Cost of Living and Food Insecurity

Patrick Grady Excerpts

Tuesday 8th February 2022 Commons Chamber

[Peter Grant (Glenrothes) (SNP)]

I commend the Labour Front-Bench team for tabling this motion, and I commend the hon. Member for Oldham West and Royton (Jim McMahon) for setting out succinctly and forcefully the impact on real human beings of the failures of this Conservative Government. It was so farcical as to be really comical, if it was not so tragic, that the right hon. Member for Wokingham (John Redwood), who is no longer in his place, asked the Minister to agree that cutting food miles was a good idea, yet a Minster from the same Department a couple of weeks ago thought it was brilliant that we had arrived at a new trade deal with Australia and that we should be trying to cut food deals. What better vignette could there be to illustrate the inconsistency and chaos of this Government? They have torn up the best trade deal we will ever have with our nearest neighbours and replaced it with a deal with people who are literally on the other side the world, yet they have the cheek to tell us that the way to deal with food shortages in Britain is to cut food miles.

Just to put into context the scale of what we are facing here, the Bank of England has increased interest rates to try to control increasing inflation, but it is warning that it could reach 7.25% in April. Very few of our constituents will get a pay rise that comes within a mile of 7.25%, and most will be lucky to get anything. Data released by the Food Foundation charity shows that, in January this year, 4.7 million adults had experienced food insecurity, and National Energy Action estimates that 6 million households in these islands will be living in fuel poverty: that is not having to cut back slightly, but being unable to keep themselves warm enough to be safe and healthy, or to feed themselves and their families enough to keep healthy.

New analysis by the Joseph Rowntree Foundation warns that the energy price cap will have the harshest impact on the poorest families. We knew that anyway, but JRF has given the evidential backing to it. The poorest families will spend 18% of their income on energy bills after April. Can hon. Members imagine spending 18% of their £80,000-a-year salary on fuel bills? This place would be in uproar if that happened. Why is it acceptable for low-paid folk to pay a bigger chunk of their income when it would not be acceptable for Members of Parliament? The Office for Budget Responsibility forecasts that average real wages will still be lower in 2026 than they were at the start of the financial crisis in 2008.

If all that was being said about a poor economy, a poor country or a poor collection of countries, we would think it was shameful, but it is being said about one of the richest places on the planet, as the right hon. Member for Leeds Central (Hilary Benn) mentioned earlier. Fuel poverty and food poverty—people literally living on the edge of starvation and hypothermia—are happening not because of necessity but because of a deliberate sustained political choice. It has certainly been the political choice of Conservative Governments since they were elected under the former Prime Minister David Cameron.

[Patrick Grady (Glasgow North) (SNP)]

Does my hon. Friend, like me, remember that, in 2014, the Labour party and the Conservative party said to Scotland that, if we voted for independence, freedom of movement to Europe would end, supermarket shelves would be empty of food and energy prices would go through the roof? Does he agree that they have quite a bit of explaining to do?

[Peter Grant]

It is a valid point. Every so often, I go back through all the scare stories that have been pushed through my letterbox—mainly from the Labour party, because we do not really have a Tory presence in my constituency, or certainly not in my part of it. When we go through all the horrible things that they say will happen if Scotland becomes independent and leave them for two or three years, we find them happening anyway. It started with the closure of the naval base in Rosyth and it is still happening today with the end of freedom of movement and increasing food prices.

It is estimated that 1 million adults, equivalent to more than 3.5% of the UK population, are having to go without food at least once a month because they cannot afford to eat. About 640,000 people in Scotland cannot afford their energy bills, and that is before they got put up by 50%. That is in a country that has more energy than it needs and that, most years, exports energy to England and other countries because it cannot use all the energy it produces.

Where else in the world would we find any commodity in surplus that is, at the same time, priced beyond the affordability of its own citizens? What on earth is wrong with the way that Scotland is run that means that the people who produce almost more energy per head of population than anywhere else in the world cannot afford to pay their bills, keep their homes heated and keep their families healthy?

