Budget Resolutions and Economic Situation

Maria Eagle Excerpts

Monday 8th March 2021 Commons Chamber

[Maria Eagle (Garston and Halewood) (Lab) [V]]

The Chancellor is by instinct a small state idealogue who slashes the public realm, but he prefers to claim to be a Keynesian spender who dispenses largesse to those affected by the covid crisis. But his treatment of the NHS shows us the true nature of the Chancellor’s Budget: it is sneaky. He said he wants to be honest with the public, but he substituted his previously promised 2.1% pay rise with a real-terms pay cut for our NHS heroes. He sneaked it out in the small print after he got his favourable headlines on Budget day—not exactly up front and honest.

The Chancellor said he would pay the NHS the extra costs of dealing with covid, but we read in The Times today that he is looking at ways of forcing them to pay those costs from existing budgets. NHS managers say they will have to start cutting services from 1 April to meet the £8 billion gap. There was nothing in his Budget to enable the NHS to start to treat the 4.5 million people now on waiting lists for treatment of non-covid illness; nothing to deal with the exhaustion and trauma that NHS staff, who have fought on the frontline of this pandemic, are dealing with, except a real-terms pay cut; and nothing to sort out the scandal of underfunded and unreformed social care. All this is part of the extra £4 billion in cuts in the Budget for public spending on vital services, over and above the £12 billion he had already pencilled in last November. Austerity is back for public services, not that it ever went away.

What about poorer households and low-paid workers, who are much more likely to be furloughed and much more likely to have lost their jobs or some of their income? There is not much in this Budget for them. This £30 billion fiscal tightening and the huge tax increases in this Budget hit the lower paid and poorest most. With incomes forecast to fall by 4.5% by 2025, the Chancellor has slashed help to those struggling. He is cutting the income of unemployed people by £20 a week—a 7% cut overnight, just as unemployment is forecast to reach 2.2 million when he ends furlough in September. It is a double whammy for those losing their jobs. He is forcing council tax up, hitting the poorest hardest. Many of my constituents are already finding it hard to feed themselves and their families. This Budget will make that even worse and it will remove support just when things are forecast to get even worse.

This Budget most certainly does not meet the moment. There is no plan for NHS recovery, just a plan for NHS cuts. There is no plan for helping poorer households, just a plan to impoverish them further. The covid crisis has exacerbated poverty and inequality. Far from setting the UK on a path to fix the damage, the Chancellor seems intent on making things worse.