Cost of Living Increases

Debate between Nigel Evans and Stewart Hosie

Tuesday 25th April 2023 Commons Chamber

[Stewart Hosie (Dundee East) (SNP)]

I was intrigued by the Chief Secretary’s answer to the right hon. Member for Wokingham (John Redwood) about forecasts: I think he said something along the lines of “For every fiscal event there’s a forecast, and on many occasions it turns out to be wrong.” That may be correct. Is it not passing strange, then, that the Government’s own fiscal charter, which they announced only six months ago, is based on precisely such a forward-looking view, with forecasts on a five-year rolling basis? I think the Government and the Chief Secretary might want to sort their lines out on that one.

I agree with what the Chief Secretary said towards the end of his speech about boosting productivity, which is a perennial problem. He is absolutely right about that, of course, but he will recall from the OBR forecast and the Red Book that productivity growth does not exceed 1.5% in any year of the forecast period. Whatever plan the Government thought they had, they will need to do a little better.

The Chief Secretary quite rightly mentioned the requirement to get more people into the workforce; I think he mentioned having an extra 110,000 people by the end of the forecast period. That is welcome, but it would be a fraction of 1% of the workforce of 33 million. Again, I think it is a case of “Five out of 10—must do better.”

There is much to agree with in the Opposition motion: the condemnation of the Tory Government and their mismanagement of the economy; the regret that the UK is the only G7 country whose economy has not returned to pre-pandemic levels; and the ambition, which I am sure is shared across the House, to secure sustained growth and good jobs. However, I will focus not on macroeconomics, but on the impact on real people of inflation and the cost of living crisis that many of them face, not least because energy price hikes, inflation, and mortgage and rent increases are continuing to erode people’s standard of living. We certainly know from the November OBR forecast that inflation was set to peak at a 40-year high, and that wages and living standards were set to be squeezed by 7%, wiping out all the growth of the past eight years. By March, the OBR was telling us that real disposable income would fall by nearly 6%. We now know that telecoms prices will rise as well: BT confirmed that its costs would rise by 15% on 31 March, O2 is increasing prices for SIM-only customers by 17%, and TalkTalk will increase its prices for landline and broadband customers by 14%.

Grocery prices also continue to climb. In February the increase reached a new record high of 17.1%, and more recently the prices of some goods have risen by 19.1%, which represents the best part of £1,000 per year per household for the average weekly shop. The prices of essential food items have also risen in recent months. The price of two pints of semi-skimmed milk is up from 92p to £1.37, a 49% increase; a litre of olive oil now costs £7.28, which is a 65% increase over the past year, and the price of vegetables has risen by 31% over the same period. However, inflation does not hit all households equally. It has a particularly dire impact on lower-income households, which spend a much higher proportion of their incomes on necessities such as food and energy. For some people, it is even worse than that: those with allergies or special dietary requirements are hit even harder. According to analysis carried out by the Allergy Team, people with specific dietary requirements are now paying up to 73% more for food than those who do not need to buy “free from” products at their local stores.

The Joseph Rowntree Foundation has warned that low-income families simply do not have the resources to go on bearing the cost of soaring inflation. It noted that

“nine in ten families on Universal Credit said they couldn’t afford the essentials in October last year. Since then, inflation has been in double digits”.

Even the Office for National Statistics told us in April that about half the adult population—49%—were worried about the cost of energy or the cost of food. I think that some of the comments we have heard from Tory Members today spoke volumes. It is almost as if they thought that Tory voters would not be affected by these prices, when half the adult population are worried about the cost of energy or food. I think that they should take notice.

We also know that families are beginning to feel the pain of increased mortgage costs, which, while they may have fallen back a little from the high point last October, are still much higher than they were a year ago; and of course, the central bank has increased the base rate for the 11th consecutive time. Let me put that in context. Nationwide has reported that its standard mortgage rate will rise to nearly 8%—7.74%—on 1 May.

It is rather obvious that, when it comes to the cost of living, the Government should have three urgent tasks. The first is continuing to help families with high energy costs, not by simply freezing the cap—although it is not really a cap at all—but by reducing it from £2,500 to £2,000, as well as maintaining the energy bills support scheme. The second is to bear down on inflation; forcing down energy prices would help with that, as it did last year. Thirdly, as this was mentioned earlier, when it comes to the elements that are under the Government’s control—the next round of public sector pay awards, benefits, the minimum wage and pension settlements—they should ensure that no one falls further behind, and should introduce fairness into the system to pay for it. As the motion says, it could be paid for by a meaningful windfall tax, the ending of non-dom status, the taxing of share buy-backs, and the scrapping of costly vanity nuclear projects.

