Civil Service Pay

John McDonnell Excerpts

Tuesday 7th March 2023 Westminster Hall

[John McDonnell (Hayes and Harlington) (Lab)]

My hon. Friend the Member for Cynon Valley (Beth Winter) and the hon. Member for Glasgow South West (Chris Stephens) have comprehensively covered most of the issues. There is little to say, apart from maybe the Minister saying, “I give up and we’ll go and sort this out.” I also declare an interest as a member of the PCS parliamentary group. There is no financial relationship as such; it is not even affiliated with the Labour party, although I keep trying.

I want to get across to the Minister what the Government need to face up to. In recent years, the Government have come for civil servants’ pensions. They lost in court over that, but they have not even addressed the legal judgment. In addition, they cut their redundancy payments, and now they are insulting them with a 2% pay offer. As the hon. Member for Glasgow South West said, these are the people who worked throughout the pandemic, and were applauded by Government Ministers for what they did. I remember the then Chancellor applauding HMRC and Department for Work and Pensions staff for the role that they played, many of them working from home. And then they get the insult of a 2% pay increase. It is no wonder that, for the first time in civil service history, there will be 100,000 civil servants on strike in a week’s time.

The Government rely on the myth that it is nothing to do with them, and all to do with the Departments that are negotiating. That myth has been exposed time and time again. The pay remit is set by central Government. As my hon. Friend the Member for Cynon Valley said, the Government hide behind ludicrous pay structures. Having 200 individual units is not just inefficient but completely counterproductive. The result is that the civil service is demoralised, and it is failing to retain and recruit in many sectors. At the same time, I never expected public servants to be paid such low real pay. We have seen the issues with food banks, and some workers not even being able to afford the transport costs to get to work. Collectively, as a Parliament, we are the employers. Parliament holds Government to account; we all have to shoulder a responsibility. The Government have to recognise just how serious the situation is. They cannot underestimate the depth of anger that is out there among civil servants, their families and their communities.

The Government have hidden behind the high cost of settling at inflation-proofing; they themselves have used the mythical figure of £28 billion. The Institute for Fiscal Studies has already said that there is 4% to 5% within the Government’s existing budget structures for 2022-23, so the cost to get to inflation-proofing may be more like £15 billion to £17 billion. I will not go into detail, but others have pointed out how much the Government will get back in tax, national insurance contributions and so on. As a result of that, we are talking about single figures in terms of the cost to ensure that civil servants are inflation-proofed. The Bank of England destroyed the argument that this causes inflation in some way. Some 80% of the inflationary factors are external, and not to do with pay. The Government cannot argue that wages are causing inflation when they have been held down for 13 years. As others have said, they are now between 12% and 23% lower.

Finally, we need an inflation-proofing offer immediately so we can avoid the industrial action that is taking place. We want a reform of collective pay bargaining structures so we can get away from the current ludicrous system and back to collective bargaining itself. I think that in the future, all pay settlements across the whole economy should minimally be based on inflation-proofing, so that people are not impoverished as a result of pay settlements imposed upon them by the Government.

--- Later in debate ---

[Alex Burghart]

The hon. Gentleman will be glad to hear that I will come to that point very soon.

As everyone will, I hope, appreciate, the Government put fiscal responsibility at the very centre of our policy, and we are taking appropriate steps to manage inflation. Obviously, at the moment, it is not public sector wages that are driving inflation. Many factors are driving inflation. Inflation is besetting our closest friends and competitors around the world; it is an international problem. However, if we were to take the advice of the right hon. Member for Hayes and Harlington (John McDonnell), the hon. Member for Liverpool, West Derby (Ian Byrne) and others, we would find ourselves in trouble.

The Governor of the Bank of England and its chief economist have both said that inflation-matching pay rises in the public sector can spill over into higher pay across the economy, and that would make the fight against inflation even more challenging. That is why halving inflation is the top of the Prime Minister’s five immediate priorities, alongside growing the economy, reducing national debt, getting the NHS backlog down and stopping small boats crossing the channel. Our focus is on pay for 2023-24.

[John McDonnell]

It is difficult to see how a reasonable settlement below the rate of inflation—for example, the fire brigade settlement of 7%, with backdating and 5% for next year—could in any way offend against the Bank of England Governor’s comments. Have the Government even considered an offer of that sort to the civil service?

[Alex Burghart]

The right hon. Gentleman is a former shadow Chancellor. He will appreciate that the higher the pay settlement, the slower the rate of decline in inflation is likely to be. [Laughter.] He laughs; I hope he has realised how the numbers work.

[John McDonnell]

This is unique in economic history in this country. We are arguing that a pay award below the rate of inflation is still inflationary. I have never heard that one before, and I think we should record it for posterity.

--- Later in debate ---

[Mark Pritchard (in the Chair)]

Indeed, there are a lot of passionate feelings on both sides of this debate.

