Queen’s Speech

Lord Bishop of Portsmouth Excerpts

Wednesday 25th May 2016 Lords Chamber

[The Lord Bishop of Portsmouth]

My Lords, in responding to the gracious Speech, I am delighted to welcome, first, the maiden speech of the right reverend Prelate the Bishop of Newcastle and to congratulate her. To be in the House and on this Bench today is a pleasure. We are colleagues again here, as we were in St Albans diocese some years ago. We have a shared conviction that the work of the Church and of government is to support the welfare of all people, reminding ourselves that welfare is properly understood not in the restricted sense in which we so often use it in our debates about benefits and eligibility but as the well-being of all people in the whole of their lives. Bishop Christine has powerfully reminded us of the perspective from her diocese and the north-east.

In my diocese of Portsmouth and in many other places, there has been a welcome for the Government’s intention, announced in the gracious Speech, to improve life chances for the most disadvantaged. Those who are forgotten, ignored, marginalised, hidden or excluded are indeed our collective responsibility. The Speech is helpful in its range of Bills to address some of those who are disadvantaged, particularly children and young people in care or outside caring or stable families. In his speech at the Conservative Party conference last autumn, the Prime Minister spoke of his commitment to end disadvantage and fight for real equality in our country today.

There is less—I suggest too little—emphasis in the gracious Speech on people and families facing economic challenge and disadvantage. The spectre of austerity and its impacts and implications are still real to many. Economic disadvantage is real for those experiencing job insecurity as well as unemployment, and for those suffering financial uncertainty and anxiety—unknown to me and perhaps to most of us here. The point is not just that there are inequalities—of course there will always be—but that there are injustices. These demand more concerted attention than is immediately apparent in the gracious Speech.

Improving lives across the country is entirely the right ambition. It is good to hear continuing commitment to the northern powerhouse and, as a proud Black Country boy, the Midlands engine. But many on this Bench, and more widely in this House I think, will surely remind the Minister that places and counties on the edge—the Isle of Wight, for instance—should have specific and focused support, too.

The legislative programme promises local growth and jobs, the delivery of fast and reliable broadband, and improved competitiveness. This sounds admirable and good, if as yet often rather vague. It is aspirational rather than convincing, but there is not much to give immediate confidence and hope to those whose economic circumstances are as fragile as the social situations of those specifically to be supported in the life chances suite of measures. Commercial spaceports and driverless cars may catch the headlines, but they can seem fanciful diversions, and the United States, South Korea and China are already well ahead in these areas. Such announcements do not offer hope to our fellow citizens who are looking for bold policies for their economic welfare.

The national economic security that the Government trumpet—not, I add, without some justification—must not disguise the economic insecurity felt by some in our nation. The Government seek to entrench strong national economic performance. It would be wrong if entrenching that were achieved at the price of embedding some people in economic insecurity.

Budget Statement

Lord Bishop of Portsmouth Excerpts

Wednesday 23rd March 2016 Grand Committee

[The Lord Bishop of Portsmouth]

My Lords, in contributing to this debate and responding to the Chancellor of the Exchequer’s Budget Statement last week, to the subsequent events and to the debate in the other place, I welcome some proposals, express some surprise, and register disappointment—indeed, shock—at some of the measures announced. First, it is good to congratulate the Chancellor and Government on the intention to raise the tax free personal allowance to £11,500 this time next year. Lifting about 1.3 million people out of income tax is, of itself, welcome, although there are some potential drawbacks to which I will return a little later.

The decision to extend the period in which the 3% stamp duty second-home premium can be reclaimed is a real encouragement to those to whom I have previously referred, particularly elderly people, who want and need to downsize for their own well-being and comfort—and who, in doing this, also release a family home—but for whom the challenge of moving out and in coincidentally, or close to it, is too demanding and stressful. The pay first with reclaim up to three years later approach is not ideal and is hardly an encouragement to downsize, but it deserves some welcome.

The commitment to HS3 between Manchester and Leeds, the road tunnel between Sheffield and Manchester, the widening of the M62 to four lanes, and the backing for Crossrail 2 in London are all to be applauded as significant investments in infrastructure for the country. The announcement of a further £20 million over two years for the First World War centenary cathedrals repair fund has been enthusiastically received. Both my See city’s cathedrals have benefited from this fund already; indeed, 54 of the 59 eligible English cathedrals have done so. A grant of more than £680,000 went to my own Cathedral of St Thomas of Canterbury for essential work on the tower and south transept, in particular.

