Only a few days to go: We’re raising £25,000 to keep TheyWorkForYou running and make sure people across the UK can hold their elected representatives to account.

Donate to our crowdfunder

Income Tax (Charge)

Part of the debate – in the House of Commons at 3:22 pm on 12th March 2020.

Alert me about debates like this

Photo of Yvonne Fovargue Yvonne Fovargue Labour, Makerfield 3:22 pm, 12th March 2020

I congratulate all Members who made their maiden speeches today, but particularly James Grundy on his generous tribute to his predecessor. He has been an assiduous local councillor and I am sure that he will bring that experience to his new role.

I am pleased that statutory sick pay will be extended to all employees from day one, although I need more detail about what will happen to people who are not eligible for statutory sick pay. We need to remember that there will be a big drop in income for many people and that their outgoings will still be the same. If we combine that with the fact that substantial numbers of people have savings of less than £100, it begins to become a pretty big issue, and it will certainly increase the need for debt advice.

The crisis also brings into focus the need to look at why people are not saving. In many cases, this will be because of a negative income, but in others, it may be the lack of an affordable, easily accessed and flexible product available to those on a low or fluctuating income and with a poor credit history. I would really like some more information on the no-interest loan scheme, which was suggested last year as a way to help people on the lowest incomes. It is disappointing that that was not detailed in the Budget.

I also want to know what is being done to ensure that there is sufficient free debt advice both in the long term and the short term. People have to be helped not to take short-term action because of a crisis that has a negative long-term effect. I am thinking particularly of individual voluntary arrangements, which have increased, mostly for young people. We have to have debt solutions that are tailored to the individual, not what is profitable for the company.

Have the Government looked at implementing the breathing space scheme earlier? More money is being given for implementation, but people need forbearance now from all creditors if they are affected. I know that some banks are looking at a mortgage break, but what help is there for renters, particularly private renters? Could the situation of those imprisoned in high-interest mortgages due to the failure of Northern Rock be urgently reviewed?

I would also like to see key performance indicators addressed so that local authorities are rewarded for sustaining long-term affordable repayment plans with council tax payers who get into difficulty, instead of prioritising in-year collections, which lead to the use of bailiffs, which in many cases exacerbates the situation. More people may be forced to claim universal credit for the first time. I agree with my hon. Friend Kate Green that the five-week wait should go. It is no use giving people a loan and pushing them further into debt. Pushing people who are already struggling into further debt is incredibly unhelpful. The stress it adds to individuals already concerned about the health of their families and themselves is incalculable.

I would also like to see more detail on the hardship fund to be given to local authorities. How will it be distributed, what are the guidelines, and how much local discretion will there be? It is surely time to reinvigorate the local welfare provision. One in seven councils no longer operate such schemes, which are relied upon by the most vulnerable when they experience sudden financial shocks—and it has to be monetary help. Many councils just point people in the direction of advice, but when someone needs to buy a washing machine or a new bed, or simply new school shoes, advice is not much use.

This might be a tangential issue, but I would like more detail of what the Treasury is doing to guarantee access to cash. There should be a strategy for long-term access to cash that looks at the current trends and which involves the banks, the card issuers and the note machine operators and, crucially, is linked to the high street strategy. In my constituency, we have lost 16% of our free-to-use ATMs. There are 900 ATMs in the borough of Kensington. The average across the country is approximately 50. This is not sustainable and does not help struggling high streets. We need to make sure cash is available and that cash machines are free.

It is good news that the Access to All scheme will receive more cash. Perhaps at last Hindley station, the most used station on the Manchester line and the best kept, will be successful in its bid. I also welcome the fact that the Chancellor has axed the reading tax, but I hope this can be extended to audiobooks, which are a lifeline to people who have impaired vision.

Despite the big announcements regarding infrastructure, connectivity and levelling up, it is disappointing that the housing infrastructure bid to open up brownfield land in my constituency failed. Without this, any new housing will severely impact on gridlocked roads. I will continue to maintain that there should be no development before infrastructure.

I will conclude by mentioning a couple of omissions. While the Chancellor is looking at helping the vulnerable, perhaps he should meet the 1950s-born women to understand the effect of the pension changes on their lives. I recently met a woman working three jobs, all low paid, to make ends meet after the death of her husband and a delay in receiving her pension. She is in poor health and works with elderly and vulnerable people. Catching coronavirus would push her over the edge, both financially and mentally. We also need to look at how social care is funded. It is deeply unfair to make councils split any allocation between their two biggest priorities of supporting the elderly and supporting children.

In short, the Budget attempts to plug holes caused by 10 years of austerity. Let us remember that interest rates have been at an historic low for all of that period. I hope there will be a review of the strategy now to ensure that more individuals and families do not become financially vulnerable and to provide more help to those who do.