[John McDonnell]

There was a flippant remark from the Minister with regard to meeting PCS members. I just remind him that PCS members in my constituency—two Border Control staff—died during the pandemic because of covid. They sacrificed their lives keeping this country safe.

[Alex Burghart]

On a point of order, Mr Pritchard. The right hon. Gentleman knows full well that there was no flippant remark about PCS whatsoever. [Interruption.] There was no flippant remark whatsoever. The record will state that all I said was that you had been invited to join the picket line, Mr Pritchard. That is not a flippant remark about PCS.

[John McDonnell]

This is a serious debate about people living in poverty.

[Mark Pritchard (in the Chair)]

Order.

--- Later in debate ---

[Beth Winter]

May I ask, through the Chair, whether the Minister will agree to attend the picket line to listen to the real-life experiences of so many thousands of civil service staff? As I began to say, if the Government are not going to address these issues for the people who are suffering, surely they will do so, because it is in their own interests. The overwhelming evidence shows that the current system is not efficient. It is not cost-effective and it will not address the cost of living crisis—

[John McDonnell]

Could my hon. Friend give way to the Minister so that he can respond and confirm whether he is coming to meet the PCS members next week?

[Beth Winter]

I certainly would like to give way.

[Mark Pritchard (in the Chair)]

The Minister can choose to respond or not, because he has concluded his remarks. If he wants to intervene, he can, but it is entirely down to him. The hon. Member who moved the motion can continue for the last minute and then allow me to put the Question, or can talk out her own time, which will mean the Question is not put. She can make that decision. [Interruption.] Order. The right hon. Gentleman should know, as he has been here for a very, very long time. I have been very patient with him.

[John McDonnell]

Too long.

[Mark Pritchard (in the Chair)]

Whether or not the right hon. Gentleman thinks he has been here too long is entirely a matter for him. He will come to order, thank you.

MPs and Second Jobs

John McDonnell Excerpts

Thursday 23rd February 2023 Commons Chamber

[John McDonnell (Hayes and Harlington) (Lab)]

Hillingdon Council, within which the Uxbridge constituency is contained, is going through one of the most massive cutbacks of its voluntary sector at the moment, including the local autistic group, Samaritans and others. Would it not be really helpful if the £5 million that the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) earned was donated to those charities?

[Richard Burgon]

My right hon. Friend makes a fantastic suggestion. Why does the former Prime Minister not donate that £5 million to these important causes in his constituency? Let us invite him to do so and see what he does.

To conclude, banning second jobs for MPs is an important step to restoring the integrity of our democracy. No one can serve two masters, and MPs’ priority must be their constituents. I am afraid that the time for half measures and empty promises on this issue has long passed. The Labour party has proposed a ban on second jobs for MPs, with exemptions for public services similar to those in my Bill. I will be proud to join my colleagues in voting through that ban if, as gladly appears likely, we are voted into power at the next general election. An election could be up to 18 months away, however, and there is no justification for allowing this scandal to carry on a moment longer. There is nothing stopping the Government from taking action to stop the rot now.

The people out there believe that MPs’ second jobs have to go, and no amount of clever wording, sophistry and non-representative examples can change that reality. The people—the public—rightly believe that MPs should be committed to public service, not personal gain. Each delay in action further damages trust and exposes the integrity of our democracy to yet more scandals in future. It is time to end the gravy train of MPs’ second jobs.

Enabling the Public to call a General Election

John McDonnell Excerpts

Tuesday 15th November 2022 Commons Chamber

[The Parliamentary Secretary, Cabinet Office (Alex Burghart)]

I must say that it is a pleasure—a genuine pleasure—to take part in an Adjournment debate such as this, to respond to a speech that has been very well researched, and to think about the big and important questions we should we always consider when looking at the future of our constitution and our democracy. To an extent, we spend too little time in this place thinking about how the operation of our Parliament, our Government and our relationship with the voters works, so I pay tribute to the hon. Member for Leeds East (Richard Burgon) for taking the time to do this work.

As I understand it, the hon. Gentleman is proposing that we amend the Dissolution and Calling of Parliament Act 2022 to the effect that the sovereign would dissolve Parliament if that Parliament was more than halfway complete—halfway through its five-year maximum term—and if at least half the number of voters who had voted at the previous general election signed a petition calling for Parliament to be dissolved, although as he said, that threshold is perhaps up for debate and is a starter for ten.

There is a mechanism that a Government could use if they wished to pursue this. We have had a very successful online petitions website for a number of years now, which allows people to register their interest in particular issues and to ask the Government to respond. At the moment, however, it does not quite have the verification capabilities necessary to allow Governments to be assured that those signing up are genuine voters, but perhaps those problems can be overcome. With reference to that successful site, I draw the hon. Gentleman’s attention to the fact that, for the past four months, it has had a live petition calling for a general election as soon as possible; in those four months it has acquired about 900,000 votes, which is a good sum but a very long way off the 50% that would be necessary under his system to trigger a general election. Even if these are, by his definition, extraordinary times, the clamour for a general election might not, therefore, be as strong as his remarks suggested.

