Supporting London’s workers

Questions to the Mayor of London – answered on 29th September 2020.

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Photo of Joanne McCartney Joanne McCartney Labour

The government’s furlough scheme is currently planned to close by the end of October. Currently 32% of all eligible employments in London have been furloughed, disproportionally affecting the most disadvantaged communities. What more does the government need to do to ensure that London’s workers are protected, and our economy supported?

Photo of Sadiq Khan Sadiq Khan Mayor of London

London has almost 1.4 million furloughed workers, the highest volume of all regions, with 14% of the total furloughed. The support is set to end and I am deeply concerned that many Londoners on low wages and from BAME backgrounds will suffer deepening economic hardship as a result of widespread redundancies over the next few months. I have been speaking, as I regularly do, with London businesses and, for many sectors, it is simply too early for Government support to be withdrawn.

Once again, Britain is falling behind our European counterparts by failing to provide more comprehensive support when it is needed. France, Germany and Belgium are among those to extend their support, but in the UK support has been tapering since August and at the end of October the scheme is set to end. The Treasury clearly wants to move on, but I cannot see how that is possible with the threat of a second wave growing by the day and social distancing set to continue for some time to come.

As you note, Assembly Member McCartney, one third of eligible employees have been furloughed in London. Young people are most likely to be furloughed along with workers over 60. Take-up was highest in the most deprived areas of London and those with higher BAME communities. If the scheme does end as planned, the potential burden of unemployment will fall on London’s poorest areas and its most disadvantaged residents.

I have highlighted the needs of those sectors hardest hit by COVID-19 such as retail, culture and hospitality. We cannot expect footfall to return to pre-pandemic levels in the foreseeable future. The economic case for protecting businesses is overwhelming and support must also be offered to freelancers and the self-employed.

Photo of Joanne McCartney Joanne McCartney Labour

Thank you, Mr Mayor. You are quite right that it is those most deprived communities that will be burdened with the effects of rising unemployment. That is communities such as mine in Tottenham and Edmonton. In Tottenham, for example, there are 32,500 workers currently furloughed. If the furlough scheme is not extended, many of those workers will lose their jobs. It is those communities that will suffer the most.

In your conversations with the Government, do you get the sense that it understands the human cost of this? Are you hopeful that it will put in some further measures to alleviate this problem?

Photo of Sadiq Khan Sadiq Khan Mayor of London

Thank you for your question. You cannot but notice the human cost of the pandemic and also the misery caused to families who have been made unemployed and the impact of redundancy on not just the person who loses a job but families as well affected by that. You and I both lived through the massive unemployment of the 1980s and we saw not simply a generation written off but the life chances of families written off.

I am hopeful that the Chancellor [of the Exchequer] will come forward with a new scheme as the furlough scheme ends at the end of October [2020]. What I have tried to get across to the Treasury is the examples of what Germany, France, Belgium and many others are doing. Some countries are giving support until 2022, some until the end of 2021 and some until the end of 2020. Very few are allowing the possibility of a cliff-edge fall with a lack of support for families.

I hope they do. It would be pretty inhumane of them not to. All of us should use whatever influence we have to persuade the Government to do right by vulnerable communities affected by COVID-19.

Photo of Joanne McCartney Joanne McCartney Labour

Thank you for that answer. What more can City Hall do? Are the Government’s schemes - for example, the Kickstart scheme to help young unemployed people - using the GLA and the contacts and abilities that this organisation has to make that targeted difference or not?

Photo of Sadiq Khan Sadiq Khan Mayor of London

We are offering our assistance to the Government to help in any way we can. You will be aware that we worked really closely with the Government in relation to homelessness during COVID-19. We are really keen to work with the Government in relation to issues around jobs to avoid mass unemployment and also in areas where we can reskill people quickly to get them back into work. One of the best ways to help people if they are in danger of losing their jobs is to skill them up to get another job that is futureproofed, hopefully, before they lose their first job or become long-term unemployed.

We are doing things ourselves - grants, loans, advertising campaigns, rent relief for businesses - and at the same time continuing to offer up to the Government our expertise and willingness to support in this area. It is a really important area. We think we know our communities and our sectors across London best. Councils know their local micro-economies really well. We are trying to use the Transition Board, chaired by [The Rt Hon] Robert Jenrick [MP, Secretary of State for Housing, Communities and Local Government] and me, and the Recovery Board, chaired by the Chair of London Councils and me, as ways to get the Government to work with us to get the best result for Londoners, which is a win-win for everyone.