That is not to say that there is no support from the UK Government—the Chief Secretary referred to some of it, which he rightly described as targeted—but it would be helpful for them to look at the efforts made in Scotland and the range of additional measures that have been put in place there. The Scottish child payment has been further expanded to all eligible six to 15-year-olds. It has increased to £25 a week, and 387,000 children are now forecast to be eligible this year. The various family payments, including the Scottish child payment, could be worth around £10,000 by the time an eligible child turns six, compared with around £1,800 for comparable families in England and Wales. There are more free school lunches during term time for all pupils in primaries 1 to 5, which is the most generous free school meals offer in the UK, saving families on average £400 a year per child.

We have doubled the fuel insecurity fund to support people at risk of self-disconnection or self-rationing of energy. The new winter heating payment that replaces the Department for Work and Pensions system will provide a stable, reliable annual payment, helping 400,000 people. We are maintaining investment in the Scottish welfare fund at £41 million this year, and continuing to invest in discretionary housing payments, with £84 million this year. We are also continuing to provide funding to deliver the council tax reduction scheme. So it is obvious that this Government can, and now should, do more.

Of course, the inflationary pressures that have driven the cost of living crisis are not there by chance. They are not all a consequence of external shocks, and they are not all a result of covid or of Ukraine. The inflationary elephant in the room is Brexit. The London School of Economics has said that

“by the end of 2021, Brexit had already cost UK households a total of £5.8 billion in higher food bills”.

Last year, as prices were rising steeply, the former Bank of England policymaker Adam Posen insisted that 80% of the reason why the UK has the highest inflation of any G7 country was the impact of Brexit on immigration and the labour market. Even the Harvard Economics Review has stated that Brexit

“can be seen as the guilty culprit in Britain’s inflationary crisis.”

I agree with this criticism of the Government. I agree that we should seek higher sustainable growth, but until the inflationary impact of Brexit is even recognised, it will be impossible to fully address the cost of living crisis that so many of our constituents are facing.

[Mr Deputy Speaker (Mr Nigel Evans)]

We will, I am afraid, have to start with a four-minute time limit. We will see where we go from there.

Points of Order

Debate between Nigel Evans and Stewart Hosie

Wednesday 16th November 2022 Commons Chamber

[Mr Deputy Speaker (Mr Nigel Evans)]

I am grateful to the hon. Lady for her point of order and also for giving me notice of it. She raises a serious issue that affects how all of us can assist our constituents, and the service she describes from the Home Office is not acceptable. Ministers on the Treasury Bench will have heard her comments and I expect them to be conveyed to the Home Office. I expect the Home Office to address the issues that she has raised urgently, and if improvements are not made, I know that the Speaker will be sympathetic to attempts by the hon. Lady to pursue the matter, perhaps in an Adjournment debate or through an urgent question.

[Stewart Hosie (Dundee East) (SNP)]

On a point of order, Mr Deputy Speaker. We are about to debate the National Security Bill. In the Second Reading debate, the Chair of the Intelligence and Security Committee, the right hon. Member for New Forest East (Dr Lewis), asked the then Minister, the right hon. Member for East Hampshire (Damian Hinds), for a commitment that there would be a Committee of the whole House to discuss a number of important matters in the Bill. The Minister responded by saying:

“I hear the request from my right hon. Friend…I can assure him that I have heard colleagues—him and others—on the importance of having time for scrutiny.”—[Official Report, 6 June 2022; Vol. 715, c. 639.]

Since then, 130 or so amendments and new clauses have been tabled in the last week, more than half from the Government, and we have 100 or so to debate today. There will be barely two hours before we are required to vote, and then presumably a near non- existent Third Reading. May I ask whether you have had any information from the Leader of the House about the intention of the Government to find more time to debate this matter, or indeed to have the important parts of this Bill debated fully on the Floor of the House?

Business without Debate

Debate between Nigel Evans and Stewart Hosie

Tuesday 29th March 2022 Commons Chamber

[Stewart Hosie (Dundee East) (SNP)]

On a point of order, Mr Deputy Speaker. I have just voted on the social security motion and ought not to have done so, as I chaired the Delegated Legislation Committee yesterday. I have voted in the Aye Lobby and the No Lobby to nullify the vote, but I owe you and the House an apology for that error of judgment.

[Mr Deputy Speaker (Mr Nigel Evans)]

I think we will accept the apology. We do not want another Division, do we? Thank you very much for your point of order and your forward notice of it.

Education Committee

Ordered,

That Nicola Richards be discharged from the Education Committee and Angela Richardson be added.—(Bill Wiggin, on behalf of the Committee of Selection.)

Levelling Up, Housing and Communities Committee

Ordered,

That Brendan Clarke-Smith be discharged from the Levelling Up, Housing and Communities Committee and Darren Henry be added.—(Bill Wiggin, on behalf of the Committee of Selection.)