That said, his well-considered remarks deserve proper consideration here, although I say at the outset—this will be no surprise to the hon. Gentleman—that we are not inclined to support his proposals. The 2022 Act, which fairly recently acquired Royal Assent, covered many of the issues on how Parliament is to be dissolved and general elections are to be held. I seem to remember that there was no opposition on that from the Labour Benches; I believe all Labour Members abstained. The hon. Gentleman perhaps missed an opportunity to table amendments at that time, but the joy of our system is that we can bring forward good ideas—or less good ideas—at any point.

For a number of practical reasons, the hon. Gentleman’s proposal should be resisted and treated with great caution. It would introduce an unnecessary element of instability into our system; if we were to create a petition mechanism that kicked in at two and a half years, we would very likely find that we quickly entered a time of perpetual campaigning—two and a half years of preparation for starting an official petition campaign, followed by two and a half years of trying to get the petition through. I know the hon. Gentleman is an avid campaigner and will probably relish that prospect, but for those of us who cherish the opportunity for stable Government it would prove a great distraction.

I thought the hon. Gentleman might well mention the Chartists; indeed I feel I see before me a descendant of the Chartists of old. He will take some comfort from the fact that the Chartists were proved right on all their demands apart from one—their request for annual Parliaments. At the time, even some of their most ardent followers disputed the idea on grounds that it would create unnecessary cost, distraction and the inability of Governments to operate over the medium term.

That brings us to the crux of why the proposal would could be damaging to our finely balanced constitution. It is important to have Governments who can be assured that if they have a majority in the House—if they can command the confidence of the House—they will have space to operate and to take difficult decisions. Stability is often most needed at times when Governments are most unpopular, and we would run the risk of introducing a mechanism that would create further instability in periods of instability, and that could be to the detriment of all of us. There is, however, a very interesting idea in the hon. Gentleman’s proposals, and I am sure he will continue to develop them and bring them back to the House.

[John McDonnell (Hayes and Harlington) (Lab)]

The Minister mis-portrays my hon. Friend the Member for Leeds East (Richard Burgon), who is more a Digger and Leveller than a Chartist. He seems to be arguing about stability and how we would be in a continuous campaigning mode. Some people would call that campaigning; others might call it a continuous accountability mode in which Governments have to demonstrate daily that they are abiding by the will of the people who elected them. That is no bad thing, is it?

[Alex Burghart]

I stand corrected on the heritage of the hon. Member for Leeds East (Richard Burgon). Accountability comes in many forms. We are all accountable to our electorate through media and debates such as this. However, that is different from having a system that gives Governments a period of up to five years in power to make decisions that they can prove the benefits of. Indeed, it was not so long ago that we had Parliaments of seven years in this country and that the French presidency lasted seven years for the reason that Governments had time to fix problems and prove that their method of government was effective.

[John McDonnell]

That leaves the decision on when to call a general election to the whim of a Prime Minister and the judgment of the ruling party on when it can manipulate its popularity. Surely that is equally unstable. All we want to do is enable the people to make that decision.

[Alex Burghart]

I have a distinct recollection of a Prime Minister trying to do that in the not-too-distant past and finding that the electorate took a different view on whether she had made the right decision to call that election. Governments and Prime Ministers use that power at their peril, and they are aware of that.

To my mind, and the mind of the Government, it is much better to be able to guarantee a period in which a Prime Minister and Executive who hold the confidence of the House can legislate and operate in order to solve the problems that the country faces. To all parliamentarians comes judgment day, as Karl Popper referred to it. We must all face an election. The question is when. When our electorate go to the polls, they know that they are likely voting for us to be here for five years and on the understanding that, whoever gets into power will get five years to do the best job they can for the country and solve the problems that the country faces. That system has served us well, and that is why we continue to defend it. It has been a pleasure to debate with the hon. Member for Leeds East this evening, and I look forward to talking to him on constitutional matters long into the future.

Referral of Prime Minister to Committee of Privileges

John McDonnell Excerpts

Thursday 21st April 2022 Commons Chamber

[Keir Starmer]

I will take one more intervention and then I will make some progress.

[John McDonnell (Hayes and Harlington) (Lab)]

I understand completely the point made by the right hon. Member for Gainsborough (Sir Edward Leigh) about toning down the rhetoric—[Interruption.] I understand that position, but let me make this point, because I have known him over the years: we cannot tone down the seriousness of this matter. I was in the Prime Minister’s constituency earlier this week; it is the neighbouring constituency to mine and we are campaigning for the London Borough of Hillingdon in the election. There is some shift in the vote from Tory to Labour because of this issue, but that is not the significant point. What is significant is the number of people we found who were totally disillusioned, who had had enough of the system and who were blaming the system itself. That is what we are fighting and campaigning for. We are campaigning to restore the credibility of our country’s democratic processes.

