Cost of Living Crisis: Wales

Beth Winter Excerpts

Tuesday 19th July 2022 Westminster Hall

[Beth Winter (Cynon Valley) (Lab)]

I congratulate my hon. Friend the Member for Newport West (Ruth Jones) on securing the debate. The people of Cynon Valley, Wales and the United Kingdom are suffering a cost of living emergency—it is not a crisis; it is an emergency. In April, in response to the crisis, I conducted a survey among local people in my constituency, and its results were truly harrowing—that is not too strong a word.

I will take a moment to focus on those results, because this is about millions of real people’s lives. I have sent a photocopy of the report that was produced to the Secretary of State; I am still waiting for a response, which I hope will be forthcoming. In excess of 650 local people responded within four or five days—an unprecedented number—which shows the severity of the crisis in Cynon Valley. Unfortunately, I am sure that is reflected across the UK.

Some 76% of people reported having to cut down on using heating in the last year and some 90% reported feeling worse off than this time last year. In Cynon, 81% of people reported that the cost of living crisis is impacting on their mental health, 78% are worried about paying the bills in the next 12 months, 61% of those on benefits have had to skip meals in the last 12 months and over half have had to borrow money in the last year. We also asked questions about the next 12 months, which were even bleaker in terms of the impact that the cost of living crisis is likely to have.

As I said at the outset, this is about real people and I want to quote what a couple of my constituents said:

“Both my wife and I work full time and don’t feel any better off. Most schemes are aimed at people who are on benefits, which I understand, but people need help who work.”

There is a massive problem with in-work poverty in this country. Another person said:

“It was already bad before the energy prices increased. Life genuinely does not feel worth living any more. I feel guilty for bringing my children into this awful mess of a world.”

That is the reality for millions of people.

This is a political choice, and it is a political choice caused by successive Conservative Governments. It is bringing misery, anxiety and despair to millions of people. We are the fifth richest nation in the world; this is not inevitable. It is a political choice.

It is not simply because of the pandemic or inflation, although that has made matters worse. For 12 years, we have seen and experienced austerity measures in this country and the Tories have overseen a reduction in wages, including holding down public sector pay for key workers. I have just come off a call with a number of trade unions and other organisations, and the National Education Union was saying that since 2010 there have been 20% to 25% real-terms cuts in their members’ pay because of the continuous pay freeze. It is not just about the cuts at the moment, but about the cuts over the longer term.

I shall go on to talk about the solution, but in Wales, despite insufficient funding from the UK Government and an inadequate devolution settlement, the Welsh Government are doing as much as they possibly can within the constraints placed on them. They have invested more than double what they received in consequential funding, to support households with the cost of living crisis, including through a £51 million household support fund announced in December 2021 and a further £330 million cost of living package of support announced in February 2022, which goes beyond, over and above what the UK Government have offered. Carers’ pay has increased to a real living wage, basic income has increased and free school meals have been extended to all primary school pupils. That is in spite of the constraints placed upon them.

As I said, this is a political choice and unfortunately—tragically, actually, for millions of people—the Tories will not listen. They are the architects of low income. They have allowed poverty to become normalised in this country, and we need urgent, immediate action to better distribute the wealth in this country. We have got to change the balance of power from the few, in whose hands it is at the moment, to the many. We have got to tackle and address the horrendous inequality that I witness, and I am sure many others in the Chamber witness, on a daily basis. That would mean emergency measures to prevent wasteful profiteering and dividend payments from essential services. We should jumpstart the windfall tax and ban dividend payments in the public transport and in energy sectors while people are suffering.

The report also contains a number of key recommendations the UK Government need to take. I have consistently argued for an increase in social security benefits. They should have been increased in April, in line with inflation as it currently stands. The £20 uplift to universal credit should be reinstated, as the Welsh Affairs Committee has proposed, and should be extended to legacy benefits. The two-child limit also needs to be addressed, as the hon. Member for Ceredigion (Ben Lake) mentioned. Despite the triple lock, pensioners are suffering inexorably from the cost of living crisis. I am continuing to campaign for ex-miners in my constituency, and supporting the Women Against State Pension Inequality campaign.

We must overturn over a decade of underinvestment through austerity, and end the rip-off of privatisation. I am an advocate of bringing utilities back into public ownership. As the hon. Member for Ceredigion suggested, we should look at what France has done in terms of limiting the increase in the energy cap. We could be doing the same in this country. As well as a windfall tax, we could and should introduce a wealth tax, which could raise in excess of £260 billion a year. The money is here in this country, but it is not evenly distributed. Those are not radical policies; they are about meeting people’s basic needs. Everybody should have enough money to eat, to heat their home, to clothe their children, and to buy pens for their children to take to school—as the NEU representative mentioned, there was no spare money for people to buy pens and rulers for their children to use to learn in school. What kind of a society are we creating? It is extremely distressing. We should have a right to food, and everybody should have access to affordable and decent housing.

I also support the trade union demand—I asked a question on this in the Health and Social Care questions this morning—for an inflation-proof increase in public sector pay. I fully support the actions being taken by the trade unions at the moment. They have been forced to go on strike. It is not a choice; nobody wants to go on strike. They have no alternative. I urge the Government to ensure that proper negotiations take place and that public sector workers, who sacrificed so much during the pandemic, and who continue to sacrifice so much, get a decent, inflation-proof pay award. Pay rises are not simply gifted. Unfortunately, they are having to be fought for. They should not have to be fought for; they should be an entitlement for people.

I will briefly mention the deductions from social security benefits, which drive huge amounts of poverty. There are 5,000 universal credit claimants in Cynon Valley who experienced a reduction in their benefits. That is unacceptable, and has an impact on people’s ability to provide the basics for their households.

We are experiencing unprecedented times. As I have just said, we do not have to be in this situation. Please listen. Please act to stop the extreme levels of poverty and inequality that exist. There is an alternative. I will continue to work alongside colleagues in the trade unions, and in our communities, to organise, mobilise and fight for change. It is such a shame that we have to be doing that. We should all be sitting down around the table. There are solutions that easily resolve the problems. Please sit around the table with us, so that everybody can have those basic human rights. Diolch yn fawr.