Women’s State Pension Age
Alison Thewliss Excerpts(8 months, 3 weeks ago)
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Mel Stride
The hon. Gentleman suggests that we are hiding behind the court cases. I have explained the relevance of those cases and the conclusions to which both the High Court and the Court of Appeal came in 2019 and 2020. We are not hiding behind anything; in fact, as the hon. Gentleman knows, because I read out the quote earlier, on Thursday 21 March—last Thursday—the chief executive of the ombudsman said on Sky News:
“The Government, the DWP, completely co-operated with our report, with our investigation, and over the period of time we have been working they have provided us with the evidence that we asked for.”
Alison Thewliss (Glasgow Central) (SNP)
WASPI women in my constituency have campaigned relentlessly for many years, and I pay tribute to all of them, particularly Rosie Dickson, who has done so much at various events around Glasgow, and who came down to London to put her case directly in Parliament. WASPI women are watching this debate, and when the Minister says that the Government will carefully consider things, they hear, “More delay.” What they hear is that they will not get the money to which they are entitled, and that too many more women will die before they see a penny from this Government. When will they receive their money?
Mel Stride
Given that the report was published as recently as last Thursday, it is a bit of a stretch to suggest that I should have come to this Dispatch Box with a fully formed set of proposals of the sort that the hon. Lady may wish for. I think that what her constituents and others want is a Government who look at the report very carefully, give great consideration to the complex issues involved and the report’s findings, and engage closely with Parliament, exactly as we did with the ombudsman.
Oral Answers to Questions
Alison Thewliss Excerpts(9 months ago)
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Paul Maynard
If the hon. Gentleman will wait and listen to the answer, I will explain what we are doing to increase uptake of pension credit. Not only do we have major nationwide campaigns, our latest one featuring Harry Redknapp; we are also carrying out experimental campaigns, such as writing to all those pensioners who are in receipt of housing benefit, to make sure that those most likely to be eligible for pension credit are being targeted to take it up.
Alison Thewliss (Glasgow Central) (SNP)
It is all very well people applying for pension credit, but The Well advice centre in my constituency has identified massive delays in people getting the pension credit for which they are eligible. One constituent got in touch with me in February, having applied for pension credit in August 2023, and they were still waiting for the application to be resolved, resulting in a backdating of more than £8,000. Would that money not have been much better in the pocket of a pensioner who needed it right then, rather than waiting indefinitely for the DWP to get back to them?
Paul Maynard
I am obviously disappointed to hear of that constituent’s experience, but it is not something I hear very often about pension credit. We have an excellent delivery record and an extremely low level of complaints.
Oral Answers to Questions
Alison Thewliss Excerpts(1 year, 1 month ago)
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Alison Thewliss (Glasgow Central) (SNP)
Last week, I received a letter from the Minister for social mobility, youth and progression, the hon. Member for Mid Sussex (Mims Davies), saying that she intends to close down the Jobcentre Plus on Renfield Street, which was opened on a temporary basis in 2021. I know from having met the staff there that they have done a huge amount of work to get people in through the door—and in particular to work with employers—and into employment, including a programme for Ukrainians. Why does the Department want to throw that all away and close it down?
Guy Opperman
I think the clue is in the name: it was a temporary jobcentre during covid. I am happy that the specific Minister will write and further explain the situation.
Oral Answers to Questions
Alison Thewliss Excerpts(1 year, 3 months ago)
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Mims Davies
I thank the hon. Lady for making those points. Child maintenance payments keep about 160,000 children out of poverty each year and are absolutely vital. They play a key role in ensuring both parents play their part in supporting their children whether or not they live with them. If the hon. Lady has particular cases or interests, I am happy to meet her.
Alison Thewliss (Glasgow Central) (SNP)
A constituent of mine has a small work pension, rendering her ineligible for pension credit yet still struggling to get by. Another constituent who is 80 and misses out on pension credit by just £10 has contacted me several times angry and hurt that he now has to pay for his TV licence. Will Ministers review the rules on pension credit, because ineligibility for so many of the passported benefits leaves many of my constituents out of pocket? They want to be eligible for it but are not.