I was surprised, though, to read in the Red Book’s announcement of an examination of cathedrals’ financial sustainability, that these 59 glorious places of worship are described as a “sector”. Cathedrals are not a sector of the economy like SMEs, banks or the leisure industry, but the vibrant and active heart of dioceses, cities and communities, with growing congregations, witness and service, as the statistics show. They do not form a sector either of the economy or indeed of anything, and while I recognise that a collective noun for cathedrals is not easy to find—suggestions are welcome—it demeans their present and our faith heritage to call them a sector.

My second surprise was the announcement of a consultation on the provision of and facilities at crematoria made in the Budget, of all places. While issues about the number, location and size of crematoria are important, they cannot be addressed in isolation from others involved in ministry and provision at and around death, such as churches, ministers and funeral directors, if the stated aim is to be fulfilled, responding sensitively to relatives and to people of all faiths.

Our surprise at the announcement that all schools must become academies was again that it was made in the Budget, but there is now clarity on the timescale, albeit that it is challenging for everyone. The Church of England, as the provider of 4,700 schools and the largest provider of academies, will use its expertise and its collaborative partnerships to ensure that no one is left behind, especially small rural and coastal schools where the challenge is greatest. Our foundation for educational leadership will help to deliver what is most needed: leaders with vision and skills.

I turn to the disappointments. Sooner or later, a Chancellor must address the issue of pensions. It cannot be skirted, avoided or ignored. In particular, I draw the attention of the Minister to a consequence of the raising of the income tax threshold which, by removing people from paying income tax, also removes the tax incentive to provide for their pensions. These are issues that will not disappear and must be addressed. Ten times in his Budget Statement the Chancellor used the word “generation”. It is clear that he is not unaware of generational issues, but every reference was to the next generation. Intergenerational considerations are ones of morality and equity. Each person in each generation of every age is of value and is a full member of society with privileges and responsibilities. It is not right to ignore the generational issues that confront us not only with regard to our children and their children, but which are the responsibility of those of us who are near or beyond retirement age. We are specifically protected, insulated and exempt from the austerity that has characterised recent Budgets. Protection, insulation and exemption all have their place in national economic policy, but burdens must be borne fairly.

Members of the Government have frequently echoed the words of the present Chancellor in his first Budget—that those with the broadest shoulders would bear the greatest burden of austerity. Not for the first time after recent financial statements I have examined the tables, both official and those in the newspapers, which detail how much various individuals, couples and families would gain or lose from the Chancellor’s decisions. This time, the tables are more striking and chilling than ever. In the Times table, for instance, of 72 different sets of circumstances only eight households face a decline in income, and that of just 37 pence per week. Every other individual, couple or family gains up to more than £400 per year. However, we know that there were, and are, losers.

The outgoing Work and Pensions Secretary, responding to Andrew Marr on his Sunday morning show—I need with haste to clarify that I viewed it on iPlayer, as I was otherwise engaged on Sunday morning—said that he was not in the business of morality; he left that to churchmen. Although I disagree because ethics and morality are for us all, I respond to his challenge and invitation.

It surely behoves us to examine not only the gain and loss tables but our consciences. Given our circumstances and ages, I doubt that many Members of this House will be worse off through the Government’s proposals. The tortuous saga of the last week finally led yesterday to a clarification—that is the politest term I can use—from the Chancellor that the Government had intended that the losers would not be those with the broadest shoulders, but the vulnerable or disabled. That decision was morally indefensible. Having accepted the error, I trust that all of us will be willing to set our course—and the Government their economic course—with a stronger moral compass.

Autumn Statement

Lord Bishop of Portsmouth Excerpts

Thursday 3rd December 2015 Lords Chamber

[The Lord Bishop of Portsmouth]

My Lords, the Chancellor in his Statement in the other place described this as a Government who do big things. I begin by acknowledging with gratitude the big decision to retract the proposals to alter the tax credit thresholds and taper rate. I spoke from these Benches not many weeks ago when we were assured that the Chancellor was listening. It would be possible to say more about that journey of listening leading to this big decision, but that might be churlish. I simply welcome the announcement.

As decisions are taken to move the economy towards higher wages, lower benefits and lower taxes, we shall though continue to ask where the burdens and costs of transition—and there always costs of transition—are being borne. The Government’s aspirations are good ones; as people are helped and supported into good jobs at higher wage levels, it is crucial that work should be encouraged, when possible, alongside commitments to the young, the elderly, the vulnerable and disabled people. I remain surprised—that is a restrained word—when marginal taper and withdrawal rates are considered an encouragement for benefit recipients, when they would be considered discouraging as marginal income tax rates.

