Working People’s Finances: Government Policy

Debate between Matt Rodda and Jessica Morden

Tuesday 21st September 2021 Commons Chamber

[Jessica Morden]

My hon. Friend is right. We owe a debt of gratitude to all those out there in the community—in churches and in other organisations—who have stepped up to help those who are suffering the most.

According to the BBC food price index, food prices have risen by 8.3% since January, with meat and fish up by 22% and fruit and vegetables by 14.7%. As has already been said today, the Government have done very little to address the supply chain issues which are leading to higher prices yet again. We are seeing HGV driver shortages and delays at borders and ports, and we need the Government to address those problems. As we have seen in many news reports, the costs of raw materials for many goods and services have risen as well, affecting the cost of furniture, women’s clothes, vets’ bills, second-hand cars and more. So much for the positive strategy from this Government for shaping our future post Brexit.

[Matt Rodda (Reading East) (Lab)]

My hon. Friend is making some excellent points about the wide range of problems that families are facing—not only the deeply mistaken cut in universal credit and the end of the furlough scheme, but wide-ranging price rises linked to supply chain issues and the Government’s ineptitude in so many respects. All those problems are hitting ordinary people across the country very hard. Do we not face a perfect storm for many of our residents?

[Jessica Morden]

My hon. Friend is spot on. It is indeed a perfect storm, with all those factors coming together at the same time.

Petrol and diesel are also more expensive, costing more than they have since 2013, and the cost of buying a home has skyrocketed in Newport East. Home-Start Cymru has highlighted the huge rise in prices in Monmouthshire, and we have seen the same in Newport. That has put the opportunity to buy beyond many people, particularly our local young people trying to get on to the housing ladder. Housing insecurity has increased, with more mortgage arrears and more people pushed into renting. My hon. Friend the Member for Houghton and Sunderland South mentioned the research carried out by Zoopla, which has reported that rental prices have risen by 5% in the last 12 months, while wages have remained stagnant for many. Average rail fares are rising three times faster than wages, and are 50% higher than they were in 2010. Studies by the Office for National Statistics suggest that those who commute to work are set to experience the steepest increase in rail fares next January. As we heard from my hon. Friend the Member for Reading East (Matt Rodda), it is all coming together in a perfect storm.

There are further problems on the horizon. This week we have seen the crisis in energy costs and soaring prices. Fuel debt is already the third most common type of debt with which people seek help. The energy price cap for October—just as the cold weather sets in, furlough payments end and the universal credit uplift is scrapped—is set at £153, higher than the warm home discount payment, which has been set at the same rate since 2014. As Martin Lewis has said on his website, that payment should be increased in the Budget, and I hope that the Ministers are listening to that too.

The CAB estimates that 2 million households are already behind in paying their energy bills. As I have mentioned the CAB, it is important to note that while demand for debt advice has gone up and up, funding for debt advice services has decreased. If the Government do nothing else as we come into the autumn, they should at least look at properly funding our debt advice services.

The cutting of the universal credit uplift will be the biggest overnight cut to social security, with 8,630 households in Newport East alone seeing their money cut by £20 a week. I know at first hand from my constituents, as many hon. Members do, how the uplift has been a lifeline for those struggling to buy essentials.