Laura Trott
Obviously this is without looking at the individual case, but it is important to note that the threshold has gone up significantly, so it is worth questioning whether the hon. Lady’s constituents are now eligible. If not, applications to the household support fund can be helpful, and local councils may be able to offer housing benefit support. If there is an individual case that she would like to write to me about, I am happy to respond.
Oral Answers to Questions
Alison Thewliss Excerpts(2 years, 1 month ago)
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Martin Docherty-Hughes (West Dunbartonshire) (SNP)
Alison Thewliss (Glasgow Central) (SNP)
The Parliamentary Under-Secretary of State for Work and Pensions (Mims Davies)
We have already taken decisive action to make work pay by cutting the universal credit taper rate to 55% and increasing UC work allowances, which mean that on average low-income households have about an extra £1,000 a year. In addition to that, two cost of living payments, which total £650, are being paid to more than 8 million low-income households on UC, tax credits, pension credits and legacy benefits. There has also been extra help for pensioners and those on disability benefits. That totals more than £37 billion this year.
Mims Davies
I thank the hon. Gentleman for that question. I note that he will be visiting his Dumbarton Jobcentre Plus shortly, which I am sure will help him to see the range of interventions in jobcentres, as well as the benefits calculator and the cost of living interventions on gov.uk. I remind him that the Scottish Government have a range of powers, including the ability to provide their own welfare benefits to people in Scotland using existing reserved benefits. The Scottish Government can see how they would like to use their powers and budget themselves.
Alison Thewliss
Happy Hallowe’en, Mr Speaker. Many of my constituents have found social security payments inadequate, because they have not kept pace with the cost of living. For William Thompson and Anne McCurley, however, it is even more frustrating because they narrowly miss out on pension credits and all the passported benefits—Anne misses out by only £3 a week. Will the Minister review the cut-off so that as many people as possible can access the support that they badly need this winter?
Mims Davies
I thank the hon. Lady for the point, and I have mentioned two particular websites that I think are incredibly important for people to make sure they get every single bit of help they need. There is always a cut-off point, which is very challenging. I understand there is a huge amount of work going on in her own community to support people, including getting people into work and progressing them, and working with local employers. Of course, the pensions issue is something that the Secretary of State has just answered and will be further updated on 17 November.
Working Tax Credit and Universal Credit: Two-Child Limit
Alison Thewliss Excerpts(2 years, 8 months ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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Steve McCabe (in the Chair)
Despite what might be happening elsewhere, we have a very important debate here. I call Alison Thewliss to move the motion.
Alison Thewliss (Glasgow Central) (SNP)
I beg to move,
That this House has considered the two child limit of working tax credits and universal credit.
It is a pleasure to see you in the Chair, Mr McCabe. You are quite right to point out that, while other debates might be happening, this debate is actually quite important. It has been six years, nine months and 13 days since the Budget in 2015, when the two-child limit appeared in the Red Book, and just over five years since it came into force. Some might be wondering why I am bothering to come here today to complain about this policy; it is because, for me, it is a fundamental injustice and deserves to be looked at seriously.
The Child Poverty Action Group and the Church of England estimate that 1.4 million children in 400,000 families are now affected by the two-child-limit policy. Unless it is abolished, the number of children affected will reach 3 million, as more children are born under the rules.
The two-child limit for child tax credits and universal credits broke the long-standing link between need and entitlement, on the basis that families in receipt of state support ought to face the same choices as those supporting themselves solely through work. This is a false narrative; it is the myth of the benefit queen. This policy has never been about fairness.
The majority of families affected by the policy are in work—low-paid jobs, working to support their families. In mentioning that fact, I do not seek to stigmatise those not able to work—many have caring responsibilities, disabilities or other reasons that prevent them from working. They ought to have the protection of the social security system, too.
In many cases, it is all but impossible for those who are working to take on more hours to make up the drop in income created by the two-child limit. The Work and Pensions Committee pointed out that the cost of childcare can also mean that families will not be able to make up the loss by working more hours. The two-child limit is a poverty trap.
Many people are just not aware of the policy, which is a significant issue. They do not know that it will apply to them. The Government intended to influence people’s choices to have children, but they have certainly not been influenced in any meaningful way by a piece of Department for Work and Pensions legislation.
The latest research by Mary Reader, Jonathan Portes and Ruth Patrick on whether cutting child benefits reduces fertility in larger families establishes that the two-child limit is not leading to any major reductions in fertility among those likely to claim benefits. All the policy does is punish people for their circumstances and drive up child poverty rates.
