Budget Resolutions

Peter Dowd Excerpts
Tuesday 12th March 2024

(2 months, 1 week ago)

Commons Chamber
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Bim Afolami Portrait The Economic Secretary to the Treasury (Bim Afolami)
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It is a pleasure to close these three days of debate on the Government’s spring Budget. Before I get on to more contentious points, I will start on some common ground.

We all know that the last few years have been tough for our country. We all know that this Government have spent more than £400 billion on protecting lives and livelihoods after covid. We all know that Putin’s war in Ukraine sent energy prices to unprecedented highs, and that this has had a huge impact on our economy.

Since 2023 this Government have principally worked to three economic priorities: halving inflation, growing the economy and reducing the national debt. We have made good progress on each of those priorities. [Interruption.] Opposition Members should wait for it. Inflation has more than halved, going from 11% to 4%. Our economy is expected to grow faster than many of our major European neighbours and partners over the medium term. The IMF predicts that over the coming four years we will be the third quickest growing economy in the G7. The OBR has confirmed that national debt is on track to fall in line with our fiscal rules.

Members across the House may say, “A lot done; a lot more to do”, but this prudent and responsible Budget takes us one step closer to tackling the inflation that has harmed the economy, to dealing with the low growth and poor productivity that has hampered us, and towards a brighter future. We have already had much success. That is why we are able to afford to cut national insurance for 29 million people. We will responsibly go further than that, as long as the country can afford it.

Peter Dowd Portrait Peter Dowd (Bootle) (Lab)
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Asked last week about the Government’s commitment to abolish national insurance contributions, the Minister said

“we’d like to continue along that track”—

more of a cul-de-sac, in my humble opinion—but today the Minister has been silent on that plan for a huge £46 billion unfunded tax commitment. Will the Minister tell us if it is still the Prime Minister’s plan to resurrect the Trussonomics mini-Budget package of last year?

Bim Afolami Portrait Bim Afolami
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It is not our plan to resurrect anything from the mini-Budget. We have our plan and we set it out in our Budget.

As the son of a doctor and a pharmacist, as many of us are on the Government Benches, I am mindful that any good doctor will say that in order for the medicine to work, one has to complete the course and stick to the plan. This Budget sticks to the plan we set out in 2023 and has three key objectives: to reward work, to grow the economy and to improve productivity. Before I get on to those points, I will address some of the remarks made by hon. Members during the debate.

The hon. Member for Makerfield (Yvonne Fovargue) made a point about some of the most vulnerable in our country and their access to credit. I commend her long-standing support for her constituents, including the most vulnerable. We are extending the household support fund, as she will know, and we are making it easier to access the debt relief order. The right hon. Member for East Ham (Sir Stephen Timms) welcomed the decision to extend the household support fund. In response to his question about making the fund permanent, that is a decision for the next fiscal event, whenever that will be.

I say to Members of all parties who are concerned for the most vulnerable that this is a Budget and a Government for them. Since 2010, the real income—the take-home pay—of those working full time on the national living wage is 35% greater than it was in 2010. On rewarding work, thanks to the actions that this Government have already taken, falling inflation means that wages in real terms are on the up, even while unemployment is low. In response to the question raised by the hon. Member for Liverpool, Walton (Dan Carden), real household incomes overall have increased by 8% since 2010. But we all know that we can go further. The simplest and most effective way to do so is by reducing people’s taxes and getting rid of the double taxation on work, which means reducing national insurance.

I was listening carefully to the shadow Chief Secretary to the Treasury, who is a man I rather like. [Hon. Members: “Ah!”] I rather admire him. We came to the House at the same time. We are practically the same age—he is about five months younger than me, but let us not go into that. But I was very surprised to hear him say—he can intervene on me if this is not correct—that it was “morally abhorrent” to cut national insurance.

