Spring Budget 2024
Lord Bird Excerpts(8 months, 1 week ago)
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Lord Bird (CB)
I want to talk about the 9 million people who the noble Lord, Lord Lamont, spoke of as being economically inactive—I think it was 9 million or just over, if I got that right. It is interesting—is it not?—that, if you look at what a bank does with its money, you will find that 80% of its transactions are all about the buying and selling of property. That means that 20% is about business. These are the high street banks. That is where we keep our family jewels. It is where we keep all the property. All the prosperity seemingly has to pass through owning property. In Germany, it is the opposite: 20% of what banks spend is on the buying and selling of property. So, we have this really weird world.
What I want to talk about is social housing. Some 19% of people in the UK live in social housing. We do not have enough: 1.5 million people are waiting to be put into social housing if it comes along. We need to build social housing, and affordable housing, so that we can break the situation where housing seems to be everybody’s obsession, whether it is the children of the middle classes or the people who inherit poverty from their parents. I find that so interesting.
The other thing I find interesting is that only about 2% of people who get social housing ever have social mobility. Only about 2% will get their school leaving certificate and go to college or university or get a job such that they can skill themselves away from poverty. We have this enormous problem: we do not have churn in social housing. The Government need to look at why, while we invest in social housing, it is not the basis of building a life for a family; it is about building a life to guarantee that for the next 100 years, the children, grandchildren and great grandchildren will be living in poverty.
If we are talking about creating a growing economy, we need to look at what is actually happening in social housing. Statistics today show that about 60% of people who use A&E come from social housing and from poor housing stock. Some 50% of NHS costs are spent on trying to keep the poorest among us as healthy as possible.
I am not an economist, but I am determined to raise the question again and again. If we are to have social housing, it has to be on the basis of accommodating potential. It should not be simply warehousing people: putting them into social housing where they then become hard on themselves, less and less able to live full human lives.
Banking Hubs
Lord Bird Excerpts(11 months, 2 weeks ago)
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Baroness Vere of Norbiton (Con)
I disagree with the noble Baroness. I would not want to put the current arrangements on a statutory footing at all, because they could be better. That is exactly what we are doing: we are looking at the existing voluntary arrangements and saying that we need a regulatory footing, not for where we are now but for where we should be in future. That is why the FCA consultation is so important. But this also builds on FCA guidance, which is already out there and which banks already follow.
Lord Bird (CB)
Is there a case for working much more closely with the Post Office, which is doing an enormous amount of work in backing up the lack of banking in certain areas? We are working with the Post Office, and its commitment to filling the gap left by banks is incredible.
Baroness Vere of Norbiton (Con)
The noble Lord is absolutely right. The Post Office banking framework has been in place since 2017, and we recognise the really important role post offices can play for people and for small and medium-sized enterprises. The current arrangements are in place until December 2025, when they will of course be looked at again, but we recognise that the more than 11,000 post offices offer a very helpful route to get cash and other services.
Destitution: Low Median Wage
Lord Bird Excerpts(1 year ago)
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Baroness Vere of Norbiton (Con)
What we are trying to do here is boost the entire economy by ensuring that everybody has good work. It is the case that, between the Spring Budget of 2023 and the package that we announced yesterday, there will be more than 200,000 more jobs, but what we are also trying to do is boost the economy in general such that those jobs are well paid. The right reverend Prelate mentioned those who might be sick or disabled. Again, we have to support those people back to work when they can, because we know that work is the best way out of poverty; it can have social and health benefits. At the moment, there are 2.4 million claimants of incapacity benefit, and that has gone up by 700,000 since May 2019. I cannot believe that the nation is getting significantly more sick, and we need to help those people back to work.
Lord Bird (CB)
Does the Minister agree that there are actually an enormous number of people in this country who are the working poor? I was with a whole group of them last week—with the King—who are out there trying to get food. They are trying to get food because, whatever the Government are doing, they seem to be a bit tinkering and not profound in their commitment to end a low-wage economy.
Baroness Vere of Norbiton (Con)
This Government are absolutely committed to ending a low-wage economy, and that is why we have just introduced the largest ever rise in the national living wage. Also, it is not just about the national living wage; I absolutely accept that there will be people who are living on benefits—that may be for a temporary period—and that is why we uprated benefits by 6.7%, which was the September CPI, versus a forecast inflation rate next year of 3.1%, so people will see more pounds in their pocket.