Imran Hussain (Bradford East) (Lab)
I thank the hon. Member for bringing a very important debate to this Chamber. The reality is that this Government’s ideological, intentional austerity agenda, more than a decade long, has led to the biggest cost of living crisis in our generation and rampant poverty on our streets. Does the hon. Member agree that it is policies such as this that lead to children going hungry in our constituencies, and that is why it needs to be scrapped immediately?
Alison Thewliss
I absolutely agree. That poverty is deep and enduring, and prevents those children from reaching their full potential. We cannot forget the choices that many families are having to make because they just do not have enough money coming in.
No one can predict the course of their lives, certainly not the course of their children’s lives, and nobody can plan for absolutely every eventuality—it is just not the reality of life. CPAG estimates that, during the pandemic, an additional 15,000 families, who never envisaged losing their jobs and incomes in a global health crisis, were affected by the two-child limit, as they claimed universal credit for the first time. That includes people who worked in sectors that shut down and have yet to recover, people who tragically lost their partners to covid and people who still suffer the effects of long covid. Domestic abuse rates increased during the pandemic, which resulted in some families separating for good. In each of those scenarios, families with more than two children were not afforded the dignity of the support they required, because the Conservatives made a judgment back in 2015 about the appropriate size of a family for benefit claimants.
Fleur Anderson (Putney) (Lab)
I congratulate the hon. Member on securing this debate, which I agree is very important. In Putney, Roehampton and Southfields, families are having to go to food banks more often. I have spoken to Wandsworth Foodbank and Little Village, which helps local families, and they have said that the thing that would make the most difference in stopping poverty in my area is scrapping the two-child benefit cap. Does she agree that the Minister should look into this, assess the impact and scrap it as soon as possible?
Alison Thewliss
I absolutely agree with the hon. Member, and she makes a good point about food banks. Essentially, the Government are saying that they will pay to feed and clothe only two children, and not provide for the rest of those families. Either that money gets very stretched or families cannot stretch any further and they end up going to food banks. In a country as wealthy as this one, families should not have to go to food banks just to put food on the table for their children.
I bring the debate today to highlight the enduring flaws in this UK Tory Government’s two-child limit and to ask them to end it before things get even worse for families struggling today.
Margaret Ferrier (Rutherglen and Hamilton West) (Ind)
An exception to the two-child limit is where the child was conceived in non-consensual circumstances, but to be eligible for this exception the parent must be able to point to either a conviction or a criminal injuries compensation claim. Does the hon. Member agree that as rape conviction rates are so low, because the bar for evidence is so high, this requirement further victimises claimants?
Alison Thewliss
That is absolutely correct. I will go on to talk about some of the exemptions to the policy and how ludicrous they are, but for a crime such as rape to have some place within Government policy on benefits is quite abhorrent.
The first difficulty with this policy is that it gives an arbitrary cut-off date, resulting in two classes of families: those with children born prior to 6 April 2017 and those with children born after that. For the arbitrary quirk of fate of bringing a baby into this world a minute after midnight, a family will find itself £2,935 worse off per year. I give some credit to the former Secretary of State, Amber Rudd, for not making the policy retrospective, as was originally intended. However, having recognised the inherent unfairness of the policy, she ought to have abolished it altogether.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
The hon. Member is making a powerful speech, and she talked about changes before and after this policy was introduced. Has she seen the figure that since covid started, 27% more families now fall under the two-child-limit policy? Does she agree with the Bishop of Manchester, who said last year that the policy “defies moral justification”? When it was first introduced, 60 bishops, as well as Muslim and Jewish leaders, wrote a joint letter to The Times saying:
“Children are a private joy and a public good. They are all equally deserving of subsistence support.”
Alison Thewliss
I absolutely agree with the hon. Member on that point and with those religious leaders who wrote that letter then and who continue to campaign on the issue now. I will touch on some of that a little later.
The effect of the two-tier policy that has been created is that a family with three children, the youngest being six, will receive support. However, a family with three children, the youngest being four, will not. The needs of these families are exactly the same, but this Government have decided that they are not entitled to the same support. Previous research on the issue has found that in some cases older siblings can come to resent the new baby in the family, because they have lost out on their activities, their sports clubs and the things they used to do because the family no longer has the money to get by. It is desperately unfair that children are already losing out on wider life experiences because of this discriminatory policy, as well as now on the very basics because of the cost of living crisis.