Oral Answers to Questions

Peter Dowd Excerpts
Tuesday 6th February 2024

(3 months, 2 weeks ago)

Commons Chamber
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Bim Afolami Portrait Bim Afolami
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I thank my hon. Friend for his question. I am studying those policies carefully. I am concerned about certain aspects of what is proposed, and I will be discussing the matter with the PRA and the FCA to make sure that we have sensible policies on this matter.

Peter Dowd Portrait Peter Dowd (Bootle) (Lab)
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T7. At the autumn statement, the Chancellor announced that he would explore selling off the Government’s remaining stake in NatWest this year. As it stands, does he anticipate that this will result in a better or worse return for taxpayers, compared with the previous sales?

Bim Afolami Portrait Bim Afolami
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I thank the hon. Gentleman for his question. Indeed, the Chancellor announced at the autumn statement last year that, over the next 12 months, the Government will consider selling shares in NatWest. That is all subject to value-for-money concerns and other matters, as he will appreciate, and it is market sensitive. Of course value for money will be at the heart of any consideration of the sale of shares, and the House will be kept fully informed over the coming weeks and months.

Mortgage and Rental Costs

Peter Dowd Excerpts
Tuesday 27th June 2023

(11 months ago)

Commons Chamber
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Peter Dowd Portrait Peter Dowd (Bootle) (Lab)
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In advance of today’s debate, I read the contents of yesterday’s statement by the Chancellor on the mortgage charter. The answers he gave went from bad to worse, and beyond. Besides not answering many of the questions put to him, those he did answer—I use the word “answer” loosely—were answered nonchalantly. Then, when he agreed with the right hon. Member for Wokingham (John Redwood) that it was all the fault of a lack of productivity, above all in the public sector—that nurses, doctors, teachers, social workers, border staff, local government staff and the other 5.8 million people who work in the public sector are causing misery and problems for themselves—I realised that the nonchalance was simply a cover for incompetence at best, or ineptitude at slightly better.

Paulette Hamilton Portrait Mrs Hamilton
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Will my hon. Friend give way?

Peter Dowd Portrait Peter Dowd
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I will not, because I do not want to take up too much time at this stage.

Clearly, the Chancellor has lost the plot. What about the productivity of the Government—the most unproductive Government in my lifetime? There was no mention of that in his statement. In that exchange, the issue of supply-side responses was also referenced. If either the Chancellor or the right hon. Member for Wokingham had read page 12 of the Library’s briefing yesterday, that would have confirmed to them that supply-side pressures and bottlenecks are easing and the cost of shipping has come down to pre-pandemic levels, but of course, that is a fact that the Government do not want to listen to.

My initial assessment proved to be correct as the debate wore on. In response to a question from my hon. Friend the Member for Sefton Central (Bill Esterson) about the reasons why many people in Europe are paying significantly less in mortgage payments than in this country, the Chancellor defaulted to the answer he gave to the previous question from my hon. Friend the Member for Chesterfield (Mr Perkins). He went from turgid to orotund and then back to turgid, with a little bit of circumvention in the middle. I thought I was listening to the Radio 4 programme “Just a Minute”, but without the humour.

The fact is that having a roundtable with the banks is all very well and good—a bit of finger wagging, a wink and a nod here, knowing looks there—but while the Chancellor looks for a solution or tells the banks in no uncertain terms that it is an issue that needs to be resolved, he is doing little to ease the pressure on millions of our constituents who have a mortgage, and there are millions of them. He said it needs a solution, and of course it does—I think we can all agree, without any contradiction, with that pearl of wisdom from the Chancellor. My cat Gilly knows there needs to be a solution. The only problem is that the Chancellor did not present us with one—unless, of course, that part of his statement was left out of Hansard.

I will not go into too much detail about how the current mortgage crisis sits alongside the cost of living crisis, the mental health crisis, the health crisis, the housing crisis and the many other crises inflicted on the country by the Conservative party—they have been covered on other occasions, including yesterday and today—but there are many thousands in my constituency, and millions across the country, who will be paying thousands of pounds more in mortgage payments as those fixed-term deals come to an end. What about the thousands of mortgage prisoners, many in my constituency, who have been hit even harder without Government intervention?

