Economic Growth

Debate between Rachel Reeves and Clive Betts

Tuesday 14th November 2023 Commons Chamber

[Rachel Reeves]

I thank my hon. Friend for that intervention. The truth is that the combination of austerity, which was five Prime Ministers ago, Brexit without a plan—which relates to most of them—and the kamikaze Budget has contributed to the parlous state of our economy and the cost of living crisis that we are enduring today.

This is a party led—and I say “led” in the loosest sense of the word—by a Prime Minister with no mandate whatsoever and with no authority or vision for the future. This Prime Minister appears to be spending more time polishing his CV in conversation with Elon Musk than fighting for the livelihoods of manufacturing workers in Scunthorpe, Port Talbot and Derby.

And it is the previous Prime Minister, the right hon. Member for South West Norfolk (Elizabeth Truss), who still sets the tune for so many in the Conservative party. She wanted to scrap the bankers’ bonus cap in the kamikaze Budget last year, and that has now been dutifully delivered by this Prime Minister and this Chancellor. When the previous Prime Minister called this year for delaying the timetable for new electric cars by five years, undermining both the net zero consensus and the British automotive industry, this Prime Minister and this Chancellor delivered. Today, the former Prime Minister’s so-called growth commission is setting out its demands for next week’s autumn statement, oblivious to the damage already done. Will the Chancellor tell the House whether he agrees with the person who appointed him to do the job he is now doing and her proposals to slash corporation tax, abolish inheritance tax, abolish stamp duty and other unfunded commitments that make last year’s mini-Budget look like small fry, with tax cuts announced totalling £80 billion?

Labour will never gamble with the livelihoods of working people, as the Conservatives have. Labour’s economic approach is built on a rock of fiscal responsibility, with respect for taxpayers’ money. We will work in partnership with industry to bring about the change that our country so desperately needs. We know what the Tories did last autumn. They blew up our economy with their reckless, unfunded promises and a trashing of our economic institutions. It was a collective failure from the Tories. It was not just one bad apple, but a whole orchard of irresponsibility. The Conservative leadership contest of summer 2022 produced a sum total of £200 billion of unfunded promises. The Chancellor did not want to be left out. His leadership candidacy might not have been as successful or lasted as long as he may have wished, but there was still time for him to make almost £80 billion of unfunded commitments himself on corporation tax, business rates and defence, with no idea how those commitments would be funded.

Following the leadership election last year, Conservative Cabinet Ministers tried to blindfold the nation and global financial markets by preventing the Office for Budget Responsibility from publishing its assessments. The Conservatives knew that the truth would hurt, but they continued to gamble with the livelihoods of our country. The pound crashed, pensions were put in peril and interest rates soared. Working people were made to pay the price for the Conservatives’ kamikaze Budget and reckless eagerness to cut the taxes of the wealthiest few. It was reckless, it was irresponsible, and with Labour it will never happen.

The result is an average Conservative mortgage penalty of £220 each and every month for hard-working homeowners. This out-of-touch Government do not have a clue about what that really means for people. That is a lot of money to try to find from nowhere each and every month. It means holidays cancelled, spending cut back and life made harder. Some families are having to downsize, and others who have been trying to get on the housing ladder for years have had their dreams snuffed out. Meanwhile, rents rise as landlords see their mortgages go up and want to pass the costs on.

[Mr Clive Betts (Sheffield South East) (Lab)]

My right hon. Friend is making a good point about housing costs and the shortage of housing in this country. Is it not therefore astounding that, given the climate we are in, there is not one single word about housing in the whole King’s Speech? There is not a single word about the shortage of housing or the rising costs of housing, no long-term proposals to build on this vague commitment of 300,000 homes, and no idea how to build them.

[Rachel Reeves]

My hon. Friend speaks powerfully on what he knows well. On top of the big challenges with house building and the Government getting rid of their housing targets, the number of homeowners in arrears on their mortgage is also up a staggering 18% compared with a year ago. The Conservatives are no longer the party of home ownership. Higher housing costs are the last thing people need in a painful cost of living crisis. It should never have happened in the first place, and it must never happen again.