There is much to welcome in the Autumn Statement. I welcome the rise in the state pension, as well as commitments to rail infrastructure improvements, particularly beyond the south-east, the retention of free entry to museums and galleries, and support for renovation of military museums, including the D-Day and Royal Marines museums in my own diocese of Portsmouth. However, time is short and I turn to some reservations.

In the pursuit of efficiency and cost-effectiveness, I appreciate that local services and provision are often easy targets. For instance, many of us committed to local communities are disappointed that the delivery of justice through our Crown, county and magistrates’ courts will be further removed and distanced from people. There are issues here of the visibility of justice as well as the costs involved in travelling to a smaller number of bigger, more distant courts. On a similar theme, few of us would criticise the increased spending on elite sport but, of course, provision for sport locally, particularly in schools, has taken a battering over some years in local communities.

I conclude with some comments about the proposals outlined by the Chancellor for increased stamp duty on additional properties. This is a matter which demands attention. Empty properties when people are inadequately housed or without housing are clearly wrong. However, these proposals are not without complexity. I apologise if I have missed further detail, but I ask the Government in the promised consultation on policy detail to bear two groups in mind. First, we need to encourage older people to move at the right time from a family home to something smaller, but that transition can be difficult enough for people who are ill, vulnerable or recently widowed, for instance, without the threat of a stamp duty penalty, if their sale and purchase do not precisely coincide. Secondly, and not without interest for the clergy of my diocese, I refer to those who occupy tied accommodation during employment or service as a condition of employment. Often on low or modest incomes, they seek what may technically be a second home to provide for their housing needs in retirement. There are complexities here.

Budget Statement

Lord Bishop of Portsmouth Excerpts

Wednesday 25th March 2015 Lords Chamber

[The Lord Bishop of Portsmouth]

My Lords, it is right to acknowledge what is good and encouraging in the economic situation—particularly compared to the background of five years ago—and in much of what the Chancellor announced last week, and I am glad to do so. I warmly welcome the continuing fall in the number of people unemployed and, among the proposals, funding for wi-fi in public libraries, investment in transport infrastructure in the north of England, a boost to charities through the raising of the small donations gift aid limit and the extra allocation for mental health services for children and for new mothers, especially when half of my Bishop’s Lent appeal in Portsmouth diocese is to support local mental health charities. I am pleased, too, to hear of the planned rise in the minimum wage, though longing for the living wage to become the norm. There is much to welcome but, as I have indicated, with some caveats.

I turn to two areas of significance to many people, individuals and families, among whom I and my clergy colleagues serve. The right honourable Chancellor’s encouragement of saving is, of course, to be applauded, and yet the provision of tax-free savings income of up to £1,000 a year, like the increase in the ISA limit and the relaxation of terms, does little or nothing to help small-amount, short-term savings for people on lower incomes trying to meet small unexpected costs such as the proverbial washing machine breakdown. Theirs is not saving for income but a buffer for emergencies. The average amount borrowed through high-cost credit is between £100 and £300, yet 40% of people have insufficient savings to cover a shortfall of £300. For these households we need to look for more creative solutions to promote short-term savings, as outlined, for instance, in the Financial Inclusion Commission’s recent report—payroll saving and matched savings schemes or, perhaps, a savings element to universal credit as proposed by the Centre for Social Justice. Research commissioned by StepChange Debt Charity found that just £1,000 in savings would have prevented half a million households from falling into problem debt. If policymakers agree that better-off groups require incentives to save, then lower-income groups should surely be getting similar support.

Similarly, the rise in the income threshold before income tax is paid benefits many but helps least those on lowest earned or benefit income. Of the £2.5 billion to be spent on raising the personal tax allowance, only £1 in every £7 will go to those with below average earnings. The rhetoric of “removing people from income tax liability” and “raising the earnings limit before tax” is common to both Front Benches and, indeed, most political parties. However, as I have said before, it is disingenuous because it ignores the interplay of income tax and national insurance. The so-called national insurance contributions are effectively the same as income tax to most of us. The headline rise in tax thresholds exceeds—not at all to my surprise—the increase in the starting point for national insurance. You may pay no income tax next year with income below £10,600, but you will pay national insurance at 12% on over £2,500 of income below that. The steps of income tax and national insurance combined are rarely headlined, but you will find that they are 12% from £8,060, 32% from £10,600 and 42% from £42,380. The coalition Government’s early changes significantly helped those on very low earnings in the lowest decile of income, as we have heard. This Budget’s changes are no help at all to those lowest 20% of earners already happily lifted out of income tax. The bulk of them will pay a 12% national insurance contribution, or tax.

