Universal Credit and Working Tax Credits

Debate between Jonathan Reynolds and Jim Shannon

Wednesday 15th September 2021 Commons Chamber

[Jonathan Reynolds]

Will the hon. Member tell me how many households in his constituency are in receipt of universal credit? I am giving him a chance to put on the record how many of his constituents are affected. There is a whole section of my speech in which I will tell him how the Government can afford to pay for this.

I did not know that the hon. Member did not know the figure for his constituency—I promise that I was not trying to catch him out. I was simply trying to make the point that the recovery of his local economy would be adversely affected by taking that spending power away, as my hon. Friend the Member for Wallasey (Dame Angela Eagle) made clear for her constituency.

[Jim Shannon (Strangford) (DUP)]

I thank the shadow Secretary of State for introducing this important debate. Northern Ireland has the highest levels of child poverty in United Kingdom of Great Britain and Northern Ireland. My mailbag, like everyone’s, is full of real-life stories of people worried sick about how they will be affected. Does he agree that the removal of the £20 universal credit payment will plunge even more people into food poverty and have a detrimental effect not just on their pockets financially but on their health? It is a double whammy, and they just cannot take it.

[Jonathan Reynolds]

I agree with the hon. Member. Opposition to the cut is truly universal, for those reasons. It includes MPs, charities, unions and six former Conservative Secretaries of State for Work and Pensions. If we are being honest, I think several serving Conservative Ministers also share that view. In this debate, I want to knock down the fiction that there is somehow a choice to be made between cancelling the cut and getting people back into work. I want to talk about what the cut will mean for the families affected and the impact that it will have on all our local economies and the national resilience necessary to meet future challenges. I also want to talk about how the Government could easily fund universal credit at its current rate without making this counterproductive and harsh cut.

Bank Branch Closures

Debate between Jonathan Reynolds and Jim Shannon

Wednesday 18th March 2020 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

First, I congratulate the hon. Member for Midlothian (Owen Thompson) on bringing forward the debate—I think there has hardly been a banking debate that I have not been at. The Minister is always in his place to respond, and I am sure he knows what we will say before we say it and that he shares our frustration over bank closures. As I mentioned earlier, my constituency has seen one of the largest numbers of bank closures in the whole of the United Kingdom of Great Britain and Northern Ireland. There has been some attempt to fill the gap with credit unions and post offices, which have done so to a certain extent, but not in totality. That is where my concern lies.

I joined in the debate last June—we had another one a few weeks ago—to express my frustration with the banks that were closing branches because they say there is another one just 15 minutes up the road, or 50 minutes up the road, as the hon. Member for East Renfrewshire (Kirsten Oswald) explained. That is not very helpful for people who are on their lunch break or reliant on public transport, which is not always available at the time that they need it to get them back to work, as she also suggested, especially in a rural constituency.

Physical branches are important to the consumer, but not to the bottom line, and it would seem that that is the only consideration for some of those at the top of the banks. How annoyed was I, last month, to find that yet another bank closure is planned for Newtownards, the main town in my constituency? This time it was Barclays. I got the obligatory email of intent, as we all do, and an offer to meet, going through the format of a visually arranged meeting. I have arranged it in my diary, by the way, and I will meet them, but the fact is that although the meeting might relieve some of my frustration, it will not make one button of a difference to Barclays.

I mean no disrespect—I try to be respectful to everyone as best I can—but I have no hope at all of persuading them to keep the Barclays bank in Newtownards open. I have sat in too many of those meetings, which is why I have become a bit cynical about meeting the banks. I think I have had some nine bank closures in total in my constituency. I have had a meeting with the banks on every one of those occasions, and with all the persuasion of stats and letters from customers that we had, we were not successful in turning things around.

As those branches have closed one by one, I have sat in too many of those meetings and been shown increases in online activity, as the hon. Lady mentioned. If we take the logic that she referred to, it is true that, if we close all the banks, more people will go online. But it does not suit everybody to go online—that is the point we are making, but it seems to fall on deaf ears. What is not explained is that the increase is because staff members have been pushing this, which they have. There is nothing wrong with pushing the online deal if it suits people, but it does not suit everybody, and the bank customers on whose behalf I went to all those meetings were not able to bank by logging on to the system. It is not always easy, either, when people do not have the broadband access to enable that to happen.

