kind of income.
As I have tried to say, it is also the case that time is of the essence. We need our policymakers to act on something like this as soon as possible—ideally in the next 24 hours—otherwise many of the transmission mechanisms that we have become accustomed to for the whole of our lives are going to be challenged. We need some kind of smart people’s QE now.
Lord Davies of Stamford (Lab)
Is it not the case that what is really alarming here is that the collapse of consumer demand is likely to last for a very long time and that there is going to be a substantial negative-wealth effect, given that people will have been out of jobs while their businesses and indeed the stock market has collapsed? People will require years to build up their savings again to where they were before. That means that for a very long time there is going to be a substantial shortage of demand from the consumer sector.
Lord O’Neill of Gatley
My Lords, my frank answer is that I do not know, but the longer that we delay an imaginative and forceful response, the risk of what the noble Lord has just described will rise. The whole reason why I am suggesting such a very unconventional and dramatic policy approach now is to stop exactly the kind of things that he is suggesting. If we give all our people confidence that they can essentially have something close to an eight-week paid holiday, and there is no reason for any employer to lay any of them off permanently or for those employers to worry about their income, that should give the confidence for us to allow what has been done so well in Asia to be fully done here, and get this virus behind us.
Lord Lamont of Lerwick (Con)
My Lords, it is a pleasure to follow the noble Lord, Lord O’Neill, and I intend to agree with much of what he said.
As the noble Lord, Lord Oates, said in his excellent speech, the Budget on 11 March now seems an eternity away. It was a challenge for anyone to deliver a Budget in those circumstances, but to do it when you have only been in office for a very few weeks was very challenging indeed. I strongly commend the boldness of the Chancellor’s measures.
To many people, the world economy must resemble a slow-motion apocalypse. As the noble Lord, Lord O’Neill, said, we have simultaneously both a supply and a demand shock. This was originally a health crisis, but the measures that Governments worldwide are forced to take to combat it add to the economic problems and to the crisis. The Chancellor of the Exchequer said that we will get through this. Of course we will, but there could be long-term damage to the world economy. In the last quarter of last year, the world economy was already teetering on the verge of recession; figures for Germany, Italy, Japan, China and the UK indicate that. A longer-term consequence might be a degree of de-globalisation, which I would regret. There are products that might have been launched that may never be. As a result of the measures yesterday, there will be loans to be repaid, which will be a big burden on the corporate sector, which in many countries in the world was already highly leveraged.
The world is not necessarily going to go back to exactly where it was before. People talk about a V-shaped recovery but it could be a U-shaped one or indeed L-shaped. People’s behaviour is going to change from what it was before. It may be that younger people will go back to how they behaved before but older people will behave differently.
The Chancellor was quite right to take advantage of low interest rates to invest in infrastructure, and for the package generally. The UK can now borrow for 30 years at less than 1%, so in real terms lenders are actually paying the borrowers for the privilege of lending. Of course people are sometimes inclined to argue that that is not without risk—for example, if we move into a period of deflation.
Since the Budget, markets have collapsed further, confidence has fallen further and businesses have begun to realise that the isolation of customers has huge consequences for them. The combined efforts of the Federal Reserve, the ECB and the Bank of England have had little effect. This is not surprising. A rate cut cannot stop the spread of a virus. This is not the sort of crisis that monetary policy can do a huge amount to ameliorate; it requires a fiscal response. It was therefore right that the Chancellor deployed his big bazooka with £350 billion-worth of guarantees, a business rates holiday and the business interruption scheme. Confidence is not going to return quickly—indeed, it probably will not return until progress is made in combating the virus—but the measures will be a bridge to that confidence.
I have two concerns about the Chancellor’s package so far. The first is what has been referred to by a number of noble Lords—the package as it refers to the self-employed and the gig economy. Self-employed people make up 15% of the labour force. I appreciate the measures on statutory sick pay that have been announced, but I question whether they really are going to be enough. We do not want people to have to choose between continuing to work when they are sick or staying at home with no money; we do not want sick people to be forced to work. Moreover, I am not convinced that universal credit or the employment support allowance will be wholly effective in the ways they need to be now, as we speak. We need to find a mechanism—although I appreciate that that is extremely difficult—to get money to those people who do not have any savings in reserve. If we cannot find such a mechanism, as the noble Lord, Lord O’Neill, suggested, it will be necessary to send a cheque or to do what President Trump seems to be thinking of doing: resorting to helicopter money. I too have had misgivings about this in the past, but I am convinced that it now needs to be considered.
My second concern is that the business take-up of loans will not go through to employees—that employers will not necessarily pay their workers. I do not mean to cast aspersions on employers, because of course most of them are concerned about their workers, their business and their other stakeholders. But they will be worried about the burden of the debt, and above all they will be concerned about whether their business will survive. Could we consider for the future perhaps making the loans conditional on guarantees about employment in individual firms? Can we take further action which the Chancellor has said there will be on employment support by making loans of this sort conditional?
I commend the Chancellor’s measures. They have been described as unprecedented in modern times and they may be unprecedented in the whole history of this country. The Government have not had much time to prepare for this emergency and we cannot expect to solve all these problems in just one day. Will more be required? Almost certainly, yes. The Chancellor has said that he is open-minded and prepared to do whatever it takes. That is the right approach and it is very welcome.
The Lord Bishop of Rochester
My Lords, as many have already observed, this Budget comes in extraordinarily unusual circumstances, and in relation to the issues around Covid-19, subsequent to the Budget announcement, the Chancellor has brought forward a number of measures which have been largely well received, and no doubt others will need to follow. While voluntary action in our communities will form much of the day-to-day response to those who are the most vulnerable and potentially isolated across our nation, the sustaining of public services and of businesses is vital for both our social and economic well-being; other speakers have already begun to address some of those issues.
Following the most reverend Primate the Archbishop of Canterbury is always a risky business, and other noble Lords have already spoken with considerable knowledge of these matters, so I shall focus my remarks on one or two specific issues and areas which were already matters of concern, and where that concern is perhaps greater because of the circumstances in which we now find ourselves.
On children and young people, I hugely welcome the long-overdue extension of higher-rate housing benefit for care leavers until the age of 25, thus giving stability in their accommodation beyond their 22nd birthday. This is something that the Church of England organisation the Children’s Society and other charities have campaigned for over some time, and it is most welcome. Also welcome is the £2.5 million for research on family hubs. However, what is not in the provisions of the Budget or subsequent provisions is sufficient funding to address the urgent need for every child to achieve a good start in life, and that is becoming more urgent in the light of the current circumstances.
The Resolution Foundation has calculated that child poverty will continue to rise, with the equivalent of an extra 1 million children living in poverty by 2023-24, while the child poverty rate in working households, which averaged 20% over the seven years between 2006-07 and 2013-14, is projected to rise to 29% by 2023-24. A simple start could have been made by removing the two-child limit, about which the right reverend Prelate the Bishop of Durham and others have spoken in your Lordships’ House. That is not only a social good, it is an economic one because it is about the financial capacity of those families who are among the most vulnerable in our society. Points have also been made about the issues around consumer demand and so forth, which plays into that agenda.
I turn now to social care more widely. As has been mentioned, we await the details about the full and ambitious plan for addressing the social care crisis which the Prime Minister promised from the steps of Downing Street. The £1 billion promised in last year’s spending review is welcome but, not least in the new circumstances, it does not come close to what is needed. For example, families are still realising assets in order to pay the care costs of an elderly relative. While I am personally happy that my own mother can be supported in care from the proceeds of the sale of her house, others are less able to do that and there is an overall negative effect on the economy from that approach when, for example, working families are eating into their own resources to support an elderly relative. The knock-on effects of that on future generations are very considerable. A sensible long-term plan, including financial provision, is essential and overdue. I know that that is a huge ask, but as a society we need it.
On a couple of specific matters, the £5 million which has been provided to support the creation of a centre of excellence for tackling youth violence is welcome, as is further funding for substance misuse services and the £10 million for innovative approaches to preventing domestic abuse. However, these are tiny amounts when set alongside such things as the effects of the cuts in local authority funding which have, for example, decimated youth services over recent decades. Further, there is a continuing postcode lottery for the victims of domestic violence who are seeking a place of refuge, not least somewhere where they can live with their children in security.
Some of us may privately welcome the freeze on alcohol duty, not least in my case when Lent comes to an end, but is there not something slightly perverse about committing extra funding to substance misuse programmes, including those related to alcohol abuse, while at the same time putting a freeze on the duty? My own hope is that perhaps there will be some instructive learning at a later point from the Scottish minimum unit pricing strategy and that it can be addressed at a later stage.
Noble Lords have already drawn attention to green issues. No doubt, given those who are due to speak later in the debate, other speakers will do so as well. There are some good things in the Budget around research and development into green energy, and the measures related to flooding and coastal defences, but I suspect that we need to be rather bolder in these matters when it comes to the longer term. The Government have set an ambition to achieve net-zero carbon emissions by 2050. I am both pleased and slightly surprised that the Church of England’s General Synod, which is not normally regarded as an ambitious and radical body, has voted to go for 2030 rather than 2050. But whether it is 2030 or 2050, what is needed is bold action. That requires investment, and there is a price tag attached to it.
I have a hope that the spending review later this year will give the Chancellor an opportunity to consider some of these issues further, not least in the light of the fuller picture of what Covid-19 means for our economy, which will be clearer by then. But the issues in our society which I have highlighted are not going to go away, and I hope that the current challenges, important as they are, will not totally divert our attention from them. Meanwhile, we must all have a particular care for those in our midst who are the most vulnerable and support all efforts to make sure that they and those who are working for their well-being, whether as public servants or volunteers, have all they need to address the current situation.
Lord Hain (Lab)
My Lords, I agree with what the noble Lords, Lord O’Neill and Lord Lamont, said, but by spending an extra £350 billion to deal with the dire consequences of the coronavirus and promising even more, Britain’s new Chancellor has blown a hole in all the dogma of the last 10 years of Tory austerity. Boris Johnson has been hailing the recent Budget as a cheerleader for the common citizen, targeted on left-behind towns in the Midlands and the north and making a clean break with the Cameron-May years of harsh austerity. But in reality, the Budget fell well short of the great Tory turnaround that his fan club believed it to be.
First, the Budget failed to undo 90%—I stress, 90%—of the damage done nationwide by an unnecessary decade during which George Osborne and Philip Hammond squeezed over £150 billion of spending power out of the economy. On top of the measly £12 billion of measures announced last week to deal with the coronavirus emergency, this Budget gave the economy only an £18 billion boost over two years, with the brakes coming on again in 2022. As singer Melanie Safka told her Woodstock audience in 1969, they are
“only putting in a little
To get rid of a lot that is wrong.”
Secondly, the big increases in public sector capital spending that the Chancellor announced caused many people to miss what is happening to the current public spending that pays for our public services. George Osborne’s first Budget in 2010 set the pattern for the next 10 years. He cut Labour’s public investment capital plans by £10 billion over five years but he cut Labour’s plans for current spending by over £80 billion. That is why 20,000 police jobs disappeared, the NHS in England is 40,000 nurses short today, and today’s social care budget is £12 billion lower than is needed to bring service standards back up to their 2010 levels. The numbers of elderly people needing care have rocketed in the meantime as the Conservatives have created a countrywide calamity of social care misery for the elderly. The Institute for Fiscal Studies reckons that outside of health, day-to-day spending on other public services is now only three-quarters of what it was under Labour in 2007, and that current spending per person for most public services will still be well below the 2010 levels in 2024.
Thirdly, George Osborne chose an 80%/20% split between public spending cuts and tax rises, meaning that Tory austerity fell overwhelmingly on our most vulnerable citizens and on vital social infrastructure. The new Chancellor led a “Getting it done” chorus, blithely ignoring the fact that growth, which had been slowing in each of the past five years, had come to a complete halt in the final quarter of 2019. It did the same in January of this year; UK GDP did not grow at all for four months. That is why the IFS describes the forecast growth rates for the British economy for the next five years as feeble, why it denies that the UK is in a robust position to cope with shocks such as the coronavirus catastrophe, and why it says that a failure to agree an orderly move to a free trade agreement with the European Union would badly weaken an already weak economy.
The Budget speech, cheered by the Tory Hooray Henrys, included a long-overdue and desperately needed increase in public investment, which they have spent the past 10 years resisting; an expanding budget deficit, which they spent a decade promising to cut; a national debt today that is double what it was before the global financial crisis—80% of GDP in 2020 under the Tories, against 36% in 2007 under Labour—and some crumbs of comfort for the neediest, to whom they have shown only a cold shoulder and frozen or cut benefits for years.
Bailing out Britain’s banks to avert financial collapse and ruin after the global credit crunch cost UK taxpayers cash outlays which alone peaked at £133 billion, according to a June 2013 parliamentary banking report. Allowing for cash outlays, government guarantees and Bank of England support, the potential cost to UK taxpayers of saving Britain’s banks had reached £1,162 billion by July 2012, or 10 times the annual cost of the NHS, according to the National Audit Office.
In 2008, the Government had to act within hours to save the economy from a collapsing banking system. In 2020, the Government had to act within days to save the economy from the virus crisis. The small group of cheerleaders on the Benches behind the Prime Minister have been forced to concede that urgent action to stave off disaster demands big decisions that only government can take, because only the state can provide the resources required in a national emergency like this.
Yesterday, the Chancellor was right to reject 10 years of Osborne austerity and to throw the power of the state at the gravest crisis we have faced in 80 years. It has been an unexpected learning experience for him and his party, and 10 years overdue. But if the sudden extra £350 billion to beat the coronavirus pandemic can be produced like a rabbit out of a hat in the last few days of government panic, the question is why appropriate extra public spending was not found from the very start of Conservative rule in 2010 to deal with the aftermath of the financial crisis, instead of plunging the country into 10 years of savage cuts—driven by neoliberal dogma and not necessity—which have gravely damaged the country’s capacity, including to fight this terrifying pandemic.
Lord Razzall (LD)
My Lords, while thanking the Minister for introducing this important debate, I share the concern of my noble friend Lord Oates that the noble Lord seems to have delivered a speech that he would have delivered last Wednesday, without realising that the economy has moved on since then. As he has raised the issue of the Budget, I will touch for a moment on the criticisms that we have from these Benches. Clearly, the Chancellor had an extremely difficult hand, as growth rates have been revised down very significantly; we would say quite often that that was as a result of Brexit. Although that might be disputed, that was so even before the effects of the virus. I will make three brief criticisms before moving on to the wider issues.
First, there was no real mention of adult social care, which is one of the real issues facing the country. I would be grateful if the Minister could indicate, when he replies, what the Government are going to do about that. Secondly, as my noble friend Lord Oates indicated and as was said on the Labour Benches, there were rather disappointing statements about climate change. Personally, I think it was a great mistake not to take advantage of the significant drop in oil prices to remove the cap on fuel duty, which would be much less noticed by the consumer. Thirdly, the issue of shifting resources to the north seems to have been rather understated. As David Aaronovitch said in the Times last week, the policy seems to be simply to build more roads to the north so that people can get there.
However, as a number of noble Lords have indicated, the Budget has really passed us by now. We are really dealing with the statement of the Chancellor on the impact of the virus on our budget and his guaranteeing of loans of up to £300 billion, which is 15% of GDP. This is obviously unprecedented. As my noble friend Lord Oates indicated, from these Benches we welcome those proposals. But as the noble Lords, Lord O’Neill and Lord Lamont, asked, will this be enough? As we all know, following the Prime Minister’s statement on Monday, the leisure industry has seen a catastrophic fall in its revenues. Without immediate action, there will be bankruptcies of businesses, which will never recover. My concern is that if £300 billion is to be lent by the banks, the bureaucratic process for people to obtain those loans will be very slow. For many people, this will be too late. It will be too late for the self-employed and for workers on zero-hours contracts, who are laid off and today have no money.
I know that the Chancellor is considering further steps. The CBI is advocating a VAT freeze and the reversal of national insurance to provide immediate payment to business but I would go further, rather like the noble Lords, Lord O’Neill and Lord Lamont. I am glad that the noble Lord, Lord Lamont, raised the phrase “helicopter money”. I like that phrase because it was coined by the guru of the right wing of the Tory party, Milton Friedman, who, when asked what he would do if there were another depression, said that the Federal Reserve should hire helicopters and drop dollar bills over every town in the United States, hence the phrase “helicopter money”.