Gross Domestic Product: Wales and the UK
Lord Bird Excerpts(1 year, 4 months ago)
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Lord Bird (CB)
My Lords, as long as there is a situation in government where most of the money spent is on emergency situations and coping with poverty and very little is spent on prevention of poverty and skilling people away from poverty, we will continue arguing about GDP and whether it is high or low in Wales or England. We do not spend money on dismantling poverty—we spend it on making the poor as comfortable as possible.
Baroness Penn (Con)
My Lords, I agree with the noble Lord about the importance of investing in prevention. That is why we have invested in our education system, and we have seen our educational outputs improve under this Government. It is why we are investing in prevention in our NHS. We also need to capture the importance of other aspects that contribute to our country when we look at these matters. That is why we are looking at incorporating measures when it comes to well-being, for example, and not just looking at the narrow measures of GDP.
Budget Statement
Lord Bird Excerpts(1 year, 8 months ago)
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Lord Bird (CB)
My Lords, I welcome the noble Baroness, Lady Moyo. I heard her speech and was very impressed, not least by her call for 3% growth in GDP over the coming years—I think she said by 2026. I have a way in which we can achieve that, but you could not achieve it as an economist; you would have to achieve it another way, which I am here to suggest.
About 10 years ago, I wrote a book called The Necessity of Poverty. It was a very simple book that looked at how important poverty has been in the life of the economy. When Chancellors talk about money and the economics of the country, I think to myself: why are they looking at the world in an arsy-versy way? “Arsy-versy” is a polite printing term for when you print something upside down. The Government are arsy-versy because they do not look at the glaring elephant in the room—in fact, I would say it is more than just an elephant; it is an elephant along with its mum, dad and children—and that is poverty.
Here is the thing about poverty. The Government have in the region of £1 trillion a year to spend; with borrowing, I think it is about £1.2 trillion. If you analyse that and look at how much money is spent on pushing the ball of poverty around, you find that the figure is 40%. So you have a Government, a Prime Minister and a Chancellor of the Exchequer all obsessed with avoiding the fact that the largest amount of money spent by government is on the collateral damage done by poverty. That is extraordinary to me.
Why is there not an economics of poverty? Why are we looking at poverty as though it is something that we just have to put up with? Why are we making as many concessions as possible to keep the poor as comfortable as possible without actually getting them out of poverty? I think that what we need is smaller government. We really need small government; there are too many people in this world who are obsessed with big government. I think we need to cut government. And how are we going to cut government? We need to cut the costs of the NHS by half. We have to do it, and we have to do it as soon as possible. So how are we going to do that—how are we going to get the 3%? I will tell you how: we are going to be bright and clever, and look at the fact that 50% of the cost of the NHS is spent on trying to keep the poor as well as possible. So, actually, if you were to grow up, and if we were to move away from the very primitive look at the economy as though the biggest part of it were not poverty, what we would do is make heavy investments in getting people out of poverty. And we are not doing it.
We spend in the region of £50 billion a year on our education system, but we know that our education system is loaded down with the problems caused by poverty. We know that the four or five children in a class who are having all sorts of problems at home, who are not getting the correct food, and whose parents are under all sorts of duress, will cost maybe 70% or 80% of the time spent by the teachers, so the educational quality of other people is hampered. I know this because I was one of them. I was actually a part of the avant-garde; I was banned from school at the age of 14. I cost an enormous amount of money. Actually, when I was put away as a wrongdoing poverty boy at the age of 14 and 15 and 16, I was costing about three times what it cost to put somebody through Eton. The poshest among us had nothing on me; in fact, you could not get into my school or my reformatory unless you did something wrong.
So we have this really weird world. I do not understand where the Government are coming from, because if you were really to do something, you would do something sensible about reducing that and slashing the NHS. Let us slash the cost to the NHS. Let us remove much of the cost of the NHS, by keeping people healthy and by, when you bring them into this world, supporting them and giving them the priority—the Rolls-Royce service—at that stage. Because if you do not, you will be paying Rolls-Royce prices until they die.
Last weekend, I was down in Canvey Island. My eldest brother is 80, he is unwell, and he costs thousands of pounds a year in his health bills. Because he is unwell, he has always lived in poverty and his children have always lived in poverty, because nobody made the investment in him at the beginning. He is in crisis, and all the people around him are in crisis. I was fortunate, as I said, because every time I got nicked, they taught me something—as I have told this House many times.