I want to bring to the attention of the Minister, and vicariously to the attention of the Chancellor, an article in the Financial Times today by Helen Thomas—I hope she will forgive me if she feels I am cherry-picking from the article, which I am not. She makes excellent points, and these are issues that have to be addressed by the Chancellor sooner rather than later. She says:

“This crisis should prompt longer-term questions about the peculiarities of the UK market”—

meaning the mortgage market—and that

“with little lending at above five years fixed and essentially none above 10 years, the UK looks an outlier even in Europe”.

In her final paragraph, Ms Thomas says:

“This interest rate shock will prove uncomfortable for many. But it should also prompt fresh debate on what might create a less dysfunctional mortgage market in the future.”

The question for the Chancellor is whether he is up to the challenge in effect laid out in that analysis. Were any of those points raised in his roundtable with the banks on Friday, and what commitments did he get from the banks in relation to easing the pressures on my constituents? Crises are years in the making, and the longer this Government stay in power, the longer this crisis will continue, so it is time for the Tories to go.

Cost of Living Increases

Peter Dowd Excerpts
Tuesday 25th April 2023

(1 year, 1 month ago)

Commons Chamber
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Peter Dowd Portrait Peter Dowd (Bootle) (Lab)
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Listening to the Minister, I get the distinct impression that Labour’s Front Benchers and Labour colleagues more generally are simply making things up; it is as though the cost of living crisis does not exist. But I know that the cost of living crisis is getting worse as the days go by and that it is becoming increasingly difficult for people to afford even the most basic consumables. I am sure that the Minister can afford to pay attention to this, even if he cannot afford much else under his Government’s mess. I did expect a bit more originality from him in explaining away the crisis. It is now getting pretty tedious listening to the same old claptrap about global headwinds, international disruption, the impact of the war in Ukraine, supply line challenges due to this or that, or the covid landscape.

There was no mention of the Government’s part in the debacle. The Government—not a Cameron Government, not a May Government, not a Johnson Government, not a Truss Government, not even a Sunak Government, but a Tory Government—have been in office for 13 years. I know that it feels much longer than 13 years, but does the Minister grasp that at all? He seems to think that the previous four Administrations have nothing to do with the current Administration. Well, I have a bit of unwelcome news for him: they do.

The Minister may be surprised to learn that we have had seven Chancellors of the Exchequer since 2010, which is, on average, about one every two years. If we put the six-year chancellorship of George Osborne aside, we have had, on average, a new Tory Chancellor every 12 months. The Minister may be even more surprised to find out that they have all been Tory Chancellors—yes, all seven of them. In fact, I will let him into a little secret: the current Prime Minister used to be one of them.

Does the Minister not think that such lack of continuity, on top of the general incompetence, may have had a bearing on the current parlous state of the economy? Does he not think that such an environment of chaos has had a bearing on the cost of living crisis? Does he seriously expect us to believe that the Government’s actions have made things better? Does he seriously expect us to swallow the narrative that all this financial, fiscal and economic entropy was foisted on an otherwise competent coterie of Tory Chancellors who happened to be in the wrong place at the wrong time over a period of 13 years?

Between them, that list of failed Chancellors broke their own fiscal rules at least 11 times, if I recall rightly. Has that not had anything to do with the current cost of living crisis? Have cutting housing benefit, bringing in the bedroom tax, freezing child benefit and making changes to tax credit not had a bearing on the cost of living crisis? What about the 10-year virtual freeze in public sector pay? How about the cuts to schools or the justice system? It goes on and on, but the Government will take no responsibility whatsoever for it.