The paying of—whatever we like to call it—a citizens’ dividend or business dividend has a reasonable pedigree. Ben Bernanke, the Federal Reserve governor in 2002, said that he would do that to combat deflation, defining deflation as a side-effect of a collapse in aggregate demand, which we are clearly heading for. Japan tried it in 1999, with some success. Australia in 2009 gave 950 Australian dollars to 8.7 million people earning less than 100,000 Australian dollars, and was one of the few countries to avoid recession; and Hong Kong has tried it in recent weeks, with a payment of 10,000 Hong Kong dollars to every Hong Kong citizen. I accept that probably just giving that sort of dividend to every individual might not be sufficient, and there would have to be a decision as to how you split that between business and individuals. However, I share the views of the noble Lords, Lord O’Neill and Lord Lamont, that this could be essential. The argument against it has always been that it is hugely inflationary. However, with the economy facing low growth or a recession, I submit that that is a risk worth taking.
At least coronavirus has enabled the Chancellor to avoid the trap set by his right-wing Brexiteers, who were advocating the creation of a Singapore-on-Thames following Brexit, with drastic cuts in public expenditure and significant deregulation. You obviously cannot deal with coronavirus and promote growth in towns that have voted Tory in the north and Midlands while cutting public expenditure and taxes. Therefore, at least the crisis has prevented the disaster for us of the creation of a Singapore-on-Thames. As a colleague said to me the other day, “With a crisis like this, everyone’s a Keynesian now”.
Lord Leigh of Hurley (Con)
My Lords, I welcome my noble friend to his new role. I was one of those who called out in private discussions with previous Chancellors and in public for this House to have a Treasury Minister, and it is appropriate that the Treasury has a direct line to the wealth of experience and expertise in this House, as this debate shows.
This Budget and subsequent statements needed to be about two things. First and foremost, it was about survival. Our economy, our businesses and our people were threatened as they have not been since the Second World War. Fear stalks the market even as it does the supermarket aisles, so now is not the time to talk about missed fiscal targets. This was a moment for the Chancellor to do whatever it takes to get us through this crisis. He could do so because our economy is in so much better shape than it was in 2010, given the mistakes made before then.
It is true that this crisis is unlike financial crashes that I have witnessed from 1972 to 2008, in that it is not driven by an endemic and systemic failure of our economic system. This could mean that the recovery is rapid. However, that depends on what is left once Covid-19 has passed. I am talking in particular about small businesses. We are confident that this will run for months, not years, but those will be long months for many businesses short on working capital, supplies and customers. Whole swathes of our economic and social life are being shut down in the name of prevention and control. In every one of those businesses, jobs are under threat, and many will not survive. On all sides of the House, we hope that the measures announced will be successful, and we are so grateful to see such a competent person in the role at this time.
Access to working capital is vital. I am, however, concerned about the ability of the British Business Bank and commercial lenders to combine quickly enough to provide the needed liquidity. It will take time—time we do not have. Each loan still has to be assessed by a bank official. Make no mistake: these loans will not be given and will not save the people who work in businesses which are just not able, in the opinion of the bank’s loan officers, to pay them back. Even if 80% of these loans are underwritten by government, the bank is not going to want to lose its 20%. Therefore, cruise businesses and those in travel, leisure and gaming and all their suppliers, and many others in a similar climate, will be deemed non-viable and will not get the loans.
I further suggest that the Chancellor considers more direct measures, as has been discussed here: emergency loans but delivered through the tax system via PAYE or VAT. This would be so much more direct for businesses which need it. If the directors of a business determine that it can survive, we need to help that business keep as many people as possible, so a PAYE holiday this month, to be recouped over the next six months, would save a lot of redundancies. We must also be aware that the £10,000 given as a grant to businesses which are eligible for small business rate relief, subject to the important point the Minister made, could be a rogues’ charter, but it is a price we will have to pay.
It is true that we have a significant package of measures designed to get us through the next year intact. However, our current insolvency laws are not helpful for this unique crisis. Currently, directors of limited companies, who must be mindful of their responsibilities to creditors and to avoid personal liability, are almost pushed to call in the administrators. This is a disaster when in fact a business has just a short-term liquidity crunch. Indeed, it may be that the Chancellor produces more rescue help in the next day or so, but that may be a day too late. A director does not know what is going on but he or she knows that administration will protect them. We urgently need a relaxation of the insolvency laws, which I gather Germany is doing right now, for some sort of Chapter 11 or other interim moratorium. It is needed immediately and it should last for the next few months. I cannot emphasise enough how urgent this is. I have been in touch directly with Ministers in BEIS but perhaps my noble friend and his colleagues can address this issue later today.
On the Budget itself, I am very glad that the Government will not pay for extra borrowing with changes to either business property relief or IHT, or by the mooted mansion tax, but I am very disappointed that they have chosen to reduce the lifetime limit for entrepreneurs’ relief from £10 million to £1 million. This flies in the face of what is otherwise a commendable Budget for innovation. The idea is that entrepreneurs who are not salaried but risk their own capital should keep more of the proceeds if they succeed. HM Treasury claims that this will net an extra £2 billion or so a year, but that assumes that entrepreneurs will not change their behaviour at all—of course they will. In my line of work—I disclose to your Lordships’ House my registered interests—I already know of entrepreneurs who are planning to start up their next business in Singapore or to emigrate to avoid, legally, capital gains tax. It was a short-sighted and counterproductive move. If we want entrepreneurs to take big risks, as we do, we have to allow them big returns. I know that people in the Treasury and the Resolution Foundation do not like it but I say to them: get over it. I hope in future Budgets the £1 million figure will be raised.
I ask my noble friend whether his officials will provide clarity on the extra funds to be provided to SMEs for apprenticeships to support an increase in the number of high-quality apprenticeships in the 16 to 18 range. Given the 47% drop in those apprenticeship starts, what plans are in place to recruit and fund 16 to 18 year-olds into apprenticeships? One start might be to ban MBAs from being covered by the levy.
I also repeat the plea made regularly by myself and my noble friend Lord Lucas for online marketplaces to be liable for the collection and remittance of VAT—Amazon being the prime example. This is taking place in most of the USA and many other countries. The UK’s competitors are cracking down on this evasion but we have not, thus making the UK increasingly attractive to VAT fraudsters. All we seem to have done is to pursue with a vengeance the one whistleblower who has revealed the scope of the problem: a Mr Richard Allen. This matter is costing our country substantially in lost VAT and really does need action from the Government.
All that I have said and asked for should not take away from a Budget from a Chancellor who has risen to the occasion. British businesses and citizens were crying out for an almighty show of fiscal force and that is exactly what they got.
Baroness Jones of Moulsecoomb (GP)
My Lords, it is always a pleasure to follow the noble Lord, Lord Leigh, because I disagree with so much of what he says that it invigorates me for my own speech. But in fact today I did agree with some of the things he said; for example, on small businesses and of course in welcoming the Minister to his new role.
I spend most of my life in a constant fury about this Government and their inadequacies, incompetence and inability to see beyond the immediate condition of the economy. Clearly, Covid-19 has exacerbated everything. I had hoped for high things from the Budget last week. We were promised that it would be an environmental Budget, but it absolutely was not; it was a failure. However, I do not want to be too hard on the Chancellor. Yesterday was a chance to improve things a bit, so I do not want to be completely rude about it. However, we have to understand that last week’s Budget has been overtaken by events. The Government had a rare second chance to get it right but, somehow, they did not.
Many of the problems are based on the fact that we have had 10 years of Tory government, and their austerity policy has damaged our society and our economy at the most basic level. A decade of relative stability, apart from the political noise of Brexit, has largely masked the devastating harm inflicted by austerity on our public services and communities. The virus is now exposing the weakness that has been cultivated by this Government: local authorities that have been cut to the bone; the NHS at breaking point; families with lots of debt and barely any savings; and a job system that has moved so heavily to precarious contract work that we now have a record number of unemployed.
Every inch of spare capacity in the public sector has been ripped out—and then more has been ripped out. The economic and social impact of reacting to this virus will break us unless the Government make an urgent, swift and massive fiscal response. I shall suggest a couple of things, one of which the DUP agrees with us on. If you have the DUP and Greens uniting on an issue, I think you are in trouble if you do not pick it up.
I fear that the Government’s response to this unique economic challenge will be to tinker at the edges of what is already a broken system. A few tweaks to statutory sick pay and a lightening of universal credit sanctions, while still bailing out and protecting big business, will leave huge gaps in the safety net, through which literally millions could fall. We have to look after all carers, zero-hours workers and parents with two jobs; all those in the gig economy and the self-employed, who are being laid off from industries such as the arts and entertainment; all those who are being asked by corporate billionaires to take weeks of unpaid leave; all those worried about having their benefits sanctioned merely for protecting their health; and all of the huge number of people involved in small businesses, who are at risk of ruin.
The Prime Minister pulled the rug from under many small businesses without any hope of insurance to cover their losses; many have already gone out of business. I have been watching the news all day and have had messages coming in. A huge number of cafes, breweries and pubs are now facing closure, with absolutely no hope of recouping their losses. I am not sure whether this Government know this, but Trump has ordered the suspension of all evictions and home-loan foreclosures. This Government are behind Trump—how embarrassing is that?
Anything less than a blanket guarantee for people who are potentially falling through the net will involve asking the population to make massive sacrifices to our way of life. We need a bailout for the people, not just for businesses and property owners. We need an end to benefit sanctions; help for renters and a ban on evictions; housing for the homeless; money off people’s energy bills and a ban on cutting off energy supplies—and, an incredibly important thing, a rescue package for local authorities, so that they can help their communities through this emergency.
While we face up to the immediate threats, it remains important not to lose sight of the bigger picture. The virus is spreading fast and is very attention grabbing; it marks a stark contrast to the climate and ecological crises, which are much slower but more impactful. Our response to those crises should be cross-party, cross-border. The Chancellor’s Budget should have been a decisive moment in our country’s history but, sadly, it was not. If the planet were a bank, the Government would have bailed it out by now. If the people were a bank, the Government would have bailed them out by now.
It is time to act in a way that prepares for a better, climate-safe future. My recommendations are that we need a green new deal, a new fiscal settlement that can transform our economy to a stable, healthy net-zero carbon future that respects our role as custodians of the earth. The Government should issue billions of climate bonds with the support of the Bank of England and invest the money in our green future. The Green Party proposed £100 billion a year of investment in a green new deal, which is less than 5% of GDP—that is the scale of investment we need to tackle the climate and environmental emergency and which can pull us out of the economic tailspin that the virus will inflict on us all.
It was the so-called environmental Budget from the Chancellor, but he caved in to pressure from the fossil fuel lobby and froze fuel duty yet again. It was a big roads Budget, with £27 billion to be spent on new roads. It tinkered around the edges. People are of course taking all this into their own hands: they are stopping going out, stopping socialising, and stopping sending their children to school. The Government are behind the people. I understand that the Chancellor might be saying even now that schools will be closing, but it was something that should have been done before. And of course we need more testing. All these things should have been in the Budget update this week.
We are obviously massively threatened, and the Government are just not doing enough. Can the Minister please reassure me that he and his department understand the real needs that this country is facing?
Lord Livermore (Lab)
My Lords, the numbers that matter most today are clearly not those that we might normally focus on in a debate on the economy—not numbers relating to growth, inflation or productivity, but instead the numbers of people who, in the UK and around the world, have been diagnosed with the coronavirus or have died from this pandemic. Alongside this tragic human cost and health crisis, there is now a growing economic cost and financial crisis for business owners, employees, their dependants, pensioners and pension investments. Already we have seen stock markets fall and the global economic outlook deteriorate dramatically in just a week since the Budget.
The Chancellor was right yesterday to recognise this as an economic emergency. He moved swiftly in announcing a further £330 billion of government-backed loans for business, the equivalent of 15% of GDP. His statement that more support will be available is also welcome, as help is still needed for workers ineligible for sick pay and for renters. The Government must act urgently to underwrite wages in exchange for businesses not laying off staff, as has been announced in Denmark, Sweden and Norway.
The required economic measures are unprecedented in their scale, yet in the Budget last week the Chancellor presented an economy already with a number of serious underlying weaknesses, raising substantial questions about its ability to sustain and support the necessary action in this crisis. The OBR’s focus was already for extraordinarily weak economic growth, averaging just 1.4% a year—well below even the 1.9% average growth in the post-financial crisis decade that we have just lived through. Even last week, the Budget forecast looked optimistic. It assumed that the economy would grow by 1.1% this year and 1.8% next year. This was in contrast to the OECD’s forecast, suggesting the UK would grow at just 0.8% in both those years. Simply replacing the OBR’s forecast for this year and next with the OECD’s forecast brings the UK’s annual growth down to an average of just 1.2%—the worst average annual growth forecast for the UK ever recorded.
As the widespread impact of this pandemic becomes clearer, there will need to be further, even sharper downward revisions to reflect the impact of lost working hours, deferred consumer and investment spending and business failures. A recession is now surely unavoidable. Capital Economics has estimated that the UK economy could contract by 15% in this quarter alone, compared with a 6% drop from the peak to the trough of the 2008 financial crisis.
The Budget also illustrated how Brexit will continue to further weaken the British economy. Although unmentioned by the Chancellor, the OBR put the cost of Brexit so far at around 2% of GDP, or £40 billion a year. Yet the Government continue to pursue the most distant possible relationship with the EU, introducing significant non-tariff barriers to trade, which the OBR now believes will reduce UK trade with the EU by 15%.
The Government have refused to publish an economic impact assessment of their proposed trade deal, but in the OBR’s forecasts we can clearly see the cost: GDP will be some 4% lower over the next 15 years. With such profound risks to the global economy from the pandemic crisis, the fiscal policy response will come at huge cost to the Exchequer while tax revenues collapse, inevitably significantly widening the fiscal deficit. Indeed, a deficit of between 6% and 10% now seems likely.
While the Government are right not to focus on the deficit now, the Chancellor and his Budget presented not a sound platform from which to respond but already rapidly deteriorating public finances. As a result of the failed economic strategy of the past 10 years, UK net debt has doubled from £1 trillion to £2 trillion. In just five years, the Government’s ambition has swung wildly from trying to shrink the state in order to run an absolute budget surplus to growing public spending to almost 41% of GDP and actively aiming to borrow more than £60 billion each year.
The Chancellor set out unfunded spending commitments growing twice as fast as the economy, and debt was already forecast to rise relative to national income. If growth turns out even worse than expected, as it now surely will, debt will begin to move decisively upwards, now clearly heading to over 100% of GDP. To paraphrase a former Chancellor, the risk is that they did not fix the roof while the sun briefly shone.
As the Government shape their immediate and longer-term response to this crisis, policy could reasonably be governed by three guiding principles: sustainability, fairness and consistency. The Chancellor made clear in the Budget that he has no attachment to the existing fiscal rules. He maintained very little headroom against the current budget balance target, despite huge economic uncertainty, and in practice jettisoned the goal of debt falling over time, so it was no surprise that he announced a review of the fiscal framework. While maximum flexibility should govern his response to the immediate crisis—providing the economy with whatever support it needs—ultimately reviewing the fiscal framework should not lead to the removal of all fiscal anchors nor the abandonment of the idea that, in the end, day-to-day public service spending should be financed from taxation rather than borrowing. Here, ensuring that the burden is borne fairly must be paramount. Looking back, the austerity of the years after 2010 hit the most vulnerable disproportionately hard. While some of the richest working-age families gained £1,000 a year, the poorest lost £3,000 a year—15% of their income.
In this Budget, despite the Government signalling that austerity is over, the signs are not encouraging that their distributional approach will be significantly different. As a result of the tax and benefit changes announced in this Budget, the poorest decile is worse off in cash terms, while the eighth and ninth-richest deciles are the biggest winners, gaining over £100 a year. Despite significant increases in spending, the Budget did nothing to off-set the welfare cuts put in place by George Osborne in 2015, so child poverty is now set to reach record highs.
