Autumn Statement

Jack Dromey Excerpts

Wednesday 23rd November 2016 Commons Chamber

[Mr Hammond]

To be consistent, I would have to direct my hon. Friend to my right hon. Friend the Transport Secretary, who, I am sure, will be delighted to hear his representation.

[Jack Dromey (Birmingham, Erdington) (Lab)]

Why should anyone believe the promises being made by a Conservative Government pretending to be the friend of working people and the party of the working class, when but six weeks ago workers were promised a seat on the board of the companies that employ them and a voice in their own future, only for that promise to be broken six weeks later, on Monday of this week, by the Prime Minister?

[Mr Hammond]

That is not what happened. I am afraid I am not responsible, and neither is my right hon. Friend the Prime Minister, for what newspapers choose to write in their headlines. What she said, what she believes and what she is committed to is ensuring that there are proper channels for the voices of consumers and workers to be heard at board level in companies, so that those voices can be taken into account in a proper way in decision-making processes—and that is what will happen.

Budget Resolutions and Economic Situation

Jack Dromey Excerpts

Monday 21st March 2016 Commons Chamber

[Jon Trickett]

Not a peep from the Secretary of State so far. Unfairness and inequality run through the DNA of this Government in every Department. Local government provides services that make the lives of the most vulnerable in our society bearable, yet it is suffering the most draconian cuts.

[Jack Dromey (Birmingham, Erdington) (Lab)]

Will my hon. Friend give way?

[Jon Trickett]

I shall make some progress now.

The same people who rely on the personal independence payments, which the Government so recently wanted to cut, rely on home helps and community services, yet nowhere is the pressure greater than the growing crisis being experienced by social care. The Tory-controlled Local Government Association estimates that despite the Government’s measures there is a big funding gap in social care—£700 million this year. Many of the frail elderly in our society are no longer being looked after properly. Lord Porter, the Tory leader of the LGA, put it starkly. He said that

“vulnerable members of the community still face an uncertain future where the dignified care and support they deserve, such as help getting dressed, fed or getting out and about, remains at risk.”

Yes, a Tory leader said that vulnerable elderly people will be denied help to be fed.

A few years ago my own family faced a crisis that so many of us have to confront at some time in our lives. Let me quickly describe what happened. I went to visit my dad in the fabulous St James’s hospital in Leeds, whose staff continue to amaze with their skills and dedication. But the nurse told me that my dad was coming to the end of his life and that he had to be discharged because there was little further the hospital could do. Clearly, he could not go home. By good fortune, I was able immediately to convert a downstairs room in our house into a bedroom and shower room and within days he came to live with me. He died in that room a few months later, but we spent a wonderful time together. The sun seemed to shine into our house every day that he was there. We were blessed to have the space available, and a loving family as well as loving neighbours who helped.

However, we could not have coped without the frequent house visits by the council’s care teams, who came every day, several times a day. Last year I held a fund-raising event at my house. One of our guests that day was a woman I recognised. She had been a carer who had helped me with my dad. She told me that she would always remember her visits to our house, but I felt a chill down my spine when she told me that because of the Government cuts, council carers could no longer provide the level of care to others that my family had received. “Honour thy father and thy mother” is an injunction that a civilised society should never forget.

Local government is facing £10 billion of additional future cost pressures. There are three main threats to council finances in this Budget. First, the Chancellor demands £3.5 billion of spending cuts, as we heard, to help to fill the black hole in the Government’s accounts. On top of that, there is the £4 billion that we heard about today.

The House knows that there are very few unprotected services left. Local government is one of them and is therefore a prime target. It is home helps, children’s centres, libraries, leisure centres, firefighters and youth clubs that are at risk.

Secondly, there is the overhaul of the business rates system. We welcome the extra help being given to small business in rate relief. That was in our manifesto; we campaigned for it, and it will cost about £7 billion. The Government have said they will compensate local government for this loss. The Secretary of State quotes page 84, line 15 in the Red Book, but he is wrong. That does not indicate where a single penny is coming from. Where is that £7 billion coming from? The Tory-chaired LGA has said that this will mean that once the 100% rate retention has been brought in, the resources to be retained will be less than previously projected as a consequence. By contrast, we would have financed these cuts to small business rates because we would have maintained, not cut, the level of corporation tax.

The third threat that the Budget outlines is the decision to ring-fence business rates in London, ahead of the rest of the country. But Westminster alone takes more business rates than Manchester, Liverpool, Sheffield, Birmingham and Bristol combined—£1.8 billion. If prosperous Westminster keeps this £1.8 billion, there will be a significantly smaller pot of money to be redistributed to less affluent areas. Tucked away in the Office for Budget Responsibility’s report are the implications of all this for the hard-pressed council tax payer—something on which the Secretary of State was silent.

The OBR estimates that 95% of councils will increase council tax by the maximum allowed, and they are being encouraged to do so by the Government. This means that for the first time ever, the average council tax bill payer will be paying £1,500 a year. Over the next five years local residents face a 14% increase above inflation in council tax. In return they will get a worse service. So much for the Tories being the party of low taxation: capital gains tax cuts for the well-off and council tax increases for ordinary families. It is an unacceptable set of priorities.

--- Later in debate ---

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I do not want to speak at length this evening, but I do wish to add my voice to the chorus of congratulations that has greeted this Budget from all parts of the House. Certainly, in the 12 years that I have been in this House, I cannot remember a Budget in which so big a hole has opened so fast, which is why it is perfectly natural for it to have provoked such a hymn of praise.