What about the issue of debt? The Minister should be unsurprised to learn that Tory Governments have been responsible for the bulk of all Government debt—a debt currently standing at £2.5 trillion. They claim to be the party of sound finance, but they are not. They have managed to pay back 0.5% of all the money they have borrowed. They say they are the party of economic confidence. That is a joke.

Authorised Push Payment Fraud

Peter Dowd Excerpts
Wednesday 1st March 2023

(1 year, 2 months ago)

Westminster Hall
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Peter Dowd Portrait Peter Dowd (in the Chair)
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I will call Kirsten Oswald to move the motion and then the Minister to respond. As is conventional in 30-minute debates, there will not be an opportunity for the Member in charge of the debate to wind up.

Kirsten Oswald Portrait Kirsten Oswald (East Renfrewshire) (SNP)
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I beg to move,

That this House has considered authorised push payment fraud.

It is a pleasure to serve under your chairship, Mr Dowd. I am pleased to bring forward this debate, because I have had protracted discussions with a business in my constituency that has been targeted by fraudsters, resulting in some of its clients losing thousands of pounds through authorised push payment scams. Those scams deceive an individual into unknowingly transferring funds to a criminal. They now represent the largest type of payment fraud in the UK, both in the number of scams and value of losses.

Energy (oil and gas) profits levy

Peter Dowd Excerpts
Tuesday 22nd November 2022

(1 year, 6 months ago)

Commons Chamber
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James Cartlidge Portrait The Exchequer Secretary to the Treasury (James Cartlidge)
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It is a privilege to open the second day of debate on the autumn statement for the Government. Last Thursday, my right hon. Friend the Chancellor presented this House with a plan to tackle the cost of living crisis and rebuild our economy—a statement that was honest about the challenges we face and fair in its response. His three priorities, and the priorities of this Government, are simple: stability, growth and public services. The people of this country need us to take the difficult decisions on their behalf, and that is what we will do.

In yesterday’s debate, we heard how our plan leads, among other things, to lower energy bills, higher long-term growth and a stronger NHS and education system. The subject of today’s debate is sustainable public finances and taxation, and the House will understand if I focus my remarks on those aspects of the statement.

For the record, and as the Chancellor revealed, the Office for Budget Responsibility judges that the UK, like other countries, is now in recession. Overall this year, the economy is still forecast to grow by 4.2%. GDP then falls in 2023 by 1.4%, before rising by 1.3%, 2.6% and 2.7% in the following three years. The OBR says that higher energy prices explain the majority of the downward revision in cumulative growth since March. It also expects a rise in unemployment from 3.6% today to 4.9% in 2024, before it falls to 4.1%.

One of the most salient points, and an issue we cannot and will not ignore, is inflation. Last week, the Chancellor called inflation “the enemy of stability”, noting its impact on mortgages, household bills, businesses and unemployment. We are experiencing very high levels of inflation, the primary cause of which, according to the OBR, is global factors. Those who question that should remember the following: yes, inflation is high in the United Kingdom, but it is higher in Germany, at 11.6%, in Italy, at 12.6%, and in the Netherlands, at 16.8%. The reality is that the pandemic is still casting an economic shadow, with the lasting impact on supply chains having made goods more expensive. As Members will understand, this has been significantly exacerbated by Putin’s illegal invasion of Ukraine.

The OBR forecast the UK’s inflation rate to be 9.1% this year and 7.4% next year, although I note that the OBR has said that actions taken as part of the autumn statement will help inflation to fall sharply from the middle of next year. Tackling high inflation needs fiscal and monetary policy to work together, with the Government and the independent Bank of England acting hand in glove. It also needs the world to believe that this country will always pay what it owes. Thanks to the decisions this Government have already taken, the OBR has said that the peak of interest rates is likely to be lower than it would otherwise have been, in turn benefiting our economy and public finances.

But we cannot be complacent. That is why we are committed to rebuilding the public finances. The decisions the Chancellor made last week will mean that over the next five years, borrowing is more than halved. This year, we are forecast to borrow 7.1% of GDP, or £177 billion. Next year, it is 5.5% of GDP, or £140 billion, then by 2027-28, it falls to 2.4% of GDP, or £69 billion.