National Insurance Contributions Increase

Debate between Rachel Reeves and Clive Betts

Tuesday 8th March 2022 Commons Chamber

[Rachel Reeves]

The hon. Gentleman speaks powerfully on behalf of his constituents, who are struggling with the double whammy of prices increasing, particularly gas and electricity bills, at the same time as this Government are piling on pressure after pressure with higher taxes on the same people who are paying those higher bills. He is absolutely right that people can only take so much, and the national insurance contribution tax hike is, as he says, potentially the straw that breaks the camel’s back.

Politics is about priorities, and it is about choices. So who has the Chancellor chosen to protect—not to tax more? Those who earn huge incomes from a large portfolio of buy-to-let properties or those making large sums from selling stocks and shares will not pay a penny more tax on that income. The super-rich will not be paying more. Roman Abramovich and billionaire oligarchs are not being made to pay more tax. In fact, some of those trying to relinquish their assets now appear to be using offshore vehicles to avoid paying tax. Lubov Chernukhin, wife of Putin’s former finance Minister, and mega-donor to the Tory party, has reportedly lobbied Ministers against higher taxes for the wealthy. As luck would have it, she will not be paying any more tax, unlike people across Britain who work for a living and keep our economy going.

[Mr Clive Betts (Sheffield South East) (Lab)]

My hon. Friend has mentioned not taxing buy-to-let landlords who have a number of properties. I do not think she is aware that the permanent secretary for the Department for Levelling Up, Housing and Communities came to the Select Committee yesterday and confirmed that, where properties are let with council tax and rents being paid in the same bill, the council tax rebate of £150 will go not to the tenant, but the landlord. If the landlord owns multiple properties, as long as they are not owned by a corporate entity, they will get multiple amounts of £150. Some of the landlords are going to be extremely well off, and tenants will have to go and apply to the discretionary fund to get any help at all.

[Rachel Reeves]

I thank my hon. Friend for bringing that to the House’s attention. It is exactly why Labour said that the warm home discount should be expanded to ensure that the money goes to the people who need it, not the landlords.

At the same time as the Government are asking hard-working British people to pay more in tax, they are writing off billions of pounds in fraud. Ordinary people are paying for this Government’s waste. The Chancellor repeatedly ignored warnings about the holes in his covid business support schemes, resulting in £4.3 billion of public money being written off. That does not even include the amounts lost to bounce back loan fraud, including taxpayer cash handed out to drug dealers and organised criminals. That fraud currently stands at £4.7 billion, so that is £9 billion and counting handed to fraudsters. Then there is the colossal Government waste during the pandemic, with £8.7 billion lost on unusable personal protective equipment, all paid for by the taxpayer. Billions has been spent on crony contracts that have not delivered, and every single cheque has been signed by the Chancellor.

Health and Social Care Levy

Debate between Rachel Reeves and Clive Betts

1st reading
Wednesday 8th September 2021 Commons Chamber

[Rachel Reeves]

I will give way to the Chair of the Select Committee.

[Mr Betts]

I bring my hon. Friend back to paragraph 36, which I asked the Minister about, which seems absolutely key. There is no clear money coming from the levy to social care. That is what the Government said. I think the Minister said it would all be revealed in the spending review. Paragraph 36 states:

“The Government will ensure Local Authorities have access to sustainable funding for core budgets at the Spending Review. We expect demographic and unit cost pressures will be met through Council Tax, social care precept”.

On top of all the other hits that working families are going to get, can they expect an above-inflation rise in their council tax next year to pay for the Government’s failure to fund social care properly?

[Rachel Reeves]

I think many councils and the people who work for them and provide social care at a local level will be incredibly worried about what they are hearing from this Government, which is that council costs are going to go up while they are getting no additional money.

Local Contact Tracing

Debate between Rachel Reeves and Clive Betts

Wednesday 14th October 2020 Commons Chamber

[Rachel Reeves]

I could not agree more. My hon. Friend will know that in Leeds, which we both have the privilege of representing, with the expertise we have on the ground, our local authority and director of public health could be doing a much better job than Serco is doing. Indeed, when we have had local outbreaks in Leeds, it has been the local authority going out and knocking on doors to ensure that people know what is going on—something that Serco cannot or does not do.

