Co-operatives and Mutual Societies

Chris Stephens Excerpts

Tuesday 14th December 2021 Westminster Hall

[Chris Stephens (Glasgow South West) (SNP)]

It is a pleasure to see you in the Chair, Dame Angela. I thank the hon. Member for Wycombe (Mr Baker) for leading the debate. I want to touch on the importance of the co-operative sector in Scotland, particularly in community energy, and the key role co-operatives will have in ensuring that we meet our net zero targets. I am keen to speak about that later.

First, I should declare my membership of Glasgow Credit Union, which is the largest and most successful credit union in the UK, with over 50,000 members. It was formed in 1989 by workers at what was then Glasgow District Council, and it has moved on and flourished from there. I thank the Greater Govan Credit Union, Pollok Credit Union, Vale of Leven Credit Union and Penilee Credit Union for their work on behalf of Glasgow South West constituents. Joining a credit union was by far and away one of the best financial decisions that I have ever made, and I know that many constituents and many people across the UK feel the same way.

The Minister will know that I have championed the credit union sector cause. To help it grow, I hope that he will join me in pushing the Prudential Regulation Authority to consider changing the capital requirements for credit unions. Successful credit unions appear to be getting punished if their assets rise above £10 million. I know that the Minister has some sympathy with that point, and I look forward to some positive comments about the credit union sector.

Co-operatives and mutuals can help develop communities and the economy. Co-operatives are a form of business owned and run by members. In the UK, co-operatives operate under various governance models and legal forms, including workers co-operatives, multi-stakeholder co-operatives, community benefit societies, community interest companies. It is interesting that they have existed in the modern form since 1844, when cotton mill workers in Rochdale formed the Rochdale Society of Equitable Pioneers to buy goods at lower prices. That example lives on in Glasgow South West, with the creation of the Threehills community supermarket, which is now starting to operate. That has become a very successful model.

The Financial Conduct Authority, of course, holds a public register of major societies, and Co-operatives UK publishes a report each year about the scale of the sector; the 2021 report is quite interesting reading. It noted that there were 7,200 co-ops, employing 250,000 people, with a combined turnover of £39.7 billion, and ranging in size from large retailers, such as the Co-op, to credit unions, farmers’ associations, and, of course, community pubs—what a fantastic idea they are, too. Interestingly, the report argues that co-ops appear to be much more resilient to the challenges brought by covid-19 and, indeed, their coming out in support of their members was a factor in that achievement. Perhaps more interestingly, the report also notes more ambitions and optimism about the future from co-ops than among other small businesses.

In Scotland, Scottish Enterprise, through Co-operative Development Scotland, supports company growth through co-operative models, which can protect community services that bring benefits to the local economy. It helps businesses and community enterprises grow by offering advice and services, including free masterclasses and one-to-one support. A community co-operative is a democratic values-led business model, in which community members come together to buy and run an asset for the benefit of local residents. Typical assets in Scotland include wind turbines, hydro schemes, shops, and pubs, among other things.

The Scottish Government have made strong progress towards community energy, including through co-operatives. They recognise that local energy cannot be delivered in isolation; it must develop alongside, and within, a vibrant national energy network. Both are crucial to ensuring that we transition to a net zero future by 2045 in a way that delivers secure, affordable and clean energy for ususb all.

The Scottish Government established their flagship community and renewable energy scheme—or CARES—with the aim of supporting and growing community and local energy projects throughout Scotland, as well as aiming for a considerable increase in the number of shared-ownership energy installations across the country. The scheme is open to a host of different groups and organisations, including bencoms and co-operatives, community groups, faith groups, housing associations, local authorities, national and regional non-profit organisations and rural small businesses.

The Scottish Government had a target for 500 MW of community and locally-owned energy by 2020, which was exceeded, so they increased it to 1 GW by 2020 and 2 GW by 2030. Progress towards that target has been positive, but changes in UK Government subsidies—for example, the closure of the feed-in tariff scheme—have undermined that progress. However, we continue to encourage shared ownership models as a means of increasing community-led involvement in commercial projects.

We are committed to helping island communities—a point was also made by the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) about rural and island communities—and we must ensure that they also become carbon neutral. Supporting those carbon neutral islands should be in the vanguard of reaching the net zero emissions targets by 2045.

As we move towards recovery from the pandemic, greater focus and priority must be given to decarbonisation as a driver for community-led action. New opportunities for communities will arise in the shift towards more localised energy solutions, giving more influence and choice and, in doing so, improving the quality of life for those living here.

--- Later in debate ---

[John Glen]

Absolutely. I sincerely look forward to that and we will engage with the substance of the information.

In my role as Economic Secretary, I would like to focus on the role of mutuals as providers of financial services, because they can play a significant role there. I see these organisations as key to providing people with greater financial stability and therefore greater choice. Indeed, I believe this is levelling up in action.

Credit unions are at the core of this. A few weeks ago, I visited the Glasgow Credit Union that the hon. Member for Glasgow South West (Chris Stephens) mentioned, and a few years ago I visited 1st Class Credit Union in Glasgow. They are two of the largest and most successful credit unions of the 402 that exist across the United Kingdom. The Glasgow Credit Union even offers mortgages, consequential of the deep relationships and bonds it has with its members and its understanding of their financial position. That demonstrates the potential that well-organised, well-supported credit unions can provide in communities.

The hon. Member for Strangford (Jim Shannon) listed the 13 credit unions in his constituency and talked about the distinct tradition that exists in Northern Ireland with respect to credit unions, across multiple sectors. Credit union and co-operative legislation is devolved in Northern Ireland, but I continue to listen carefully to what the hon. Gentleman has to say on this matter.

Affordable finance is key to generating opportunity, wealth and liberty for people around the country.

[Chris Stephens]

The hon. Member for Strangford (Jim Shannon) and I both raised the point about the Prudential Regulation Authority, the work it does and the capital requirements it places on credit unions. Does the Minister have anything to say about that? Can he encourage the PRA to make some changes to help successful credit unions?

[John Glen]

I am extremely grateful for the prompt; one of my kind officials passed me a note on this matter and reminded me that there has been progress in this area. We saw some changes in the way that was delivered last year. In 2020, the PRA implemented a simplified capital regime for credit unions to remove barriers to growth. This created a graduated rate approach, removing the 2% capital buffer and the link between capital requirements, activities and memberships. These changes were broadly welcomed by the sector, but I have committed to continuing to work with the sector further. I hope I will be allowed to introduce legislation next year to address some outstanding concerns that exist within the sector as a whole. I am grateful for the prompt and to the hon. Member for Glasgow South West for raising that matter.

As I said, affordable finance is key to generating opportunity, wealth and liberty for people around the country. We provided £3.8 million to fund the pilot for the no-interest loans scheme, which I have championed over a number of years. The scheme is run by Fair4All Finance, which encourages credit unions and other non-profit lenders to offer these loans. I believe that when this gets through the “proof of concept” phase imminently, it stands to be able to expand significantly. A number of individuals have approached me wanting to support this work, and I look forward to campaigning to broaden that pool on a sound foundation of how it would operate.

We have introduced other changes to help credit unions to generate greater opportunity and wealth for communities. For instance, we introduced and ran a pilot prize-linked savings scheme for credit unions until March this year, which was a real success. Independent research found that it helped to increase positive awareness of credit unions, enabled individual savers to build financial resilience and demonstrated that prize-linked savings be an effective tool in encouraging people to build a nest egg. We have 13 credit unions around the country and the Association of British Credit Unions Ltd currently involved in continuing the scheme, and I hope more will join them in future.

We have also released £96 million of dormant asset funds to Fair4All Finance, to support access to affordable credit products, including those from credit unions. Last Monday, on Second Reading of the Dormant Assets Bill, we introduced the extension of the pool of moneys that will be available from an extended range of financial instruments—£880 million over the next 10 years—which will be for Fair4All Finance to allocate. We will bring forward legislation when parliamentary time allows. That phrase is used a lot, but I am working hard to generate that opportunity in the next Session. It would allow credit unions to offer a wide range of products and services.

I want to spend a moment on building societies, because they are key to unlocking opportunity and driving positive change across the country. For example, in mortgages, Yorkshire and Skipton building societies are among the first institutions to bring back a 95% loan, when there was a problem in the spring, and 95% loan to value mortgages after the lockdown. That obviously brings first-time buyers on to the housing ladder. In addition, the sector is pioneering new products that will decarbonise the UK housing stock. For instance, Nationwide offers a green additional borrowing mortgage, and the Leeds building society has launched two new mortgages for the most energy-efficient homes.