The Chancellor’s response is better than nothing but it is woefully inadequate. He is basically offering a payday loan: “We’ll give you the money just now to pay off your fuel bills and we’re going to hope and pray that they come back down again in the next few years.” If they do not, what on earth happens? The Scottish TUC has said that the Treasury’s buy now, pay later loan

“comes nowhere near tackling the problem…It is nothing short of shameful that people are being forced to choose between food and heat.”

If emergency loans are such a good idea to tackle the problem of increasing energy prices, why not go to the source of the problem and give them to the energy companies? They are struggling because of many global factors that have been covered in other debates. At least that way, the Government would be giving the loans to people whose shareholders should be able to meet the cost. Why give the loan to somebody who will not be able to afford to pay it back next year, the year after or the year after that?

Given that the decision has been made to give that money directly to citizens, the SNP says that it should be turned into a grant. People should not be made to choose between taking the money now and not being able to pay it back later. The Chancellor must also cut VAT on energy bills, which is within his gift. Why has he not done it?

As well as giving emergency loans to the energy companies, the Chancellor should have ruled out a rise to the energy price cap—he simply should not have allowed it, or Ofgem should not have allowed it. He could also reintroduce the £20-a-week universal credit uplift that the Tories cancelled recently. None of that by itself will solve the problem completely, but at least it would give an indication that we are dealing with a Government who care, whereas, quite clearly, we are dealing with a Government who could hardly care less.

[Peter Grant]

Absolutely. My hon. Friend—I hope that I can continue to call her a good friend and colleague—has, as always, made a very valid point.

One of the most iniquitous and downright evil things about the crisis that we are now facing is that the people who get the hardest hit will be those who are least able to afford it. If we all had to take a 20% hit to our living standards, none of us would enjoy it, but all of us would manage. Most of my constituents cannot afford to take that scale of hit to their standards of living and they are the ones who are being hit the worst.

I want to look briefly at some of the things that have been done by the Scottish Government, using their limited powers to mitigate this crisis. The Scottish Government have a much more progressive income tax system than the rest of the UK. It is often attacked by Tory Back Benchers who are interested only in the wellbeing of high earners, but the fact is that, in 2021-22, 54% of people in Scotland—the lower paid 54% of people in Scotland—are paying less income tax than they would if they lived in England. There is also fact that Members of Parliament for Scotland pay a bit more income tax than our colleagues in England. I do not mind that if the money is going into essential services.

Last year, the Scottish Government invested around £2.5 billion to support low-income households, nearly £1 billion of which went directly to children living in low-income households. They have committed more than £3.9 billion to benefit expenditure in 2022-23, providing support to more than 1 million people. That figure of £3.9 billion is £361 million above the level of funding that we get from the UK Government, so while again the Tories will demand guarantees that all of the money that comes to Scotland be used for its intended purpose, the Scottish Government are spending almost 10% more than they are receiving for that purpose.

The reaction of the Child Poverty Action Group was that this was

“a hugely welcome development on the path to meeting Scotland’s child poverty targets... a real lifeline for the families across Scotland who are facing a perfect storm of financial insecurity as the UK cut to universal credit bites, energy prices soar and the wider costs of living rise.”

It said that on 29 November 2021. The British Government did not seem to wake up to the problem until about 29 January 2022.

My hon. Friend the Member for Glasgow—

[Patrick Grady]

North.

[Peter Grant]

Glasgow North. I do beg my hon. Friend’s pardon. I love the city of Glasgow, but I can never remember the constituency boundaries.

My hon. Friend has raised the impact that Brexit is having. Brexit has had a disastrous effect on our economy, and it has not finished. The OBR estimates that we still have three fifths of the way to go. Most of the damage from Brexit has still to be done. Every single person on these islands faces a cost of around £1,200 as a result of Brexit, and we know who will be hit the hardest. Make UK, the organisation that represents 20,000 manufacturers, has said that Brexit changes will undoubtedly add to soaring consumer costs in 2022.