Finally, the Government’s response to coronavirus requires an unparalleled consistency of purpose. It is inconceivable that the Government have the time or capacity to respond adequately while also seeking to renegotiate the UK’s entire economic relationship with our closest trading partner. Reports that the negotiation period may now be extended are therefore welcome. This is an argument not about Brexit but about the pandemic crisis. Unless the Government are able to devote their entire attention to what is happening now, they will fail to produce an adequate response.
This does not feel like an economy in a robust position, capable of coping with the profound shocks it is now experiencing. The Chancellor’s forecasts will clearly need to be downgraded further, and he will need to reassess much more of his fiscal strategy than appeared to be the case just one week ago.
Lord Bates (Con)
My Lords, I want to use my time in praise of a spirit of optimism. It is shown by many people, and there is an abundance of medical evidence to prove that having an optimistic outlook boosts the immune system of individuals—something that I am banking on. I declare that I am an optimist; even my blood group is B positive.
As far as we are concerned, I believe that optimism can also boost the immune system of our economy as a whole. As the Chancellor of the Exchequer said last week:
“We will get through this—together … We will rise to this challenge.” —[Official Report, Commons, 11/3/20; col. 278.]
Rising to the challenge is, indeed, the need of the hour. It reminds us that resilience in overcoming adversity begins in the mind. Whatever fate has in store for us, the impacts will be far less severe and shorter in duration if we pull together and help each other to get through it. Rising to the challenge will be easier if we maintain that optimistic spirit. In my view, one of the finest books ever written was Optimism, published in 1903. In it, optimism is described as
“the faith that leads to achievement. Nothing can be done without hope and confidence.”
The author was a young Helen Keller, who had just become the first deafblind student to graduate from university with a degree anywhere. Any person who has ever stood for election, any athlete who has ever competed in a race or any businessperson who has ever set up a business knows the truth of her words. So where is the hope and confidence in the current situation?
Let me start with confidence. Confidence speaks of remembering where we have come from and what we have. It reminds us that we have come through many challenges far worse than this in our long and illustrious history. Had this disease struck a year ago, it would have found our nation and our Parliament divided; it would have found a hamstrung Government in the midst of an acrimonious debate about Brexit. But all that changed on 12 December 2019; whether you are happy with the outcome or not, the message of the British people was crystal clear. As a result, political leadership has been restored and the Government are able to govern.
Had this crisis struck 11 years ago, it would have found us still reeling from the aftermath of the global banking crisis. Instead, we have had almost 10 years of economic growth, bringing borrowing under control and seeing some of the highest employment levels in our history. There is no doubt that our economy is in much better shape than it was and is more capable of withstanding these shocks.
We have a National Health Service which I believe is the envy of the world. It is our front line in the fight against this virus; we could not have a better one. Added to this, the Chancellor made a pledge in the Budget Statement, saying that
“whatever extra resources our NHS needs to cope with coronavirus, it will get. Whether it is research for a vaccine, recruiting thousands of returning staff or supporting our brilliant doctors and nurses—whether it is millions of pounds or billions of pounds—whatever it needs, whatever it costs, we stand behind our NHS.”—[Official Report, Commons, 11/3/20; col. 279.]
That should give our incredible NHS staff and all of us great confidence in facing this crisis.
Next, we have produced some of the greatest scientists. In his speech, the Chancellor mentioned Newton, Hodgkin and Turing. He could have added Faraday, Fleming, Darwin, Lister, Jenner, Ross, Davy, Crick, Hawking, Goodall and many more. The UK is home to two of the top three universities in the world; one of them, Cambridge, has produced more Nobel laureates than the country of France. The steam locomotive, television, telephone, electric lightbulb, computer and world wide web were all developed by British scientists. The greatest medical breakthroughs of all time—in nursing care and hospital safety, germ theory, IVF, the smallpox vaccine, penicillin and DNA—were all developed by British scientists and clinicians. If someone is going to come up with a vaccine to protect the world from this virus or diseases like it, my money is on the solution being found here. That is why we can be confident.
What about hope? Hope is all about being positive. It reminds us that we should not let what we cannot do stop us doing what we can. Many sections of the economy will adapt to home-working, thus: raising productivity; reducing pressures on public transport systems; tackling the housing crisis by reducing the need for people to crowd into big cities, especially in London; tackling the effects of climate change by reducing the need to travel and lessening congestion on our roads; and levelling up by moving more high-paid, high-skilled jobs to the regions.
As a result of this paradigm shift, we will need to ensure that we have greater connectivity—one moment of caution. One area in the world in which we still lag behind is broadband and mobile speeds, where we rank 34th and 26th respectively. I welcome the Government’s announcement of £5 billion to get gigabyte-capable fibre-optic broadband across the country. This is certainly what we need to continue being a technology superpower, but it is far from the reality at present. In many parts of the country, even here in London, many people struggle to get download speeds of 10 megabytes per second, let alone 1,000. Speed is indeed of the essence, as the noble Lord, Lord Oates, reminded us.
The worst part of any crisis is the feeling of being battered by events and not having any control. That is far from the case. We might remember the words of the Serenity Prayer:
“God, grant me the serenity to accept the things I cannot change, courage to change the things I can, and wisdom to know the difference.”
The Chinese character for crisis is composed of two characters. The first is for danger; the second is for opportunity. We need to continue to seek and grasp the many opportunities before us. In doing so, we will find renewed optimism, hope and confidence so that, together, we can not only rise to this challenge but emerge from it stronger.
Lord Bruce of Bennachie (LD)
My Lords, it is always a pleasure to follow the noble Lord, Lord Bates, not least because I think his experience as a government Minister was a triumph of optimism in adverse circumstances.
It appeared it was becoming received wisdom that last week’s Budget marked the end of austerity and, worse than that, or more than that, the confirmation of the assertion that austerity was never actually required. It is argued by some—the noble Lord, Lord Hain, is not in his place—that it was a right-wing ideological choice which caused unnecessary hardship. I assert that that is contrary to any objective analysis of the facts of the past 12 years. In 2008, we had a global financial crash partly brought about by a combination of light and divided regulation and the creation of impenetrably complicated financial products riding a global market. The scale of that crash was such that it threatened the world economy. It plunged us into recession from which we have actually barely started to recover. Drastic, urgent action was required, and it is to the credit of the then Labour Government that they led a co-ordinated global approach by the world’s leading economies. Radical action was taken, and it was delivered, but there was a clear legacy. UK banks were more exposed than most, and the level of borrowing required to stop the rot led to an unsustainable current account deficit well in excess of 10%. So whoever won the 2010 election had to take strong action to bring the public finances under control. The manifestos of all the parties reflected that, although they seem to forget it. Labour, in particular, seems to have created an alternative narrative.
There is of course room to debate which measures were fairest and best and what was the right balance between tax, borrowing and spending, but to suggest that we did not have to do anything is simply preposterous and defying gravity. The fact is that the deficit was reduced to under 2% and, thanks to the Liberal Democrats, at the same the tax threshold was raised to £12,000, the triple lock was introduced to reinstate the real value of pensions, the Green Investment Bank was set up, the British Business Bank was established, we adopted an industrial strategy and we boosted research and skills through expanded apprenticeships. Frankly, I believe it was an era of calm and pragmatic government compared with the volatility we have suffered since.
Forward then from last week’s Budget to this week’s Statement. The Government have been forced to recognise the scale of the threat to the population, the NHS and the economy and have proposed record spending measures with more needed and likely to follow. Some of these measures are short term and will act as a palliative, others are longer term and many may prove irrelevant. What the Government call “wartime measures” introduced this week will immediately—indeed, have immediately—turned off the cash tap for thousands of businesses and social enterprises and millions of people, especially those working in the gig economy. I have seen emerging in this debate a recognition that now may be the time for something radical to be tried. It may be the time to look to a citizen’s income to give cash to everybody immediately to help alleviate their anxiety and deliver support to the economy. It is no good telling businesses to borrow money to maintain their activities if there are no customers, so people have to have money to spend, and while the social distancing is going on businesses have to have money to carry them through, but not money that will saddle them with unsustainable debt. As others have suggested, this can be done through the PAYE system or the benefits system; indeed, I suggest urgently that this is the time to do something really radical and forward-thinking.
At the same time, we have just had an announcement that schools will close across the UK from Friday until further notice. That will put further stress on young people facing the possibility of exams with no knowledge of how they are going to get through them, and a lack of teaching time to help them get the grades they need. As a very important aside—I speak on Northern Ireland issues for the Liberal Democrats—in the three years that the Province was without an Assembly or an Executive, the health service pretty well broke down. Waiting times were extended and staff were stressed out. What are the Government doing to ensure that Northern Ireland has the support that it needs in this weakened state to meet the crisis?
If you put all this together, it adds up to a sharp reversal of the current account deficit. The consequences will perforce shape the Budgets not only for the rest of this Parliament but beyond, as the Government will have to bring borrowing back under control. That will present a challenge for a Government who want to level up the regions. They have won seats off Labour, but those seats will expect better funding for local services and will not appreciate tax cuts for the well-off. It will present a further challenge—this is a really important point—if the consequences of the hard Brexit that the Government are chasing are to further depress an already traumatised economy and reduce tax revenues. Surely this is the moment to acknowledge that the forward trajectory does not need and cannot sustain a sharp disruption to our alignment with the European Union.
At the very least, it surely calls for an extension of the transition period so that we can concentrate on bringing Covid-19 under control before we conclude a future trade agreement, and we should certainly not cut ourselves off from health and security co-operation across the EU. Looking further ahead, we should also address the supply-side weaknesses and encourage investment in skills development in new sectors such as robotics, the digital economy, AI and, of course, climate change—from the sophisticated engineering for sustainable energy to the job-creating benefits of retrofitting older houses with low-carbon systems. Crashing on with the Cummings/Johnson disruption presents not just the economy but our whole society with a potential cataclysm that it may not be able to absorb, bringing about far-reaching and deeply damaging consequences for years to come. It is surely time to face reality.
Lord Skidelsky (CB)
My Lords, I share the general appreciation of the Chancellor’s Budget and even the former austerians have joined the chorus of approval. What they were belatedly acknowledging was that fiscal austerity was the wrong response to the recession; here I must disagree with what the noble Lord, Lord Bruce, has just said. When private spending falls off, the correct response is to increase not reduce public spending, as George Osborne did between 2010 and 2016. The penny dropped that what a Government can afford is determined by the real resources that it can command, not by financial arithmetic.
So, “better late than never” was an intuitive response to the Chancellor’s cash injection. Providing £2.5 billion to fill potholes that should have been filled 10 years before now seemed more obviously sensible than to allow the number of potholes to keep growing until all roads became unusable. But I have one caveat. “Better late than never” may not be the right policy if the “late” comes at the wrong point in the business cycle. Keynes wrote:
“The boom, not the slump, is the right time for austerity at the Treasury.”
No doubt it does not feel much like boom time right now, and forecasts have suggested a recession. Nevertheless, today there is less surplus capacity in the British economy, and other western economies, than there was 10 years ago. In 2010, UK unemployment was 8%. Today, with less than 4% out of work, we are much closer to full employment. I know that the calculation behind the Chancellor’s stimulus was that the extra investment would draw workers from lower to higher-productivity jobs, thus boosting economic growth. That was a reasonable gamble, but it was a gamble all the same.
In any case, all this has been overtaken by the pandemic, which has led to the promise of an extra £350 billion to deal with it. The Prime Minister said:
“We must act like any wartime government”,
a sentiment echoed by the most reverend Primate the Archbishop of Canterbury. Let me say a word about the “war” metaphor, because it can be a source of some confusion. A war economy is above all a shortage economy; supply falls relative to civilian demand. To put it another way, it is an excess demand economy. People find it hard to get their heads round that idea because they are so used to the belief that crises come because demand has fallen, but a war economy is an excess demand economy for the simple reason that a part of supply has been taken by the state for other purposes—in the case of the war economy, for war purposes—and there is therefore less supply for civilian demand.
Today, the equivalent is that people, for very good reasons, are made to stay at home. It is sort of like conscription; suddenly there are fewer people available to produce supply and therefore the supply falls. That is what is happening. A fall in supply in that sense is independent of what is happening to demand.
What is happening to demand? That is the next thing. Although the Government have announced guaranteed loans only to businesses, it is certain that they will be driven to measures making it possible for firms to pay redundant workers their normal wages or, as in the United States, to pay wages directly—in other words, giving workers paid holiday for two or three months or whatever it might be. The likelihood is that incomes and demand will not fall as much as supply. That is when you get the typical war economy situation of excess demand. The essential point is that standards of living cannot be maintained for long if part of industry remains closed. At this point we will be faced with the alternatives of inflation or higher taxation, the question Keynes addressed directly in his 1940 pamphlet How to Pay for the War.
There are already signs of excess demand in certain retail sectors due to panic buying and interruptions of wholesale supply chains. In the short run, this may be choked off by a combination of informal rationing, which has already started, staying at home and voluntary saving. But if the pandemic lasts for more than two or three months—and we have no evidence of how long it will last—more drastic measures will be needed. That is some way off, but it is worth thinking about it and not assuming that there is a magic bullet which will keep all the jobs going and then somehow allow us to recover quickly. Sooner or later, we will all have to start paying for what we are now giving. There is no way out of that.
Lord Adonis (Lab)
My Lords, it is a great privilege to follow the noble Lord, Lord Skidelsky, the biographer of John Maynard Keynes. It appears that we are all Keynesians once again. As the most reverend Primate put it, it is now “us” and “we”, in place of “I” and “me”. But I am not sure that Keynes himself would have been overly impressed with the position we are in at the moment. In his last speech in the House of Lords, in 1945, he said that
“everyone talks about international co-operation, but how little of pride, of temper or of habit anyone is willing to contribute to it when it comes down to brass tacks.”—[Official Report, 18/12/1945; col. 777.]
That is exactly the position we are in now.
I was particularly impressed by the speech of the noble Lord, Lord O’ Neill, who laid out the big agenda that we need to follow. We need precisely the international co-operation that Keynes was talking about in 1945, and which he did so much to foster in his own age in respect of Breton Woods and Anglo-American co-operation. We need that in this crisis. Ideas of the kind that he put forward, including the people’s QE, are very timely and need to be taken forward as a matter of great urgency.
I was especially impressed that the noble Lord, Lord Lamont, who I do not always agree with on matters of politics and ideology, rowed in strongly behind that. At the moment, we face a massive demand shock and a massive supply shock, and we need to address them directly and immediately. That is true not least because dealing with the pandemic itself involves—as the noble Lord, Lord Lamont, rightly said—giving people reassurance, not just about their medium and long-term future but that they can go off sick tomorrow when they develop coronavirus symptoms, without thinking that their livelihood, and potentially their job, is at stake.
The situation is very serious. The absence of international co-operation and exchange is a huge challenge. I hope that the Minister, who we hold in high regard, will take these ideas back to the Treasury and the Cabinet Office and see that they are acted on immediately.
Martin Wolf, in today’s FT, in a very Keynesian article, said that we need to:
“Think big. Act now. Together.”
Thinking big, acting now and doing it together must be addressed through two particular priorities: sustaining people through this crisis and sustaining businesses through this crisis. On sustaining people, I do not want to go through the specific points that have been made so far, but I want to direct a few additional questions to the Minister.
The first question is about provisions in respect of sick pay. The Minister will have picked up that there is huge dissatisfaction about this, concerning the gig economy and the self-employed, and the fact that sick pay is only £94.25 a week. That people on high or moderate established incomes are expected to go down to £94 in one go will be a big disincentive to people to declare themselves sick and self-isolate.
The biggest outgoing that people have is of course accommodation costs. It is not acceptable that we are still in a state of great confusion about this. The Chancellor, in his statement last night, announced that there would be a mortgage holiday of three months for those who are suffering from coronavirus. That is good, but we still do not know what the position is in respect of renters. We are told that people will not be evicted, which is a big step forward, but will there be a rent holiday similar to the proposed mortgage holiday? The Minister needs to tell us that at the end of the debate.