The Chancellor also confirmed two new fiscal rules. The first is that underlying debt must fall as a percentage of GDP by the fifth year of a rolling five-year period. The second is that public sector borrowing over the same period must be below 3% of GDP.

Peter Dowd Portrait Peter Dowd (Bootle) (Lab)
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Given that the Government since 2012 have broken virtually every fiscal rule they have set themselves, why should we pay a blind bit of attention to this new fiscal rule? Why would we believe anything that those on the Tory Front Bench say about their fiscal rules, which are brushed aside as and when they feel like it?

James Cartlidge Portrait James Cartlidge
- Hansard - - - Excerpts

I always enjoyed intervening on the hon. Gentleman when he was a shadow Minister and I was a Back Bencher, and I have great respect for him. The Opposition may want to airbrush from history the extraordinary events of recent years—the pandemic and now the invasion of Ukraine—but any Government would have to adjust to those circumstances. These were not minor events; they were once-in-a-generation events, and they have had a huge impact.

Overall, the autumn statement delivers a consolidation of £55 billion, with just under half from higher taxation and just over half from spending reductions. The consolidation ensures that excessive borrowing does not add to inflationary pressures and push interest rates up further. In the short term, we are taking difficult decisions to make sure that fiscal policy keeps inflation in check, but doing it in a compassionate way that still provides support to the most vulnerable.

--- Later in debate ---
Tulip Siddiq Portrait Tulip Siddiq
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May I remind the hon. Gentleman that the Tories have been in government for 12 years now and may I remind him about everything that happened during covid, including burning personal protective equipment? Maybe he has forgotten about that, and maybe he has forgotten about the amount of fraud that took place during covid. I can send him the details because he looks incredulous. Maybe he does not know how much fraud there was during covid, but we will send that to him. I also remind the hon. Gentleman that, after 12 years of economic mismanagement by this Conservative Government, the UK is forecast to have the lowest growth in the G7 over the next two years, with growth stagnant over 2023 and 2024. That is not a record the Government should be proud of.

Let me return to the energy companies, because even they admit that they do not know what to do with their excessive profits. The Chancellor chose to protect that tax break for the energy giants and let the cost land on working people. He also chose to ignore Labour’s calls to scrap non-dom status, which is currently costing us more than £3 billion a year. Why will the Government not undertake that policy? If Labour was in government, we would be stretching every sinew to generate revenue for the hard-working people of our country.

Peter Dowd Portrait Peter Dowd
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When the Tories came to power in 2010, national debt was just under £1 trillion, yet I remind Conservative Members that it is now £2.4 trillion—so much for the party of sound finance.

Tulip Siddiq Portrait Tulip Siddiq
- Hansard - - - Excerpts

As always, my hon. Friend is right, as is his point about how every time the Conservatives bring in a fiscal rule about lowering debt, they end up breaking it.

Tackling Short-term and Long-term Cost of Living Increases

Peter Dowd Excerpts
Tuesday 17th May 2022

(2 years ago)

Commons Chamber
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Peter Dowd Portrait Peter Dowd (Bootle) (Lab)
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I congratulate Liverpool football club, although, as an Everton supporter, I hope people will respect my wishes and not tell them.

The Chancellor seems increasingly tetchy and indignant at the very idea that he should be expected to loosen the purse strings and support those people who are most economically challenged, but today we find ourselves in a scenario where the International Monetary Fund predicts that the UK will have the weakest growth and highest inflation in the G7 in 2023. Even before the pandemic, and before the war in Ukraine, we had weaker growth than the rest of the G7. We were less productive than our German, French and Americans counterparts by a country mile, and the UK is ranked 24th out of 25 countries in the OECD for public sector investment. In fact, British employees work 38 days a year more than the Germans and are being expected to work even harder. We face even more pain. Research by the debt collection agency Lowell has found that, after factoring in emergency savings, defaulted debt, the claiming of work-related benefits, and the use of payday loans and high-cost loans and emergency credit, my Bootle constituency is in the top 10 constituencies hardest hit by the cost of living crisis.