Over the years the bank closures in my constituency have been Kircubbin, Portaferry, Killyleagh and Ballynahinch—all Ulster Bank—Danske Bank in Kircubbin and Portaferry, Barclays bank now imminent, Bank of Ireland and Allied Irish. Those banks have all moved to other towns or moved out of the area completely. I remember when we used to have at least four banks on the Ards peninsula, but they have all been closed. There were some sub-banks, which would have been there on certain days a week, but they are away as well.

The hon. Member for Midlothian referred to credit unions, and we have been fortunate that credit unions have grown in my constituency, as they probably have in all our constituencies. They have tried to fill the gap, and they have done so to some extent, but they cannot provide what the banks offer to customers. We have a new credit union in Kircubbin; I am very pleased to see it, and it is very active and very able. The credit union in Portaferry has grown as the banks have closed, as has the credit union in Newtownards. I had the Minister over about a year and a half ago to visit the one in Newtownards, which is doing extremely well. The credit unions are filling the gap.

Then there are post offices. The Minister might say that post offices are able to fill the gap, and in some ways they are, but they cannot provide all the range of support and services that can be given in the banks. Post offices can only fill those in a small way. We need to have all the opportunities that the banks offer. I am becoming increasingly frustrated with the banks. I say that not as a socialist—

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

There is nothing wrong with that.

[Jim Shannon]

There is nothing wrong with being a socialist, by the way—I am letting you know that right now. I am not against the banks, but I get immensely frustrated when it seems that they make decisions in order to bring bigger dividends for their shareholders. I suspect that everyone who spoke and the shadow Minister will say the same thing, but to me it is simple: the wee man and wee woman need help, and they deserve to have their banks, yet it is all about the profit at the end of the year. Whenever banks are making a massive profit, in a way it is about getting more profit. Was it Jean Paul Getty who said that the only thing better than having £1 million is having another £1 million? Speaking about Jean Paul Getty probably ages me, but I am just making the point that banks focus only on their profit margin and how much they can make, not on delivering.

The hon. Members for Midlothian and for East Renfrewshire referred to online banking—I know that others will refer to it as well—but it does not suit everybody. I tried to help a number of customers of those banks to do online banking, but it was lost on them. I hope those people took their savings to the post office or the credit union, but I suspect that some did not, and I therefore fear money being stored under the blanket, the pillow or the mattress, or in some tin box somewhere, because those people want to be in control.

My wife’s auntie was in that situation. She had some money in the house, which we did not know about. One day she was out for only half an hour, but the thieves obviously knew, and they came in and stole her life savings—£8,500—which were probably to pay for her funeral. It is soul-destroying. The community came together to help as best they could. That happened to a couple of others in my constituency as well, and again the community reached deep into their pockets and made some of that money available.

I realise that time is flying. I was sitting here almost loth to speak, to again use the same words and rhetoric, because it is not stopping the closures. Then I realised that this is the place where changes need to take place. I have the utmost respect for the Minister, as he knows, but I urge him and his Department to give serious consideration to supporting those banks that support their local community. For Newtownards, that is the Danske Bank, the Ulster Bank—the one that is left—the Santander bank, which has filled some of the gap for some customers, and the Nationwide building society. Those are the last four banks in Newtownards. All pay rates and council tax, provide local employment and are all available for the vulnerable—for me, this debate is about the vulnerable; those who do not have access to banks—to open their first bank account or for those who want face-to-face advice, because we need that from the banks as well.

I ask the Minister what we can do to reward those banks that do right by local communities and keep an online thrust as well. I understand that some people want to go online. I am an old traditionalist; I will probably still write cheques for all my things every week, as I always do, and I will probably still carry cash in my wallet, because that is how I did it when I opened my first bank account at age 18. How can we encourage more banks to be part of local communities, instead of being removed and literally counting their pounds rolling in? I look to the Minister for guidance, because asking, reasoning and pleading with the banks is not working. Maybe rewarding community-minded banks is the way forward.