To help building societies continue to flourish, we want to ensure they benefit from an appropriate legislative framework. That is why last week we published a consultation proposing several changes to the Building Societies Act 1986, working with their representatives, to try to provide them with greater flexibility in their funding model, and maintain their key mutual status, which is so important. The consultation also includes proposals to update their corporate framework in line with companies.

Civil Service Pay

Chris Stephens Excerpts

Monday 29th November 2021 Commons Chamber

[Chris Stephens (Glasgow South West) (SNP)]

In raising this important issue, I refer the House to my entry in the Register of Members’ Financial Interests, and to my position as chair of the PCS parliamentary group.

May I begin by saying a few words about a personal matter? Today would have been my grandfather’s 99th birthday. My grandfather was a keen supporter of the Scottish National party, and, indeed, voted for it every time it featured on the ballot paper. He was a great influence on me, in ensuring that politics was discussed and debated. I want to pay tribute to my grandpa, and to thank him for everything he did for me. I hope that he is proud of me. He was of course a public sector worker too, and I am sure he would approve of the fact that I am raising the issue of public sector pay this evening.

The covid-19 pandemic has presented the United Kingdom with its biggest national crisis in decades. Workers in the civil service and its related areas have risen to the challenge, and have rightly been lauded as heroes by the Government. Plaudits, however, are not enough. Those workers have faced over a decade of pay freezes and pay caps which have seen their living standards fall by about 20% in real terms.

I am sure we will hear the Minister say that austerity is necessary in order to manage public finances, so let me start by putting that myth to bed. Austerity has done enormous harm to the public finances through the strangulation of living standards, investment and economic growth. It is a policy widely recognised by every reputable economist as a complete and utter failure, and workers in the civil service have been hit particularly hard by that failure. A study by Dr Mark Williams of the University of Surrey in 2018 found that average annual growth in median pay in the civil service had been up to 1.9% below inflation since 2010; that the erosion of pay in the civil service had been greater than in the rest of the public sector and that it had fallen up to 11.4% behind the rest of the public sector since 2010; and that women had been particularly hard hit, with the gender pay gap standing at 12%.

Let us not attempt to explain this away with false comparisons with workers in other sectors, or with references to the national finances and the economy. In my view, Ministers constantly change their position on this issue when it suits them. If borrowing is up, they say that they cannot afford pay rises, and if inflation is going up, they say the same. Despite the squeeze on living standards, private sector wages are going up, but they simply ignore that comparator. The Government need to stop doing this, and start taking responsibility for the welfare of the staff.

I happen to believe that the Government’s approach has been a disaster, particularly for workers on low pay. They cannot claim to want a high-wage civil service while Departments scramble around on an annual basis to find the funding to raise pay levels to the minimum wage. During the pandemic, they laud civil servants as heroes, but their pay policy makes them paupers. There is little doubt that civil servants have become the poor relations when it comes to pay in the public sector, and it is frankly disgraceful that the Government should treat their own workforce in this manner.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Gentleman on bringing forward this debate. He has a substantial amount of time in which to put forward his case. Does he agree that middle-income families who receive no help from the Government in any shape or form need to have a pay rise to help with the substantial cost of living? Does he also agree that Ministers must be mindful, when rightly uplifting pay levels, that they should increase the cap for child benefit at the same time? If there is one thing they could do to help the middle-class, it would be to increase the cap for child benefit.

[Chris Stephens]

I thank the hon. Gentleman for his intervention. He will know the importance of the role that the civil service has played in Northern Ireland in developing the peace process and helping the Northern Ireland economy. I am sure that, like me, he will pay tribute to civil servants in Northern Ireland for that. I agree with his point, and he will hear later some examples of what the pay freeze has meant for civil servants and the real pressures that they are under. I hope he will intervene again when we come to that.

To add insult to injury, in November 2020 the Chancellor of the Exchequer announced a pay freeze for those workers for 2021. In my view, that was totally unacceptable, and it is high time that the Government properly recognised the contribution that their workforce make to society, particularly in an atmosphere of rising inflation and falling living standards. It was therefore welcome to hear the Chancellor’s recent autumn Budget announcement on the lifting of the pause on public sector pay. That announcement was accompanied by a statement that the normal process of independent reviews and recommendations would be resumed.

However, as the Chancellor should know—I am sure the Minister does—the civil service does not have a pay review body. The question therefore arises as to what mechanisms will be used to determine civil service pay, and I am now going to ask the Minister my first question. Assuming that the Chancellor is sincere about the pause being lifted, can he confirm that there will be no fetters on pay bargaining in the civil service this year, and that there will be no arbitrary cap on pay awards contained within any civil service pay remit guidance?

That brings me to the importance of pay coherence and coherent pay policy. Ever since the financial crash in 2008, and more recently during the pandemic, the Government have insisted that we are all in it together and we must be united in our efforts to overcome the difficulties we face. However, they continue to foster a divisive approach to pay arrangements for their own workforce through the delegated pay system. This needs to change if the Government’s words are not to ring hollow.

Against that backdrop, I highlight PCS’s long-standing objective of securing a return to national bargaining on pay and terms and conditions covering all workers in the civil service and related areas. The delegated bargaining system has created a wholly unacceptable situation where workers doing broadly the same job at broadly the same grade suffer huge disparities in pay. Similar inequities exist in relation to annual leave and working hours arrangements. The delegated system is also unnecessarily costly, time-consuming and inefficient as a result of the replication of the same process across every bargaining unit, where one set of negotiations would suffice.

On this issue, again, the Government always change their position. They claim they cannot direct Departments that have delegated authority on pay, yet they persist in centrally mandating things that Departments must do. For example, they instructed all Departments last year to pay £250 to staff earning below £24,000 a year. It is therefore demonstrably the case that the Government are the single source from which all civil service pay arrangements emanate.

Another example is that, under freedom of information, we know the departmental permanent secretaries got together in February 2018 to agree the joint position across all Departments that there would be a pay rise of 1% to 1.5% for public sector workers. I find it extraordinary that there are 200 separate pay negotiations across UK Government Departments but one pay policy.

In recent years PCS has entered a number of pay reform agreements within Departments that have put right some of the structural discrimination and inequities that exist. In the Home Office, the Department for Transport, Her Majesty’s Revenue and Customs and the Ministry of Justice, agreements have been reached on pay reform that have secured good negotiated outcomes for all concerned. PCS will rightly be continuing to press for an expansion of this approach, and it should be encouraged by the Government.

Last year, alongside its national pay claim to the then Chancellor of the Duchy of Lancaster, PCS submitted single sectoral pay claims to chief operating officers of parent Departments at delegated level. As a step change towards national bargaining, PCS indicated that it stood ready to engage and to start discussions on how sectoral claims may bring a greater degree of coherence to current pay arrangements.

These proposals sought to reduce the number of bargaining units at sectoral level from 55 to just 13, with scope for further rationalisation over time. Indeed, PCS indicated it was prepared to discuss business cases in respect of workforce reform that may enable funding to be provided to address the structural inequities. Astoundingly, given the Government’s rhetoric on their commitment to efficiency in the public sector, there has been almost no progress on that concrete proposal that would deliver the efficiency they claim to desire.

PCS rightly intends to repeat this approach in 2022, and I seek an assurance that the Government will grasp the opportunity to improve efficiency in pay bargaining across the civil service. Will the Minister confirm that he agrees with the former Chancellor of the Duchy of Lancaster, now the Secretary of State for Levelling Up, Housing and Communities, when he told the Select Committee on Public Administration and Constitutional Affairs on Thursday 10 December 2020 that

“trying to tackle some of the balkanisation of the process of pay, reward, recruitment and so on—creating what has been called in a vogue phrase “one civil service”—is a very good thing”?

Will the Minister also confirm that he will turn those words into action by engaging in a proper way with the civil service trade unions to achieve greater coherence on pay across the civil service, including a full exploration in all delegated areas of the business case processes for pay reform? In addition, will the Cabinet Office proactively assist delegated areas in developing successful business cases? Will steps be taken to involve the trade unions properly in the task and finish group on pay delegation and related matters, which has been established in Whitehall, but about which the unions have so far neither been informed, nor consulted?

