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Financial and Social Emergency Support Package

Part of the debate – in the House of Commons at 5:11 pm on 25th March 2020.

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Photo of John Martin McDonnell John Martin McDonnell Shadow Chancellor of the Exchequer 5:11 pm, 25th March 2020

I am grateful for the intervention, if only because it enabled me to have a drink, but it was a useful one, because the hon. Gentleman will argue that we were suggesting to the Government that some of these loans should be conditional on participation in the scheme and the guarantee not just of the 80%, but of the 20% that employers would pay to top up the salaries as well.

That 500,000 people are applying for universal credit is a sign of the scale of job losses that we are facing now, so there is a real need to close the gaps and bring forward the scheme with some urgency. As many have said, there are 5 million self-employed out there. Let us be clear: the self-employed pay the same rates of tax, so they deserve the same protections and they are losing out.

As we have heard, the scheme will be announced tomorrow at a press conference, so let us say clearly that the self-employed must be treated fairly and they must be treated as any other workers, as in the job retention scheme. Let them be able to claim 80% of the income lost—yes, self-declared—and if there are any concerns about overpayments, exactly as has been said, they can be clawed back in their next tax return. This is not as complex as some have said. If people claim fraudulently while still working, they will rightly be prosecuted. It is as simple as that.

But right now, as we have heard from my right hon. Friend Mr Jones, my hon. Friend Zarah Sultana and others, millions of cabbies, childminders, plumbers, electricians, painters, decorators and actors have all lost work or have had to close down their businesses, as have builders designated as self-employed under the construction industry scheme, and they have no income. They need a solution now.

We will see what the scheme is tomorrow, but the delay has just been unacceptable. For all those saying it is complicated, yes, it can be complicated, but other countries are managing it. One example that was given earlier was Ireland, where the national support scheme will be up and running on Friday and covers both PAYE and self-employed workers at 70% of their net wage. Many other countries have had more comprehensive and more generous schemes.

I turn to the issue of statutory sick pay, mentioned by my hon. Friends the Members for Brighton, Kemptown and for Brent Central (Dawn Butler). As has been said time and again in this House, when the Health Secretary and his predecessor were asked whether they could they live on £94 a week, they were honest and said no. It is blindingly obvious that the rate has to be increased. At the moment, it is less than half the level of many other European countries. Our view is that it should be at the level of the real living wage, but we need an increase, and we need it rapidly, because people are having to choose between health and hardship.

I give the House another real example that was sent to me by an hon. Member whose constituent has been told that their terms and conditions are being changed, so instead of getting sick pay of three weeks on full pay, they will get merely SSP. While the Minister is at it, let us stop insulting the unemployed and disabled people by telling them that they have to live on £73 a week, or, if they are under 25, £57 a week.

Thousands of workers have been laid off in recent weeks through no fault of their own, and many are struggling to make a claim for universal credit online, as several hon. Members have pointed out. We want to know urgently from the Government what they are doing to expand capacity in those departments. I urge the Government to heed the call of the Resolution Foundation today to raise jobseeker’s allowance and employment and support allowance, exactly as we are saying. We also suggest that there is an urgent need to increase the carer’s allowance.

Other hon. Members, such as my hon. Friend Ruth Cadbury earlier this week, have proposed at least a temporary £10 increase in child benefit to help to lift children out of poverty. As my right hon. Friend the Member for East Ham said, the Government have to get to grips with reducing the five-week wait for universal credit and follow the calls of groups such as the Child Poverty Action Group to turn that advance loan into a grant. We should not be pushing the poorest people in our society into further debt.

I spoke to the Public and Commercial Services Union, which represents staff in the Department for Work and Pensions. As a point of fact, during the last spike in demand after the global financial crash—a number of us were here—the DWP had 130,000 staff. Today it has just 78,000 staff. We are told that an extra 10,000 may be coming, but as the hon. Member for Glasgow South West said, the contractors and the staff who are directly appointed need to be cared for, so we are asking for the enforcement of social distancing and proper protections.

Many of the Government’s workers have not received personal protective equipment and clothing, with nurses and doctors relying on makeshift masks and plastic bags. Again, I pay tribute to the bravery and dedication of the NHS and social care workers who have ploughed on regardless, but they deserve better too.

Individual cases are being brought to us that it would be useful for the Minister to be clear about. For example, on medical advice, should pregnant workers be self-isolating if they cannot work from home? The advice that has been given appears contradictory to many workers and employers. I have been forwarded a case where a pregnant worker was told to take three months’ unpaid leave if she would not continue to do face-to-face working. That is the sort of treatment of some people out there at the moment.