[Keir Starmer]

That is a really important and powerful point, because if we do not pass this motion and take this opportunity to restate the principles, we are all complicit in allowing the standards to slip. We are all complicit in allowing the public to think that we are all the same, that nobody tells the truth and that there are alternative sets of facts.

Gurkha Pensions

John McDonnell Excerpts

Monday 22nd November 2021 Westminster Hall

[David Linden]

I will not hold that against you, Dr Huq.

[John McDonnell (Hayes and Harlington) (Lab)]

I am sorry to rudely interrupt the hon. Gentleman again. I apologise to you as well, Dr Huq. This is a fleeting visit; I am trying to be here and in the main Chamber at the same time, but I have not quite mastered that yet.

Before I left, the hon. Gentleman raised the key issue for me and my constituents: the poverty Gurkhas have been thrust into as a result of, to be frank, an act of gross discrimination over years. Does he agree that, because of the length of service and the commitment Gurkhas have shown, including through the human sacrifices made, we should never allow this group of people to live in the level of poverty that he described earlier, and that we need redress as rapidly as possible?

Oral Answers to Questions

John McDonnell Excerpts

Tuesday 9th November 2021 Commons Chamber

[John McDonnell (Hayes and Harlington) (Lab)]

15. What recent assessment he has made of the effect on (a) recruitment, (b) morale and (c) retention of Her Majesty’s Prison and Probation Service staff of the Government’s pay policy for public sector workers.

[The Minister of State, Ministry of Justice (Victoria Atkins)]

I start by thanking all prison and probation officers and staff across the country. They do an absolutely vital job protecting the public and rehabilitating offenders, and they deserve our thanks and our acknowledgment. Pay awards for this financial year across HMPPS are subject to the public sector pay pause, which was imposed due to the covid-19 emergency, but I welcome the Chancellor’s recent Budget announcement on public sector pay and the fact that from 2022, it will return to a normal pay setting process.

[John McDonnell]

I am an honorary life member of the Prison Officers’ Association, with which I have worked for the last 25 years. Morale is at rock bottom among prison staff, and that relates to pay. In response to the chair of the justice unions committee, the Secretary of State said that the Government were accepting the pay review board’s recommendations. The pay review board has made it clear in its report that the remit that the Government have given it precludes it from making a full recommendation on pay awards. It finds that to be incompatible with its independence and in conflict with its role as a compensatory mechanism for the fact that prison staff are not allowed to strike. May I request that the Minister meet a delegation from the justice unions group to talk about morale and the development of a pay strategy?

[Victoria Atkins]

I am delighted to inform the right hon. Gentleman that I have met not just the POA but the Prison Governors Association and many of the smaller unions that represent the interests of vital members of staff such as chaplains and educationalists, who play a really important role in the prison system. I very much look forward to working with the POA and others not just on matters of pay but on ensuring that we value their role in the prison system. I want prison officers to feel safe in their workplace, for example. That is not up for question. We should be making sure that they feel safe, and that is one of my priorities as Minister with responsibility for prisons.

Afghanistan

John McDonnell Excerpts

Monday 6th September 2021 Commons Chamber

[The Prime Minister]

My hon. Friend is completely right. The issue is that, very sadly, our friends across the channel in France are faced with a very difficult problem: large numbers of people who want to come to this country. We are doing everything we can to encourage the French to do the necessary and impede their passage. My right hon. Friend the Home Secretary is working round the clock to ensure that we not only encourage the French to stiffen their sinews and stop people making the journey but use every possible tactic available to us.

[John McDonnell (Hayes and Harlington) (Lab)]

May I raise a constituency matter with the Prime Minister? More than 800 local Afghani families have contacted me about their concerns over their relatives in Afghanistan. The thousands who are coming to this country are largely coming in through Heathrow and being quarantined in about seven hotels in my constituency. There is real anxiety, given the performance in the past on asylum seekers in hotels in my constituency, that those people could be trapped in those hotels for quite a long time to come. I would like the Prime Minister to arrange a meeting with myself and the relevant Minister or officials to discuss the plan to support those families—like everybody else, I welcome them, as do those in my community—but also the long-term relocation plan to make sure that they have all that they need to settle here for the future.

[The Prime Minister]

The right hon. Gentleman is right to draw attention to the issue. Some councils have responded magnificently, notably in the east midlands and elsewhere. I know that my right hon. Friend the Secretary of State for Housing, Communities and Local Government is putting substantial funding in place, but if the right hon. Gentleman wants a further meeting, I have no doubt that the relevant Minister will be only too happy to oblige.