That brings me to the impact of the civil service pay policy. At Prime Minister’s questions on Wednesday 17 November, the Prime Minister said:

“I think that actually the Department for Work and Pensions, under the Secretary of State for Work and Pensions, my right hon. Friend the Member for Suffolk Coastal (Dr Coffey), has performed outstanding service. It has performed miracles. Among the things that it has achieved is helping to get millions of people effectively back into employment, in spite of all the difficulties that we have faced. We now have unemployment running at virtually record lows, in spite of all the difficulties we have faced in this pandemic and as we come out of furlough. That is largely thanks to the work of the DWP.”—[Official Report, 17 November 2021; Vol. 703, c. 579.]

In response to those words of praise, the PCS trade union received more than 50 emails from individual DWP workers about the toll that more than a decade of real-terms pay cuts have taken on them. Some commented that they felt embarrassed to be a government worker, and that they have had to ask friends and family for handouts, and have even turned to food banks. Many are seriously considering leaving the DWP, not because they do not like the job, but because they cannot afford to stay. The following are just some examples of comments received by these government workers for whom the Prime Minister had such high praise. These describe in devastating terms the impact that continued pay restraint is having on civil servants and their families, and what a real pay increase would mean for them.

[Jim Shannon]

One issue I recognise in my constituency, from my weekly or even daily dealings with some workers, is that workers in the DWP do an extremely stressful job. They are looking after the financial affairs of others, and are trying to guide people through the system and help them. Does the hon. Gentleman agree that the hard work they do in the DWP must be reflected in the wages they receive?

[Chris Stephens]

Yes, I agree with the hon. Gentleman on that. I am sure he will be fully supportive of, and will recognise, some of the statements from DWP workers who responded to the Prime Minister’s words earlier this month. As one DWP worker put it,

“I have been coming into the office during the whole of the pandemic and I am now totally disheartened and angry that DWP put so little value on the work that the staff do. Now there is a great improvement in the jobs market staff are leaving all over the place... The powers that be have to do the right thing and award us a decent wage rise otherwise there will be very little experienced staff left.

I never thought when I took up this position that I would ever have to send an e-mail like this one letting people know how hard it is to make ends meet in 2021.”

Another said:

“I have worked for DWP for nearly 17 years, those years of which I felt proud to work for my government. Now I feel embarrassed. I work hard, as I always have. I have two children to bring up and can honestly say I’m on the breadline. My family suffer financially, with the rise in cost of fuel bills, food...everything has gone up but our pay....absolutely disgusting. Our government doesn’t look after its own workers but expect us to be loyal and perform an outstanding job...which we always do.”

Another DWP worker, a single parent of two, said:

“My son works as an apprenticeship who receives more wages than me. I have considered using the food bank but not keen in letting them know where I work as ashamed my employers can’t seem to look after their own staff. I have used a food hub before as no details were given. When I receive my wages at the end of the month there is nothing left by the 1st of every month. I am unable to save so no holidays. I am unable to save for Christmas so everything goes on credit card which I ran up nearly £2,000 of debt.

I have worked for your company since 2008 and have never felt the struggle that I do now. Food prices have rocketed and gas and electric have also gone up, how do you expect families working for a government organisation to cope when you don’t give them the wages to reflect the price rises now. I am ashamed to be working for the DWP.”

A DWP worker for almost 20 years said:

“Having a pay freeze has meant that I have to choose between having my heating on or feeding my family. Yes these struggles are real even for the Hard Working Civil Servant!...As a mum I have concerns for my children’s wellbeing when I have to tell them that they cannot go to the after school clubs or go out with their friends because I can’t afford it. They are suffering mentally taking on my worries as well when I tell them that I can’t get them a birthday or Christmas present that they deserve. I have had to take on a 2nd job in the evenings so that I can afford these for my children leaving me less time to be with them. A Civil Servant should not HAVE to work two jobs to pay bills and live…Having a pay rise would alleviate a lot of my worries. It won’t make me rich but my family would be able to live without the worry of deciding to put the heating on, have a substantial healthy meal or afford to put clothes on our backs. We shouldn’t be made to beg for help from various charities.”

A Department for Work and Pensions administrative officer said:

“I’m not quite at the stage of having to choose between heating and eating but I fear that I may be in that position in the near future. Add to that the state of our pensions and I fear that I may never be able to retire. I really don’t know how I am supposed to save towards my retirement on what I am paid…Boris Johnson said a little while ago that employers must pay better wages so when is he going to follow his own advice and pay us a wage that we can actually live on and save for our future?”

Another DWP worker said:

“Personally I am struggling on my pay to make ends meet and really dreading the next Gas/Electric bill. My water rates have also gone up and food prices are just getting ridiculous even though I shop as cheaply as I can using certain low-price supermarkets. I am single and my son lives with me just so I can afford my rent and even that is a struggle…It would be really helpful to receive a decent pay rise given that inflation is certainly rising and before long I will not be able to meet my cost of living. Staff in DWP deserve to be recognised properly for all our hard work during 2020 making sure the people of our nation who urgently needed help with money received it. All staff worked tirelessly to ensure the nation’s needs were met so not are we only helping them back into employment we were there when they weren’t and needed us the most.”

Another administrative officer, who works in the Child Maintenance Service, said:

“I cannot name any colleague who is not feeling that we have been demoralised by the government’s total insensitive behaviour following the Government announcement of a Public Sector pay freeze in November 2020. Did not every DWP employee rise to the challenge during covid ensuring payments for children still were upheld and our colleagues in the benefit office maintaining benefit payments to the people whose lives were thrown into turmoil?...At 61 years of age I am now financially worse off than I have ever been. This morning my gas and electric supplier…sent me a letter stating last year my annual bill for gas and electric was £900.00 and they are increasing my direct debit now because with the rise in energy prices they are estimating it to be £1900.00 this year. Please tell me, ministers who voted for the pay freeze for your loyal civil servant of over 20 years, how am I going to pay this bill?”

[Jim Shannon]

The hon. Gentleman referred to the Child Maintenance Service, with which my staff and I have regular contact. One problem that we have when we take child maintenance complaints through the system is changes of staff. Why are there changes of staff? Because the remuneration that the civil servants in that department need is not there. Does the hon. Gentleman feel, like me, that a civil servant wage is necessary for staff in that department we are to retain staff and have continuity of staff in respect of complaints—in other words, if we are to ensure that when people make contact, they can speak to the same person they spoke to the first time?

[Chris Stephens]

I could not have put that better myself. The hon. Gentleman, representing his constituents in Northern Ireland, will certainly be aware of the importance of Child Maintenance Service payments, and of payments for those who are not in work and who rely on universal credit. He is right that civil servants have performed miracles, given the huge numbers of people who were on universal credit during the pandemic, and I know he agrees that they should be properly remunerated and given a decent wage rise for their wonderful efforts.

A civil servant of 39 years has said:

“I currently work for the DWP. The Prime Minister and other politicians always give us credit for the work that we do and for how we have coped through the pandemic, delivering our services. We have been called miracle workers. It would be great to see that reflected in a decent pay rise. I am lucky if I get an extra £5 a month every year when we get our pay rise. With the costs of electricity, gas, food, and travel all going up, my family are really struggling to make ends meet.”

A civil servant of 42 years told me:

“I have been in the civil service for 42 years and have never found it so difficult to manage financially. I am still working from home and have to sit in a room with thick clothes and one small electric heater as I cannot afford the heating bills. I am disabled and I cannot see the future at all. After giving my whole working life to the service of others, making a difference to our DWP claimants’ lives, I would appreciate a wage that enables me to keep up with rising living costs. My wage has reduced in real terms for decades now, and with rising costs it will reduce again. I’m 62 with many health conditions and cannot consider taking a second job. I feel really abused and forgotten by my employer who I have shown only loyalty and commitment particularly during the pandemic.”

Another DWP worker has said:

“I have always been proud to work for the Department of Work and Pensions and consider it to be a great place to work. Family and friends expect it to be a well-paid job as we are ‘working for the Government’, so I always feel disloyal when asking to borrow money or not being able to afford a day out or having to buy small presents for birthdays and Christmas. I want my children to know that you reap what you sow, and that if you work hard you see the rewards. Sadly, at this time, I do not feel that this is the case for me.”

A DWP worker who was forced back into the workplace has said:

“With increasing fuel and food prices, I am finding it incredibly hard to survive financially. I am widowed, I live alone and am unable to make ends meet. Furthermore, I have to find £200 a month to travel to work, as face-to-face appointments are now being forced and we are no longer allowed to work from home. It would appear I have to resource my own ‘miracles every month’, whilst being in a very demanding role. Moreover, my health and wellbeing are currently suffering. I am by no means alone, and have many colleagues in the same position.”

