Autumn Statement Distributional Analysis, Universal Credit and ESA

Robert Flello Excerpts

Wednesday 16th November 2016 Commons Chamber

[John McDonnell]

I fully agree with my hon. Friend. There is a week in which we can overturn at least an element of that brutality. This week, we need to seize upon the chance as best we can, across parties, to deliver change.

From our privileged position in this House, I firmly believe that before we consider cuts to basic support for low earners and disabled people, we have a moral duty, as my hon. Friend said, to fully appreciate the plight of many of our fellow citizens and the impact that any changes that are forced upon them could have. There are some basic facts that we need to face up to—basic facts that depict the harsh reality of the lives of so many members of our community. Nearly 4 million of our children are living in poverty. The scandal is that two thirds of them live in families where someone is working. Thanks to low wages, zero-hours contracts and forced or bogus self-employment, which has been exposed today, the promise that work will lift people out of poverty is a broken one for many.

If a basic responsibility of the Government is to ensure that their population is adequately fed and housed, they are failing. A million emergency food parcels were given out by food banks last year to families who did not have sufficient income to feed themselves. The latest reports confirm that the numbers are rising. This year, 200,000 children in our country will be dependent on a food bank to get a decent meal at Christmas. One survey reported that more than 20% of parents had regularly not eaten so that their children could eat. Others report the frequent choice between eating and heating. This is 2016.

On the duty of the Government to ensure that people are adequately housed, they are failing again. Rough sleeping has doubled in recent years. The equivalent of 100 households a day are evicted from rented homes—a near-record 40,000 in the year to date. Some 1.2 million households are stuck on council housing waiting lists. In my constituency tonight, there will be families sleeping in beds in sheds that have been rented to them.

As for the Government’s responsibility for disabled people, as the UN report concisely summed it up, the Government have—and I quote—systematically or gravely violated the rights of disabled people. Independent research suggested that Government efforts to push people off claiming disability benefits have been associated with more than 500 people committing suicide in three years.

Three years ago, I led a debate following the presentation of the War on Welfare petition, which highlighted the call for an overall impact assessment of the Government’s policies on disabled people. I cited the immense human suffering caused by the brutal implementation of the work capability assessment and the latest round of cuts to benefits and care services. I cited examples of people who had tragically taken their own lives in despair following the WCA and the penalisation through sanctions. We now know that those suicides were not isolated examples, but that there have been hundreds.

[Robert Flello (Stoke-on-Trent South) (Lab)]

Of course, there is a double whammy, because people who are suffering and being punished in that way are not likely to get access to good mental health services or NHS services, because those are being cut and wound down across the country as well.

[John McDonnell]

I have listened carefully to the Prime Minister’s responses to a number of questions about cuts to mental health services at Prime Minister’s Question Time. I hope that her commitment to social justice will result in the reversing of some of those cuts, particularly to mental health walk-in services, which were raised at the Prime Minister’s questions session before last.

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[The Minister for Employment (Damian Hinds)]

I beg to move an amendment, to leave out from “House” to the end of the Question and add:

“notes the role of universal credit in ensuring that work pays; welcomes the £60 million package of additional employment support announced in the Summer Budget 2016 available to new claimants with limited capability for work from April 2017 and set out in the recent Work and Health Green Paper; further welcomes the proposals for employment support for disabled people and those with health conditions set out in that green paper; and notes the comments by the Chancellor of the Exchequer to the Treasury Committee on 19 October 2016 on his intention to publish distributional analysis at the forthcoming Autumn Statement.”

Since 2010, we have been working to get the country’s finances in order while continuing to provide proper financial and practical support to those who need it. We will have to wait until next week to hear the Chancellor’s plans, but we can note today the significant progress on which the autumn statement will build. In 2010, we faced an economy that was barely growing, investment that was low, unemployment that was high, and a deficit at a level not seen since the second world war. In 2009-10, the then Labour Government were borrowing an annually recurring amount of nearly £6,000 for every household in the country—an unsustainable situation.

Since then, Conservative-led Governments have taken the tough decisions needed to reduce the deficit, and it is working. Over the past six years, we have cut the deficit by almost two thirds from its 2009-10 post-war peak of 10.1% of GDP to 4% last year.

[Robert Flello]

It is funny, because I remember being in the House and being told that the deficit was going to be cut—wiped out, gone—by 2015, and Labour’s plan to halve it by 2015 being dismissed as nonsense. Does the Minister have the same recollection?