This crisis can be solved, and the Chancellor can help to solve it, but he will not. He never tires of telling everybody—at least, the diminishing number who are listening to him—that £410 billion has been spent on the pandemic in one way or another. We spent £1.3 trillion in one way or another in bailing out the banks, so we can bail out 66 million people and the millions of people who are in dire straits.

The Chancellor has lectured us for not being supportive of his Budget. Well, it was hardly a Budget; there was nothing in it to be supportive of. There was nothing whatsoever of any significance there. For too many of our constituents who stand on the precipice of falling into deeper poverty, the Government’s failure to tackle this issue is deplorable. We need urgent action from the Government now, in the next few days—not in six months, not in a year, not next year, but now.

If the Government will not listen to the Opposition, they should listen to the public. Government Members cannot seriously expect us to believe that their constituents are happy with what the Government have been doing or with their handling of the crisis. At most, we are little further than two years from a general election. We like general elections in Bootle, because we can send a message to the Tories. In my old council seat of St Oswalds, they did not put up any candidate in the local elections. Nobody but Labour put up a candidate in the local elections, because people know Labour are the only ones who are there to support them.

My campaign between now and the next election will remind my constituents—not that they need reminding—and for that matter anyone who will listen, that the Tories are the party of high inflation, high taxation, low growth, low productivity, low skills, low wages, low investment and low aspiration—and that is just for starters.

Finance (No. 2) Bill

Peter Dowd Excerpts
2nd reading
Tuesday 13th April 2021

(3 years, 1 month ago)

Commons Chamber
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Peter Dowd Portrait Peter Dowd (Bootle) (Lab) [V]
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I support the reasoned amendment in the names of my hon. and right hon. Friends. I hope to make a brief contribution, given the scope of the debate—I do not want to fall foul of your legendary patience and tolerance levels, Madam Deputy Speaker—but it goes to the heart of the concerns on the Opposition Benches that the Government are failing to address the many challenges faced by a whole variety of sectors across the country, especially in the light of covid.

I want to use one example in due course of the lacuna—not addressed substantively in the Bill—that may affect the finances of families and the broader health of the economy, which in turn impact on revenue raising. It is a proxy for the wider malaise that the Bill does not address.

I appreciate that the Bill is about raising revenue and not necessarily the spending of that revenue. In this regard, my call for spending on palliative care—the care that enables people to live life as fully as possible and enjoy precious time with loved ones before the end of life—is vital, but is not necessarily about revenue raising. However, I recognise that the Government have to some degree recognised how important the independent hospice sector is to our health and social care and the benefit it brings to the economy. The Government have recently used revenue from previous Finance Bills or borrowing to support the sector and enabled it to survive. Crucially, that eases the financial pressures on the families of those affected who need palliative care, but that is a proxy for the Government in this Bill not addressing the real needs of the economy.

The economy has been under stress and will continue to be so for a considerable period of time. We all have our experiences of families who are affected in one fashion or another, and palliative care and the support of people in that situation are part of that. It is time for the Government to recognise that they have to look after those in most need and use the benefit of the Finance Bill to raise revenue to support them.

The hon. Member for Hitchin and Harpenden (Bim Afolami) talked about productivity. Yes, we are one of the worst nations in the G7 for productivity. We are about 30% less productive than the Germans, about 20% less productive than the French, about 9% less productive than the Italians, and similarly 30% less productive than the Americans. There is nothing at all in this Bill in substance that deals with productivity issues. As much as the hon. Gentleman likes to say it, the Bill does not deal with that. It does not deal with job insecurity, low pay and low skills. It does not deal with inequality in education, social care and health. It talks about levelling up, but when, where and how? They are just phrases. There is absolutely no action and no route for the action that the Government wish to take over the years.