Your Lordships’ House will understand, finally, that I am grateful for the extra £40 million allocated for the church roof repair fund, increasing the initial £15 million which I welcomed in December following the Autumn Statement. The heavy oversubscription demonstrates the widespread demand—1,900 applications so far with about half likely to be met after this significantly increased provision. I am not making a sectional point here about the religious use of Christian church buildings but reflecting, rather, the importance of churches and religious buildings at the heart of community both symbolically and practically.

The limited time does not allow me to make similar points of welcome, with some reservation, for changes such as, for instance, the savings support for first-time house buyers. Still less can I expand on the apparent acceptance of the rapid increase in the number of people in employment needing recourse to housing benefit—a more than 50% rise during this Parliament. I would have wanted to hear and ask more about the absence of detail on the productivity challenge we face and on what seem to be planned but unspecific welfare savings.

In these comments of welcome with caveats, I do not seek to make party-political points. However, as I emphasised in my remarks about income tax and national insurance, our people should be given not the rhetoric or a partial or palatable version of how it is, but all they need—not least to make informed decisions in six weeks’ time.

Autumn Statement

Lord Bishop of Portsmouth Excerpts

Thursday 4th December 2014 Lords Chamber

[The Lord Bishop of Portsmouth]

My Lords, it is a pleasure to add to others’ my welcome to the noble Lord, Lord Rose, in eager anticipation of his maiden speech. The Statement of the right honourable Chancellor of the Exchequer has been welcomed and applauded in some quarters and criticised in others for its emphasis on what it means for individuals and families, as well as for the national economy. I am glad to see specific, though limited, encouragement for some individuals and welcome support for some often overlooked but important groups in society. The most noticeable and eye-catching announcements yesterday highlighted the changes to stamp duty, ISAs, fuel duty and air passenger tax. For some in our communities, these will be welcome news after an extended and extending period of fiscal tightening and often reduced disposable income. There will, however, be changes—as those on these Benches serving all parts of England know—that will make little or no difference to many who would echo the Chancellor’s wish to back the aspiration to save, work and own a home.

The dignity of work—with the capacity to provide for a family and save for the uncertainties of the future—and the ambition of home ownership remain beyond many. I shall look, and I am sure that I am not alone, for the benefits of the anticipated economic growth to reach those who may now be among the welcome record number in employment, but are still dependent—despite a full-time job—on benefits. The Chancellor’s new target of a personal tax allowance of £12,500 is undated and would just take those working full-time on minimum wage out of tax. Even then, at some future unspecified date, there would indeed be no income tax for those on the minimum wage but still national insurance contributions payable on income above just less than £8,000—an income tax of 12% by another name. Surely the time has come, for the sake of honesty and clarity, to name the reality and not perpetuate a fiction. I echo the conviction, used in a different reference last night, that we challenge this candour deficit.

The Chancellor’s confidence that we,

“stay on course to prosperity”—[Official Report, Commons, 3/12/14; col. 327.]

is not yet the personal experience of many known to me and to the parishes and clergy in my diocese, including the urban and rural areas of coastal south-east Hampshire and the Isle of Wight.

There is much to welcome in the less publicised parts of the Statement. I know that many in this House will delight in the refund of VAT on expenditure by hospices. The taxation of such hugely valued provision and care, predominantly funded by voluntary donations, has long been overlooked and been for many of us indefensible. I welcome, too, the extension of the £2,000 employment allowance to carers, who do so much for family members, friends and neighbours in sickness and disability.

With less individual significance but of great importance to community and business, I am grateful to the Chancellor of the Exchequer for granting £15 million towards the repair of roofs on listed places of worship. This is recognition of the importance of our church buildings, many of which are at risk, to our national heritage. They are a tangible link with our past and very often a focus of local identity. Today, they are increasingly used not only for worship but for wider community activity, and are visited and enjoyed by a large and diverse number of people.

The support scheme for first-time exporters, the expansion of the Funding for Lending scheme with its focus on smaller firms, and at least a partial limit on the amount of past losses banks can off-set for tax purposes against future profits are important steps in encouraging small and medium-sized enterprise in our nations and ensuring that the biggest and strongest pay their proper share of what we should together fund.

This Autumn Statement sets a high level of aspiration and raises the hopes of many. I know your Lordships will understand if I conclude by saying that I pray, and not just hope, that, as we approach further substantial cuts in public spending, the aspiration for the nation will be enjoyed by the many and not just those who now benefit from the welcome but modest steps that the Chancellor has taken.