A full-time work coach, a mother, has said:

“I am relying on my child benefit to cover electricity and gas for my family next week, until I receive my next pay in almost two weeks’ time. This is due to rocketing energy prices, rocketing fuel costs and childcare costs that I need to cover. My wages are simply not enough to cover all of these costs and I am left struggling every month. I have been with the Department since 2006 and have never known it to be this bad.”

Another employee in the Child Maintenance Service has said:

“My wage has dropped to just above the minimum wage and my workload complexity has increased. I’m worried sick about the basics: affording heating; paying travelling-to-work costs; and trying to pay the overdraft. In the meantime, as a frontline worker, I have to stay positive and professional whilst dealing with the emotional and financial issues of the public. I don’t treat the public with platitudes the way that I am by successive Governments.”

As the hon. Member for Strangford made clear, it is an emotional job. These staff have to deal with many of the public’s emotional and financial issues. That, to me, says it all when it comes to the question of why a pay rise is necessary.

An administrative officer in DWP has told me:

“I joined DWP last year during the first wave of the covid-19 pandemic and received a salary of £21,262. My monthly salary is £1,442.65. My monthly expenses including rent and bills is £1,265, leaving me with less than £180 to cover my work travel and food expenses.”

Another child maintenance officer—for over 23 years—said:

“I am stuck on an income that doesn’t even cover my bills which are rising every year. Is anyone going to help the staff who have been loyal to the Child Maintenance Service for years? I actually love my job, but am so disappointed with the pay. We deserve more.”

A civil servant who joined DWP in 2016, who said that they were paid significantly higher in their previous Department, has said:

“I am stuck on an income that doesn’t even cover my bills which are rising every year. Is anyone going to help the staff who have been loyal…for years? I…love my job but am so disappointed with the pay, we deserve more.”

A DWP worker who is nearing retirement age says:

“I am retiring in May 2022 so the pay freeze has seriously affected my pension. I will be on a lower pension for ever and ever and there’s no compensation. I really have lost out as have a lot of my colleagues in the same situation.”

Another DWP worker says:

“I am struggling to keep a roof over my head, feed and clothe my daughter and have not bought clothes/shoes for myself in over a year. Without support of family would honestly be in real state. My 75 year old father supports me from his pension which is not great either.”

A work coach says:

“As a Work Coach we have put ourselves and our loved ones at risk throughout the entire pandemic by interacting with many customers to ensuring they received the upmost support…Myself and my colleagues have helped countless people transition from the national lockdown and from losing their jobs into finding new light in a brand new sector of work. The DWP have worked long hours to ensure our customers are getting the support they need. We ourselves sacrificed time with our loved ones to ensure our Nation got back to its once thriving self and all we have received was a thank you and a pat on the back! Actions speak louder than words and never more so in our current climate…Needless to say the world around us is increasing in price dramatically. A pay rise would reflect the rise in living costs and allow us to keep up with the rapidly increasing inflation.”

Those are just some examples from one Government Department, but civil and public servants are experiencing the same difficulties right across Government services. Employers are experiencing recruitment and retention problems because of this, and staff continue to face very real hardship. There is also a clear economic case to end pay restraints and give a real-terms increase to civil servants. The benefits of a real-terms increase would outweigh the costs. Before the pandemic, about 70p in every £1 of public money ended up in the private sector economy, whether in grants, contracts or, crucially, the wages of public sector workers. The pandemic can only have increased that 70p figure.

In my experience, workers and civil servants do not have Cayman Islands accounts to put their wages in, and neither do they place their wages in a shoe box and hide it under their beds. No, they spend their money in the private sector economy—in the high street and the hospitality sector, buying additional presents for their family or spending more putting their clothes in for dry cleaning. Not only do they keep the economic wheels of the country going in their work; they do so with their hard-earned wages.

The realities of the examples provided by those who work in the civil service, the compelling moral case and the undeniable economic case can only begin to be rectified by funding for real-terms pay increases across the civil service and related areas for this coming year. I therefore look forward to hearing the Minister’s response.

[The Paymaster General (Michael Ellis)]

I thank the hon. Member for Glasgow South West (Chris Stephens) for securing this important debate, and welcome the opportunity to respond. I know that, in his role as chair of the PCS parliamentary group—a position that I think he still holds—he shares my interest in matters relating to the civil service.

At the beginning of his remarks, the hon. Gentleman paid tribute to his grandfather. Although, of course, I did not have the privilege of knowing his grandfather, may I say that I am sure that his grandfather would be proud of him, not only for the speech that he has just given to the House, but for his service to his constituents as a Member of Parliament?

Across the House we all know that civil servants are committed to delivering vital services to the general public. That is what they do; it is the essence of who they are. Ministers are enormously proud—I include myself in this category—of the dedication and professional commitment that civil servants across the board and of all grades demonstrate in delivering public services and the Government’s priorities, particularly during what we know has been a very challenging time. Civil servants of all grades have played a vital role during the pandemic to maintain public services, and will have performed functions that will have saved lives.

Civil service pay is determined by separate processes for delegated grades—typically grade 6 and below—and the senior civil service, which is calculated separately. For delegated grades, the Cabinet Office publishes the pay remit guidance on an annual basis. The pay remit guidance is a cost-control document setting out the parameters of average awards in a pay remit year for Departments. For the senior civil service, it is different. The Senior Salaries Review Body makes independent recommendations to the Government based on evidence provided by the Government, with recognised trade union data and labour market data added into the equation.

In 2011, some 10 years ago now, the Government took a tough but fiscally responsible decision to implement a two-year pay freeze. That was followed by a 1% pay award between 2013 and 2017, applied across all workforces in the public sector, as many of us will recall. There is no doubt that these were difficult decisions but they were fiscally responsible ones that we had to take in response to the then economic position—a position, I need to say, that we had inherited from the previous Labour Government. Those responsible decisions ensured that the Government rewarded hard-working civil servants, which is as it should be, while enabling the UK to tackle the huge deficit that had grown. The sustainable pay structures that we put in place at that time supported many civil servants and prevented us, as a society, from burdening our children and grandchildren with even more debt that accrues. In the years post 2017—from 2018 to 2021—the 1% pay cap was lifted and the civil service received pay rises of up to 2.5%, which was actually higher than inflation at the time.

In the face of huge uncertainty and the unprecedented impact that the covid-19 coronavirus pandemic had on the economy, the Government temporarily paused pay rises for the majority of public sector workers in 2021-22. We ensured that those who most needed it had the protection that they needed, with 2.1 million public sector workers with median earnings at or under £24,000—therefore many of the individuals whose accounts the hon. Gentleman relayed to the House—receiving an increase of at least £250, equivalent to over 1%.

In his most recent spending review, my right hon. Friend the Chancellor of the Exchequer announced the end of the temporary pay pause in the public sector, including the civil service, starting from the 2022-23 fiscal year and throughout the duration of the spending review period, right the way through to 2024-25. During this forthcoming period, these increases will retain broad parity with the private sector while continuing to be affordable. It is thanks to the strong recovery in the economy and in the labour market that Her Majesty’s Government have been allowed to return to a normal pay-setting process. My right hon. Friend the Chancellor of the Exchequer also announced the increase to the national living wage of 6.6% to £9.50 an hour from April 2022 for those aged 23 and over, which will benefit more than 2 million of the lowest paid workers in the country. That will keep us on track for our target of the national living wage rate being two thirds of median earnings by 2024.

The public sector has on average better remuneration packages when compared with the private sector. That is not a well-known or acknowledged fact, but it is true. In 2019, the Office for National Statistics reported that the public sector benefits from a 7% on total remuneration compared with the private sector. In 2020, the median salary in the public sector was £1,770 higher than the private sector. That gap is most acute at the lower grades, where the public sector average hourly wage is 20% higher than the private sector.

[Chris Stephens]

I thank the Minister for his personal remarks, which are very much appreciated.

The Minister talks about public sector pay, but does he acknowledge the study from Dr Williams from the University of Surrey, which suggests that civil service pay is lower than the rest of the public sector? Can the Minister tell us what he and his departmental colleagues will do to rectify that situation?

[Michael Ellis]

I look forward to reading that report, and I will certainly have a look at it, but there is no getting away from the fact that when one looks at the last fiscal year, the public sector was being paid on average £1,770 higher than the private sector. That is particularly noticeable at the lower pay grades, where we find that public sector pay is 20% higher than private sector pay. I am happy to look at the figures he wishes to bring to our attention, and I will do that, but the premium I refer to also reflects the generosity of civil service pensions when compared with the private sector. Most members are in what are called defined-benefit schemes, where employers contribute around 27% of earnings. In contrast, most private sector employees receive defined-contribution pensions, which are dependent on investment performance and where employer contributions are typically around 50% of those in the public sector.