My example in relation to the health sector, and in particular the palliative care sector, is a proxy to say, “We should be investing our resources in supporting people in need, whether that is on job security or the hospice sector, because if we do not, it impacts on the economy in one fashion or another.”

I do not want to go on too much, so I will finish on this point. I would like to put on record my disappointment that the Government are continuing with the no amendment of the law provision. As the Hansard Society notes, if there is no amendment of the law resolution, then

“no amendment”—

to the Finance Bill—

“may be moved unless the relief proposed is covered by one of the Ways and Means resolutions…Nor may an amendment…exceed any figure prescribed in the relevant resolution.”

In doing this year after year since about 2017, outwith elections, the Government are breaking a 90-year-old protocol. They are freezing Parliament out. Regrettably, this is yet again more chipping away at the powers of the House by the Executive’s sequestration programme, supported by obtuse Members on the Benches opposite. That is all I have to say on that matter.

Financial Reward for Government Workers and Key Workers

Peter Dowd Excerpts
Monday 14th December 2020

(3 years, 5 months ago)

Westminster Hall
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Peter Dowd Portrait Peter Dowd (Bootle) (Lab)
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It is a pleasure to see you in the Chair, Mr Stringer. It seems that we are in a loop with the Government, as far as public sector pay is concerned. In 2008, the Government made another attempt to curtail public sector pay. Three trade unions—the Public and Commercial Services Union, Prospect and the FDA—expressed their dismay at the approach taken by the Government. At the time we said:

“It is high time the Chancellor recognised the human cost of his disastrous pay cap and commit to giving our dedicated civil servants the pay rise they deserve.”

We all remember that the coalition blamed the last Labour Government for not being prepared for the world financial crisis—“Labour’s banking crisis”, as they called it. They said that they had to get the public finances into shape, and public sector workers were the first on the list. They underwent a decade of pay restraint. Members will remember the silly comparison to fixing the roof while the sun shines. Well, the roof has well and truly fallen in—and public sector workers will have to pay for it to be fixed, according to the Government.

Here we are, in the worst crisis the country has faced, which took place on this Government’s watch. They were simply unprepared. Despite the hard work of the public sector, which my hon. Friend the Member for Gower (Tonia Antoniazzi) referred to—it is made up of 5.3 million people, and the public sector pay bill is £190 billion—the Government have decided to pick on them yet again. Every 1% pay rise costs around £1.9 billion gross; after tax and national insurance, is about £1 billion.

Yet again we have an easy target and the same old strategy: set the public sector against the private sector, and set parts of the public sector against other parts of the public sector. It is such a cynical approach. Here is an idea: there are 1,200 tax reliefs, through which we forgo £400 billion, according to the Institute for Fiscal Studies. Have the Government bothered to look at any of them in detail, so that perhaps they can give the public sector the break that it deserves after 10 years of restraint? No. Very little work is being done. They cannot be bothered, because the public sector workers will pick up the bill for the Government’s incompetence.

Let us look at a few examples of how the Government could be a tad more imaginative. Capital gains tax relief for entrepreneurs’ qualifying disposals is £2.7 billion, although it is coming down. Tonnage tax is £100 million —my right hon. Friend the Member for Hayes and Harlington (John McDonnell) often refers to that. The patent box is £1.2 billion, and research and development relief is £2.2 billion. There are £300 million-worth of fiddles in that. I will stop there, because it gets a little tedious. I have a very long list. The Government talk about incentivising people; they incentivise their mates all right. the Minister will tell us that there have not been any public sector disputes or pay problems. These people need a pay rise.

