Marie Rimmer
Main Page: Marie Rimmer (Labour - St Helens South and Whiston)Department Debates - View all Marie Rimmer's debates with the Ministry of Justice
(8 years, 4 months ago)
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Marie Rimmer (St Helens South and Whiston) (Lab)
The 1997 to 2010 Labour Government paid off more debt than any previous Government on record—debt left by the Conservative Government. We always know when Conservative Members’ arguments are weak, because they come out with the mantra about the financial mess left by the Labour Government. The financial mess was created and started in America with Lehman Brothers. They use that—[Interruption.] This really doesn’t bother me, because I don’t hear what they’ve got to say.—[Interruption.]
Madam Deputy Speaker
Order. It would appear that it is Christmas. I hope the House has not been attending too many Christmas parties. We behave in a reasonable and polite fashion. If anybody needs to be told to be quiet, I can do that.
Marie Rimmer
No. The hon. Gentleman will wait until I have had my say.
The financial crisis was caused by Lehman Brothers in America and started in 2008. Had Labour been returned to power—had someone not been greedy for power—we would not be in this mess today because the Conservatives would not be in power. Our strategy was actually working. [Interruption.] I am sorry that Conservative Members do not like the truth.
Several hon. Members rose—
Several hon. Members rose—
Marie Rimmer
Sit down! I am sorry, Madam Deputy Speaker.
We always know when the Government are at their weakest, because they go on and on about the financial crisis. But let us get to the welfare cap. Of the two major cuts to in-work support in the summer Budget—to tax credits and its replacement, universal credit—only the tax credits element has been reversed. The reason we are in this state is that the Chancellor originally set the cap at a level that, in the first instance, simply tracked the Office for Budget Responsibility’s projections for spending on those benefits and tax credits that were in scope—as one of my colleagues mentioned, tax credits are in scope, which is unacceptable. The cap started in 2015-16 and extends for the next five years, meaning that, for now, the cap has no policy effect whatsoever. The Government are simply committed to operating future policy on the basis of not overshooting the current estimate of financial spending over the coming years. We could be in this position next year and the year after, because there are no real policy decisions. It is short term. It is nothing else.
As predicted, that led to the announcement of emergency cuts, including those to tax credits, but they were resoundingly kicked out by the Lords—the Conservatives at prayer, as someone described them. Although I am not in favour of an unelected second Chamber, I applaud them for taking that action. Only the tax credits element was reversed, however, and working families remain on the front line of further assaults, such as the cap and the universal credit cuts. The latter will affect many people—more than 200,000, I think—from April 2016, and the majority of those on universal credit are in the north-west. They are the ones who suffer the most from unemployment and financial deprivation—much of which is caused by zero-hours contracts, insecure employment, low pay and part-time work—which is why they are on benefits.
Marie Rimmer
Not at the moment. Hon. Members will hear what I have to say.
We need reforms that address the structural drivers of social security spending. We need good, secure employment; we need to get rid of zero-hours contracts and low pay; and we need to ensure an adequate supply of affordable homes.
Marie Rimmer
No. Hon. Members need to learn that I will not give way until I have had my say. [Interruption.] Yes, the House needs to know what type of woman I am.
We need to shift the balance of expenditure from the cost of failure towards investment. As my hon. Friend the Member for Pontypridd (Owen Smith) has said, the large rise in housing benefit expenditure in the 20 years before the financial crisis came at a time when the number of households receiving help to pay their rent stayed broadly flat. That should have triggered a major focus on those trends and led to serious reform of policy and spending, but it did not. As a consequence, the benefits system was extremely vulnerable to economic shocks, as large numbers of people were in more expensive private rented accommodation. When the crisis really hit in 2010-11—it came a couple of years later—housing benefit shot up, and in response we have seen a series of arbitrary attempts to hack back the costs. We have seen 14 changes to housing benefit, including the bedroom tax, which was entirely unrelated to the causes of the rising expenditure. We need to get down to the policy and the causes.
Ministers are leaning too heavily on the political dividing-line and not enough on designing a cap that would advance structural reforms. Although it is set over five years on a rolling basis, the Government’s cap will bite on an annual basis. With the Office for Budget Responsibility warning about the overshooting of the autumn statement, we call today for compensating action in the next Budget.
We have had emergency cuts, not long-term saving. The cap has been set in nominal cash terms. Higher expenditure, driven by inflation, will trigger policy action, which risks locking in lower living standards for those reliant on benefits. General price rises feeding through into uprating decisions do not count as a structural divide in spending. In line with consumer prices index forecasts for the coming years, the Chancellor set out a margin of error of 2%, which will not trigger action.
The cap makes no distinction between contribution-based and income-based benefit spending, consistent with the drift of social security policy over decades, but they are different, and should be treated as such. Entitlement to contributory benefits, which are financed by national insurance contributions, should stand outside the mainstream of Government revenue and be taken out of the cap, strengthening the integrity of the national insurance fund.
I urge the Government to backtrack on the political ideology-driven trajectory that they are on, with 80% of cuts coming from public spending and welfare and 20% from tax, and with tax cuts being provided to people who do not need them and will not spend the extra money, so it will not go into the economy and will not feature in the drive for more jobs. The Government should invest in proper affordable housing for those who need it. Never mind all these dressed-up schemes—let us have some honesty in this place and address the issues for the public out there. I think the Government are living in a virtual world; it is certainly not the world that I move in.
Question put and agreed to.
Resolved,
That, pursuant to the Charter for Budget Responsibility: Summer Budget 2015 update, which was approved by this House on 14 October 2015, under Section 1 of the Budget Responsibility and National Audit Act 2011, this House agrees that the breach of the Welfare Cap in 2016-17, 2017-18, and 2018-19 resulting from the decision not to pursue proposed changes to tax credits, as laid out in the Autumn Statement 2015, is justified and that no further debate will be required in relation to this specific breach.
Riot Compensation Bill (Money)
Queen’s recommendation signified.
Motion made, and Question proposed,
That, for the purposes of any Act resulting from the Riot Compensation Bill, it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to the Act in the sums payable under any other Act by local policing bodies, by way of compensation for damage, destruction or theft occurring in the course of riots, out of money so provided.—(Mike Penning.)
Mr Jacob Rees-Mogg (North East Somerset) (Con)
I want to raise the modest question of why this Bill has not been introduced under Standing Order No. 50, as it seems to me that the primary purpose is a charge. For a Bill of this kind, Standing Order No. 50 is the usual process. I know it has the Government’s support, but I am puzzled that that approach has not been taken.