COP26

John McDonnell Excerpts

Wednesday 10th March 2021 Commons Chamber

[John McDonnell (Hayes and Harlington) (Lab) [V]]

I echo the words of the last speaker, the hon. Member for Tonbridge and Malling (Tom Tugendhat), about how monumental the decisions will be that need to be taken this November, because November’s COP26 in Glasgow is a historic opportunity for Britain to provide leadership to the world on climate change.

I pay tribute to my hon. Friend the Member for Bristol North West (Darren Jones) and his colleagues on the Business, Energy and Industrial Strategy Committee, who have produced detailed reports that should be influencing the Cabinet Office and shaping the agenda in the run-up to COP26. Scientists and climate experts are urging the Government to lead the way in adopting ambitious deadlines for achieving net zero along with shorter-term interim targets, and it is those targets that are vital. The former Prime Minister committed the UK Government to reach net zero carbon emissions by 2050. The BEIS Committee said last week that

“no details have yet been provided on how success will be measured”

for COP 26. We cannot achieve significant carbon reductions by empty words, good PR or grandiose declarations. It takes action.

I have to say, last week’s Budget does not give us much hope of demonstrating world leadership. In fact, for some of us, it is a cause of despair and shame. The decisions by the Government to freeze fuel duty and to dig a new coalmine, and the pathetic scale of the Government’s environmental policies are a dereliction of duty to the planet and to future generations. It is a failure of Government, who could have acted to create hundreds of thousands of climate jobs in areas from wind turbines to tidal lagoons, from electric car charge points to tree planting, but there was no evidence of the scale of investment and scale of ambition that the hon. Member for Tonbridge and Malling and my hon. Friend the Member for Bristol North West called for. Instead of tying corporate tax breaks and investment write-offs to clear climate criteria, the giveaways announced in the Budget could hinder, rather than help our carbon reduction strategy.

The verdict of Richard Black from the Energy and Climate Intelligence Unit was that this was

“a Budget that didn’t even try to get the Conservatives on track to their net zero target”.

Today, there are reports that the Government will cut air passenger duty on domestic flights. Frankly, I would struggle to find a more regressive policy, and I speak as somebody who represents a constituency with Heathrow in it. I would struggle to find something that is more regressive than encouraging domestic aviation before we have had that debate and discussion and the development of the environmental aviation strategy.

It is crystal clear to me that this Government have no co-ordinated plan and no cross-departmental agenda to drive the decarbonisation that we seek. This is not just my view, but that of the Public Accounts Committee, which has been quoted. The PAC published a report on achieving net zero with the brutal conclusion, “Government lacks a plan”. Never have four words better summed up an Administration than that.

In terms of the modest 2050 target, the Committee said, damningly:

“there is little sign that it”—

the Government—

“understands how to get there”.

I will raise just one other point from the report, which said:

“Local authorities will also play a major role in the move to net zero, and Government will need to engage more with local authorities about how they can contribute”.

The irony is that today we learned that across the country more than two dozen councils are on the brink of bankruptcy, stripped of the funding to provide the statutory services their communities need, let alone the funding they need to take on the challenge of climate change.

The autumn statement is expected to be delivered on the eve of COP26. I just say to the Government that we hope for something better then. Otherwise, unless a serious plan is brought forward and unless there are significant resources attached to that plan, what leadership can the UK Government hope to offer the rest of the world? What authority can it possibly have in those vital discussions, when we are trying to bring together others, some more recalcitrant than others, who will be brought to the table to have a serious discussion only when they see others leading by example?

I believe that without drastic action COP26 risks exposing the UK Government as a laughing stock on climate change if we are not careful. I urge Ministers to change course and show some leadership. I urge them now to look at the reports our Select Committees have produced. They provide not just an agenda of issues to be addressed, but a direction that the Government could take. Otherwise, it is a betrayal of future generations. My hon. Friend the Member for Bristol North West claimed the future for himself. Well, some of us older ones have an interest in the future as well, with our children and grandchildren. This November will ensure, hopefully, that they will have a planet that they can survive on and flourish on.

From the evidence I have seen so far—it is not just me; I think it is independent experts as well—the leadership the Government are showing is nowhere near the scale or commitment we need to demonstrate to the rest of the world what can be done, what needs to be done and what our country can contribute.

[Madam Deputy Speaker (Dame Eleanor Laing)]

The time limit is now reduced, but it is only reduced to seven minutes.

Prime Minister's Update

John McDonnell Excerpts

Wednesday 25th September 2019 Commons Chamber

[Mr Speaker]

Order. I thank the Prime Minister, and the Front-Bench spokespersons and 111 right hon. and hon. Members who have questioned him over the past three and a bit hours.

[John McDonnell (Hayes and Harlington) (Lab)]

On a point of order, Mr Speaker.