National Productivity

Debate between Jonathan Reynolds and Jim Shannon

Wednesday 22nd January 2020 Westminster Hall

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

It is a pleasure to see you in the Chair, Mr Paisley. I thank my hon. Friend the Member for Barnsley Central (Dan Jarvis) for securing the debate. He made an excellent contribution, as did the hon. Member for Strangford (Jim Shannon) and my hon. Friends the Members for Islwyn (Chris Evans) and for Wirral South (Alison McGovern). I genuinely enjoyed listening to them. I say that every time I close a debate, but it was true today, because if I had my way, we would be talking about this subject every day of the week.

All hon. Members have correctly said that the No. 1 objective of any Government must be to ensure that the country’s economy works to provide the maximum prosperity and living standards for all parts of the country and all our constituents. That is what we all want, which means that we should celebrate what we do well as a country and the optimism that the Government are asking us to embrace. It also means, however, that we must be honest about what is not working well and what needs to get better, and then discuss what the solutions might be. In the UK, productivity is clearly one of those significant problems.

As my hon. Friend the Member for Barnsley Central said, according to the figures from the House of Commons Library, UK labour productivity has historically grown by about 2% a year, but it has stagnated since the recession in 2008-09. The level of labour productivity in the third quarter of last year was only marginally above what it was 11 years earlier, in 2007. We might look at the impact of Brexit and the uncertainty that was mentioned earlier, but we must acknowledge that the problem is more deep-seated.

It is normal to expect a recession of the depth and severity that the financial crisis brought about to have an impact on productivity, but we would expect that to last only for a certain amount of time. The fact that we are still only just recovering to pre-crisis levels is a deeply worrying indicator and does not reflect well on how the Government have handled the recovery. Overall, UK productivity is still 16% below the average for the rest of the G7 countries. As hon. Members have said, that matters a great deal. In a highly competitive global environment, we are not match-fit. We are about to voluntarily increase our barriers to trade—at least in the short term—with our major trading partner, the European Union, as Brexit occurs, so if we do not improve productivity, we face a challenging future.

There are many reasons for that underperformance. Something so persistently bad must be deep-rooted, and many hon. Members have put forward accurate analyses and persuasive arguments about what they want to be addressed. My hon. Friend the Member for Barnsley Central talked about skills and devolution, and I agree entirely. My hon. Friend the Member for Islwyn talked about capital investment and monetary policy, which was spot on. I particularly agreed with the contribution of my hon. Friend the Member for Wirral South about gender disparity and the need to look at issues such as childcare alongside capital infrastructure projects.

I will talk about three additional areas where we need decisive action: transport, automation and business support. I acknowledge, however, that there is a counter-argument to what I will say. Some people will put the UK’s poor productivity down to our higher employment rate. In other words, some might say that, by definition, having more economically active people than France, for example, comes at the expense of higher productivity—so a country could feasibly have a smaller but more productive workforce that exists alongside significant unemployment.

We cannot be satisfied by that explanation. In 2018, the employment rate among people of working age was the highest ever in this country, as we have often heard from Ministers in Treasury debates. But in 2018 the employment rate was also the highest ever in Canada, Germany, Australia and 22 other OECD countries. The truth is that the Government have been incredibly fortunate to be in office at a time when technology has driven up employment rates in all developed countries. We should therefore be in no doubt that we have serious work to do.

On transport, I will shamelessly talk about my own constituency. Every hon. Member present has a sound grasp of north-west geography, but for people who are not aware, Stalybridge, Hyde, Mossley and Dukinfield sit about 10 miles east of Manchester city centre. My constituency’s other border is where Derbyshire begins. It should take about 15 minutes to get from Stalybridge train station to Manchester city centre, but that can happen only if the train turns up. Every single day—today is no different—I get up, turn on Twitter, and see my constituents telling me, rightly, that they are not getting the service they deserve. If I say, “Brexit is coming. We’ve all got to roll up our sleeves and improve this nation’s productivity,” they will reasonably suggest that the first thing to do to achieve that might be to give them a train service that gets them to work on time.

The problem is about much more than underperformance by the franchisee, although that is evident too. It is an endemic problem of inadequate infrastructure outside the south-east of England. Not that long ago, my constituency was full of big firms such as ICI, Christy, which produces towels, and Total Petrochemicals—real industrial giants—that employed the vast majority of local people.

