Covid-19 Economic Support Package

Alex Cunningham Excerpts

Wednesday 14th October 2020 Commons Chamber

[Rishi Sunak]

Thank you, Mr Speaker. If they did care, we would hear from the shadow Chancellor how many jobs Labour’s lockdown would cost.

[Alex Cunningham (Stockton North) (Lab)]

I am grateful to the generous Chancellor for giving way. Today, the North East Child Poverty Commission said that 35% of children in the north-east region are living in poverty. As a direct result of Conservative policies, we are going to see that number increase. What is he going to do about those children?

[Rishi Sunak]

The most vulnerable have been at the forefront of our mind throughout this crisis, which is why it is clear from the distributional impact of our interventions, which was published over the summer, that they have benefited those on the lowest incomes the most. It is there in black and white: a Conservative Government making sure the most vulnerable are protected through this crisis.

Any responsible party of government would acknowledge the economic cost of a blunt national lockdown. The Labour party may say it has a plan, but be under no illusion: a plan blind to the hard choices we face—a plan blind to and detached from reality—is no plan at all.

--- Later in debate ---

[Mike Wood (Dudley South) (Con)]

Hospitality is one of Britain’s biggest employers. Some 3.2 million people across the country rely on hospitality for their jobs, including 4,300 of my constituents in Dudley South. My right hon. Friend the Chancellor has always been a real and true friend of the beer and pubs sectors, in particular. He knows how much they have been affected by this pandemic, and he has delivered a comprehensive and unprecedented economic support package. Without such a support package, many thousands of pubs and breweries would simply not have survived the spring. They would not have got through the first phase of this outbreak.

I do not know whether the Chancellor has seen his rather fetching likeness on posters in pubs up and down the country, recognising the contribution that many of those support measures have made to making our pubs and other hospitality viable over the past six months but, as we are now firmly in a new phase of the pandemic, new measures are vital for those businesses that are not necessarily legally compelled to close. For those that are required to close their doors, the grant he has announced, although it may not cover the whole rent and all the fixed costs, will make a substantial contribution to the costs those businesses incur even before they pull a single pint or serve a single meal. However, there are also enormous challenges facing venues that are not legally compelled to close, those in tiers 1 and 2, where the legal restrictions that have been introduced make it impossible for them to operate. We know that one in 10 pubs has never reopened since March’s lockdown, and about two thirds of those that did reopen were already trading at a loss last month. That was before the introduction of 10 o’clock closing, mandatory table service, and of course the new restrictions that have come into effect today.

[Alex Cunningham]

Simon Longbottom of Stonegate, one of the largest pub groups in the country, has written to me about this, and he could have been making the speech that the hon. Gentleman is making now. He is very concerned that in tiers 1 and 2, he gets no help with his business costs whatsoever. Can the hon. Gentleman give the Chancellor some direct advice on what he needs to do about that?

[Mike Wood]

I would not presume to attempt to direct my right hon. Friend the Chancellor, beyond saying that pubs and hospitality cannot, of course, continue to operate with almost no income and without additional support that is proportionate to the legal restrictions they face. Those restrictions may not be in their immediate area. I have heard today from Titanic Brewery, a brewery in Stoke. The majority of its customers are in Liverpool and Merseyside, which are tier 3 areas, but that brewery will not receive support even though that is where its customers are based. These pubs need urgent additional support; otherwise, many of them are going to close their doors for good and never reopen, which would be a huge loss to not only our economy, but our communities.

--- Later in debate ---

[Alex Cunningham (Stockton North) (Lab)]

It is a pleasure to follow a fellow north-east MP, my hon. Friend the Member for Jarrow (Kate Osborne). The UK has one of the highest covid-19 death rates in the world, with thousands of lives lost and families torn from their loved ones far too soon. The UK is also on track to have one of the worst recessions, with millions out of work and people looking for employment in the most hostile conditions imaginable. Yesterday, it was announced that the UK unemployment rate had surged to its highest level for over three years at 4.5%. The disastrous mix of the pandemic and Tory incompetence continues to decimate our jobs market.

While the national picture is devastating, what is happening in the north-east of England is utterly catastrophic. We have among the highest mortality rates for deaths involving covid-19 and our unemployment rate has soared to 6.6%, the worst in the UK. As Niamh Corcoran of the North East England chamber of commerce said yesterday:

“The North East now finds itself with the highest unemployment rate, the lowest employment rate and the lowest average hours worked of all British regions…Although the Government’s amendments to the Jobs Support Scheme offers some support for our region in the event of tighter restrictions, it does not go far enough.”

For thousands of families, their income is precarious, dwindling or has disappeared, and new child poverty statistics released today by the End Child Poverty coalition show that the north-east has seen the biggest rise in child poverty. In my constituency and next door in Stockton South, the proportion of children living in poverty has risen to 34% and 29% respectively, with others in the Tees valley higher still. Those are not empty statistics, but represent thousands of living, breathing children plunged into poverty as a result of poorly paid jobs or no jobs at all for their families.

The Tees valley is haemorrhaging jobs. Some 12,565 have been lost since March, and thousands more are now destined for the scrapheap thanks to the Tory response, yet businesses in tier 2 lockdown, such as those in my constituency, have no safety net whatever. They are not legally mandated to close, yet we know for a fact that many of them will, and many will not open again. They will have few, if any, customers, but they will get no proper support from the Government. Simon Longbottom, CEO of the Stonegate Pub Company, which has 10 pubs in my constituency, said:

“Whilst we are continually working to protect jobs, with every new instruction from Government our delicate business balance fractures further.”

Even businesses that are mandated to close will only get partial support for wages, which can only mean another wave of job losses.

Across the Tees valley and the north-east, we are crying out for serious and sustained economic investment. Our Tory metro Mayor promised job creation for the Tees valley, but he has spent £100,000 on each job he has created in the last three years. Then there is Houchengate. The Tory Mayor proudly donned his hard hat to announce that he was spending £1 million on a new gate to an industrial estate, with few, if any, jobs. That £1 million could have provided 100 vulnerable businesses with a £10,000 lifeline and probably saved many of them from closure. Sadly, it has been spent on a gate. There is no protection scheme for jobs. For every job announced in the last three years, five have been lost in the last six months.

We need a serious vision from the Government—one that is not just about creating a few eye-wateringly expensive new jobs but about protecting the good jobs that already exist. If the Government do not act, not only will we see the poor suffer even more in communities like mine in Stockton North, but many families who have never experienced poverty in their lives will experience it for the first time. That is not a place that we as a country want to go.