Following the outcome of the spending review, the Cabinet Office—my Department—is assessing what the affordability position will be for Departments to make pay awards going forward. The 2022-23 pay remit guidance is due to be published in spring next year, just a few months from now.

The hon. Gentleman made a powerful speech, with some moving contributions from people who had written to him and to others. I am confident that when we announce the 2022-23 civil service pay remit guidance, we will continue to strike the all-important balance between appropriate reward for hard-working civil servants and the need to live within our means as a nation and recover, as we need to do, from the economic impact of the pandemic.

[Chris Stephens]

I am grateful again to the Minister, who has been typically generous. When the Cabinet Office looks at the remit guidance, will it consider the nonsensical position of having all these different negotiations—something like 200 of them—taking place across Departments and reduce them while ensuring that pay across the civil service is equitable for the work done?

[Michael Ellis]

The hon. Gentleman makes an attractive argument for a reduction in the number of discussions. The rationalisation of those issues is always worth looking at, and I will ask my officials to look at that aspect.

I remain confident that when the Government announce the 2022-23 fiscal year civil service pay remit guidance, the focus will be on striking the balance expected of us by the general public between appropriate rewards for those hard-working individuals in the civil service—as one of Her Majesty’s Ministers, I know how hard civil servants work and I recognise the work that they do—and the need for all of us, in a fiscally responsible society, to live within our means. The Government have fiscal responsibility for that. We will strike that balance and together we will recover from the painful economic impact of the covid-19 pandemic.

Question put and agreed to.

Better Jobs and a Fair Deal at Work

Chris Stephens Excerpts

Wednesday 12th May 2021 Commons Chamber

[Chris Stephens (Glasgow South West) (SNP) [V]]

It is a pleasure to follow my colleague on the Work and Pensions Committee, the hon. Member for Runnymede and Weybridge (Dr Spencer). I want to start by congratulating Humza Yousaf and Nicola Sturgeon on their emphatic victories in their re-election to Scotland’s Parliament last Thursday. They are both back with increased majorities, and I look forward to working with them to ensure that we deliver the best service we can to my Glasgow South West constituents. I also look forward to the Government’s other measures when the crisis is over, including granting a section 30 order so that Scotland can decide its own future.

As well as the great domestic issues that we are dealing with, there are a number of worrying international developments. I want to express my solidarity with the people of Gaza, as well as with the Kurds in Turkey, where a quite disgraceful situation is happening. There are also worrying trends in Colombia, and the Colombian Government must immediately end all violence targeted against protesters. I look forward to the Government telling us that the protection of human rights will be that at heart of their international response.

The last two Queen’s Speeches, in 2017 and 2019, committed to legislation in response to the Taylor review and the good work plan. The pandemic has exposed even further the issues and inequalities in the world of work. The lack of an employment Bill has, according to the TUC, rowed back on the Government’s promise to boost workers’ rights. It is three and a half years since the Government responded to a joint inquiry by the Department for Work and Pensions Committee and the Business, Energy and Industrial Strategy Committee by promising a response to the Taylor review. Workers urgently require legislation to ensure that they have the right to a written contract. They should also have the right to a fixed-hours contract, ending the practice of zero hours, and the right to know in good time and with adequate notice their hours of work for the days and weeks ahead.

What this pandemic has exposed is the high number of workers without access to statutory sick pay. Workers should never again have to choose between going to work and possibly passing on sickness to colleagues, and going without finance and being unable to pay their bills. An employment Bill is urgently required to address the status of “worker” or “employee”, and to define what self-employment is and who the self-employed are. As the Taylor review says, the meaning of the term “worker” is ambiguous and the legal definition is excessively vague. I join colleagues from across the political parties and trade unions such as GMB and Unite in seeking to end fire and rehire. Never again should workers have to face that exploitative practice. The Government need to put an employment Bill before the House, or allow others to do so and provide time for it, in order to ensure dignity and fairness at work. If they fail to do so, many of us will demand the time and will be putting our names in for ballots to ensure that we get this Bill through.

Financial Reward for Government Workers and Key Workers

Chris Stephens Excerpts

Monday 14th December 2020 Westminster Hall

[Chris Stephens (Glasgow South West) (SNP)]

It is a pleasure to see you in the Chair, Mr Stringer.

The House of Commons Library tells me that the Glasgow South West constituency has the highest percentage of workers in public sector employment, so it is only fitting that I contribute to the debate. I refer colleagues to the Register of Members’ Financial Interests. I chair the Public and Commercial Services Union parliamentary group, I worked 25 years before arriving in this place in the public sector, and I am a proud trade unionist of 20 years’ trade union activity. I would safely argue that the best political education and lifelong learning that one can achieve is through being a trade union activist.

I thank the hon. Member for Gower (Tonia Antoniazzi) for leading the debate. I use the word “debate” advisedly because no one has justified the Government’s position. The history that others have referred to is important. In 2010, there was a two-year pay freeze and then there was a six-year pay cap of 1%. Other Departments maintained that pay cap.

Public sector workers and civil servants have, during the last nine months, performed heroics, and the general public seem to think so too, with more than 100,000 people signing the petitions. The point has been made that the devolved Administrations have provided pay for NHS staff—£500, as a thank-you payment—and frankly we have seen a disgraceful response from the Treasury, which wishes to take tax and national insurance off that payment. I really hope that the Treasury thinks again on that point.

I will confine most of my remarks to the civil service and what it has done over the past nine months, including administering millions of new universal credit claims for the Department for Work and Pensions and processing furlough payments in Her Majesty’s Revenue and Customs, all despite—this has to be emphasised—staff in a number of Departments not being provided with the proper equipment for homeworking during the crisis, including in the Department for Work and Pensions.

Colleagues made the point about the problems of low pay in HMRC. I emphasise again that the median salary in HMRC is the lowest across the civil service. Is that not ironic, given that a key role of HMRC is to chase all these rogues—the Googles, the Vodafones and all these other companies that have not been paying their tax for years—and try to collect that tax? Around one in five staff is paid the minimum wage or just above it, but there is also another issue. It is clear that pay delegation has also led to pay segregation by gender, and that the gender pay gap can only be reduced by increasing the pay of staff in the lowest-paid Departments and agencies.

It is really disappointing that not one Government Back Bencher is here to justify these policies; people watching will wonder why the Government have thrown in the towel in the middle of the debate. However, I can tell hon. Members that PCS members have been sharing emails they have received from Government Back Benchers in reply to their request to not go ahead with this public sector pay freeze. I think the politest term I have heard is “short and sniffy responses”. It seems that the position of many Government Back Benchers is that public sector workers should be thankful for their job security. Tory MPs could perhaps tell that to the 2,000 workers in HMRC facing redundancy at the end of the year and knowing that vacancies within that Department are not being offered to them but are instead being farmed out to agency staff, and God knows the cost to the taxpayer of the more than 100,000 civil servants who have lost their jobs in the past decade due to Tory austerity. The Prime Minister responded to me, as emphasised by the hon. Member for Gower, that he was “lost in admiration” for the work of the civil service during the covid crisis. I can only suggest that a pay freeze is an extraordinary way of showing that.

A public sector pay freeze is both counterproductive and economically illiterate, and it gets to the whole debate on the role of the public sector itself. Research before the pandemic consistently showed that 70p in every pound of public money ends up in the private sector economy, whether via grants, contracts or, indeed, public sector workers’ wages. We really need to end the notion that public sector workers, when they get a pay increase, hide it in a shoe box under the mattress. That is not how it works, I can tell you. When people get more money in their pockets, they spend it, and they spend it in the private sector. If we are serious about helping the private sector and about ensuring that the economic wheels turn, it surely stands to reason that public sector workers, as thanks for all the work they have done over the past nine months, should get a proper pay rise.

I hope that the Minister will tell us what progress is being made in ending the 200-plus bargaining units across Whitehall Departments. I hope that the Government —this political party of small government and efficiency—will tell us how they will enact that particular policy. Workers in Westminster Departments are moving to the Departments of devolved Administrations. Why? Because the devolved Administrations pay better wages.

There can be no return to the austerity programme that flatlined the economy. A public sector pay rise could start the post-pandemic recovery. Investment is required in the civil service to reflect the changed circumstances in which we now find ourselves. I and my SNP colleagues support the demands of the petition because they are morally just and economically sound.