[Anna Soubry (Broxtowe) (IGC)]

On a point of order, Mr Speaker.

[Mr Speaker]

If the points of order, consistent with the earlier approach, arise specifically from and relate to the matters with which we have just been dealing, I will take them. [Interruption.] Prime Minister, I think it would be a courtesy to stay for the point of order—a point of order that relates to the matter with which we have just been dealing. [Interruption.] Go and sit down. [Interruption.] Well, I asked the Prime Minister if he would be willing to stay, but he does not wish to do so. So be it. The point of order from Mr John McDonnell will be heard.

[John McDonnell]

Mr Speaker. I regret that the Prime Minister has left the Chamber. The penultimate question put to him, by my hon. Friend the Member for Edinburgh South (Ian Murray), was whether, in the fulfilment of all the conditions of legislation passed by this House, he would abide by that legislation. Now I might have heard wrong, but I believe the answer was a single word: no. We have passed legislation. If all the conditions of that legislation were fulfilled, would he then ensure that the action arising from an enacted piece of legislation would be taken? We are moving into new territory, where a Prime Minister who has already been found guilty of an unlawful act is now refusing to abide by the law as passed by this House. We are moving into an extremely dangerous position with regard to a Prime Minister’s accountability to this House and our democracy itself.

Mr Speaker, the Prime Minister has left the Chamber, even though you indicated quite clearly to him that the point of order related to his behaviour. I ask you to express the view that we expect the Prime Minister to be back in this House, so we can ask that question again.

[Mr Speaker]

I am grateful to the right hon. Gentleman for his point of order. I did not say to the Prime Minister that the point of order related to his conduct or behaviour; I did not know what the point of order was going to be. I said to the Prime Minister that the point of order related to the matters with which we had just been dealing; in other words, in keeping with the approach that I adopted in respect of points of order following earlier statements—points of order that came from hon. or right hon. Members on both sides of the House—I was happy to take them after the statements to which they related. I suggested that the Prime Minister might wish to stay. He indicated initially that he was minded to do so, but he then decided that he wished to leave the Chamber. He has been here since 6.30; he was here for three hours and 11 minutes, and he has chosen to leave.

What I would like to say to the shadow Chancellor and to other colleagues is that I have been in the Chair since 11.30 and will remain for the remainder of the proceedings. Therefore, I have inevitably heard everything that has been said on this and other matters, and I think the fairest thing I can say is that I have heard the Prime Minister say explicitly that we will always obey the law, we will abide by the law and we will adhere to the law. He has said that. Equally, I did hear the answer that he gave earlier. I think his words related to the submission of a request for an extension, and he indicated that he would not be minded to do so. I heard the full question and I heard the full answer, and I think the right and proper thing to say, at this point, is that colleagues—hon. and right hon. Members—should study the record and form their own assessment of it. I have, of course, myself said, as anybody would expect any citizen to say, any parliamentarian to say or any Speaker to say, that adherence to the law must, of course, be non-negotiable.

I do not think that I need to add to that tonight. Let us reflect on these matters, let us remain calm and let us assess the record. Just as I said, good-naturedly, I think, to the Prime Minister some minutes ago in a slightly different context that repetition was not a novel phenomenon in the House of Commons—never has been, is not and will not be—there will be further opportunities for Members to raise these matters, including this very particular point, in subsequent days. This Chair will always facilitate the fullest and most unsparing scrutiny of the Executive branch, because that is the responsibility of the Speaker—not to be a craven lickspittle of the Executive branch, but to facilitate the fullest and most unsparing scrutiny of it. That is my job, and come hell or high water I will continue to discharge it. Non-negotiable—end of subject.

Debate on the Address

John McDonnell Excerpts

Wednesday 27th May 2015 Commons Chamber

[Mr Thomas]

I say gently to my hon. Friend, for whom I have considerable respect, that I profoundly disagree. Never mind the Scottish question, the Welsh question or indeed the English question, there is a London question that demands an answer: when will London be able to shape its destiny without always having to go to the man in Whitehall and the man in Downing Street to sort out our great city’s challenges?

[John McDonnell (Hayes and Harlington) (Lab)]

I was the last chair of finance at the Greater London Council. London did have control of its business rates. It did have an element of property tax in the sense that it could borrow against its own assets. In addition, it had its own capital fund. It was certainly not a threat to the nation then.

[Mr Thomas]

I welcome my hon. Friend’s intervention. I hope that he will agree with me on this, too: there is now a democratic deficit in this capital city. London did not vote for austerity on the scale we can expect. London did not vote for cuts in the NHS. London did not vote for cuts—to our police, our schools or the services our councils provide—on the scale that is set to befall our great city. I gently say again to the House that London deserves better. It is time to start a proper debate about the devolution of further responsibilities and about income tax being devolved to London.