[Mr Clive Betts (Sheffield South East) (Lab)]

The hon. Member for West Aberdeenshire and Kincardine (Andrew Bowie) said that £300 million had been given to local authorities to do tracking and tracing. My recollection is that it was not given for that purpose. It was given to local authorities to help them develop outbreak control plans and set up outbreak control committees. There has never been any general amount of money given to local authorities to do tracking and tracing. That has been a demand, but it has not been responded to by the Government.

[Rachel Reeves]

I thank my hon. Friend the Chair of the Housing, Communities and Local Government Committee, who is better informed than most in the House.

In the last Parliament, I had the honour of chairing the Business, Energy and Industrial Strategy Committee, and it was a privilege to see the work of so many businesses, which are the backbone of our economy. I also chaired the inquiry into the collapse of Carillion—a house of cards built through outsourced contracts from Government. When I see the endless contracts and the enormous sums of money handed over today to outsourcing companies, I cannot help but conclude that the Government have learnt none of the lessons from that collapse and that failure. It makes me really angry that, despite all the work done and all the evidence presented, the same thing is happening again.

There are clear alternatives, and there always were. The World Health Organisation issued clear guidance for contact tracing, which states:

“Critical elements of the implementation of contact tracing are community engagement and public support”.

That should have been the model for England, so why was it not? We do not need to travel halfway round the world for a successful alternative. We can look to Wales—a model where contact tracing is devolved to local communities. In the most recent figures for Wales, of the 2,190 positive cases that were eligible for follow-up, 91% were reached and asked to provide details of their recent contacts. Of the 10,516 contacts, 83% were successfully contacted. That is in stark contrast with the Government’s Serco model, in which just 69% of contacts were reached—a figure that is getting worse week in, week out.

Perhaps if the Welsh Government were a private outsourcing consultancy, the Government would have paid them a small fortune to take over the system in England. Instead, the Government turned to outside consultants, paid £563,000 of public money this summer for producing a report on test and trace—a report that we have all paid for, but none of us has seen. The Government could have learned valuable lessons for free. They could have gone to Mark Drakeford rather than to McKinsey.

Knowing all this, my hon. Friend the Member for Leicester South (Jonathan Ashworth) and I wrote to the Health Secretary in August, urging him not to renew Serco’s contract and to put public health teams in charge. However, Serco’s contract was not terminated—it was extended. Out of necessity, with Serco tracing failing, many councils have had to create their own tracing systems with a fraction of the money. The Secretary of State for Housing, Communities and Local Government knows that this is a problem. On Sunday, he said that local councils are

“bound to be better than Whitehall or national contact tracers.”

That begs the question, why not give those resources, powers and responsibilities to local government if even the Secretary of State realises that they would do a better job and deliver better value for money? Instead, the Government have wasted over half a year on a system that is failing, with mounting evidence of that growing by the day.

It is quite simple. As Liz Robin, director of public health in Peterborough, has pointed out, people were always more likely to answer a call from a local phone number, and unlike national contact tracers, local tracers are able to knock on doors and visit people if they are not responding. Peterborough has managed to contact between 80% and 90% of the cases that the national tracers were not able to. As the Mayor of Greater Manchester, Andy Burnham, said:

“Council leaders in many regions have been relying on volunteers but this cannot continue. It can’t be done on the cheap—councils have to be given more resources to employ expanded, trained teams.”

The resources need to be shifted from Serco to our local authorities.

The Minister will argue, I am sure, that local and national teams are working perfectly well together, but if she were to show some humility and some honesty, she would admit that it is clear that local services are delivering better. In fact, the national system is hugely flawed, in that it is totally disconnected from the communities while hoovering up most of the resource. This week the Government said they would provide funding to councils for contact tracing in areas with a tier-3 alert level, but what about tiers 1 and 2 to stop them ending up in tier 3? It is a bit like a fire brigade handing out smoke alarms to a family whose house is already ablaze. They needed that support some time ago. If they had had it, they might not have ended up in this situation.