[Jim Shannon]

On that point, there were people on the news this morning who were unable to get a train on time. One lady, who started a new job in Manchester in the new year, had been late to work every day since—not because of her, but because the trains were late. If there is going to be connectivity and dependability on the train service, that service must ensure that the trains are on time and that the number of trains can grow, so that people are not saying, as they were this morning, “If the train doesn’t go on time, I’m going to go by car.”

[Jonathan Reynolds]

I could not agree more. I am delighted to hear about new jobs being created in Manchester, but not that people are struggling to get to them.

My point about the state of infrastructure, and not just the short or medium-term performance of the franchise operators, is that, not that long ago, people said that modern communications technology would make place less relevant to economic development, that we would all be able to work from home, that it would improve productivity, and that we would see the benefits of that. My hon. Friend the Member for Barnsley Central made the point, however, that place is as crucial as ever, because cities have generated the jobs of the future, particularly in the knowledge industries and in services. Our transport system is only now trying to catch up.

If we cannot give people an adequate journey over 10 miles, we have no chance of linking up the north, the midlands or South Yorkshire more comprehensively. From Stalybridge and Hyde, people should be able to go to work by public transport in not just Manchester, but Leeds, Liverpool, Sheffield and, of course, Barnsley. That is why I have always championed transport projects in my constituency, such as electrifying the Huddersfield rail line, which the Government are still prevaricating about and telling us might be partly possible; the Mottram-Tintwistle bypass, which would make it easier to get to Barnsley; and the extension of successful transport networks, such as the Metrolink tram network. That is also why we need schemes such as HS2 and Northern Powerhouse Rail. I say to the Minister that those two projects are complementary, not in competition. They will require major transport investment, but it will be worth it.

Secondly, I want to talk about automation. Many people fear the rise of automation and worry that it will destroy jobs and create huge and painful upheaval. I understand those concerns; I grew up in the north-east in the 1980s, which was a time of tremendous upheaval. We did not deal with those changes well, but, in the right hands and with the right leadership, automation makes the country more productive and more prosperous, not less. The problem in the UK is that we have not enough automation, rather than too much. The International Federation of Robotics notes that, in 2018, there were 71 robot units in the UK for every 10,000 manufacturing employees. The comparative figure in Japan was 303, in Germany, 309, and in South Korea, 631. We need more ambition with technology, not less. It is amazing that, until very recently, one 10th of all the fax machines in the world were in use in the NHS. I would like to see the Government lead on a managed automation plan as part of their industrial strategy, to drive up the use of new technology, and alongside that, have a technology displacement fund to support workers with the skills and training they would need if they faced displacement through new technology.

I also want to talk about business support, because as well as the things the Government need to do to improve productivity, decisions that individual firms make clearly have a big impact, based on the leadership and training they possess. The previous Chancellor, Philip Hammond, used to mention that a lot. There is some excellent work already happening. Many Members will be familiar with Be the Business, the business-led organisation that works with peers to improve and benchmark productivity performance. I am impressed with its work, but I wonder whether it could be taken further. Could Be the Business be the basis for a new social partnership or standing organisation to further expand on that work?

I hope this is one of many debates we will have on this subject in this Parliament, but I want to sound a word of warning. We are told the Government want to ban the word “Brexit” in an attempt to present it as being done, but, in reality, so many of the debates in this Parliament will be related to our exit from the European Union. The impact of future trade deals, in particular, will require serious debate about which sectors will be prioritised and which will be severely disrupted. The announcements we have had so far suggest there will be no substantive deal covering services of any kind, especially financial services, and that, on goods, the just-in-time supply chains that the automotive and aerospace manufacturers depend on will be significantly disrupted. Those sectors are where productivity is currently strongest. For instance, the Nissan car factory in Sunderland has a claim to being the most efficient in the world. If all of us here today are in agreement that national productivity must be improved, we must also make sure we do not lose the good sectors that we have.

We should work to improve the UK’s productivity where we can, but we should not take poor decisions that would make our productivity and therefore our prosperity and the living standards of our constituents much worse. I look forward to what the Minister has to tell us about the Government’s plans in this area.