According to the right hon. Member for Haltemprice and Howden (Mr Davis), when one starts picking the details apart, the whole thing falls apart. The hon. Member for South Cambridgeshire (Heidi Allen) said that the Government had made some poor decisions. Over the weekend, the hon. Member for Brigg and Goole (Andrew Percy) said that this was a Budget that hit exactly the wrong people. According to The Times, Members of Parliament, who were presumably once supportive of the Chancellor, now say that he is a “busted flush” and “damaged goods”. Let me associate myself with this new consensus breaking out right across the House.

I also congratulate the Chancellor on going to such lengths to, in his words,

“put the next generation first.”—[Official Report, 16 March 2016; Vol. 607, c. 951.]

That was a pithy message, and he has presided over an economy where that is exactly what has happened. This is now the first generation to be worse off than the generation that came before them. This is now the first generation to be more likely to live in poverty than pensioners. Today’s young generation are the first generation to have to work years longer in order to earn their pension. Young people today are the first generation to graduate from university with over £50,000 of debt. This was indeed a Budget for the next generation, but not quite in the way the Chancellor presented it. In fact, it was just the latest from a failed generation of Conservative politicians.

For me, the final proof was this: if the Chancellor wanted to do something for the next generation—if he truly wanted to put the next generation first—he would surely have done something significant, perhaps even magnificent, for Britain’s youngest city, which is of course my home city of Birmingham. Instead, we have a Conservative Birmingham bombshell of over £100 million of tax rises and spending cuts. That is the how the Chancellor has put Britain’s youngest city first. The Government now admit—this is the irony—that the great city of Birmingham needs a fair funding formula. In fact, they are so convinced of the need for this new funding formula that they are determined not to introduce it now but in a couple of years’ time. This short-changing is costing our city some £98 million in lost grants. Indeed, there would be almost no need to introduce cuts in this year’s council budget were it not for that short-changing.

[Jack Dromey]

I am grateful to my fellow Birmingham MP for giving way. The great city of Birmingham has been hit by the biggest cuts in local government history—three quarters of a billion pounds. Had it been treated fairly this year, it would have been £98 million better off. Does my right hon. Friend share my concern, and that of the people of Birmingham, that although we put a powerful case to the Government for support out of the transitional fund, 95p in every 100p goes to Conservative councils, but not one single penny to hard-hit Birmingham?

[Liam Byrne]

My hon. Friend is absolutely right. It takes some doing to sit in Whitehall and write a formula that means that pretty much only Conservative councils get the money, but I take my hat off to the Secretary of State and the Chancellor for somehow finding a way of doing it.

The problem is not just that £98 million was short-changed from the budget for Birmingham this year, but that because we have a weaker tax base in our city, we have to raise significant extra resources from the social care levy, costing us another £5.5 million, and that despite the fact that our police service is on one of the most dangerous frontlines, we have had £10 million of cuts to its budget this year. Altogether, the total is £113 million. This is a bombshell that the people of Birmingham will not forget.

Whoever is winding up this debate should recognise that there are some significant questions that we from our home city need answers to. We would like to know why we have not got any of the transitional funding that went to others. We want to know whether, if we agree a four-year funding settlement, our budget will be put into play in 2019-20 as part of the £3.5 billion of efficiency savings earmarked by the Chancellor last week. This is a significant issue for councils up and down the country. If they agree four-year funding settlements with this Government, will they be protected from the new £3.5 billion efficiency drive that the Government announced last week? Yes or no is the simple answer. Birmingham is up for the challenge of business rate retention, but we need much clearer answers than we got earlier about whether the gaps will be made good. Will Ministers confirm whether the OBR’s assumptions that there will be a 14% increase in council tax over the next four years are true? Do they share those assumptions?

The Labour party in Birmingham is rebuilding our city and getting it back to work, delivering record numbers of new businesses, record amounts of new investment, and record new infrastructure. We have built more council homes than any other council in the country, we have got over 3,000 young people into work, and we promised and delivered the living wage on day one of the new Labour council. Give us the tools and we will do the job!

Spending Review and Autumn Statement

Jack Dromey Excerpts

Wednesday 25th November 2015 Commons Chamber

[Mr Osborne]

I thank my hon. Friend for his support and for the work that he has done to champion the most disadvantaged and vulnerable in our communities. The troubled families programme is protected and supported in this spending review. The money for social impact bonds to help with complex social needs in our society is additional to that, as is the extra support for homeless people, which will go direct to councils rather than through the benefits system and have an extra £10 million put into it. There are a number of pieces of good news.

[Jack Dromey (Birmingham, Erdington) (Lab)]

Just days ago, our police service, reeling from the biggest cut in Europe of 17,000, was facing the catastrophe of being cut in half. Now, following pressure from the public, the police and the Labour party, the Chancellor has thought again, including embracing our proposals for sensible savings on procurement. Does he agree that the first duty of any Government is the safety and security of their citizens, and that a U-turn, however begrudging and belated, is to be welcomed?

Tax Credits

Jack Dromey Excerpts

Tuesday 15th September 2015 Commons Chamber

[Seema Malhotra]

My hon. Friend is entirely right. We are standing up for families who are doing the right thing: going out, working hard and trying to support themselves and their children.

[Jack Dromey (Birmingham, Erdington) (Lab)]

As a founder member of the drive, initially in London, for the real living wage, may I ask whether my hon. Friend agrees that the phoney living wage of the Chancellor of the Exchequer will not begin to compensate for the tax credit cuts, which will hit those in work particularly hard and will therefore punish the very strivers about whom the Chancellor is always lecturing us?

[Seema Malhotra]

I thank my hon. Friend for that intervention and for highlighting that the living wage will be lower than in any year since 2011. That is another example of this Government’s lack of transparency.

This move today amounts to a huge cut in the income levels of hard-working families.