The other crucial point is the big injection of loans and potentially straightforward subsidies that has been put into maintaining businesses. The first big question is whether the right approach is for this £330 billion to take the form of loans, or whether some of it should be turned into straight grants. The fiscal stimulus that has been referred to crucially depends upon whether the state is expecting these loans to be repaid. The confidence with which companies will take them up depends upon the same thing.
The noble Lord, Lord Lamont, raised an extremely pertinent point. The reason for giving loans or grants to companies is twofold: to sustain businesses but also, crucially, to sustain employment. He is absolutely right to say that, if the state is going to make a big investment in businesses up and down the country to keep them going—as it should in this crisis—part of the deal should be that they maintain their employees. There should be a straightforward contractual agreement between the Treasury—or the banks, or whoever the Treasury will channel money through to directly make these loans—and all recipients that, for the duration of the coronavirus crisis, they will not make anybody redundant or in any way reduce people’s terms and conditions. That seems to be a straightforward and very basic point, and it goes a long way to providing the kind of people’s QE that the noble Lord, Lord O’Neill, referred to. I would be grateful if the Minister responded to that, explained the Government’s thinking and said whether he can see any issues arising.
Next week we have coming before us the legislation, which I am told is of doorstep proportions, and we will want to address a lot of issues in it. The security of workers—which is absolutely crucial to the long-term health of the economy but also in the short term in dealing with the pandemic—will be vital.
Finally, as we come out of this crisis—and we will—we need to come out of it as strongly as we possibly can, which means giving the strongest possible incentives to reviving trade and international confidence. Yet what is the first thing the Government intend to do after we come out of the coronavirus crisis? To push us into a hard Brexit. I cannot think of anything more ill judged than to move from one massive shock to the national economy to another. I know the Government are saying at the moment that they will not change the timetable and all that. Everyone who speaks to anyone in Whitehall knows that preparations are being made for it, not least because at the moment it is not even possible to conduct the negotiations on the terms of our trade and economic relations with the EU after the end of the year. I do not expect the Minister—who would lose his job immediately if he indicated any flexibility on this—to give us any indication of what he really thinks on this, but he needs to hear the views of the House. I think most Members would regard it as absolutely absurd for us to move from the depths of one crisis to a massive self-inflicted crisis immediately afterwards. We should put Brexit on hold after this crisis. As John Maynard Keynes famously said:
“When the facts change, I change my mind. What do you do, sir?”
Lord Hunt of Wirral (Con)
My Lords, I first declare my interests as set out in the register. As many have observed, this debate is taking place during the greatest crisis our nation has faced since the Second World War. Our principal concern must be the health of our people, but the state of the economy will be critical too. I gladly join the many tributes paid to our heroic staff in the National Health Service, but there are many other heroes too—in pharmacies, supermarkets and right through all those vital supply chains, ensuring that life can go on at all.
The measures announced by the Chancellor yesterday were very welcome, but more will surely be needed and many colleagues have already put forward some persuasive proposals in this debate. Even as the latest measures were being immediately digested, it became clear—as the noble Lord, Lord Adonis, just pointed out—that millions of our fellow citizens are still trapped in potentially untenable situations, such as people living in rented accommodation, whose sources of income in many thousands of cases have suddenly dried up. I think, too, of those who work in bars, restaurants and theatres—sectors that usually provide and enable so much of the joy of life, all suddenly come to a standstill. Of course, much of their work is casual, short-term, fixed-contract or zero-hours in nature and it has suddenly vanished, literally overnight. Think of those actors who rely on bar work, restaurant shifts and front-of-house work between times, or supply teachers contemplating imminent school closures.
Of course our great nation will survive this shattering blow, but we must ameliorate urgently now, as well as rethinking things for the future. As noble Lords will know, I believe we shall succeed only if we come together as one nation.
When we debate economic matters in what we might think of as normal times—and that normality may never fully return—we tend to emphasise the need to innovate, to compete, to outrun and outshine the competition. As we strive to build social and economic resilience in the face of this terrible pandemic, it is only natural that our focus should shift towards notions of solidarity, co-operation and social cohesion.
I know this is ancient history, but when I made my maiden speech from the green Benches in the other place in April 1976, the great fear of the land was the inexorable decline of our great industries and consequent unemployment and social disenchantment. The unemployment rate was around 5%, above where we were last month, but I fear somewhere below where we will shortly find ourselves. I said in that speech:
“It is very worrying to contemplate the amount of social and economic damage done by such widespread unemployment. To be without the opportunity of work is an affront to human dignity.”—[Official Report, Commons, 12/4/1976; cols. 969-70.]
Just a few short weeks ago, both the employment rate and the number of people in full-time work were at record highs. Wages have been rising ahead of prices month after month after month. How quickly a situation like that can crumble.
The One Nation group of MPs came into being in 1950 after the Conservative resurgence in that year’s general election swept in one of the most talented intakes in history. To most economists and politicians back then, full employment was generally seen as something that could and should be achieved through government intervention, job creation schemes, state enterprises and so forth. Since the 1970s, that outlook has seemed old-fashioned and discredited. In this situation, however, the current replacement of ideology with pragmatism is not only welcome but, I believe, essential for our survival. It is said that in times of national crisis no one claims to be small-government Conservative, so I warmly applaud the swift and decisive action taken by the Chancellor to underpin small businesses in particular. He deserves all our support, and I believe that he is the right man at the right time.
I mentioned theatres and actors. Just last week, although it seems a lifetime ago now, my wife and I attended the first anniversary performance of the West End show “Come from Away”. The show tells the true story of how the population of Gander, a small town in Newfoundland, welcomed thousands of unexpected visitors when 38 passenger planes were grounded at their local airport in the wake of the 9/11 attacks. The people of Gander famously came together and showed us the best of humanity. That powerful, timeless message of social solidarity and generosity of spirit must infuse not only our social policies but our economic policy too.
As one nation we shall survive this crisis, but only as one nation shall we then successfully rebuild our economy and our society.
Baroness Falkner of Margravine (Non-Afl)
My Lords, it is a real pleasure to follow the noble Lord, Lord Hunt of Wirral, whose long experience and pragmatism is something that we in this House should all take account of.
Like other noble Lords, I want to concentrate on the broad economic outlook in these extraordinary times. It is said that in 1942, in the middle of the Second World War, William Beveridge said on publishing his report on the welfare state:
“A revolutionary moment in the world’s history is a time for revolutions, not for patching.”
I think we are all coming to the realisation that this extraordinary period may end up being revolutionary, not least in its impact on globalisation—or deglobalisation —and on our faith in the capitalist model underpinning these free societies.
Several analogies have been drawn between the financial crash and this coronavirus pandemic, but the profound difference is of time, scale and scope. With the financial crash, it took five months between the run on Northern Rock and its eventual nationalisation. In the case of Covid-19, it has taken 13 days from the first death on 5 March to around 71 now. While the crash was a relatively slow burn with a very long tail, as we know from austerity policies, it is expected that the UK will see 95% of cases over a nine to 10-week period only.
Another difference is scale. Banks and large businesses going under undoubtedly impacted on a significant number of people very directly, but the indirect effect of lower public spending was a slow, long burn over many years, as other noble Lords pointed out. For me, the underlying risks to the economy are more grave this time and the level of uncertainty, as opposed to risk, is rising; hence the slump in global markets. We do not know whether a global recession, or indeed even a depression, caused by the pandemic will go beyond the current stock market slump to a full-blown financial meltdown, which will be of a different order of magnitude from that which we are planning for in loosening the purse strings.
We know that global regulation and financial buffers have made banks much more resilient and that the stress tests to evaluate bank safety have been made much tougher, taking into account multiple scenarios for shocks to the economy. However, the modelling has not anticipated the speed and depth of this pandemic, and its impact on regional and national lockdowns on supply and demand constraints. The equity market falls contemplated in worst-case scenarios of around 25% have already been exceeded, since some markets have fallen south of 30% in the last couple weeks. While central banks have countercyclical capital buffers, the question is whether they are deep enough to increase the capacity to lend to avert a credit crisis.
In this context, I note that calls for helicopter money, which has been mentioned by the noble Lord, Lord Lamont, are being considered in the US, where Steven Mnuchin, the Treasury Secretary, is contemplating a cheque of $1,000 for every American citizen. Here in the UK too, there are increasing calls for universal basic income. I note that the Prime Minister did not rule it out in Prime Minister’s Questions this morning. It is not surprising, since conventional economics holds that when interest rates are low—ultra low—debt can grow exponentially. I think that was the basis of the Labour Party’s spending splurge promised in its manifesto.
The current Government’s borrowing assumptions in the Budget were also predicated on that view, hence the £30 billion stimulus, which would have looked like good economics had normality continued in the market and the wider economy. While some speakers on the Labour Benches have used this crisis to suggest that there should have been no attempt from 2010 onwards to bring down the public debt, I am curious whether they think that the economy would have been able to withstand this particular crisis, or that this level of spending would have been possible, if we were still carrying a level of government debt of around 57% of GDP, as was the case in 2009. Of course, that excessive and extremely high public debt is a burden carried by future generations.
However, it has all changed now, and hard times call for new thinking. As far as helicopter money or universal basic income are concerned, if used to alleviate shocks to earnings and employment they must be for a very time-limited crisis response, since its overall effect on incentives and issues of equity will create free-riding. I think the noble Lord, Lord Skidelsky, said that we will all have to start paying for what we are giving. Some will pay more than others.
The Government should use every lever that they can at the moment, but in doing so they must surely be mindful that things can get worse, even from where we are today. At unpredictable times, we might be mistaken in thinking that we have hit the bottom, only to discover that our sight was blurred and that the bottom is still some way down. Foresight, not panic, should be the order of the day for both the Government and the public. Good judgment should drive the response, not the need to do something, even at this time of national crisis.
Baroness Lister of Burtersett (Lab)
My Lords, in his Budget speech, the Chancellor claimed to be providing security and to be getting levelling up done. But levelling up should not just be about the physical infrastructure of new roads, railways, broadband and homes, as he described it, welcome though all but the first are; it is also about the social infrastructure of public services, such as social care and childcare. These are of great importance to local communities and people’s lives, as is currently being brought home to us. Levelling up should be about people as well as places, wherever they live. The Budget fails to get levelling up done on either count, or to deliver genuine economic security to those whose economic circumstances are most insecure.
Like a barium meal, the current crisis is illuminating painfully the inadequacies of our care services and social security system, depleted of resource after a decade of austerity. The Women’s Budget Group, of which I am a member, argues that the social infrastructure is every bit as important as the physical, and of particular importance to women, who rely more on public caring services. What has happened to the plan we were promised on social care? It is like “Waiting for Godot”. Moreover, the group calculates that investment in care services would create more jobs than the equivalent level of investment in construction. The group calls on the Chancellor to include the social infrastructure in his welcome review of the fiscal framework. Will the Minister confirm that, in this review, investment will be understood to include investment in the nation’s social and human capital, as well as its physical capital?
As I said, levelling up has to be about not just places but the individuals who live in those places and elsewhere. The two are intertwined, as the Resolution Foundation underlined:
“differences in family finances … drive up regional living standards inequalities, and these should form a substantial part of the levelling up agenda in future.”
It points out that this is particularly true of social security cuts, to which what it calls “blue wall seats” gained from Labour were most exposed. It says that the Budget does virtually nothing to offset the cuts imposed in 2015. The households in the second net income decile, for example, will eventually be £2,900 a year worse off on average due to benefit and tax changes since 2015, with £900 of that yet to come from the social security policies still being rolled out, notably the two-child limit. One consequence is
“a risk that child poverty will reach record highs by the time of the 2024 election.”
A key driver has been the four-year freeze, which has cut the value of working-age and children’s benefits by around 6%. Overall, they are now worth about 9% less than if CPI indexation had applied since 2010.
It is all very well that the Budget report cited the end of the benefits freeze under the rubric of supporting the most vulnerable, but it was due to end anyway. What is missing is any commitment to making good the money lost, as called for by the Work and Pensions Committee in the previous Parliament, and by others—not even that which was due to higher than anticipated inflation, so that it is estimated that the Treasury saved roughly an additional £1.2 billion. This is money owed to the most vulnerable, and the Government should acknowledge the debt.
Policy in Practice concludes that the Government have missed an opportunity to show support to households in poverty and halt the reputational damage of universal credit. Noticeable by omission was any provision to alleviate the impact of measures introduced as part of austerity. For these households, austerity is far from over. Unless the value of their benefits is restored, it will be baked into inadequate social security benefit levels in perpetuity.
Inadequate benefit levels are also one reason that the social security system is not now providing the security that its name promises. Other problems caused by a number of aspects of the design of universal credit, in particular the five-week wait, have already been mentioned. While the tweaking of the rules governing the repayment of advance payments is very welcome, I fear it will be now used to resist the growing calls for more fundamental reform of the five-week wait. As Policy in Practice argues, this meant that the Chancellor missed an excellent opportunity to set out an alternative strategy to support households through the five-week wait.
That strategy, recommended in various forms, including by the noble Lord, Lord Freud, is to provide what Nicholas Timmins of the Institute for Government calls a
“non-repayable … ‘welcome grant’ for … new claims for UC and to those transferring … from tax credits”
who will not be covered by the run-on of existing benefits. This has particular implications for those hit by Covid-19 who do not qualify for statutory sick pay. Policy in Practice, Citizens Advice and others argue that much more must be done to ensure that everyone can afford to self-isolate and is not discouraged from doing so by the UC rules.
Nor must they be discouraged by the sheer inadequacy of available benefit levels or support with rents. Will the Government heed CPAG’s call for an emergency increase in children’s benefits, especially as free school meals are suspended when schools close? Can the Minister give—or seek on our behalf from DWP—an assurance that all work sanctions and job search requirements will be suspended? Discretion is not good enough to ensure protection. More radically, petitions are circulating, both nationally and internationally, calling for an emergency universal income scheme, as mentioned, to help get us through the crisis. Ireland is showing the way on a temporary basis.
I welcome the fact that the Chancellor is promising a further package of measures. These must be sufficient to meet his promise to every British citizen that this Government will give you the tools you need to get through this. Without financial security, it will be that much harder to get through. This is a public health—as well as an income security—issue.
Two weeks ago, during the debate on the Child Benefit Up-rating Order, the Minister declared:
“I am proud to represent a Government who are focusing attention on those at the very bottom end of income.”—[Official Report, 3/3/20; col. 571.]
Two days later, the Office for National Statistics published a bulletin showing that there had been a 7% fall in the real income of the poorest fifth of people, largely due to the benefits freeze. The Budget does nothing to rectify this. It neither offers genuine security to those with the least security nor levels up the living standards of those at the bottom. In the face of growing poverty and hardship, the Government’s priority should be a source not of pride but of shame. Following the remarks of the noble Lord, Lord Hunt of Wirral, I hope that the Government will now prove me wrong, and prove that they are genuinely a one-nation Government.
Baroness Bennett of Manor Castle (GP)
My Lords, it is a great pleasure to follow the noble Baroness, Lady Lister. I can only very strongly agree with her that the Budget utterly failed to address our desperately threadbare social infrastructure. I am speaking as someone who has just started cycling to your Lordships’ House and I am very keen to get those potholes filled in—but, while the Budget put some funds into the physical infrastructure, we are going far beyond the Budget in this debate. We are looking, as one noble Lord said, at the big picture.
I want to refer to the most recent episode of the BBC series “Child of Our Time”, which follows children born at the end of 1999. Experts at the start of making that programme said with confidence in 1999 that we were looking at
“a better society, a better world for our children”.
Look where we have got to. One of the first landmarks in that period was the financial crash of 2008. We bailed out the banks and made the people—particularly the poor, the disadvantaged, the disabled and the young—pay for that bailout. I draw on the New Economics Foundation for the statistic that welfare social security is now down £34 billion in real terms on the figure from 2008. Then, of course, we have come to realise that we are in a climate emergency. I go back to the Budget; as my noble friend Lady Jones of Moulsecoomb suggested, it utterly lacked the climate bailout that we so desperately need, and what we had promised to sign up to through our words in declaring a climate emergency and through our position at the head of COP 26.