I rarely bring personal matters to this House, but I will make an exception today. My daughter Jennie would have been 32 years old today. She died in a cycling accident 10 weeks ago. She worked at the Royal Liverpool University Hospital—yes, in the NHS; in the public sector, as does my wife, her mother, and her friends, and as did I. She and her colleagues worked hard. They do work hard. I owe it to all those who work in the public sector to speak out for them today. Without question, they deserve a decent pay rise, full stop. In the light of the covid crisis, it is time for some of those on the tax relief bonus, as it is being called, to take their turn.

Coronavirus: Employment Support

Peter Dowd Excerpts
Thursday 19th March 2020

(4 years, 2 months ago)

Commons Chamber
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John Glen Portrait John Glen
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I am very grateful to my right hon. Friend for raising this matter. I made clear in my response the urgency of the Government’s deliberations on this—it is absolutely at the top of everything we are doing. Ministers are working flat out, 24/7, to look at all the options.

My right hon. Friend raises the specific anxieties of businesses. I recognise that the package of measures that we have put out—with respect to statutory sick pay, easier access to universal credit and employment and support allowance, the business rates relief, the small business grant facility, the local authority hardship funds and the HMRC forbearance measures—will for some not feel sufficient at this point. However, he will also know from his experience in government that it is very important that when the Government announce the measures that we wish to take to assist with supporting employees, they need to be effective and need to work. So I say to the House and to my right hon. Friend: be in no doubt that all options are being examined. We are looking at models that exist in other jurisdictions and when, very imminently, the Chancellor comes to the House, we want to be sure that what we announce will be effective.

Peter Dowd Portrait Peter Dowd (Bootle) (Lab)
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It is now six and a half weeks since the first cases of coronavirus were reported in the UK. For over a month we have known about the substantial risk that coronavirus poses to the economy and to workers, yet the Government have announced no plan to protect jobs and wages—no full plan for employment support. We are all—all of us—inundated with so many questions, and I have just four of those questions to ask.

People are asking us: why, for example, have Denmark, which had its first coronavirus case on 27 February, and New Zealand, which had its first case on 28 February, four weeks after our first case, both announced comprehensive job protection plans, while we have announced nothing to secure people’s jobs and wages? Given that, the second question is: what consideration has been given to the models in Denmark and Austria, which the Economic Secretary referred to, which involve the Government paying the bulk of people’s wages in exchange for job guarantees?

The third question is: why, when the Chancellor announced the loan guarantee on Tuesday, did the Government not tie those loans into an undertaking from business that no one would be laid off? The fourth question: will the Minister accept that freelancers will need additional support if they do not qualify for statutory sick pay? For example, in the culture sector we have as many as 2 million people, hundreds of thousands of whom may be affected.

The country deserves answers to those questions as a matter of urgency. We will continue to ask these questions not as a matter of political point scoring or ideology, but to ensure that we have a Government response that properly protects the public and matches the scale of the crisis affecting us here and now, not just next week.

John Glen Portrait John Glen
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It is in order for the hon. Gentleman to raise those points, and he is right to draw attention to the experience in Denmark. Throughout this crisis, the Government have acted on the best scientific and health advice, and that has clearly had to move over time. That advice has been challenged and questioned, and the Prime Minister and the Cabinet have made decisions based on the best advice available. Consequent to the health advice, which is clearly motivated to relieve as much pressure as possible on the NHS, there are other issues that we are dealing with urgently, and sequentially we are offering that advice as urgently as we can in different domains.

The hon. Gentleman asked about the Danish experience, and we are looking at the furlough system. We are looking at the proportion of support that is available, and we are also looking at the German system. In the last significant recession that happened in 2009-10—that is broadly the comparator that we could use—only 3% of German firms were helped. We are aware of what is happening in the US, and we are aware of the proposals that have been put forward by various think-tanks this morning. We are looking thoroughly at all those options, but it is very important that we have a system that delivers the support that is required to employers.

We have extended the coronavirus business interruption loan to up to £5 million. It is clear that there will be no interest payable in the first six months and no fees, and obviously we expect businesses to use that to support their employees during this time.