Many international cities derive income from a local income tax, including, I am told, New York, Berlin and Madrid. In the UK, there is already a precedent with Scotland having the power to set income tax. Given the huge contribution that London makes to the rest of Britain, it is not identity politics that drives the case for further devolution; it is economic and social imperatives.

The London Finance Commission argued that property taxes should be devolved first and that is right, but it also concluded that, if greater powers, for example, in welfare, health or education were devolved to London, the option of devolving or assigning income tax in London should be revisited. I believe that moment is now. If Greater Manchester is being invited to shape the future of its health and social care, I believe London should be invited to do so, too.

The London Challenge helped to drive up standards in education. I believe that it should be re-established and London given more collective responsibility to champion stronger standards and higher achievement in our schools. Skills and employment training budgets should be devolved, too.

These are, I recognise, big judgment calls for London itself and for the country as a whole. I disagree with many of the current Mayor’s choices, but the mayoralty throughout the terms of its two incumbents has demonstrated generally sound management of major public services, notwithstanding the current garden bridge plans. I believe that it is time to establish a cross-party, cross-government inquiry, with business and other key stakeholders closely involved, and with the remit to explore both the case for devolution of further responsibilities to London and the case for devolving further taxation powers. The next Mayor, even if they serve for two full terms, may not be the Mayor who sees responsibility for income tax devolved to them, but I believe profoundly that it is time for London to accelerate its path to proper devolution. We should, for example, consider the case for more local control of London’s NHS. I want the NHS to continue to be a truly national service. I think there is a need for national targets—cancer and waiting times being two key yardsticks by which to judge quality of service—but it is surely right that Londoners have more control themselves over services we value so highly.

Why should London not have responsibility for the decision on whether to introduce a London living wage, of course after consultation, not least with business? Why does that power need to rest with Ministers instead of Londoners? Why cannot we in London decide whether to control the cost of renting? Londoners together should be able to make these decisions, not have them dictated to us.

Any further devolution of tax powers and extra responsibilities will inevitably require scrutiny over how London is governed and whether the current divide in powers between Mayor and local boroughs and the Assembly are correct. Instinctively, I believe more power should be devolved to London’s boroughs. City Hall has often felt remote from outer-London suburbs, but I suspect it has not always felt terribly helpful to some inner-London boroughs either. A root and branch review of the powers and effectiveness of City Hall and the Greater London Assembly ought to be part of the work of a commission looking at future devolution. I say that recognising the skill, hard work and powerful contributions of many in the Greater London Assembly, not least many of my own colleagues.

London is a great city, the envy of many worldwide, but we face huge challenges as our city grows even bigger. Certainly we look to this great House to help, but in London we have the imagination, the talent and the wealth to confront head on the issues that hold our city back or hold back the ambitions of our neighbours and fellow citizens. If others in this great country have succeeded in securing greater powers to control and shape the response to their problems, why should not Londoners expect their Mayor to have the powers to be able to act?

I want London to continue to play a leading role in the UK. Indeed, I want London to lead the UK. But for that to happen, Londoners need to be able to lead London’s future.

--- Later in debate ---

[John McDonnell (Hayes and Harlington) (Lab)]

Earlier in the debate, the right hon. Member for Wokingham (John Redwood) suggested that we should have serious discussions in this Parliament about the future of our economy, and I agree with him. In the debate so far, I have found remarkable complacency about the situation that we are facing. In fact, all the structural weaknesses and other factors that were present before the last crash are now reappearing, and many economic forecasts suggest that there is a prospect of precipitating another crash over the next two years. Consumer debt is rising, as are housing costs. There has been no sustained pick-up in wages, productivity is stagnating and living costs are vulnerable to rises in interest rates and inflation. If the Budget on 8 July cuts £30 billion as predicted, that could push us back into recession as a result of reducing demand so dramatically.

The fundamentals of our economy remain completely unaddressed: we have an unbalanced economy; production, manufacturing and construction have still to recover to their 2008 levels; and the finance sector is oversized and unregulated. At the last estimate, 60% of the big five banks’ profits since 2011 have been lost as a result of scandals. There is now a current account deficit of 5.5%, and a massive outflow of capital from this country. We have a debt of 80% of GDP, the bond markets are extremely volatile and the eurozone is unstable. These are all the ingredients for another crash, yet we do not seem to be debating that at the moment, despite the continuous warnings from the Office for National Statistics and the Office for Budget Responsibility in recent months.