Then, in the scant week since the Budget, we get the coronavirus crisis. On Saturday, the Green Party called for a solidarity pact: for a guarantee that people’s utilities would not be cut off; a guarantee that there would be no benefit sanctions; and a guarantee of a freeze on council tax. Yet what we have not seen from this Government is the people’s bailout. Another thing called for in that solidary pact is a guarantee that no one will be evicted. We have heard about the Government backing that, but I hope that the Minister can give us more detail, which we have not heard in the other place.
Many noble Lords have referred to the damage done by austerity. I want to pick out one very relevant case study. IPPR analysis shows that there has been an £850 million cut in local public health budgets in the last five years. The poorest places have been hit first, and worst. We know that the people most vulnerable to coronavirus have type 2 diabetes, heart disease and respiratory disease linked to smoking, unhealthy diets and obesity. The figure for public health in the Budget was up about £150 million but that is based on a cut of £1 billion since 2014. This spending could have directly reduced the impact of coronavirus but has not been made.
Let us focus on the now and think about the situation of so many people outside your Lordships’ House. The most reverend Primate the Archbishop of Canterbury was prescient in referring to free school meals. As we now know, from Monday, huge numbers of families will be wondering how to feed their children without those meals. There are people sitting in households in the dark and the cold, possibly ill too, wondering how they will top up their pre-payment meters. They are not supposed to go out. Why do we not have a measure to top up automatically such meters, owned by some of the most vulnerable people in our society?
In the gig economy, which many noble Lords referred to, two-thirds of renters have no savings at all, and 1.1 million households made up of renters rely on self-employed people as their main source of income. They will be worrying about the rent but, even more basically, right now they are worrying about buying food. We have seen no steps to help them.
It is fascinating to listen to the debate. We have seen people move their positions hugely. The noble Lord, Lord O’Neill, who is not currently in his place, said that incomes need to be made good by our Governments. The noble Lord, Lord Lamont, referred to “helicopter money”. I must say, as someone who represents a party that has for decades spoken in favour of universal basic income, I feel some sense of shock at this moment. As my noble friend Lady Jones of Moulsecoomb said, we agree with the DUP, which calls for a universal basic income; the SNP is calling for it in the other place too.
As noble Lords might expect from the Green Party, I want to go further than that. In opening the debate, the Minister said that the world has changed and that we must see beyond the short-term impact of the coronavirus. I absolutely agree. As I said with regard to public health budgets and making the people pay for the bailout of the banks, we have made choices that have created a profoundly fragile, insecure economy, which coronavirus is now exploiting. The virus is exploiting our weaknesses.
Let us look to the future and the long term. Let us unleash the creativity of people, give them a chance to develop their skills and give them security. Let us move immediately to a universal basic income to give everyone security, not just for a few months or a year but for the future.
Baroness Finn (Con)
My Lords, I am grateful for the opportunity to speak today. It is humbling to follow so many experienced, knowledgeable and very learned noble Lords. As others have mentioned, it is far from business as usual; as we have watched this crisis build ominous momentum, so we have waited to see the Government’s fiscal response. Of course, it is too early to say, but I sincerely hope that this is indeed the Chancellor’s “whatever it takes” moment.
On Monday, the Prime Minister rightly told the nation not to frequent bars, theatres or clubs, with a massive effect on those businesses and many more. However, on Tuesday they heard from the Chancellor that the Government would support them with £330 billion in loan guarantees to give firms access to cash. I very much welcome the package outlined by the Chancellor and appreciate that this is a fast-moving and uniquely challenging situation. However, I echo many other noble Lords in urging him to provide much-needed clarity and to consider additional measures to support the self-employed and businesses in the service, hospitality, retail and entertainment sectors.
No Conservative would want to see good money thrown after bad to support a failing industry, but that is not the situation we face. There are hundreds, if not thousands, of perfectly viable and profitable businesses which risk going under because of an act of God. The first duty of a Government is to protect their citizens, but they must also intervene now to reassure businesses that they will stand behind them. This cannot be just through loans; they will need tax holidays, cash injections and relief from PAYE and other pressures. The message must be clear to business owners: keep your staff on your books, the Government will support you. As a country, we will get through this terrible virus. However, if ever there was a role for government, it is here and now. We must ensure that our economy is strong and vibrant on the other side.
This extraordinary backdrop should not overshadow what I hope will be a critical change in measuring return on public investment—a rewriting of HMT Green Book rules. I welcome what my noble friend the Minister said about this. For years, this outdated Treasury methodology, which was intended to guarantee the best return for government investment, has perversely done more to widen economic disparities, depress productivity in poorer parts of Britain and deepen the gulf between north and south. We cannot continue to count every pound spent in terms of narrow cost-benefit. This Budget shows a welcome break from orthodoxy to ensure that funds are now allocated on the basis of how much they will improve well-being and social cohesion in the areas targeted.
The first indicator is the approach to spending on infrastructure. It seems that the Government are minded to go even further than the feted £100 billion. The Chancellor said that, by the end of this Parliament, public sector net investment would be triple the average over the last 40 years in real terms. This money must be spent on projects that have sustainability and productivity at their heart, so I am pleased that, as well as roads and railways, we have significant outlays for improving 4G networks such as the £5 billion for gigabit broadband. As the eyes of the world will be on the UK in Glasgow later this year, it is good to see the Government committing to building electric charging infrastructure. The commitment to carbon capture and storage technology will be vital if we are to meet our commitment to be net-zero on carbon emissions by 2050.
One former casualty of the outdated Treasury methodology is the Swansea tidal lagoon project. I have mentioned this many times; it has the potential to be the prototype for world-leading exportable technology. Could my noble friend the Minister commit to looking at this again? Our uniquely powerful tidal flow is an enormous competitive advantage that it would be a crime to ignore.
When it comes to investment, we cannot do better to boost our productivity than to invest in our people, so I commend the £2.5 billion new national skills fund. In this time of profound economic change, it is vital to support people as they upskill and reskill on their journeys to future-facing careers. Such a fund should give our high-growth, innovative firms access to a stronger pipeline of talent. I was disappointed—as were many others, including my noble friend Lord Leigh —to see a stringent reduction in the lifetime allowance for entrepreneurs’ relief. I declare an interest as the co-founder of a start-up company. We must mitigate the reputational damage this shift could do to our hard-won entrepreneurial culture. Access to talent, domestically and globally, will go some way to offsetting this, as it remains the No. 1 concern for start-up businesses.
This was a Budget about a crisis, but it was also about sowing the seeds of recovery. This pandemic has been a reminder that we are a truly global society, so we must build a workforce, infrastructure and ideas that can compete and succeed globally. On that measure, this Budget holds much promise.
Baroness Valentine (CB)
In these testing times, I thought it was important to speak up today for those towns at the end of the line, which rarely reach the consciousness of our Westminster world. These towns, which have some of the worst deprivation in the UK, will suffer greatly from the current crisis. I urge the Government to do everything they can to support them through the crisis—I am taken by the people’s QE proposal from my noble friend Lord O’Neill—but they should also plan for the longer-term levelling up that was promised at the last election.
Given the last two years I have spent in Blackpool, and my role now working with Business in the Community to bring business’s attention to Britain’s overlooked towns, I will focus my remarks today on what levelling up means in practice. The promise of serious attention might well have contributed to swaying marginal seats in the north, but the words “levelling up” did not feature heavily in the Budget. Last year, the Government announced a town deal programme, focusing £3.6 billion of funding on 101 forgotten towns. If levelling up means bringing opportunity and hope to these towns once we are past the current crisis, then the Government will have gone a long way towards both defining levelling up and establishing its credibility in so doing.
I think we all get the intention of levelling up, but delivering it is another matter. Local people are looking for genuinely transformational commitment to their areas. Delivering this change in long-ignored places requires sensitive, long-term strategic investment, in tune with local opportunity and need and going beyond a single political term. I ask the Minister: how do the Government plan to direct the welcome investment described in the Budget towards these towns? Relevant spending pots include the stronger towns fund, the high street fund, the UK prosperity fund, housing funding, and skills and education spending, to name but a few.
Specifically, could the rollout of 4G and better digital infrastructure perhaps be prioritised for these towns, or could they even leapfrog to 5G? I sat on the House of Lords committee on regenerating seaside towns last year, which identified digital connectivity as a means of compensating for the isolation of these towns at the end of the line. Could we also add digital training academies and enterprise hubs, so that we can build skills for the future in these places? Can some of the hundreds of billions allocated to infrastructure be set aside for town deals to access, and can we find a way of assessing cost-benefit ratios more imaginatively to capture public benefit, rather than saving time spent on a train? A river crossing in Lowestoft could knit together two halves of the town, thus providing community cohesion at the same time as economic connectivity.
On housing investment, can the policy instruction to Homes England be amended so that it is not just tasked with building more housing to accommodate overheating in the south, but can also help those towns deal with seriously run-down neighbourhoods? Blackpool has an area of 10,000 units in the centre, which are the legacy of the traditional bed-and-breakfast industry; it now houses the greatest concentration of deprivation in England. At the moment, Homes England does not have the remit to help.
The town deal programme has promised not just to be about money but to provide a strategic approach as well. Will the Government consider having a town deal tsar to work across departments and deliver funding and strategic progress in these terms, and will they measure this progress in aligning government strategies and funding?
I also wonder whether some delivery capacity at the centre is required to move from headline messages to supporting local teams in achieving real change on the ground. For instance, the Government plan to move 22,000 civil servants outside London. Can this be integrated with the Government’s plans to create Civil Service hubs, and can those hubs be located in town deal areas? Again, I am aware of the Civil Service hub proposal for Blackpool, which has been agreed in principle for some time but never seems to progress.
The Budget said little about skills and education and the town deal programme focuses primarily on capital investment, but there is also a need to a focus on finding the best people and upskilling alongside capital projects. At the end of the day, this is about people, their self-belief and opportunities. If there is no one to inspire young people to set up social enterprises, a social enterprise building is just that—a building, without a heart. The last Government made a helpful intervention with opportunity areas in many of these deprived places, but unless they are given a reprieve then these unfortunately are soon to finish. One way or another, we need to see a much more determined focus on improving school results for these children. Focusing Department for Education civil servants and money in these areas might be a start.
I finished by congratulating the Government on their investment plans for infrastructure, but I urge them to follow up on their levelling-up commitment and to ensure that there is a genuine long-term impact on the places that need it most.
Lord Brooke of Alverthorpe (Lab)
My Lords, I am grateful to the Minister for introducing the debate and for what he had to say about growth, about which I will say a few words. To use his phrase, he felt that the Budget had seen beyond the immediate problems that face us.
I think the Government are doing their best in difficult circumstances, and I wish to support them as best I can. There are areas either that they have overlooked or where they have made mistakes, but they seem to be moving quickly enough to speedily resolve some of those difficulties. For example, on rentals it immediately hit people that we needed some movement there, and it will be very interesting to see what they come up with.
It is important that politicians try to come together if they can. This is probably the most difficult time that any of us have experienced where the nation has been faced with such grave challenges. I know people who are virtually having meltdowns through fear and having panic attacks about what is happening. It is therefore important that we as the leadership should endeavour to speak sensibly and calmly and reassure people, rather than frightening them by constantly engaging in attack.
No one knows all the answers; the Government do not have them, nor, I suspect, do my friends in the Green Party, although I must say I agree with an overwhelming amount of what they are saying. It is important that we take our time over this issue and have a look to see just where we are. This House is particularly able to do that. We had three quite important debates last week that made us look to the future: a debate on the green economy, a debate on well-being and the debate of the noble Lord, Lord Bird, about relationships with the younger generation, on which I think we should be spending more and more of our time. So we had that run last week and now we have this debate today.
It is important that we look at some of the fundamentals behind this issue. Why do we have it now? Are the Chinese to blame, or is this something that is happening around the earth for which we all, in different ways, have some responsibility? We are already talking about getting back to our pursuit of ever more non-stop growth as quickly as we can, but we really are at a point where we have to start questioning the nature of the growth that we have. Perhaps we need some growth but in a different direction entirely from that which we have produced in the past. I hear from friends in business that the factories in China are now back and waiting for orders, waiting to start producing the trash and rubbish, much of it, which we have been calling on them to produce at low prices and which we then discard so quickly, harming the planet in the process.
We all have to accept a degree of responsibility for where we are. What faces us at the moment is part of a piece of what we have witnessed over the last two to three years, with the famines, fires, flooding and the list gets ever longer about the pestilences that come our way. We need to start realising that we are relatively powerless. In spite of the size of our brains and intellects, we are powerless when we come up against the real power in the world—the power of nature and of the Almighty behind that. This is not the kind of thing that people talk about easily these days—it embarrasses people—but that is the reality we face at the moment. It is a very different set of circumstances to anything we have seen for a very long time. There is an opportunity for positive change within this. The important thing is that we have to work together to get that change.
I was disappointed that the Budget did not look far enough down the line. I pick up the point from the noble Lord, Lord Skidelsky: this will have to be paid for in future. It is wrong that it is again the young who will have to pick up the tab rather than the older in society, who in many ways are responsible for some of the problems we currently face. I hope we can look to start now with some changes. Why did we not reimpose the regulator, the duty RPI link, on fuel? We have seen that the price of fuel has collapsed with the fight between the Saudis and Russians; it has dropped down from £1.35 to £1.26 or £1.27. It is the perfect opportunity to reintroduce the escalator, which we need. The Conservatives know that prices count and that people’s behaviour is changed and governed by pricing, so I ask the Government to look again at the decision they took last week to fail to move on it.
I will not mention what the right reverend Prelate the Bishop of Rochester said about duty on alcohol; people have heard me go on about this before. We have so many ill people, and here we are reducing the price of alcohol so that they will become ill. This is the kind of living we are talking about—living longer, yes, but living unwell. We must seek to effect changes there. Underneath all that is the sugar tax, which was not even mentioned. We have major problems in our society with obesity and its costs. We should look at the sugar tax and see whether it should be extended and widened beyond what it is already operated on.
There are things we can do to make sure that in the long term we are preparing for a different, better society than the one we have. I hope the Minister will take some of those points away and maybe respond in his reply.
Lord Maude of Horsham (Con)
My Lords, I draw attention to my interests in the register, including as co-founder of a start-up with my noble friend Lady Finn.
It is a great pleasure to follow the noble Lord, Lord Brooke. He and I had dealings some 30 years ago when I was Financial Secretary and he was leading the Inland Revenue Staff Federation. He was calm, courteous and moderate then, as he is in your Lordships’ House today. Thinking about that time, it was said after the Chancellor’s Budget last week that this was the biggest fiscal stimulus since the Budget in 1992, introduced by my noble friend Lord Lamont. Looking at the Red Book from that time, issued in my name as Financial Secretary, my noble friend reminds me that the fiscal stimulus then amounted to some 0.25% of GDP, whereas last week it was a heroic 1% of GDP.
Of course, that has been made to look nugatory in the face of what has happened since then because that Budget inevitably has been very much overshadowed by the necessary and desirable response to the intensity of the Covid-19 crisis. This is troubling for a fairly unreconstructed smaller state, sound money Conservative, but these are utterly extraordinary circumstances and so an utterly extraordinary response is required. Last week, long-term decisions were made in the Budget on investment in infrastructure and spending more generally, while short-term palliative measures were introduced earlier this week. A different approach is required for each, but in both cases, the huge increase in spending makes it more necessary to focus on how the money is spent. I have some general points and some specific ones.
On the general points, our experience from the coalition Government is that a lot of money spent by Government is not spent very well. By dint of applying some disciplines that are commonplace in successful businesses but very uncommon in government, we were able to save from what are essentially the running costs—the overhead costs of Government—some £52 billion over those five years cumulatively, one year added to another. Some of the reforms we introduced persist, some have advanced, while others have regressed, and I am delighted to see that the role of my noble friend the Minister is to accelerate those reforms. It is necessary for him to be successful because it is his job to ensure that public money is spent well. It could be easier than it might have been because it has been shown that it can be done. However, it will be more difficult because when there is a sense that the sluice gates have been opened, it is tougher to persuade the spending Ministries to accept the centrally imposed disciplines that are essential to drive the effort successfully. I wish him every good fortune in the task he has taken on.
