Financial and Social Emergency Support Package

Debate between John McDonnell and Bill Esterson

Wednesday 25th March 2020 Commons Chamber

[John McDonnell]

I support the words of Mr Speaker last week, when he made clear the practices that Ministers should pursue, and I believe that this is an act of bad faith on the part of the Prime Minister.

Let me make other demands on the Government. Here is a small one: can apprentices, many of whom are paid just £3.90 an hour, be furloughed too? Can they please get 100%, not 80%, because they earn so little? As I asked the Chancellor yesterday, can the scheme be flexible? Workers put on reduced hours must be eligible, so that the shortfall in wages can be made up. Some businesses will lose part of their operation. We need them to carry on in a reduced form, so that would be the right solution for them.

[Bill Esterson]

I want to take this opportunity to thank my right hon. Friend and the Leader of the Opposition for the work they have done over the last five years and for their friendship and support of all Opposition Members.

My right hon. Friend mentioned furloughing. Can he reiterate that there should not be any situation in which pay is allowed to be below the national living wage, and if that means going above the 80% rule, that is what should happen?

[John McDonnell]

I am grateful for my hon. Friend’s words. We have asked for a while, not least when we put forward our proposals last Thursday, that there should be a floor of the national minimum wage. If those who are on low pay get 80% of their pay, many of them will be taken below the national minimum wage. It is set at that level because it is a basic survival level, so we urge the Government to act. Again, that is only a small step.

It cannot be beyond the wit of the great minds in the Treasury to find a way to resolve a number of these issues, and that call was reiterated by the Resolution Foundation this morning. A YouGov poll found that one in 10 people surveyed are still in work but with reduced pay or hours. Those people are not protected by this scheme. For businesses to stay afloat, many of them will need part-time workers, and those part-time workers need the support that this scheme should provide.

Zero-hours contract workers and agency workers who are not on PAYE are limb (b) workers, as I explained to the Chancellor and wrote to him about at the beginning of the week. They must be made eligible for the job retention scheme; otherwise, there is the potential that 2 million workers will not be included in the scheme. These are some of the workers who are most at risk of losing work and not being able to put food on the table during this downturn.

Several Members mentioned this, but I urge the Government to give an assurance that non-UK nationals are eligible for this scheme. I also appeal to the Government to ensure that support is provided for non-UK nationals in the coming weeks when travel is so restricted. Let me echo what several Members have said: that must include the suspension of the rules of no recourse to public funds. The rules that have been put in place may be acceptable to some Members, but in this period those rules are brutal and will force people into penury.

Staff who can no longer work because of childcare responsibilities must be protected as well. Why on earth are they not eligible for this scheme? Just think of the single parent who cannot work because they need to stay at home with their child—surely they should be covered as well. On the subject of childcare, can the Minister be clear that childcare providers should not be charging parents for services that they no longer deliver or cannot now deliver? Those childcare providers must be supported in the long term as well, because we will need them.

My concern, which many Members have expressed today, is the gaps in the scheme and the fact that it will not be operational until April. People will not receive funding for weeks, and it certainly will not be taken up at the rate that many of us would hope for, given the indications from a large number of employers. Lay-offs are happening at scale.

Contingencies Fund Bill

Debate between John McDonnell and Bill Esterson

Committee stage & 2nd reading & 2nd reading: House of Commons & Committee: 1st sitting & Committee: 1st sitting: House of Commons
Tuesday 24th March 2020 Commons Chamber

[Bill Esterson]

Absolutely. It is important, and I certainly welcome it. None the less, there are some challenges with it. The fact that it is not available for the March payroll is a big problem for many businesses. We have already seen a significant number of businesses close and many workers laid off who will not now be eligible to be part of that scheme. The Government, totally understandably, have used examples of furlough schemes elsewhere in the world, but it will be difficult for the scheme to deal with the nature and the scale of this crisis.

[John McDonnell]

What we were trying to establish in our discussions with the Government last week was equality of sacrifice. Yes, workers and the Treasury have realised that there will have to be some sacrifice, but we were expecting some contribution from employers themselves. An hour ago, 400 workers at Tristar in my constituency were laid off. Those 400 drivers were told that they will get paid 80% of their wages by the Government and they have been laid off for three months. We expected the employers to contribute to that 20%, but, in this case, that will not be paid. The crisis is falling on the shoulders of workers, rather than on businesses. There is no equality of sacrifice in a number of these companies, some of which are being ruthless.

[Bill Esterson]

My right hon. Friend highlights the fact that some employers do not behave in a way that we should be able to expect them to behave given the nature of the crisis. We have heard other examples of large companies behaving in a way that is irresponsible and, frankly, downright wrong.

In addition to what my right hon. Friend says about employers not paying the 20% element of the wage replacement scheme and taking advantage of it, it is also the case that, for employers who wish staff to go on to short-time or part-time working, or reduced hours of some sort, the scheme does not apply. There is a real challenge for businesses in those categories, too.

That brings me on to the self-employed and this point about desperation. People are desperate now. We have debated that a number of times today and over the past few days as well. I just do not get the sense of urgency in this place. We are in here, and away from the real world. The same applies with Whitehall. I just think that, sometimes, people here do not have a sense of just how desperate things are when two members of the same household are both self-employed and have no money. They cannot put food on the table. When the Chancellor says, as he did this morning, that he is worried about the scheme for self-employed going to wealthy people, I say, as indeed did the right hon. Member for Kingston and Surbiton in his urgent question, let us not make the perfect the enemy of the good. Let us get a scheme in place and let us make it comparable with what the Government have offered to employees.

I want to say just a word or two about food supply and how the fund might apply there. There will be challenges around security of food supply; obviously, given the closing down of international transport links, that will be a challenge. We heard about the pressures on supermarkets. Some of the behaviour in supermarkets has been completely unacceptable, and the same applies to pharmacies. I hope that some of this money will go to ensuring security of deliveries, to protecting retail workers, to making sure that food and medicine get to those who most need it, and to helping pay for deliveries. The same applies to the supply of PPE, which hon. Friends have spoken about.

The right hon. Member for Kingston and Surbiton is right to raise the issue of helicopter money; at some point, that is something that the Treasury should consider. Any scheme, whether on PPE, food or access to funds, is only as good as the information out there, the awareness of the scheme, and the immediacy of access to it. The Government need to do much more to ensure that people know what is available in all those areas. The gov.uk website will carry that information, but lots of people and businesses do not know that it is there.

There is a real imperative on the Government to work much harder on the information that is getting out there, and on access to what is being offered. Television and radio will lose their commercial advertising; there is a great opportunity to replace it. I can give an example of the power of really good advertising: the video put together by the Belfast Health and Social Care Trust respiratory department. It was one of the most powerful pieces of advertising about the need for people to stay at home that I have ever seen. The BBC showed it; I think Sky might have, too; and it had viral attention on social media. The Government need to produce advertising of that quality to demonstrate what is available in a range of areas across society. Some of this money can be used to deliver on that agenda. Information and proper access will ensure the most effective use of this enormous necessary injection of funding.

The debate has been an opportunity to bring together the issues. I hope that the Financial Secretary will take them to all his colleagues across Government, as appropriate. It is interesting that the right hon. Member for Kingston and Surbiton said that 1919 was the last time there was this sort of scrutiny; that was the year of the Spanish flu pandemic. We will not vote against the measure this time, but let us hope that, this time, it is effective, and that the money gets through as quickly as possible.