The Economy

Part of Council Tax Rebate – in the House of Commons at 6:50 pm on 31st March 2009.

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Photo of Lindsay Hoyle Lindsay Hoyle Labour, Chorley 6:50 pm, 31st March 2009

It is not often that I disagree, and the hon. Gentleman makes his point, but I say to him that some businesses never introduced the reduction and some have already put prices back up, so we have a mix-and-match approach in the VAT circles. I understand that there was a cost to business, but this is about doing the right thing by the people of this country and the best thing by people who are losing their jobs. It is about refocusing and re-using that money—we can do that—to keep people in employment, and that is what it should be about. We have to support people who have lost their jobs, because there is no greater upset to any individual or family involved. Surely if we can protect people so that they do not lose their job, that ought to be the measure that we take.

It is a concern that short-time working and temporary lay-offs are now a reality. In some cases, that is having a negative impact on workers who qualify for tax credits, as short-time working is taking them below the minimum hours qualifying threshold. We can help them and we can ensure that those families will still receive the tax credits. We are seeing the impact of short-time working in constituencies up and down the country. My constituents have told me about its impact, highlighting the difficulties and uncertainties facing both workers and employers. Each week more businesses are being forced to do the same. These companies and their workers deserve our support, and we have a responsibility to respond to their needs.

We should introduce a wage subsidy scheme that is time-limited, and that has sufficient safeguards to ensure that only those firms directly affected by the impact of the recession can qualify and that we avoid a dead-weight—in doing so, significant benefits could be achieved.

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