[Damian Hinds]

The hon. Gentleman, who is a man of great memory, will also remember the Opposition Front-Bench spokesman shouting “Too far, too fast” over and over. We embarked on a determined programme to get our nation’s finances back in order, which the Opposition opposed at every turn. They voted against essentially all the substantial measures to get us there.

[Robert Flello]

I also remember, in the run-up to 2008, Conservative Members saying from the Opposition Benches that the Labour Government needed to spend more on hospitals, spend more on schools—spend more, spend more, spend more. Funny how they have forgotten that.

[Damian Hinds]

They have not forgotten that, and it is because we are getting our nation’s finances back in order that we can afford to increase our funding for the national health service by £10 billion, in line with what the NHS itself has deemed necessary in the five year forward view, a plan that it would never have been possible to realise had the Labour party been in government.

The Opposition claim that the poorest in our society have borne the brunt of the reductions in the deficit, but that is not the case. It is undeniable that when we face a deficit of almost £6,000 for every family in the country, we have to do some difficult things, but people throughout society have contributed to getting our finances back in order. We have never seen tackling the deficit as just an option. It is a matter of social justice, because when Governments lose control of the public finances, with all that flows from that, it is invariably those who have the least who stand to lose the most.

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[Jenny Chapman (Darlington) (Lab)]

I begin by saying some words that I never thought would leave my mouth: I really hope that Ministers listen to what the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith) has just said—but where were you as Secretary of State? The right hon. Gentleman has explained very clearly how many people feel about the proposed changes. I hope that it is not too late for the Government to change their mind.

This Government seem to be developing a problem with transparency. We found out from the front page of The Times this week that there is no plan for Brexit, even though we were told that there was. My constituents found out through a leak from another local authority that their A&E department was under threat. Now we find that the Government do not intend to publish a full distributional analysis of the impact of the decisions they are about to make in the autumn statement. The decision not to publish a full analysis of that impact makes Opposition Members incredibly suspicious. The people who are going to feel the worst brunt of those decisions might well feel extremely angry.

[Robert Flello]

The right hon. Member for Chingford and Woodford Green (Mr Duncan Smith) said that, historically, whenever there was a change to benefits, people suffered until the situation was changed and improved. Does that not also explain why so many of our constituents are extremely worried about what is going to happen?

[Jenny Chapman]

That is right. People want clarity. What everyone wants is for work to pay and for people to be better off in work than out of work, but that is not what we are going to get.

The Government used to be very keen on having a full and detailed distributional analysis, and I have with me the introduction to the one they published in 2012. They said then:

“The Government has taken unprecedented steps to increase transparency and enable effective scrutiny of policy making by publishing detailed distributional analysis of the impact of its reforms on households.”

It was a very good thing that the Government, and the right hon. Member for Tatton (Mr Osborne), did then. The right hon. Gentleman went on to say:

“The analysis shows average impacts due to policy changes over time across the income and expenditure distributions by decile”.

I hope that, at the end of the debate, Ministers will commit themselves to publishing the information by decile, so that we can scrutinise it properly and challenge the Government on what they are about to reveal. That is not just my view. The Tory Chair of the Treasury Committee agrees, because he knows that if he is do his job effectively the information must be published and available to everyone, including the public. This matters: the distributional analysis should reveal the impact of tax, welfare and public spending changes on 10 household income brackets, but the Government want to halve the amount of detail and cover just five brackets.

I was pleased when the Conservatives chose this new Prime Minister, given the choices that they had, and I was pleased when she said that she wanted this to be

“a country that works for everyone”.

Don’t we all? But how can we know whether the Prime Minister is true to her word if she does not proceed to publish the information that we need to test the assertion by which she herself asked to be judged? Unless she does so, we cannot test that claim.

This leads us to ask ourselves what the Government are attempting to hide. What the Minister said sounded incredibly positive, and there were many measures that he said we ought to be welcoming. If that is true—if he is right and Opposition Front Benchers are wrong—he should publish the information, so that we can test him on his claims. Go on, let us see it!

I suspect that the picture is not quite as rosy as the Minister suggested. Perhaps it is the £1,500 a year to be taken from disabled people that he is trying to conceal, but it could be any number of the measures that he has in mind. The Resolution Foundation has estimated that the poorest 50% of households will be £375 worse off on average by 2020-21, while the other half will be £235 better off. We need this information to be published before every Budget and every autumn statement, so that we can compare the impact of the different measures. I want to be able to see what is going to happen next week and compare it with what happened three years ago.