The Prime Minister wants us to believe that economic recovery is under way and that the crisis is behind us. At the micro level, for my constituents, the economic crisis appears every payday. Many of them are experiencing economic crises, hardship and insecurity on a regular basis. As a London constituency representative, I believe that housing market failure is at the heart of our economic crisis. We knocked on every door in my constituency during the election, and I know that we are now facing the worst housing crisis since the second world war. I have 4,000 people on the housing waiting list. There were 10,000 last year, but a manoeuvre by the Conservative council simply wiped 6,000 of them off and denied them eligibility to be on the list. Tonight, I have 200 families in bed-and-breakfast accommodation. I have families living in appalling housing conditions, with overcrowding, damp and insanitary conditions. I have families living in sheds. Shanties are now being built in my constituency to house families.

Rents in the private sector are between £1,200 and £1,600 a month for a little house. We have reinvented the back-to-back in my constituency, with some families living in the front of a property and others living in the back. The landlords of those properties are reaping something like £3,000 a month in rent. The buy-to-let landlords are making a fortune out of exploitative rents in my constituency. They fail to maintain their properties, but if the tenants complain, revenge evictions take place on a regular basis. This week, however, we have discovered that buy-to-let landlords have been given a £14 billion tax concession each year in recent years. Why? It is because, as the right hon. Member for Haltemprice and Howden (Mr Davis) said, successive Governments have failed to build council houses. It is also because they have sold off council houses. The sell-off of council houses in my area has resulted in the bizarre situation of a Conservative council now having to rent back some of the council houses that it sold off 30 years ago, in order to house families in desperate need.

Affordable properties are being built at a minimal level. At the same time, affordability has now been redefined as 80% of the market rent, so “affordable” properties are now unaffordable to most of the population in my area. We were told that there would be a cap on benefits, and that that would reduce rent levels as the message went out to landlords, but it has had no effect whatsoever because supply is not matching demand.

The legislation proposed in today’s Queen’s Speech on selling off housing association properties will simply exacerbate the problem. I fully agree with the housing associations’ view that it will simply deplete their stock. Worse, it will undermine the asset base against which they can borrow to build new properties. We are told that this proposal will be funded by the sell-off of councils’ higher-value properties, but that is absolutely unrealistic. The sell-off of more council properties will mean a greater depletion of council stock. In addition, the record of reinvestment and rebuilding following the sell-off of council properties has been abysmal: it is a record of non-delivery over decades.

The Government’s legislation announced today will permanently embed the crisis in our housing market for future generations. We are storing up a greater crisis for the future. My hon. Friend the Member for Islington North (Jeremy Corbyn), who is no longer in his place, said that these policies are socially cleansing whole areas of our city. Properties are being sold off, then sold on again to speculators and overseas property developers. Even those in the professions—the teachers, the firefighters, the police officers—can no longer afford to keep a roof over their head in London. As a result, working-class people and what could be described as middle-class professionals are being forced to move out. Alternatively, they live in an asset that they cannot sell because they are trapped and cannot find an alternative. Their sons and daughters are unable even to get on to the property ladder.

This all adds to the precarious nature of living in London at the moment, as incomes fail to match basic living costs. Professor Guy Standing defined the “precariat” as people on zero-hours contracts or on the minimum wage, but many people on middle-range incomes—teachers, firefighters, the police, middle managers and small businesspeople—are now cascading into the precariat because they cannot afford the housing costs in our city. They are also faced with unstable employment, threatened by outsourcing or privatisation. They are no longer able to find a voice for their frustrations, either at work as a result of the undermining of trade union rights or, to be frank, within the political system itself at times.

We need to remind Governments to have an element of humility. This Government were elected by 25% of the electorate; 75% of the electorate failed to support them. That is why I issue this warning. There are real frustrations within our political system. People whom we represent are angry because successive Governments have not delivered the basics to them—new Labour and Conservative Governments alike. They have not provided people with decent jobs, decent wages or the ability to live in a decent home with a roof over their head and in a decent environment. Unless Governments acknowledge those frustrations and they are reflected in this House, they will be ventilated elsewhere.

If the Government fail to listen, opposition will surface on picket lines no matter what the legislation states. We will go back to the days of wildcat strikes, whether or not union members comply with the legislation proposed in this Queen’s Speech. These problems will be seen on the streets, just as we have seen tonight in Parliament Square, which has been blocked by people who are angry at not being listened to and angry at the production of this Queen’s Speech. We will also see more occupations, particularly among the people in our capital city who are desperate to have a roof over their head and are forced to squat. We saw an example last year, when a young man was evicted from a squat and froze to death on its doorstep later that night.

The Government have said that this is a one-nation Queen’s Speech, but I fear that this country has now been divided geographically and that people will be riven by division as a result. This is about inequality. The Government are not listening to the people who are suffering as a result of the recession and who are not seeing the sunlit uplands of the supposed recovery. If we in this House are not very careful, we are going to witness a population driven by anger losing faith in politics altogether. Yes of course we must have a rational debate on the Queen’s Speech, but there needs to be room for some compromises in the legislation. I urge the Government to take a common-sense approach to a situation that could, if we are not careful, develop into an elected dictatorship.