I come now to what we all hope will be the short-term measures that have been introduced to address the effects on the economy of Covid-19. We do not know what they are yet, but they will be severe in the short term, and immediate. One of my daughters had a part-time job in the hospitality sector while she undertakes a course of study, but she no longer has that job. There will be many people in those circumstances. She is being protected by the Bank of Dad, but many more are not in that position. The effects of all of this are very immediate. Further, while this may be surprising in view of what I was saying earlier, it is important that the Government should not be too fussy about trying to ensure in advance that all of the money is spent perfectly. It will not be because speed trumps everything else in this regard and getting the money out of the door.
How should that be done? A number of noble Lords have spoken of increasing the amount of leverage, the amount of debt in our economy, which is a real and genuine concern. I have a great deal of sympathy with the argument made by the noble Lord, Lord O’Neill, about whether this is the moment to print money. Some 30 or 40 years ago, that would have been anathema to us all, but we have seen in the response to the global financial crash that quantitative easing—printing money, as we used to call it—did not unleash inflation in the way that we feared. I think I heard the noble Lord say on the radio earlier this week that if we suddenly see a burst of inflation, that would be a quality problem for us and we could deal with it.
I have a couple of questions for the Minister about the measures that were announced a couple of days ago. On insurance, we have heard different things about the effect on business. Will those who have cover for these circumstances be able to claim on their normal business interruption insurance? An answer on that would be welcome.
What of the economy as we emerge from this crisis? There will be effects, and some of them may not be bad. As an economy and as organisations, we should be much better at organising and managing people remotely. There are huge benefits if more people work from home, which means being more sophisticated in how they are managed, managing them by output rather than by presenteeism. That can be a massive boost to productivity if we learn the lesson well of making a virtue out of necessity.
We used to talk in the coalition government about the big society, and we were sometimes mocked for that. However, the reality is that while the Government have an absolutely indispensable role in addressing the challenges that come out of this dreadful crisis—this dreadful virus—there is an enormous amount that people can do, such as working with each other in organisations, supporting each other, although less so physically. Thank God for the internet and for the connectivity that enables people to support and connect with each other without being physically present. The damage that would be done without that would be intensely worse. Therefore, there are potential benefits to come out of this. These are dark clouds indeed, but let us make sure that when the silver linings emerge—they may just be flickering—we do not waste them.
Lord Desai (Lab)
My Lords, the one joy of speaking in a Budget debate in your Lordships’ House is that social distancing is not a problem. I have been sitting here, not in spitting distance of anybody. However, let me say this: rejoice! We seldom have such a beautiful crisis. This crisis is not caused by anybody’s bad behaviour. It is not caused by debtors’ behaviour or dubious mortgage equities or bankers’ bonuses. It is a purely exogenous black swan shock, and it is so big that it is totally global. Of course, whoever originated it in the backstreets of Wuhan, its spread is due to globalisation—due to the ease of movement. In one sense this is in fact a great opportunity. I am sure that right now, Greta Thunberg is the happiest person in the whole world, because all flying has stopped and people have stopped travelling—they have to sit at home and do nothing. Wow! Climate change will finally be tackled if we go on like this.
Before I go on to weightier matters, we have had in this debate one specific radical idea, which was articulated by a number of noble Lords, including the noble Lords, Lord O’Neill and Lord Skidelsky, and of course it is also part of the Green Party’s programme. I declare an interest: I have been going on about a citizen’s income or basic income for well-nigh 30 years. This is the opportunity for us to institute a temporary citizen’s income. In a sense, given the supply shocks and all the uncertainty, we do not know who will be deprived of income and for how long. Instead of people worrying about sick pay—there are all sorts of things they should be worried about—a citizen’s income should be given to everyone on the electoral register. It need not be a large sum of money; I am always rather thrifty, so I would say £100 per week for everybody on the electoral register until such time as the Government decide that things have returned to sort of normal. Okay, if you want to make it £200, I do not mind—it is not my money.
With something like that, the universality is important. In universal credit, which is a disgrace—I will not go into that right now—there are too many side conditions that people have to satisfy to qualify for a benefit. That by itself ruins the good of the scheme. The thing about a basic income or citizen’s income is that everybody gets it by being a citizen; it is like the right to vote. Right now, it would do a tremendous amount for a lot of people at least to have pocket money—especially, for example, women who are not part of the labour force. Anybody who is not part of the labour force will still get it.
I urge the Government, since they are in a spending mood, to let the Chancellor come tomorrow and throw another £20 billion or whatever the sum is at this. That money will go a long way and will plug a gap in the system.
Having said that, let me say that British economic politics are a battle between either 35% or 45% of GDP being spent by the state. If you look at the data for the last 50 or 60 years, it goes between 35% and 45%. The Conservatives want to be near to 35% to 40% and Labour wants to go a little further, but there is not much in it. If your income is down, then the proportion is high, but actual expenditure is not very much. People go on about austerity, and my noble friend Lord Brooke challenged me to own up to the fact that I supported austerity—and I do. I was the only person in Parliament to sign a letter to the Sunday Times on that back in February 2010. I do not want to defend myself, because it is a hopeless task, but I would say that if you look at the Budget Red Book—tables 1.2, 1.3 and so on—the proportion of GDP spend between 2010 and 2020 was higher than 40% every year, and was higher than the proportion of GDP spent in the 10 years of the Blair Government. In a sense, these are proportions, so I am slightly cheating. If you look at the employment numbers in chart 1.3, employment has grown throughout, as the noble Lord, Lord Skidelsky, was saying, and we are right now in full employment—in the last year of austerity. Those numbers are to be taken with a pinch of salt.
I became a balanced-budget ayatollah way back when the Conservatives were in power and the noble Lord, Lord Lawson, gave a double mortgage concession after winning the election. I thought it was ridiculous; why should anybody give tax concessions after winning an election? You do it before. Anyway, then we had a recession. I believe in balanced budgets when balanced budgets are important and in deficits when deficits are important—horses for courses. I will not resile from that.
To return to the present crisis, we are back to Butskellism—thank God—and now it is a compromise where the Conservative Government are willing to spend money when there is the necessity to spend money. I had been saying before the coronavirus problem came up that this was a very good time to borrow money, because interest rates were low—so therefore borrow as much as you can at a low rate of interest. Interestingly —I think I have spoken for too long; I will sit down—we had excess savings in the global economy, and, with coronavirus, that excess saving will be mopped up by Governments. Perhaps we may reach equilibrium faster than we otherwise would have.
Lord Northbrook (Con)
My Lords, it is always a pleasure to follow the interesting and entertaining viewpoints of the noble Lord, Lord Desai. I will talk first about the post-Budget emergency economic measures. Following the example of France and Portugal and the USA’s proposals yesterday, the Chancellor stated that he would do whatever it takes to get businesses through these difficult times. He unveiled a package of major assistance for companies and individuals: the £330 billion loan guarantee support and the £20 billion business assistance help—they are astonishing figures. I approve of the way the Chancellor said that:
“This is not a time for ideology and orthodoxy.”
First, I welcome the loan assistance package, with separate schemes for larger and smaller companies, but note other noble Lords’ concerns about the delay in banks processing these. For individuals, I commend the Chancellor’s decision to suspend mortgage payments for three months for those in difficulty. Secondly, I agree with the Government helping with companies’ fixed costs, again particularly with the larger and smaller company schemes regarding business rates relief, and with improved cash grants for smaller companies. Thirdly, I welcome the proposal to look at regulatory relaxation in sectors such as transport, airlines and airports. Finally, on these extra measures, I await the
“bold and ambitious employment package”,
which the Chancellor pledged to establish, having made a start with more generous statutory sick pay proposals.
I agree with many noble Lords that much more needs to be done. I was fascinated by the idea proposed by the noble Lord, Lord O’Neill, of helicopter money, which was supported by my noble friend Lord Lamont and the noble Lord, Lord Adonis, and put into historical perspective, regarding its use by other countries, by the noble Lord, Lord Razzall—I agree that there is less risk of inflation in doing it now. I agree with my noble friend Lord Leigh of Hurley that another simple route would be through the PAYE system.
I turn to the Chancellor’s original 2020 Budget, which I also welcomed. Even before such difficult circumstances, a different approach had to be taken after the election, especially to thank constituencies in the north and Midlands that elected Conservative MPs, wanting a new approach to improve their neglected infrastructure and business prospects. On monetary policy, I welcome the 0.5% base-rate cut, which is always a necessity in difficult economic times.
Moving on to fiscal matters, the Budget’s economic forecasts are now history, as the OBR’s estimates were completed before the Covid-19 outbreak really got going. Also, they assume that the Brexit negotiations are going to go entirely smoothly, with a “typical” trade deal with the EU. I ask the Minister to heed well the words of the noble Lord, Lord Adonis, on Brexit negotiation delay.
Economic growth, as predicted by the OBR for the Budget over the next five years, was not very exciting. Clearly, these figures will have to be revised substantially downwards. By way of comparison, the European Commission has revised its estimate for European GDP growth, now expecting a GDP contraction at 1% this year. Apparently—according to the Canadian National Post—unpublished internal estimates are more likely to indicate a contraction of 2.5%.
As many noble Lords have stated, the original Budget’s big spending boost over the period came in public sector net investment. Public sector spending is forecast to grow at 2.8%, twice as fast as the economy. Public sector net borrowing, excluding yesterday’s emergency measures, at its peak increases by 74% to nearly £67 billion by 2021-22. While this is a major increase, it is still a far cry from the huge figure inherited from Labour in 2010. In answering criticism from the Adam Smith Institute and the IEA, I maintain that while interest rates are low, this is the time to do this. Of course, as the IFS stated in its Budget review, the debt hike is vulnerable to changes in interest rates, inflation and economic growth. Obviously, the longer the Covid-19 outbreak continues, the worse the effect will be here. I also note that the fiscal rules framework will be reviewed in the autumn and doubtless tinkered with.
Looking at the figures in more detail, I welcome the initial £12 billion fiscal stimulation package, directly related to the outbreak, with £7 billion going to people and businesses. However, I am worried about liquidity problems for smaller companies; as I predicted, the £7 billion figure had to be expanded considerably due to the outbreak. The other £5 billion is going to the NHS—a good decision.
Turning to longer-term public net investment, I note the huge figure of £600 billion promised over the forecast period for gross public-sector investment but calculate the net figure at £451 billion. Can the Minister let me know about the major components that must be deducted to get to £451 billion? The big public investment figures mentioned for investment, R&D, new roads, the affordable homes programme, improving broadband, potholes, 70,000 new houses and a new building safety fund are all welcome, as long as they are properly implemented.
In other departments, I welcome the extra £6 billion of regular funding for the NHS, noting that it is in addition to the extra £34 billion over five years. I also welcome the announcement that the Government will give the NHS whatever it needs to fight the Covid-19 outbreak. Regarding the further education sector, I am sure that the Minister is as pleased as I am to see the further new capital promised to improve the condition of the further college estate. On the transport sector, I welcome the money to be invested in the transforming cities fund.
In summary, the OBR said that
“the Government has proposed the largest … fiscal loosening since the pre-election Budget of March 1992”.
All this money needs to be well spent.
Lord Judd (Lab)
My Lords, I evidently failed to register my strong interest in this subject by not putting my name down to speak in this debate, and therefore I am grateful for the opportunity to speak in the gap.
Of late, we have heard an awful lot about having more people in work than we have ever had before, but we have failed wantonly to look at the nature of much of that work and the conditions of employment that go with it. The vulnerability of many people between their work and the abyss that awaits them is frightening.
We have also had too much ideology in our approach to politics and economic management in recent years. This debate and this situation bring home to us that we need a reassertion of humanitarian and economic pragmatism in fulfilling our objectives. There is just no room for bigoted ideology.
This morning I have been in touch with the chief executive of Hospice at Home West Cumbria, of which I am a vice-president. She is disturbed about how the present situation is making it very difficult to raise the public funds that are essential to provide for the work of that organisation. That must be typical of many charitable organisations across the front line, which become part of the indispensable fabric of our social infrastructure. Can we have an assurance from the Government that, when they are looking at industry and the big institutions, they will look also at the charitable sector and the support that must be provided at this juncture?
Lord Naseby (Con)
My Lords, I appreciate the opportunity to say a few words in the gap, arising out of phone calls that I made last night.
First, a number of noble Lords will know that I was Member of Parliament for Northampton. The answer that I got from those phone calls was, “Michael, wake up. Demand has collapsed. Cash flow is at a critical point. We recognise what the Chancellor has done on business rates, and well done him, but there are two other problems—VAT and national insurance—and we need some help in that area.”
Secondly, we are not good at communicating to people in business what the Government are doing. I had the privilege of doing all the advertising for the COI on the three-day week. Every day there was different copy in every single national paper and all the trade papers. I say to my noble friend on the Front Bench that we need to communicate to reassure all people in commerce and trade about what is happening. That includes the trade associations, along with the chambers of commerce and chambers of trade and so on.
My third point, on which I will finish, is that I have the privilege of being president of Northamptonshire County Cricket Club. The sporting world is our next problem. You have only to look at what is happening in football, with people playing and nobody watching. Rugby is in the same situation. All those clubs are in potential financial difficulty. Cricket is due to start next month and after that will come tennis. I say to my noble friend on the Front Bench: please get the Minister of Sport involved now so that some anticipatory work can be done to ensure that those great sports, which our whole nation likes to watch, can start on time and not be in financial crisis.
Baroness Kramer (LD)
My Lords, as the first of the wind-up speakers, I can say that I have never before spoken in a debate where there is a unanimous view. Unfortunately, that view is that we are in an economic emergency. It is quite extraordinary; these are not normal times. The usual test for any Budget, including the typical measures of fiscal prudence, are, frankly, out of the window. When the noble Lord, Lord Maude, accepts that as the appropriate view, the Government have to understand how strongly not just this House but almost anyone who has looked at the situation feels.
The Government and the Chancellor announced a huge and significant package yesterday to support the economy. That is genuinely welcome, but it is my view—and, I suspect, from listening to the House the view of many—that the Government are still clearly running behind events. Much more is needed, especially speed. My noble friend Lord Oates raised that issue, but we heard it again and again, including just now from the noble Lord, Lord Naseby. People need cash and they need it now.
Many of the programmes being proposed will struggle to deliver that kind of cash in any kind of timely manner. We have had proposals from the noble Lord, Lord O’Neill, for a people’s QE. The noble Lord, Lord Desai, joined the Green Party in proposing at least a temporary basic income, as did my noble friend Lord Bruce. We have had proposals from the noble Lord, Lord Leigh, that we use the PAYE system and from others that we use the national insurance system in a sort of reverse mode to get cash out rapidly. It will be challenging to use any system that is not already in place, because we need cash to flow in the next few days. Although there is fertile opportunity for new ideas and new thinking, at this point we need to use something that can absolutely deliver and be implemented very quickly, if not instantly.
I am concerned that the Government have put so much of their support for businesses into commercial paper—which is effectively QE—and bank loans. I hope that they understand that many businesses of every size in the severely impacted sectors will need years to repay the debt that they accumulate during this crisis. It is a crisis of not weeks, but at least months; it could run longer. Some will not be able to repay and others will find that the debt burden will completely compromise their ability to invest and grow when the crisis is over. I hope that we can hear from the Minister that there is a willingness to rethink that balance of loans to other kinds of direct support, perhaps not in the heat of this week, but certainly in the very immediate future.
However, none of the measures that have been announced will be a solution for the hardest-hit sectors. I know that the Government have said that they will step forward to deal with the problems of, for example, airlines and airports; their crisis is so extreme. We have to face the fact that taxpayer bailouts will be required. Deciding how much to protect shareholders at taxpayers’ expense will be genuinely difficult. As we look at those most vulnerable parts of the economy, may I ask the Minister about the wholesale financial markets? I am really concerned that we could have spillover risk into those markets. As we know, the consequences are very widespread when that happens. We have all said that insurance companies must step up to make good on business interruption insurance. I agree, but how resilient is the commercial insurance sector as a whole? Remember that the UK is an insurance provider to companies across the globe. Those consequences worry me a great deal and I hope that the Minister can say something.
