Universal Credit and Working Tax Credits

Alexander Stafford Excerpts

Wednesday 15th September 2021 Commons Chamber

[Naz Shah (Bradford West) (Lab)]

The Government’s cut to the universal credit uplift is beyond a joke and a bad policy decision. The actions of this Government are literally going to starve families across the country. When the Government bring in a jobs tax—the highest tax rise in 50 years—they blame the pandemic, all the while ignoring the stark reality of the effect of the pandemic on the poorest families in our nation. The Secretary of State claims that it was always meant to be a temporary uplift that would come to an end, but let me tell her the reality of the consequences of her Government’s decisions.

The impact of this cut to universal credit could send 500,000 families into poverty, and research by the Joseph Rowntree Foundation shows that it will be my constituency of Bradford West that will be hit the hardest in the whole country. Some 82% of families with children will feel the pinch of this cut—and all this while food prices rise, with supermarket prices rising by 1.3% just this month, marking significant grocery price inflation as supply chain difficulties begin to affect shoppers. For those Tories who disgracefully shame poor families in this country, I am talking about the price rise not on luxury items, but on household essentials. Vegetable oil is at its highest price for over 30 years. The cost of products such as tomatoes has almost doubled in the past year.

Energy prices are set to rise, with households braced for the biggest rise in their energy bills for a decade when the price cap is lifted in October; 15 million customers protected by the cap could see a rise in their bills. Just last month, wholesale electricity prices in the UK soared to record levels, stoking concern that more families would be pushed into fuel poverty this winter. Research from the Trussell Trust on this cut to universal credit found that 1.2 million people say that they are “very likely” to skip meals, and 1.3 million people say that they are “very likely” to be unable to afford to heat their homes this winter if the lifeline is cut.

The story under this Government is not rocket science. It is pretty simple: food prices are rising; energy bills are rising; electricity bills are rising; living costs are rising; the number of families reliant on food banks is rising; child poverty rates are rising; the number of people without jobs is rising; wages are frozen; and this Government are cutting a lifeline to the poorest in our society. This cut is going to hit not just those who are struggling to find work, but those who are already working. Many nurses, primary school teachers, postal workers, retail workers and care workers—our key workers throughout the pandemic—could see on average a loss of £1,790 compared with the past 10 years, according to Action for Children. Single mothers working part-time will be hit by this cut, such as Sophie, who told The Guardian:

“This has felt like my rock bottom”.

At this point, we would expect a Government to support their citizens to get back up, and to provide a safety net, not to burden them further. The same party that dragged its feet to feed hungry children during the school holidays is now taxing working families and taking away the lifeline to the poorest in my constituency. I will not let the Government get away with that.

[Alexander Stafford (Rother Valley) (Con)]

I hear what the hon. Lady says. She mentions taxes. I agree that taxes are always going to hit people hard, but in order to keep the £20 temporary uplift, taxes will surely have to rise. If she wants to keep the £20 uplift, which taxes would she like to raise?

[Naz Shah]

We have had that debate for hours in this Chamber; I am not going to regurgitate it. It is clear that Members on the Government Benches do not agree and are happy with the tax hike. The tax rise affects those at the bottom end of the scale in terms of work and wages. It does not affect Government Members, as many colleagues commented earlier. The truth is that my constituency is the worst affected in the country—that means the children of Bradford West. When children do not get a healthy meal, they do not learn. When mothers have to make the choice between feeding their children and putting the heat on, that is an absolute shame for our country, which is the eighth or sixth richest in the whole world. That is what we are talking about.

We will not let the Government get away with the gesture politics of clapping for key workers last year during the height of the pandemic, while they now rush through inhumane reforms to the tune of scraping spoons on empty dining tables across the country. That is the reality if this £20 cut happens. I urge the Minister, and not just for my constituents in Bradford West: please do not take this lifeline away from those who rely on it and who have to make the stark decision between food and heating for their children and families.

--- Later in debate ---

[Nick Fletcher]

I take the hon. Gentleman’s point. I will come to other issues regarding similar things towards the end of my speech.

This Government are trying to help people to get back to work and get into work. I cannot stress how important it is that people work. This debate is about the money, but it is also about the value that it gives an individual when they go to work. We need to take down the barriers to get to work that have been put in people’s way over the years. We need to incentivise people to get to work, which is what the Government are doing with the kickstart scheme, the restart scheme and JETS—job entry targeted support.

[Alexander Stafford]

Does my hon. Friend agree that it is not just about getting people back into work but about getting people back into high-quality, high-paid jobs, and that is what this Government are focusing on?

[Nick Fletcher]

I completely agree. We need to get people into work so that they start feeling valued and they are contributing to society, which is what most people in this country want to do. Then, with the lifetime skills guarantee, we can educate them more so that they bring more value to the companies they work for and to the state, and we can increase wages and increase the growth of the country in GDP, so that we can probably lower taxes while still pulling in more money. There will be more people working and so maybe we can get more targeted help for those who really need it.

I have some asks to put to the Government. As I say, we really do need to have some targeted help, because there are people who are going to be particularly hit by this decision. As we have heard, the problem may not be the £20 cut but the benefits system as a whole. Certain demographics really struggle and we need to home in on them as we move forward over the next few months and years. Single people are hit particularly hard. The tapering needs to be adjusted so that it pays to do the extra hours’ overtime that many people need, and want, to do to increase their standard of living. There should be no block on that at all. We need to give some targeted help, and it is important that we look at that, but overall the Government have the right policy. Moving forward from this, we should hopefully see the growth and start getting people into these quality jobs, as the Government want.