--- Later in debate ---

[The Exchequer Secretary to the Treasury (Kemi Badenoch)]

Thank you, Mr Stringer. It is a tradition on occasions such as this to congratulate the hon. Member for Gower (Tonia Antoniazzi) on securing a debate on the issue of the day. Today, however, we should also congratulate the thousands of people who secured the debate by taking the time to express their support for key workers. On hundreds of occasions, Government Ministers have, in public and in private, expressed their gratitude and respect for what our millions of key workers have done, and I would like to do so again.

I would also like to express my condolences to the hon. Member for Bootle (Peter Dowd) and his family on the death of his daughter. As a mother of three, I cannot even begin to imagine such as loss. We are divided by politics but united in our passion for public service, and I pay tribute both to him and to her for all her service.

We tend to think of key workers as nurses, teachers and police officers, whose efforts, as ever, have been invaluable. In the context of the pandemic, however, our understanding of who is key has rightly stretched far more widely, which is pertinent for the subject of the debate. Understanding who is key extends to local government, national Government, transport, utilities and communications. Importantly, many of the people on whom we have relied are in the public sector. The right hon. Member for Hayes and Harlington (John McDonnell) said they are the people who kept the country going, but it is not just the public sector. Food retail workers, train conductors, farmers and lorry drivers—every one of them is a crucial link in the chain and deserves our thanks.

The substance of today’s debate is asking why we choose restraint when it comes to the way in which some of those in the public sector are financially rewarded. Hon. Members will know the answer. Many, in fact, have referenced fiscal policy since 2010. They should all know—if not, I am happy to remind them—that it was the difficult decisions we made during that period that have enabled us to borrow to fund such a significant package of support. Members have repeatedly said today, “We should borrow.” We are borrowing. A year ago, who would have believed that we would have spent £43 billion on people to be furloughed, £13.7 billion on the self-employed, and over £280 billion in total, in the space of eight months, on an unexpected pandemic?

[Chris Stephens]

Will the Minister give way?

[Kemi Badenoch]

No, I am afraid I am not giving way.

I am also happy to remind hon. Members that almost exactly a year ago, after nine years of Conservatives in Government and the very same fiscal policies that hon. Members have criticised today, the public chose to renew their faith and trust in this Government—not just with an increased share of the vote, but with a much increased majority. Since 2010, they had heard these arguments about what we were doing on fiscal policy over and over again, from many colleagues on the Opposition Benches who are not in the House today. We all believe in fair pay, but we disagree on where it is sent. However, I remind hon. Members that the public also want fiscal responsibility.

Good government is about making the right choices. To paraphrase the Chancellor, our health emergency is not yet over, while our economic emergency has only just begun. At a time like this, it is the responsibility—in fact, the duty—of Government to prioritise and target support where it is most needed, in a way that is fair and sustainable, that protects jobs and businesses, and that limits long-term damage to the economy. The hon. Member for Gower referenced many previous responses the Government have given on this topic. She may not like the answer, but the facts have not changed, and I am happy to repeat them here. Fairness has been a guiding principle.

--- Later in debate ---

[Kemi Badenoch]

I will conclude by saying that this Government and all the people of this country are grateful for everything that our key workers in both the public and the private sector have done and continue to do, but in the choices we make, we must chart a way ahead that is fair and sustainable and that gives us the best chance of a strong economic recovery. That is the thinking behind what we have done and it will remain the thinking behind what we do in the challenging months and years ahead, as I believe it should.

[Chris Stephens]

On a point of order, Mr Stringer. If I heard the Minister correctly, it was suggested that there were to be no job losses in the public sector, yet a number of us in the debate mentioned that there were 2,000 redundancies in HMRC. Mr Stringer, can you tell me how the record can be corrected—or has the Minister just cancelled the redundancy notices of 2,000 workers in HMRC?

[Graham Stringer (in the Chair)]

That is not a point of order; it is a matter of fact and for debate.

Covid-19 Economic Support Package

Chris Stephens Excerpts

Wednesday 14th October 2020 Commons Chamber

[Chris Stephens (Glasgow South West) (SNP)]

The Chancellor told us in March that no one would be left behind, but that has now become: Government support is not a universal scheme.

I very much associate myself with Members who have spoken of the excluded: the newly self-employed, many of whom are on zero-hours contracts; freelancers; and artists, including comedians. You would think that the Government would have shown some solidarity with comedians, but, no, they have not. I make a serious point, which was made very well by the hon. Member for Newport West (Ruth Jones) about the creative arts. The creative arts sector is very important, particularly in bringing young people into work who do not want to go into a conventional office environment, factory environment or the rest. The creative arts has that place. It is important that the Government reflect on the support that they could give the creative arts, but also on the support that they are going to give, and should give, to those who have not received anything at all since March.

I very much agree with the criticisms of the job recovery scheme and what it means for individuals who are currently being paid the national minimum wage. Now that we are in this crisis, I ask the Government to look at poverty-proofing their policies. I hope that the Minister might want to say something about that. I have a very real concern that the lack of support they are giving will put more people into poverty.

That brings me quite nicely on to universal credit and making the temporary £20 uplift permanent. I am a member of the Work and Pensions Committee, which will be looking at this and we hope that it will be debated in the Chamber in future. I hope the Minister will reflect on this because we are in the middle of a global pandemic that has delivered a severe blow to people’s incomes and livelihoods right across these islands, and vulnerable households are taking a disproportionate economic hit. Far too many people are living under the constant threat of poverty and the coronavirus pandemic crisis is only exacerbating the financial challenges facing those families and the impacts on their health, particularly their mental health.

The findings are that 4 million families could see their support slashed if the Government refuse to make the £20 uplift to universal credit payments permanent. I hope that they will reflect on that. Making the £20 uplift permanent is the bare minimum that we would ask them to do to rebuild social security, with the findings showing that it would undo, at most, two thirds of the benefit cuts made since 2015, let alone those made during the time of the coalition. With mass unemployment on the horizon and other key support schemes being prematurely ended, it is critical that the Government heed the warnings from anti-poverty charities and strengthen that support by extending the £20 uplift. I hope that the Government will also look at sector support, particularly for aviation; I have many constituents employed in that sector.

It is ludicrous that there is not going to be a Budget. That impacts not just on the Scottish Government but on local government, which will have to be in the dark in trying to put its budgets together next year. That is a ludicrous position and I hope that the Government will reflect and think again.

Coronavirus Job Retention Scheme

Chris Stephens Excerpts

Thursday 17th September 2020 Commons Chamber

[Chris Stephens (Glasgow South West) (SNP)]

I believe I have eight minutes to speak, and I will do my best to keep to it. These are important debates, and I have some sympathy with your view, Mr Deputy Speaker, about seeing whether we can merge them.

I thank my hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) for leading the debate with a fantastic and robust speech. The key point she made was about the costs versus the savings of the job retention scheme, with the social cost of ending it too early being that millions of jobs will be affected, including in the aviation sector.

My hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East (Stuart C. McDonald) made the important point that we are in deep and dangerous waters, and we could extend the furlough scheme for eight months, rather than end it on an arbitrary date. I certainly support his view that tax offices should be kept open. He made the case well for Cumbernauld, and I have opposed HMRC office closures across the United Kingdom. Perhaps the Treasury could take a leaf out of the Department for Work and Pensions’ book. Two years ago, half the jobcentres in Glasgow were closed, and the Department for Work and Pensions is now having to reopen them as a result of the demand that it believes will be placed on them. It is also having to look at opening jobcentres in other areas where it closed them two years ago.

My hon. Friend the Member for North Ayrshire and Arran referred to the bewildering vote in Holyrood last night, but I have to say, it was not as bewildering as the statements we heard from a number of Conservative colleagues that the job retention scheme was somehow a key feature of Conservative economic theory. That was not the case in March, when such a scheme had not yet been put in place by the UK, and when Opposition parties were raising examples of schemes put in place by other countries to support workers. It was that pressure, I would suggest, from all Opposition parties and Opposition Members asking the Government to look at international examples and put in place a scheme to protect workers that was the reason for the job retention scheme.

The hon. Members for Edinburgh West (Christine Jardine) and for Ellesmere Port and Neston (Justin Madders) made an important point about local lockdowns. If, for reasons of public health, there must be a local lockdown in an area of the United Kingdom and the job retention scheme no longer exists, what support will be made available? Are we really suggesting that people and businesses should make a choice whether to follow the public health guidance or to challenge and ignore it because they are not getting support? That is a dangerous path to go down and a reason why we should consider extending the scheme. No one should have to make that choice. There were optimistic forecasts in March that this would be a three or four-month event, and then things would suddenly get back to normal, but that is not the case, and I think the optimistic forecasts about what happens next will also not take place.