We welcome the moves to protect mortgage holders and ensure that payment holidays are in place, but as many hon. Members, such as my hon. Friends the Members for Brighton, Kemptown and for Croydon Central (Sarah Jones), have said, we need the same security for renters. The difference needs to be understood: a rent holiday is not the same as a mortgage holiday. Rent is paid continuously while in tenancy, while mortgages are fixed-term, meaning that repayment terms can simply be extended. It is therefore important that the Government act to ensure that people’s rent payments are covered for this period, not merely suspended.

As others have said, we are extremely disappointed by the legislation published yesterday—frankly, the Prime Minister has broken his promise to the country’s 20 million renters. It was not an eviction ban, as promised: the legislation will not stop people losing their homes as a result of the virus. As my right hon. Friend the shadow Housing Minister said, it just gives people some extra time to pack their bags. The Housing Secretary said this morning that the Government could extend the three-month delay on evictions. He said it was extremely unlikely that any repossession proceedings would continue. That is just not clear or strong enough. The Government must look again at this.

There are wider problems. Over recent years, austerity cuts have lessened the value of support available via housing benefit. The Government must immediately suspend the benefit cap—and yes, the bedroom tax must go. We welcome the moves announced last week on local housing allowance, but the Government must go further and restore the allowance from the 30th percentile to the 50th percentile of market rates, as it was before 2010, under the last Labour Government. People will have made rental decisions based on their incomes, and they should not be penalised by the unforeseeable impact of the virus. Now is not the time for families to be downsizing or sofa-surfing with parents, grandparents or friends in the cramped and overcrowded conditions that my hon. Friend Siobhain McDonagh described so clearly.

We cannot have a situation in which, at the end of this, tenants have either depleted all their savings or— worse—amassed large and unpayable debts. The suspension of evictions for private and social tenants must be extended from three to six months. Shelter has told us that as many as 20,000 eviction proceedings are already in progress and will go ahead over the next three months unless the Government take action to stop them. They must be stopped, and I urge the Minister to be absolutely clear when he stands up: no evictions of any kind.

Others are also being hit by the impact of the virus. We need to ensure that undergraduates are not charged rent for student accommodation that they are no longer using as their institutions close. We need to know what scheme is in place for students to claw back rent or escape tenancy agreements rendered defunct by the crisis. Likewise, we are urging the Government now to suspend the interest on tuition fee debt.

The issue of utility bills has been discussed on both sides of the House. My hon. Friend the Member for Mitcham and Morden gave the stark example of what has happened with key meters and the behaviour of British Gas at the moment. Unless we do something to intervene on utility bills, especially when families are at home and their energy bills are increasing, families could shortly be threatened with disconnections. We cannot have bailiffs coming round to houses about water, energy or even internet bills.

What about the internet? My hon. Friend the Member for Newcastle upon Tyne Central emphasised the critical importance of internet capacity and access at this point in time. We need to know what the Government are doing about internet access. Many people in our community used to rely on libraries to access the internet, but now libraries are closing. The Government must bring forward new measures to ensure that people can get online—whether for benefit services or to maintain some proper form of social contact.

Sir David Amess, my hon. Friends the Members for Mitcham and Morden and for Brent Central, and my right hon. Friend the Member for North Durham all raised the problems of charities, at a time when many people are falling back on charities. We have been told, by Members here and by reports coming in from across the country, that charities, voluntary organisations and social enterprises are running out of money; the predicted losses will be about £4 billion in the next 12 weeks. What is being done to support those groups? The Government also need to clarify whether some of them could participate in the job retention scheme.

Finally, I echo what others have said; my hon. Friends the Members for Brent Central and for Coventry South put it eloquently. Lessons must be learned from this crisis. We must ensure that in future we build into all our public services the resilience they need to deal with any future crisis. We must eradicate from the economy the low pay and insecure work that prevent people from having the personal economic resilience to cope when hardship threatens. Above all, as others have said, we need to learn the lesson that austerity is no solution, and never will be. As has been said, let us start planning now for the economy and society that we want to shape after we have won the war against this virus.

Madam Deputy Speaker, you mentioned that this is my last speech in the Chamber as shadow Chancellor. I am grateful for the many kind words said about me and the Leader of the Opposition. In fact, I do not recognise myself from them, but thank you very much. It is almost as though I have been tamed.

Some Members present will recall that when I address party meetings, I usually end with a single word. It is a word upon which the Labour and trade union movement was founded. It is based on a secret we discovered; one that working people learned in the fields and workshops of the early industrial revolution. It taught us, as my right hon. Friend Jeremy Corbyn said, that unity is strength and an injury to one is an injury to all. That word is solidarity. It is solidarity that will see us through this crisis, protect our community, and on which we should build our society in the future. Madam Deputy Speaker, I end with solidarity.