I begin by saying that my thoughts are with the loved ones of those individuals who have sadly died in the UK, and with those who have contracted covid-19.
People in my constituency are worried about their security, their income, their job, their home and the wellbeing of their families, children and elderly relatives. The job of Government is to provide reassurance, especially at this most worrying of times, yet this Finance Bill fails to do so. With the economy necessarily being shut down in an unprecedented way, it is urgent that the Government act to protect jobs and incomes. It is now becoming clear that there are severe problems with the design and performance of many of the programmes that the Government have introduced to deal with the current crisis, and that these are reducing their take-up. This Finance Bill does not resolve those problems.
Due to time constraints, I will raise just a few specific examples today. As the Institute for Fiscal Studies has pointed out, the self-employed are more likely than employees to be in relative poverty and are more likely to work in sectors currently seeing large falls in demand. This Finance Bill offers such people little, if anything. I have been contacted by local nurseries regarding recent information stating that nurseries would not be able to claim furlough payments for all employees while also receiving local authority funding. They have argued that, as a result of the Government’s approach, they will probably have to make staff redundant. Basing eligibility on receipt of relief on business rates means that some businesses in need of support have been left behind. Many businesses in my constituency have contacted me with concerns that they are not eligible for this crucial lifeline, because they are not registered for business rates as they are renting a small space within a larger property, paying a proportion of business rates to the landlord.
On the wider economy, this Finance Bill does not properly address the fact that, according to the Office for Budget Responsibility, public health restrictions and social distancing mean lower incomes, less spending and weaker asset prices, which all reduce tax revenues, while job losses require more public spending. We already know that the covid-19 crisis is causing serious financial suffering for people and their families, and that while coronavirus can affect everyone, it does not affect everyone in the same way. It differs depending on class and status, and this Finance Bill does nothing to address that inherent systemic imbalance. This is of particular relevance to my constituency, Poplar and Limehouse, which already suffers from the highest rate of child poverty in the entire country. After a decade of austerity, too many people remain trapped in low-paid, insecure work, and they are invariably failed by the social security system.
After all our lobbying, the Government are now launching a review of the impact of covid-19 on BAME communities, which is to be welcomed, but for any review to be meaningful it must address the underlying economic system and the fact that years of austerity have had an utterly devastating impact on ethnic minority communities. I am hoping, therefore, that the Chancellor and his Department will accordingly carry out and publish a review of the Bill’s effect on equality.
This pandemic has exposed the fact that the Tories’ economy for the few is not fit for purpose, and it is fundamentally unfair and unequal. For example, Care England has today published a paper calling for greater financial support for the care sector, yet CareTech, which runs a large number of established residential care homes in the UK, has seen its shares rise by 12% in the last five days since announcing, in its words, “stronger” revenues and margins. Is it not obscene that as the coronavirus outbreak streaks across our care homes, with the death toll rising, profits are being pocketed by a rich few? The truth is that our social care system is a national scandal. Nearly £8 billion has been taken from councils’ social care budgets since 2010. At the same time, many big care providers have developed highly complex corporate structures involving offshore tax havens.
There have been emerging discussions about the need for new forms of progressive taxation as opposed to spending cuts, yet the Bill does not include an immediate windfall tax on the banks and finance sector, combined with a wealth tax on the richest in our society—policies proposed by my Labour colleagues that would ensure that there were enough resources to pay for our public services in a fair and just way.
Although this crisis is exposing the weakness in our economy and society, I have been inspired by the number of people who have organised to protect their communities. We need a Government who follow their lead and ensure that our economy is defined by solidarity and compassion, rather than by insecurity, fear and inequality. Unfortunately, this Finance Bill is further evidence that the Conservative party is unable or unwilling to be such a Government.