I echo the remarks of the right hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts), who rightly said that people will have to make choices, and some of those choices are unacceptable if the job retention scheme is not extended. I also echo the remarks of the hon. Member for North East Fife (Wendy Chamberlain). The pressure on the constituency office teams of every Member since March has been considerable. Whether you have been a Member for decades or came in the door in December, we can all agree that this is the busiest that any constituency office team has been. Part of the reason is having to address inquiries from constituents about the nuts and bolts of the job retention scheme. For example, some people who were new starts in March were missing out, and we had to pressure the Government to make those sorts of changes.

As has been said, extending the furlough scheme by eight months would save 61,000 jobs. In August, in Scotland, 34.4% of staff in the accommodation and food services were still on furlough; in the arts, entertainment and recreation sector, it was 57.5%. These are key sectors of the economy and are viable jobs going forward. Sectors such as the arts, entertainment and recreation, for example, are key parts of the economy that take on young workers and people not interested in working in a conventional workplace—say, an office or factory—and are key to going forward and a key part of the rebuild and of putting young people into work.

We can no longer have vague promises of creative solutions. As several Members have said, according to some estimates, unemployment could be greater than in the great depression of the 1930s. According to some assumptions, there could be 4.5 million people unemployed—even higher than the unemployment in the 1930s. We are seeing an explosion of redundancies, while the Government are saying they will do whatever it takes, but the point has been well made: it has not stopped Centrica, British Airways and other employers who wish to fire and rehire. I hope the Government will look very sympathetically at the private Member’s Bill put forward by my hon. Friend the Member for Paisley and Renfrewshire North (Gavin Newlands), because that practice really needs to end.

We are in a serious situation now, given the number of employers who have announced job losses: Rolls-Royce, 9,000; Jaguar Land Rover, 1,100; John Lewis, 1,300; Boots, 4,000; Marks and Spencer, 950; Alexander Dennis, a bus company in Falkirk, 650; Costa, 1,650. These will all have serious economic impacts, and we need to do everything we can to ensure that those jobs are saved. I hope the Government do accept the demands of the Treasury Select Committee that they look carefully at extending the job retention scheme. I hope they will do that.

In closing, not one Member has said that the job retention scheme should go on forever, but extending it by eight months is a sensible proposition, and as others have said, we need to look at what other countries are doing and match that.

The Economy

Chris Stephens Excerpts

Wednesday 8th July 2020 Commons Chamber

[Chris Stephens (Glasgow South West) (SNP)]

I see the Economic Secretary to the Treasury in his place; I thank him for his correspondence in relation to the credit union sector. Credit unions are a very important part of financial life these days and I hope he will say something about them in his closing remarks.

The parts of today’s package that will help people to go into the hospitality sector and restaurants and buy meals is all fine and well, but we must also acknowledge that far too many people across these islands cannot afford food—they cannot afford to eat—and if it was not for the charitable sector rising up during this pandemic and providing food and meals for many people, there would have been an explosion in the use of food banks. I hope the Minister will also say something about the support that the charitable sector will receive, because it is an important part of what needs to be addressed.

On the Department for Work and Pensions package, I am still hoping we will get an answer today on the increase in the number of work coaches. The Department for Work and Pensions has said that it needs 30,000 additional staff to process universal credit claims and make sure that people are paid on time, so I would like to know if the announcement on work coaches refers to new staff or staff from somewhere else being redeployed. We need to know that and to know genuinely what the package is. We also need to know what training there is going to be for any new work coaches.

I have a real fear and concern that conditionality has been brought back too early, and that is a mistake by the Government. I hope I am wrong, but I think that reintroducing conditionality and the prospect of people being sanctioned from 1 July, as announced by the Department for Work and Pensions, was the wrong move to make.

I join the others from all parties who have mentioned the excluded. I mention in particular my constituent Stephanie Milne, who has written to me. She paid tax for 21 years through pay-as-you-earn and is now self-employed. We must remember that there are people who have been forced to be self-employed. There are people on zero-hours contracts who are not getting any of the support packages that are available. I have a real concern about that; it is the wrong decision.

Lastly, I have received a letter today from David Fulton, the Unite convenor at Thales, impressing on me and the Government how much support is required for the aerospace sector, which is an important sector not just for my constituents but across these islands.

Economic Update

Chris Stephens Excerpts

Wednesday 8th July 2020 Commons Chamber

[Rishi Sunak]

I thank my right hon. Friend for his support, and he is absolutely right: leaving the EU provides us with a unique opportunity to re-examine all our procurement rules and many of our regulations. I share his passion to ensure that, as much as possible, we support our local economy and create jobs, which has never been more vital than it is today.

[Chris Stephens (Glasgow South West) (SNP)]

I want to take the Chancellor back to page 14 of his statement. He will know that DWP management have asked for 30,000 additional posts, so will the doubling of work coaches be new posts or redeployments? Will the jobcentre closure programme be suspended as a result of his announcements, and will he build an attractive terms and conditions package, given the high staff turnover in the DWP?

[Rishi Sunak]

We are investing an extra £1 billion in the DWP this year, specifically, among other things, to double the number of work coaches from 13,500. I am pleased to say that work has already started and recruitment is already under way. This will be done faster than ever before—certainly faster than in 2008-09.

Coronavirus: Job-Support Schemes

Chris Stephens Excerpts

Tuesday 7th July 2020 Commons Chamber

[Chris Stephens (Glasgow South West) (SNP)]

It is a pleasure to take part in this debate, and I join Members across the House in representing the excluded in the United Kingdom. I am fascinated by the view that those who have chosen to adhere to Government advice and set up limited companies are currently being treated as if they are some sort of Mr Bill Gates. Those who decided to set up such companies are not all a Bill Gates. They were told to do this. Indeed, the advice they were given was to create such an arrangement for financial security, yet they now find that there is no financial security for them. I join other hon. Members in hoping that the Government will address that issue.

The Government must also address the issue of who is self-employed and who is not. They have had the Taylor review for three years but they have sat on it, and far too many people in the economy are directly employed yet designated as self-employed. They are also missing out on Government support, particularly those who, over the past couple of years, have found themselves directly employed and then moved to being self-employed. I hope the Government will consider that area.

I want to offer huge thanks to the HMRC staff who have performed heroics to ensure that companies have been paid through the various support schemes. We have seen the benefits of home working, and many of those employed by HMRC have been working from home and gone the extra mile to ensure that companies are paid. What is the thanks they get? They get a notice from HMRC, notifying them that they could very well find themselves in a redundancy situation. That is an absurdity. HMRC went ahead with its office closure programme, but we have now seen the benefits of home working. Why should someone who has been asked to travel 100 miles to their next workplace be faced with a redundancy notice when this crisis, this pandemic, has proven the benefits of working from home to keep the economic wheels turning? I hope that the Minister will respond to that disgraceful treatment of HMRC staff. Perhaps instead they should be given the reward they deserve, which is an above-inflation interim pay rise, as that is exactly what the civil service deserves in these times.

Financial and Social Emergency Support Package

Chris Stephens Excerpts

Wednesday 25th March 2020 Commons Chamber

[Jeremy Corbyn]

My hon. Friend anticipates the point I was about to make. We have all seen the images this morning of construction workers packed on to the London tube and other trains all around the country, going on to site because it is the only way they can earn a living, and putting themselves and all of us at risk as a result. Action has to be taken now on this.

[Chris Stephens (Glasgow South West) (SNP)]

Is there not also a responsibility on Government contractors? I am thinking of Atos, Adecco and those that have call centres, which are telling at-risk employees to attend their work. Is not that disgraceful, and should not the Government intervene?

[Jeremy Corbyn]

It is absolutely disgraceful and totally unnecessary. If someone feels they are at risk, the advice from the Department of Health is that they should self-isolate—and eventually get tested, but clearly the tests are not available immediately. If the employer then forces that person to go into work, we all know what the consequences will be. There is a responsibility on employers as well in all this.

I hope that the Government will take action to close building sites, provide the workers with the necessary economic support and tell the companies that this should not be seen as an opportunity to cut their workers’ wages by 20%; they are getting 80% from public funds and they should make up the rest with the profits they make on big construction projects. Many people on construction sites are, sadly, self-employed, which is a slightly different issue that I referred to earlier.