I do not want to go on too much, but I want to say another thing. We have the crisis of poverty, and we will until the Government and economists grow up and realise that they are getting rid of the largest amount of their money on poverty—40%. Unless we have that change, whether it is this Government or the next Government on the other side, and unless we have a real growing up, we are not going anywhere. All we will be doing is kicking the can of poverty down the road. We will not be making inroads or accepting the fact that, whatever has been done, it has not actually worked.
I now want to talk about the fact that what really worries me about this Government—and maybe the next Government and the last Government—is the problem that we are in now, which will go on for the next five years in some form or another. That is the problem of the terrible emergency that we are in. I can tell your Lordships that 140,000 children and their parents are in temporary housing, in transitional homes such as hostels. Do you know what that is going to do to them? I bet you a pound to a penny that at least a third of them will have all sorts of problems to do with mental well-being. I can tell your Lordships that, when they enter the workforce, those children will have been so atomised by the experience of being homeless that it will affect their ability to operate in the marketplace, to get the kind of jobs that are necessary—the jobs that will produce the 3%.
At the moment we are not addressing ourselves to the emergency but doing a bit here and a bit there and not even waking up in the morning and saying, “What are we going to do about stopping circa 300,000 families falling into poverty?” They are falling because they have been evicted as they could not pay their rent—they lost their jobs and all those sorts of things. I am absolutely frightened of the fact that, because of that, I am going to wake up in a year’s time and 50,000 people will be wanting to sell the Big Issue. At the moment our sales have gone up. Why? Because there are more people who need to sell the Big Issue. They are not homeless but, if we do not work with them, they will become homeless. Our figures went up last year by 10%. We do not know where it is going to go this year. Will it be 15% or 20%? We cannot handle that number of people. We work with about 7,000 to 9,000 people a year.
I am saying that we are in an emergency. I suggest to the Government that they bring that emergency forward, because it will echo down the next 10, 20 or 30 years and we will have the decimation and destruction of people who will be caught in poverty and will not be able to respond to the opportunities that come. I suggest that we need a COBRA. We need what we tried to do during Covid; you wake up in the morning and you get all the Ministers together and all the departments working together and—God bless them all—they get somewhere in the end. We need an emergency COBRA to address the fact that we do not want to condemn the next generation and the bit of the generation that is moving on and push them into poverty. That is the costliest thing to do—the Government will never get their 3% then, because their costs will be up and it will be 50%, but the money will be taken by the problems of poverty.
I am sorry—I am going on a bit. Normally I try to be economical. There are a couple of really wise things. Can we ask the Government to stop no-fault evictions? That would be a useful thing as it would stop hundreds of people falling into homelessness because they have been evicted by their landlord. Can we also look at why we cannot give universal credit so that it matches the requirements of the crisis that people are in at the moment, which is the crisis of inflation? Can it not match that? Otherwise, people will not pay their rent because they will use the money elsewhere, and they will fall further into poverty and be evicted.
The other thing I would like to do is to liberate our local authorities to be able to pay the rent and for central government to give local authorities enough money so that it is the rent that is expected and there is no gap, because if there is a gap between the money that the Government give and the rent, people will be thrown out on the street. Anyway, those are my arguments. Thank you very much and God bless you all.
Cross-Government Cost Cutting
Lord Bird Excerpts(1 year, 11 months ago)
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The Parliamentary Secretary, HM Treasury (Baroness Penn) (Con)
My Lords, the Government announced the efficiency and savings review in the Autumn Statement to keep spending focused on government priorities and to help departments manage the inflationary and other pressures on their budgets; all savings will be reinvested in departments’ budgets. We need to be ambitious as a Government in finding ways of working more efficiently and focusing spending on where it delivers the greatest value for the taxpayer. The Government will report on progress in the spring.
Lord Bird (CB)
Does the Treasury also measure the costs of cost-cutting, because that is the important thing, is it not? It is all well and good to cut something, but if the damage is greater than the savings, surely it is not wise government to do that.
Baroness Penn (Con)
I put it to the noble Lord that there is a cost to not having efficiency and value for money in our services. That means we can deliver less for people for the money that we are putting into them. We want to see it the other way around, and that is the aim of this review.