Central counterparties, especially the clearing houses—obviously we have the London Clearing House locally—clear most of the world’s interest rate swaps. The current stock on a day-to-day basis is something in the range of $30 trillion-worth of swaps. How resilient are the CCPs in a crisis such as this?
I cannot believe that the collateral quality has not been compromised. Any kind of failure in CCPs will, frankly, make 2008 look like a picnic. I really would like some answers and some reassurance.
We all agree that companies need money quickly. The big companies will be able to get their money quickly, because the Bank of England can turn on its new commercial paper facility very fast. As we have said, it is a sort of QE equivalent. The noble Lord, Lord Adonis, said that perhaps we need to attach conditions to those commercial paper facilities to make sure that they are used to support jobs. I am not quite sure how we could do that, given the nature of the commercial paper market; if anybody can come up with innovative ideas on how to do that, I suspect a phone call to the regulator would be called for. It will be very hard to ensure that the money goes exactly where we want it to. That does not mean that we should not do it, but we need to be realistic. Smaller companies, however, will have to turn to the high street banks, and I do not understand how the usual hurdles and complex approval processes will be speeded up sufficiently. As we know, businesses need money now.
If I heard correctly, alternate lenders are not included in the Government’s loan guarantee scheme, but they are typically faster and more flexible than banks, and have become a significant component of lending to small businesses and, equally importantly, to the self-employed. During the coalition years, my colleague Sir Vince Cable was able to route money far more rapidly to small businesses and the self-employed through the alternate lenders. Will they be included in the scheme?
The grant scheme and business rates holidays for small businesses in retail, hospitality and leisure are crucial and welcome. However, I point out that the grant excludes many very small businesses in London—because the rateable value of London property is so high, they do not fall within the scope of the scheme. I hope we can get some comments from the Minister on that. As the Chancellor explained, these grants in their amount are targeted to make sure that small businesses can pay their rents. The money is not intended to also cover wages. Many businesses, not in the named sectors, are having similar problems and, frankly, there is nothing in the way of grants for them. Can the Minister respond to concerns on both those fronts?
Are measures being taken to make sure that big companies pay their supply chains properly? Their instinct in a crisis is to do quite otherwise. Can the payments regulator be given greater powers to force prompt payment?
The Government tell us that they are discussing employment support schemes with the trade unions and others, which is good. Will the Minister look at the proposal from my colleague Ed Davey to guarantee that every person made redundant will receive at least 20 days’ full pay, guaranteed by the Government? People are being laid off as we speak, and a message like that would make a dramatic impact; it is clear, simple and easy to understand.
We must have action for the self-employed and those working in the gig economy. Frankly, I do not understand why we have not heard measures that will tackle this sector. Employment support allowance and universal credit will never keep most families afloat. The fragility of self-employment should have been tackled long ago; we need successful, flexible working in the 21st century.
I will say one good thing for the Government: at least they have listened to the urgings of many in this House—the noble Lord, Lord Forsyth, who is not in his place, has been an absolute star on this—and agreed to delay for a year their changes to IR35. I hope that they use that year to have a complete rethink, and drop those plans to pursue reforms that deal with employment rights and not just tax revenues in the self-employed sector.
The Government simply must use this opportunity to remedy the two greatest travesties within universal credit. First, the five-week wait is intolerable. I know from talking to people who are dealing with this that paying back the five-week advance loan, even with a longer repayment period, leaves people living for months at just above destitution. The most reverend Primate the Archbishop of Canterbury and the noble Baroness, Lady Lister, made very powerful points about that. Secondly, the right reverend Prelate the Bishop of Rochester underscored that the two-child benefit cap has to be removed. Many families will be turning to universal credit for the first time in the Covid-19 crisis, and will be horrified that the two-child cap on benefit levels does not enable larger families to put a proper meal on the table. That is quite deliberate and by policy. Indeed, with so many children dependent on free school meals in order to eat, we will need an emergency scheme when schools close, as many people speaking today have underscored.
There are many other gaps, such as renters and food banks. The noble Lord, Lord Naseby, highlighted the crisis for many charities and not-for-profits, while homeless people cannot be left on the streets but equally cannot be put into dormitory-like hostels. Perhaps the most crucial gap, which others such as my noble friend Lord Razzall and the noble Baroness, Lady Lister, have addressed, is social care. Where was social care either in the Budget or in yesterday’s announcement? Even Jeremy Hunt now admits that social care was slashed too far by the Conservatives, but in this pandemic social care is carrying out the critical task of caring for our most vulnerable while underresourced and with no built-in resilience. The Government must step forward.
I have a few comments about what happens after the crisis—because the Covid-19 pandemic will end. I very much take note of the comments from the noble Lord, Lord Skidelsky, and the noble Baroness, Lady Falkner: we are going to have to start paying. This is the first time when I have heard the noble Lord, Lord Skidelsky, use words that translate to, “There is no magic money tree”. This will have to be paid for. We will be a nation in debt. Businesses will be in debt, individuals will be in debt and the Government will be in more debt than ever. The Government were already planning to allow public sector net debt to soar. I support the additional spending, but refusing to raise taxes in the Budget struck me as extraordinarily irresponsible.
The noble Lord, Lord Livermore, has highlighted the weakness that runs through much of our economy. We will have to rebuild our fiscal position, and that is going to be exceptionally difficult. It is going to require a real willingness to tax as well as borrow. As far as I can see, we are going to have to consider a completely new framework in future because the underlying economy is weak. The noble Lord, Lord Livermore, and my noble friend Lord Bruce, were clear that growth was already forecast to be at an abysmal running rate of 1.5%, held back by friction in trade with the EU and the loss of freedom of movement. The OBR forecast demonstrates that new trade deals with the US and others add so little to the economy that they hardly even register in the numbers. Productivity growth is limping at 0.3%, and all the planned infrastructure and skills investment in the Budget is not forecast to return productivity to its historic—and even then underwhelming—level of 2% until 2030. Business investment was forecast to be continually weak, and that was before coronavirus. Interest rates were low already, so there is very little cushion for further cuts. QE has been pushed pretty much to its limits and we have now had to take it even further. We face huge costs to tackle climate change because the timetable cannot slacken if we are to avert a catastrophic crisis. Regional disparities are stark. Infrastructure, public services and welfare are underfunded.
This is not a good picture, and it is the reason why I have to say to the noble Lord, Lord Bates, that of course we have to splash the cash now, but we really need to be careful about painting a false picture of the future because that will lead us to poor decision-making. I understand why the Government want to talk about light and joy as soon as the virus passes through because they want to keep up confidence, but we in this House have to be realistic. Every economy on the globe is going to be impacted by Covid-19 so I hope that inside the Government some sober minds are coming to grips with the longer-term reality. This is going to require very substantial new thinking, new frameworks and new directions, and I am delighted that this House will have an opportunity to contribute to that.
Lord Stevenson of Balmacara (Lab)
My Lords, I thank all noble Lords who have contributed to this very good debate, and the Library for its briefing, which was very informative and useful. As a result, this has been a very high-quality debate held against a fast-moving scenario. The noble Baroness, Lady Kramer, just mentioned the noble Lord, Lord Bates. He encouraged us to be optimistic about everything, so I will try to thread optimism in, although sometimes when I have been reading some of the detail, I have been rather depressed by it all.
My noble friend Lord Tunnicliffe said that the timing of this debate is normally such that we reflect on the Budget and on the reaction to it. That is what has made this debate so interesting, as the many excellent contributions today have benefited from such a rich picture.
We have also benefited from having seen how the Government have responded in real time to the economic aspects of the coronavirus pandemic, and many contributions today focused on that. Indeed, the contributions of the most reverend Primate the Archbishop of Canterbury, the noble Lords, Lord O’Neill, Lord Lamont and Lord Skidelsky, my noble friend Lord Adonis and several other noble Lords have broken new ground, which I hope the Minister will take back to his department and prosecute with some vigour.
The main challenge facing the Chancellor, on which I think he was largely successful, was how to make sense of the Conservative Party’s new clothes and, in particular, how the end of austerity U-turn was going to be achieved without destroying the Conservative Party’s alleged reputation for managing the public finances. What we got, as the noble Lord, Lord Skidelsky, reminded us was a reaffirmation of Keynesian economics. The Chancellor tried to persuade us that his party now has a large appetite for increasing public spending combined with far less appetite to raise taxes and a growth in public sector debt unseen in modern times. Timing is all, apparently. As the Resolution Foundation commented:
“The result is a Conservative Chancellor now planning a bigger state than was seen under Tony Blair, financed through higher borrowing than Gordon Brown ever saw as Chancellor”.
The Office for Budget Responsibility described it as the “largest sustained financial loosening” since 1992. So this new Conservative economic policy approach may be a third way in its imitation of some of the tropes of new Labour, but it is certainly not fiscally conservative. Time will tell, and there are enough uncertainties out there to blow even the best-laid plans off course but, as my noble friend Lord Tunnicliffe, said, we support much of what has been proposed.
As my noble friend Lord Livermore said, the most recent OBR forecasts were completed long before the widespread domestic impact of coronavirus was clear, but even so they make grim reading. The OECD forecast suggests that the UK economy will grow at 0.8% for the next two years, which will bring the UK’s annual growth outlook down to an average of just 1.2%, the worst average annual growth forecast on record. When he comes to respond, will the Minister comment on those figures?
This Budget reflects the Government’s goal to be seen to turn the corner on the austerity over the decade of the 2010s. Successive Chancellors have been increasing capital spending since 2016-17. Bringing austerity to a close on current spending is new, and very welcome, but the sober truth is that in less than five years the Government’s ambitions have gone from shrinking the state in order to run an absolute budget surplus to growing public spending to almost 41% of GDP and actively aiming to borrow around £60 billion each year. This is the new reality. The good news is that the spending review later this year will therefore be able to apportion day-to-day spending growing by an average of 2.8% a year, well above the rates of the past decade, but it is less than was promised in September last year by the previous Chancellor—4.1% was his figure—and is below the growth rates prevailing in most of the years after 2000, but it is an increase and we welcome it.
According to press reports, overall real-terms, day-to-day public spending per capita will return to 2009-10 levels by 2024-25. However, the figure is more nuanced. As we have heard from others, austerity will continue for many departments, with spending increases being sufficient only to reverse around a quarter of the real cuts per capita in the departments which have not been protected since 2010; that is, those other than health, defence and international development.
The real picture is that the Budget does almost nothing to offset the considerable welfare cuts put in place by George Osborne in 2015. As my noble friend Lady Lister and the right reverend Prelate the Bishop of Rochester said, these factors mean that not only will the incomes of the poorest families fall over the next period, but there is a significant risk that, despite the extra spending, child poverty may reach record levels by the time of the 2024 election.
Perhaps the Chancellor did not have time in his speech, but he did not mention international competitiveness and how the Government intend to address the increasing productivity gap between UK workers and those in the largest EU economies. The announcement of £600 million for new infrastructure investment is good news, albeit that the figure represents only a small increase on the Government’s existing plans, while some of the money is a reversal of cuts in previous decades. Nevertheless, it will bring public investment up to around 3% of GDP, and we await further details. Can the Minister say when we will finally see the national infrastructure strategy?
The proposed changes to how the Treasury calculates the benefit of infrastructure projects may also benefit lagging regions rather than focusing solely on public projects that are most likely to generate higher returns, which tend to favour those in London. It is hoped that the new proposals will place more weight on projects across the country. But there is no easy fix when it comes to reviving the regions that are lagging. New money for infrastructure projects will go only so far given that renewal also requires investment in better skills, support for business and knowledge networks, strong local public services and local government. When will we see those proposals?
The Chancellor announced an increase in public spending on research and development, more than doubling the current budget. This is good, but the Budget was quieter about using innovation to tackle other societal problems such as adapting to an ageing society and research around the creative industries, perhaps building on the Creative Industries Clusters programme. Can the Minister confirm that there is more to do in these areas?
Small businesses took centre stage as part of the Chancellor’s £30 billion Budget package to deal with the coronavirus outbreak. Increasing resilience in SMEs is crucial to help them overcome major economic shocks and requires bold and decisive action. As research shows, the uncertainty caused by Brexit and the global financial crisis is deeply harmful to UK SMEs. While on paper the Chancellor’s new lending measures seem appropriate in scale, they are very supply-side focused and assume that there will be uptake and demand from SMEs but, as we know from the global financial crisis, uncertainty typically leads to reduced demand. Given that, what about doing more? If these measures prove insufficient, do the Government have other plans such as a reduction in VAT for SMEs? As the noble Baroness, Lady Kramer, suggested, what about speeding up payments to SMEs and giving more powers to the Small Business Commissioner?
I turn now to the coronavirus announcement. A number of noble Lords have said that we have to work together as a country to overcome this threat, so we on this side make it clear that we pay tribute to the work of experts in the NHS and to the Government for their work so far, and we join the Chancellor in saying that we should do what needs to be done to get this sorted. However, as several noble Lords have argued, if we are facing an unprecedented demand and supply shortage shock, are we doing enough? People are being laid off today and thus losing their incomes. Gig economy workers and the self-employed are not getting the support they require. The general sense of today’s debate is that something along the lines of the people’s quantitative easing proposal made by the noble Lord, Lord O’Neill, may be required to ensure that the economy itself is not damaged beyond repair.
I was struck by the suggestion made earlier in the debate by the right reverend Primate the Archbishop of Canterbury and picked up by others that we may lack more of a moral dimension to some of the issues we face. One concern mentioned in the other place was the impact that all this will have on the charitable sector, which faces a bleak future if funding dries up. Have we thought through how we would function as a society if the third sector were not able to function after the end of the crisis? Let us take the recommendation to practise social exclusion. Why is the language being used so vague that those affected—hotels, restaurants, pubs, theatres, galleries and arts organisations—are not eligible to claim on the insurance cover that they have paid for?
As a result, as we have heard, premises are closing, jobs are being lost and the very fabric of our society is being destroyed before our eyes. It is morally reprehensible, but it is also economically illiterate. Take the early announcement to safeguard mortgage payers; no parallel announcement has emerged about those who rent. Housing is vital to survival, whichever choice of tenure you take. Surely, that is morally reprehensible as well as economically illiterate. Chasing loans for SMEs, which will be hard and slow to administer, may also encourage bad effects in a nation which already suffers from a personal debt problem. Is that fair or moral?
I could go on, but I will make just one further point, as made earlier in the debate, about the school closures which we now know are happening. I gather that the Minister has some expertise on this issue. Can he ensure that the wide impacts of this change—particularly as grandparents are apparently being asked not to help out with childcare—are taken properly into account? Free school meals have already been mentioned, but this is also about careers and future employment for older cohorts, as much as it is about learning social skills and growing up in our society for younger cohorts. How will that all be dealt with and by whom? Will it be sustainable and fair to all concerned? This has been a very interesting and somewhat inspiring debate, and I look forward to the Minister’s response.
Lord Agnew of Oulton
My Lords, we have had an insightful debate today and I am most grateful for the many contributions that have been made. I draw some comfort that, in these difficult times, our great democracy shows itself at its best, with some innovative ideas. I hope to tease out some of those in my response.
I will come to the points raised in turn. Many of course related to the coronavirus, so it is right to quickly restate our response. Coronavirus will, in the short term, have a profound impact on this country and, as the Chancellor said yesterday, it is an economic emergency as much as a medical and health emergency. Inevitably, workers will have to leave work to recover, businesses will struggle to access some goods, and consumer spending will slow. Supply and demand will both take a hit. This is an enormous economic shock and it sets a challenge that we must all rise to.
In the Budget, the Chancellor laid down an initial £30 billion package, and this week, in response to the fast-moving situation, he went further, supplementing that package with a range of extraordinary measures, including £330 billion of loans to help firms cope with their cash-flow problems. The Budget we have debated will likely for ever be remembered as the coronavirus Budget. But it was a Budget of more besides: one that laid down a blueprint for a new decade of infrastructure and scientific investment. This will lead to an improvement in productivity, which is the soundest way to improve living standards in the long term.