As we look beyond the crisis we should all give workers respect, with proper social security extending to the self-employed as well. We have to understand that we have a very different economy than we had 10, 20 or 30 years ago. A very large number of people are self-employed. They are making their contribution. They deserve respect, recognition and the necessary social security support: full rights for workers, including those in the gig economy.

We must raise statutory sick pay to European levels. The Secretary of State for Health and Social Care said, honestly, that he could not survive on £94 a week. I suspect that most Members would not want to survive on £94 a week and most probably could not survive on £94 a week, so how can expect others to do so? We are saying that they have to survive on £94 a week and we cannot. It is up to us to say that in this crisis we have to increase it, so that people can have a survivable income. Looking beyond the crisis, no one should become poor just because they become ill. Many people have been shocked—I have spoken to self-employed people—to find just how low statutory sick pay is. They imagined statutory sick pay was something they could live on. They did not realise what it actually was. Even more shocking is that disabled people on employment and support allowance are expected to survive on £73 a week, as are those on jobseeker’s allowance. Those figures are disgraceful. People cannot live on that sort of money, so they will be forced to take risks and therefore put us all at risk. For carers, it is even less money. Carers allowance is just £66 a week. That is simply unacceptable.

Right now, we have to give support and security to renters in the private rented sector. The Government promised 20 million of them a ban on evictions, but then broke their promise. Emergency legislation does not stop people losing their home due to coronavirus; it just gives them three months in which to pack their bags. This public health emergency will become a housing and homeless emergency if the Government do not change course now on the treatment of people in the private rented sector. All of us represent large numbers of people in the private rented sector, none more so than my hon. Friend the Member for Brighton, Kemptown (Lloyd Russell-Moyle), who I know represents a very large number.

--- Later in debate ---

[Chris Stephens (Glasgow South West) (SNP)]

It is a pleasure to follow the hon. Member for Brighton, Kemptown (Lloyd Russell-Moyle). He made his points well and with force and clarity, and I agreed with much of what he said.

I understand that this afternoon is a testimonial for the Leader of the Opposition and the shadow Chancellor, in terms of their performance at the Dispatch Box. I count them both as good friends, and I wish them well for the future. They have always led by example in speaking truth to power. That is something I have always tried to emulate, and they set a good example for other hon. Members. We must speak truth to power, particularly given the current situation.

In my view, the past two weeks have brought out the best in people, but sadly, and as we have read and seen on the television, all too often they have also brought out the worst. We have seen behaviour in supermarkets that I found extraordinary, and we have had to put pressure on supermarkets to ensure that they do not cut orders to local foodbanks. I thank supermarkets for addressing that and ensuring that foodbanks get the support they need. I also thank foodbank volunteers right across these islands, as well as workers in our national health service and in local and central Government, as they try to assist people through this process.

I also wish to mention the constituency office staff of every hon. Member of the House. They have been flooded this week—as have we all—by emails, particularly from constituents who are abroad and trying to get home. I am concerned by some information that was provided to me by my constituency neighbour, my hon. Friend the Member for Glasgow South (Stewart Malcolm McDonald), who told me that the Foreign Office is not providing support to individuals who have dual nationality. That really is nonsense. Glasgow in particular has a thriving Asian community that does great work across the city, and many of those people will have UK as well as Pakistani citizenship. If UK citizens are stuck in Pakistan, we should be doing everything we can to bring them home, and we should not refuse to help them because they happen to have dual nationality. I hope that the Foreign Office will address that urgently.

Let me say for the third time today—I am going to keep mentioning it as often as I can until the message is driven home—that there are far too many businesses out there that are still open but should not be. They are defying clear public health advice. The advice is clear that, by doing what they are doing, they are putting not just public health, but lives at risk. I think we know what is happening here. This is blatant opportunism. They are blatantly trying to make money and make a profit. There is only one way to deal with these people, and that is to issue them with closure orders and heavy fines. They are only operating to make money, so the only way to deal with them is to take money off them.

We cannot have a situation where businesses are threatening staff—including, I am sad to say, those at risk—with their jobs. People with symptoms and those with a health condition that means they are at risk of getting this virus are being ordered into work by too many employers. It really is a disgraceful situation. If the Government do start fining those businesses, I hope they name and shame them publicly in the same way as we do with employers who do not pay the national minimum wage. Once the crisis is over, I think consumers will be entitled to know what businesses defied the public advice given not just by the UK Government but by devolved Administrations.

In the past two weeks we have also seen some—not all, but some—employers opportunistically try to lay off workers and tell them they will no longer have a job. That was completely unnecessary. The best example I can give is the G1 Group, which notified 200 people in Glasgow on Friday that they were being laid off due to a lack of trade. If it were not for the great Unite hospitality branch we have in Glasgow, which organised a sit-in by workers in one of the G1 premises, those workers would not have had the victory of being told that they are being kept on and that the company will apply for the job retention scheme.

I want to say a word about the job retention scheme. If any of the businesses that are still open today—I am sure they will, in due time, be ordered by the Government to close—apply for the job retention scheme, that money should not be backdated to 1 March. I hope the Government take cognisance of those companies that have tried to lay off workers and ensure that it is made clear to companies that apply for job retention scheme money that it is not an excuse to lay off workers once this crisis is over. That would be an abuse of public money, and I will name and shame any company that tries to do that, as I am sure will many other hon. Members.

I hope the Government are taking seriously their responsibilities to their own workforce when it comes to social distancing. I am thinking in particular of workers employed in service centres by the Department for Work and Pensions and Her Majesty’s Revenue and Customs. I am picking up examples where social distancing is not taking place and there is a lack of basic health facilities. The Government have a responsibility and a duty to ensure that those workers are protected—that their health is protected and their lives are protected.

That also goes for those Government contractors—I am thinking of Adecco and Atos—that have ordered at-risk employees into work. I am thinking in particular, because he gave me permission to mention him, of my constituent Andrew Rossetter, who clearly has health conditions that mean he is at risk, being ordered into his workplace. Why is a Government contractor doing that? It is time the Government had a word with those contractors to ensure that they are applying the appropriate guidance and advice, and are doing so to the letter.

I received a letter this afternoon from the Glasgow Institute of Architects, which is rightly concerned about what is happening on construction sites as we speak. Construction workers are being ordered into work. I really cannot see the purpose of that. It is clearly against the advice and guidance the Government have given, and it really needs to be sorted out. Of course, it comes as no surprise that some of the companies trying to order construction workers into work have traditionally operated blacklists. We need an assurance from these companies that they will not put any worker who decides to self-isolate on any blacklist. Blacklists are, of course, illegal, but we will make sure that that does not take place.

This morning, the Work and Pensions Committee, of which I am a member, asked about the pressures being put on DWP staff as a result of 500,000 people applying in one day. We have probably all seen the screenshots on social media showing where people are in the queue—I have seen one where someone was 100,011th in the list of those trying to get their claims processed. I am sure that I speak for many Members in saying that we support the staff going through this process. We understand, of course, that the Government will have to redeploy staff to make sure that claims are processed and that people get the money they deserve and are looked after, but we need the Government to keep in touch with us on what the pressures are. If the Government need to hire more people, they should do so. If they need to redeploy staff from other Departments, they need to do so to ensure that everyone is looked after.

On statutory sick pay, I join other colleagues in saying that £94.25 a week is not enough to live on—indeed, I think the Secretary of State for Health and Social Care is on record saying that. We need to see the level of statutory sick pay rise, certainly to the European average. I do agree with many—the Select Committee had a chat about this today after our session with the Secretary of State—that we really do need to look at a universal basic income. In a time of crisis such as this, we need to consider and address the need for a universal basic income.

In closing, I just want to say—I am thinking particularly of what the hon. Member for Ilford North (Wes Streeting) said last week—that after this crisis is over, there will be political choices to be made. The last thing we need is another decade of austerity. The decade of austerity we have lived through has shown us that the public services are not all ready to deal with situations like this. We need to have a serious conversation about the role and function of public services and to make sure that they are properly financed, maintained, resourced and staffed.

We also need to have a conversation about the status of the worker in the workplace, because, as we have seen in the past two weeks, there are a lot of opportunistic, bullying employers out there. We need to sort out, once and for all, who is self-employed and who is not self-employed. Far too many workers are finding out only now that they are self-employed, and they should not be self-employed—they are directly employed. If someone has to go in for a job interview, I think it is safe to say that they should be considered as being directly employed.

I hope that after this crisis there is no return to austerity and that we invest in our people and our public services. That will be the people’s bail-out, and it will require the sort of investment that the banks got in 2008.