I turn to some of the points raised by noble Lords. The noble Lord, Lord Tunnicliffe, and several other noble Lords asked whether we are going far enough. Can we go further, and should we? They included the noble Lords, Lord Northbrook, Lord Stevenson and Lord Oates, and my noble friends Lord Lamont and Lady Finn. I thought it might be useful to quote some of the comments made by the Chancellor of the Exchequer last night, because I hope they will give some reassurance. He said:
“I want to reassure every British citizen, this government will give you all the tools you need to get through this. We will support jobs, we will support incomes, we will support businesses, and we will help you protect your loved ones. We will do whatever it takes.”
The noble Lord, Lord Oates, asked about grants for small businesses—only those that were already paying rates. Matters like this will be put under urgent consideration. It is my understanding that they will not be restricted, but I will certainly write to him to confirm that, and put a copy in the record.
The most reverend Primate the Archbishop of Canterbury raised a number of issues. Perhaps the most important and relevant one, given the announcement that has come during this debate, was that of school closures. I do not have any more detail on that, other than on the one area of free school meals. I have been given a statement, which says simply that we will give schools the flexibility to provide meals or vouchers to children eligible for free school meals. Some schools already doing this, and we will reimburse the costs. I hope that that will provide some reassurance.
On the most reverend Primate’s comments regarding small towns and the decline of retail there, they have been hit particularly hard.
I think we all understand that retail has gone through the most extraordinary revolution over the last 15 years. Part of the levelling-up programme and the commitments in our Budget were to try to get out to some of these poor communities and to inject some more energy and infrastructure into them. One of the initiatives which I am personally involved in is encouraging civil servants to move out of London over the next seven to 10 years. This is an enormous opportunity, because we have a staff turnover rate of about 10% to 12%, and indeed it is higher in London, so there is a real opportunity to do this. I am also the Minister for the Government Property estate, so one of the things I have done is to ensure that break clauses are activated on London leases so that we do not have foot-drag by some departments that do not really want to move out of London. However, I can assure your Lordships that this is an important personal commitment because it is a win for everybody, and it will help some of these towns. For example, I live near Yarmouth, which is a classic example of an area of deprivation.
The noble Lord, Lord O’Neill, brought forward the most dramatic proposals today, supported by the noble Lords, Lord Razzall, Lord Bruce, Lord Adonis, and Lord Desai, and the noble Baroness, Lady Bennett—whether you call it “people’s QE” or “minimum basic income”. These are all dramatic ideas, and I am sure that we will hear a lot more about them over the next days and weeks. We have to acknowledge that already in this country we have moved quite a long way towards a minimum basic income, when you think of the minimum wage and what it was even 10 years ago. Indeed, I would say, to the discredit of my own party, that we objected to the introduction of the minimum wage back in 1997, but I believe it was one of the best things that the Labour Government of the day ever did. We have accelerated the increase of the minimum wage over the last few years. In particular, there will be a 6% increase in April. Therefore, that is the start of the journey towards a minimum basic income. We already have working tax credits and, while I know that universal credit is not loved in this Chamber, it is trying to give that kind of opportunity and safety net to those on lower incomes.
However, we also have to remember that all this has to be paid for, as the noble Lord, Lord Skidelsky, said. We already have the top 1% of earners paying something like 29% of all income tax, and we just have to square the circle. Therefore, while I very much recommend and encourage the debate that the noble Lord, Lord O’Neill, suggests, we have to work out how it will work. Maybe, as he suggests, it will be for a few weeks, so that people have that certainty—but, again, one of my other concerns is the hoarding of the cash.
Lord O’Neill of Gatley
I apologise—I am not sure of the appropriate convention. We do not have weeks to have this debate; we need to act now.
Lord Agnew of Oulton
It is worth reassuring the noble Lord that we have acted pretty quickly. When you think where we have come over the last six or seven days, I do not believe there is any example in the history of modern government where a Government have reacted as quickly as we have. However, I take on board the challenge, and the noble Lord knows his way around the Treasury better than I do, so I am sure he will use his influence.
My noble friend Lord Lamont quite rightly makes the point that our borrowing costs are again at a 300-year low and that this provides opportunities. Indeed, with the current rate of inflation, we are borrowing at a cost below inflation, which provides some palliative to the very difficult situation that we face. That has partly reassured the Chancellor in his recent announcements. What will happen? The noble Lord, Lord Skidelsky, thinks that we could end up—
Baroness Kramer
I should have said this when I spoke, so I apologise. While we have very low interest rates, because of QE a heck of a lot of that debt is being held by the Bank of England, so in a sense it is almost circular. It is not quite as benign as it looks on the surface.
Lord Agnew of Oulton
I do not like debt at all, so I accept what the noble Baroness says. We have also not had a proper drains-up on the impact of the original QE 10 or 12 years ago. It seems to have enriched the rich—those with assets—but what did those at the bottom end of society get out of it? Also, the question no one has ever been able to answer is: what happened to all the money? Did it stay in the British economy? One figure I was given is that at least a third of it just disappeared completely. So I am certainly not in favour of another one of those kinds of QE.
Turning to the noble Lord, Lord Hain, I am afraid that there is not a lot I can agree with in his statements. He seems to think that there is a magic money tree, and seems to have forgotten that we inherited a budget deficit of 10% in 2010. As a huge Europhile, he seems to forget that the EU has a 3% ceiling on its budget deficit levels. We have had to bring that down, and it is one of the reasons why we have more flexibility in the current days to do some of the dramatic things that have been announced by the Chancellor.
Lord Agnew of Oulton
I disagree that we have had needless, destructive austerity. For example, we have created some 3.5 million jobs over the past 10 years, and until this crisis hit us in the last few days we have seen steady growth in earnings over the last year to 18 months. We are probably never going to agree, I am afraid, but let us at least put our points of view on the record.
The noble Lord, Lord Leigh, asked for faster action. I think some of the points he made on liquidity and the relaxing of insolvency laws were well made. I will certainly take those back to the Treasury. If he has any more information on that, I would certainly be interested to learn about it.
In relation to entrepreneurs’ relief, the noble Lord, Lord Leigh, and the noble Baroness, Lady Finn, were disappointed that we had increased the tax rate. But it is worth pointing out that the capital gains rate is 20% and it was reduced from 28% in 2016. It is hardly a rapacious rate of tax. I would be surprised if that put entrepreneurs off. We all have to pay our share of tax.
The noble Baroness, Lady Jones, said we were tinkering around the edges. But to announce within four days 15% of GDP as a bailout to the economy—I just do not accept that that is tinkering around the edges. As I said when I quoted the Chancellor at the beginning, we will continue to do more. This is a very fast-moving story and we are not going to sit idly by.
It was a rare moment of sunshine to hear from the noble Lord, Lord Bates. I share some of his optimism. Perhaps I am foolish and your Lordships will be able to berate me in six months’ time, but I think we will come through this as a stronger society. I think that sometimes an event such as this gives people pause for consideration about how things work. I am not as gloomy as many noble Lords were in the debate today. Indeed, just as I sat down earlier, I had a text from someone who says that there is already a possible vaccine being tested in Japan. I have no idea, but I think we have a good chance of finding a vaccine sooner than in previous outbreaks because the science has moved on so quickly. I read two weeks ago that they had already decoded the DNA of this virus within a few weeks of it becoming known in China. Last time with SARS and so on, this took months. I am probably putting my credibility on the line here, but a little bit of sunshine cannot go amiss.
The noble Lords, Lord Bruce and Lord Adonis, were worried about the EU. I gently and quietly remind them that we had a general election which put this absolutely fair and square to the electorate and, against the wishes of the vast majority of this House, and indeed many in the Commons, they gave a resounding thumbs up to what we were trying to do. What is going to happen now, I have no idea. But I do not think it should be used as an excuse to try to get us back into the EU.
The noble Lord, Lord Adonis, also asked about international co-operation. Of course, this will be extremely important. I hope he is reassured by our changes to the emergency government structure, which were announced yesterday. We have created four strands: health and social care; public services; economic; and international. We are very aware that this needs international co-operation. We have to be realistic, though, that in the next few weeks countries are going to be looking out for themselves. That is the brutal reality when supply chains have been broken and we are not able to get the things we want because other countries will want to keep them. Likewise with the closing of borders—that is an extraordinary thing for the EU to have done. That goes against all its principles, but it has reacted in a perfectly rational way. We have to accept that that is going to be the case over the next few weeks, but I think there will be a mammoth effort to come up with a vaccine and that will be a worldwide endeavour so I remain optimistic that it will prevail.
The noble Baroness, Lady Falkner, worried about prudent levels of debt and—like the noble Lord, Lord Skidelsky—that there is no free lunch. The noble Baroness, Lady Kramer, raised this at the end when summing up. We will just have to see what happens. I am not trying to duck the question. As a person about half my age said to me a few years ago—
Lord Desai
There is this obsession with debt levels and the ratio of debt to GDP, which is a mistake because debt is a stock and income is a flow. The thing to do is to compare income with the cost of servicing the debt. If the cost of servicing the debt is reasonable, we should borrow. Everybody who holds a mortgage knows that it is a large proportion of their income, but if you can service the mortgage you are all right.
Lord Agnew of Oulton
I do not fully agree with the noble Lord. Most people who have a mortgage do not increase the amount of the mortgage every year when they get a pay rise. A country needs to be mindful of that and not do the same.
A number of noble Lords, including the right reverend Prelate the Bishop of Rochester, the noble Lord, Lord Razzall, and the noble Baroness, Lady Lister, are worrying about social care. It is perhaps worth just summarising some of the things we have done over the last year or so. Over the last three years, between 2017-18 and 2019-20, we have cumulatively given councils access to up to £10 billion of dedicated additional funding for adult social care; we are increasing the funding of that next year.
The noble Baroness, Lady Bennett, talked about the bailout of the banks in 2008 and 2010 as though we should not have done it. It is worth just putting it back on the record that if we had not done it, the whole system would have ground to a halt. We would have been plunged back into the dark ages, which would have been great for our carbon but not for the millions of people who rely on a functioning economy.
Baroness Bennett of Manor Castle
For clarification—perhaps I was not clear—I said that we should not have made the people, particularly the disabled, poor and young, pay for the bailout of the banks.
Lord Agnew of Oulton
To reassure the noble Baroness, most of that burden will have fallen on the higher-income taxpayers, as I alluded to earlier. Something like the bottom 60% of taxpayers receive more in services from the state than they pay in tax, so I do not feel that they took an unfair level of the cost of that bailout. Of course, the banks continue to pay an additional levy over and above corporation tax to try to bring about the fairness she alludes to.
The noble Baroness, Lady Finn, is keen—I was not aware of this—on a tidal power solution. We live at opposite ends of the country; I am on the east and she is on the west. If the numbers work, I—wearing my Treasury hat—would be very interested. I have a farm that runs down to the sea; I would love to create a tidal power system there, but I do not think the numbers work. To reassure our Green Members, what is happening in offshore wind is, frankly, extraordinary. There was a contract for difference auction about a month ago—they do them every two years—and the bidding price for the offshore-generated electricity was 32% lower than two years ago. It is the most incredible development. That is why I do not accept the gloom that says that we are not embracing the green economy and decarbonising. We are now creating offshore wind at a price virtually without the need for subsidy. If the noble Baroness can do that with her tidal—
Lord Maude of Horsham
At the risk of prolonging this, does my noble friend accept that one of the reasons the cost of offshore wind has fallen so much is that there was a subsidy that enabled the unit cost of installing it to fall? Something similar could happen with tidal power. This country is uniquely equipped with the natural resource to develop something capable of being exported very widely and generating a UK-based technology that could be of enormous value, as well as a renewable resource.
Lord Agnew of Oulton
My Lords, I am a huge fan of pump-priming. If there is a credible business case, I think it is worth taking the matter back to the Treasury, so I agree with the noble Lord. I am conscious that I am running out of time.
Baroness Finn
My intervention is about the Green Book methodology. The very outdated methodology in the Treasury was mentioned by my noble friend in his opening speech, and I referred to it in mine. I am hoping that it will rebalance some of this.
Lord Agnew of Oulton
That is excellent news. I do not want anyone to think that I am not in favour of it. We as a country have an enormous opportunity to lead the green energy revolution.
I was grateful for the calm comments of the noble Lord, Lord Brooke, and some profound questions about the value of growth itself. The problem is that growth is really the only way to improve the quality of lives of most of our population; the only other way is probably productivity. There is no doubt that this will give us the opportunity to reflect on such things as international supply chains, which have perhaps got too wide and impersonal over the last 30 years. These are the sort of moments when we should reflect on that. He asked specifically about the RPI link on the fuel escalator. The Government are nervous about putting up fuel prices because it is a very regressive tax and hits the less well-off hardest. There is a sensitivity to that; I am sure that it will be kept under review.
The noble Lord, Lord Maude, urged us that the money that we spend should be spent well. My title is Minister for Efficiency so I guess it will land on my lap if we do not spend it well. As other noble Lords have said, the key thing is to get the money out as quickly as possible. He asked about insurance. I think I have something on that which can give clarification. The Chancellor made clear in his Statement that for those businesses that have an appropriate policy that covers pandemics, the Government’s action is sufficient to allow businesses to make a claim against their insurance policy.
The noble Baroness, Lady Kramer, asked about the strength of the balance sheets for the insurance sector. It is worth remembering that they came through the 2008-10 crash very well, other than AIG, which was not really an insurance company. I would be cautiously optimistic at this stage. She seems to know about the financial sector; it has two layers above it: reinsurance and retrocession insurance above that. At this stage I would be reasonably confident but, again, this is a fast-moving picture.
The noble Lord, Lord Northbrook, if I heard him correctly, asked a question about the difference between the £451 billion and the £600 billion. The difference is depreciation; the net investment is the £451 billion. If he needs more information, he can by all means let me know. The noble Lord, Lord Judd, asked about a commitment for the charitable sector. I entirely agree that charities are often the hidden battalions helping some of the most vulnerable people. If he feels that they are not being given the focus that they should be, again, I hope he will let me know.
The noble Lord, Lord Livermore, asked about the distributional impact of the Budget. He claimed that the poorest came off worst but, in the spending round of 2019, we announced the fastest planned increase in day-to-day departmental spending for 15 years. Of course, it is those at the bottom of our society who benefit the most from our public services.
The noble Lord, Lord Stevenson, asked about the national infrastructure strategy. Yes, I am afraid it will be delayed. I do not know whether I am allowed to say this—it will definitely not happen now, anyway—but we were going to try to slot it in the middle, between last week’s Budget and the spending review, probably in July.
It is perhaps worth pointing out that, in the Budget, we put some more beef under the IPA—the Infrastructure and Projects Authority—which is the key organisation in ensuring that, we hope, a lot of the spending on infrastructure is done in a controlled and effective way. I think I am running out of time.
Lord Adonis
I want to ask the noble Lord something about the key issue raised by the noble Lord, Lord Lamont, and me. Could the £330 billion of coronavirus-related loans to keep companies going be made conditional on employment being maintained?
Lord Agnew of Oulton
That is an extremely good idea. I will certainly take it back to the Treasury, where we will investigate it.
Lord Tunnicliffe
If the Minister is going to write to individuals, will he copy in all noble Lords who participated in the debate?
Lord Agnew of Oulton
Yes, of course. I am afraid I have not had time to answer various noble Lords’ specific questions, so I will ensure that they are all copied in to my replies.
To sum up, there have been many calls today for the Government to move faster—not just by putting more money into the system but by being ever more restrictive of people’s liberty and way of life. Indeed, I was at a meeting with the Prime Minister last night. He said to the assembled group, “Even in the war, we didn’t stop people going to the pub.” We have to try to bring the country with us as we do some of the most profound things to happen in our lifetime.
I want to finish on a slightly more positive note. For those noble Lords interested in history, it is worth remembering that it was in difficult times like this that the Education Act 1944 was introduced for its Second Reading that January, nearly five months before D-day and nearly 18 months before the war was won. Parliament had the vision then to introduce legislation that would change the lives of young people in peacetime well before we had any sense that we had achieved peace. I hope we will be able to look back on this Budget in 18 months’ time and say something similar, but for the whole economy and everyone who lives in Britain.