I will describe some of the other inconsistencies in the policy in some detail, because every time I explain them to people they are absolutely baffled; I would like to hear the Minister’s answer to the mad exemptions that exist. On the exemption policy for multiple births, if someone happens to have twins after having a single birth, there is an exemption to the policy, which is fine. If they have twins first and then go on to have another baby, they are not entitled to support, presumably because they should have known better. There are three children in each scenario, but different support.
As my hon. Friend the Member for Rutherglen and Hamilton West (Margaret Ferrier) mentioned, the rape clause is even more pernicious. For this exemption, a woman has to fill in a form and have her traumatic experience verified by an official to say that her third child was conceived through rape or a coercive relationship. This form exists and has to be signed off by a professional to verify that someone has had a child in that circumstance. However, it can be claimed only if the person is not living with the parent of that child.
We know that forcing a woman to leave a relationship can put her and her children in danger, but that reality does not appear to trouble the Department for Work and Pensions. Some 1,330 women claimed under the exemption in 2021. The really perverse part of this pernicious and stigmatising policy is that it applies only to third and subsequent children. If someone’s first child was conceived as the result of rape and they went on to have two more children, that is just unlucky for them as far as the DWP is concerned.
The exemptions around adoption are also perverse. There is no additional support for an adopted child if they are adopted from abroad, or if a person and their partner were that child’s parent or step-parent immediately before they adopted them. Why on earth would this Government want to disincentivise adoption? The exemption for kinship carers, who were losing out on support for their own children because they had been so good as to care for others, was only granted after the Government were taken to court. It should not take legal action for this Government to recognise and fix their mistakes, but we know the DWP repeats this pattern again and again.
The effect of this policy is well documented and well assessed, and I pay tribute to the Child Poverty Action Group, the Church of England and other faith groups including the Interlink Foundation, which represents the orthodox Jewish community. As my hon. Friend mentioned, there is a discrimination at the heart of this policy that affects people of faith. It sticks in my craw to see Easter greetings from Members of this place—the Holy Willies of this place—when their faith does not extend to supporting children, who they are instead actively pushing into poverty through the policies they advocate. How does the Minister believe this policy affects people of differing backgrounds and faiths, and how can he say the policy is fair in this context?
Jim Shannon (Strangford) (DUP)
I am normally pleased to hear the hon. Lady speak on any issue, but particularly so on this issue, given her knowledge and expertise. On her point about faith, does the hon. Lady feel that a human rights issue could well be at stake here? While that is not a direct responsibility of the Minister, it is a part of this debate that must be considered. By enforcing this rule, the Government are creating a human rights issue for people who do not want to be under that law.
Alison Thewliss
The hon. Gentleman is absolutely correct to point that out. There are particular issues with this policy for women in Northern Ireland, related to the rape clause and issues of abortion. When this policy was brought in and was being implemented, Northern Ireland particularly was an afterthought to this Government, just as faith groups have been. Children are regarded as a blessing—not just by people of faith, but particularly by them. Therefore, the policy of this Government to limit support to the first two children in a family has a disproportionate effect on people of orthodox Jewish, Muslim or Catholic faith, for whom abortion and contraception just are not options. We already know that this policy is forcing some of those families into significant poverty.
We all know that contraception is not infallible, even for those who actively choose it. In one of its reports, CPAG has quoted a parent who said:
“I got pregnant despite having an implant. When I found out it was too late for [an] abortion. I’m struggling since then as I had to give up my work”.
I very much support a woman’s right to choose, but a Government welfare policy should not be forcing people into abortions. The British Pregnancy Advisory Service has carried out its own research on this issue and found that it was a factor in the decision making of women who were aware of the policy. BPAS has said:
“We have warned the government that the two-child limit is forcing some women to end what would otherwise be wanted pregnancies. Since 2016, the number of abortions performed to women with two or more existing children has risen by 24%, compared with an increase of 11% performed to women with one existing child.”
I would like the Minister to comment specifically on how he is monitoring the impact of this policy on women’s decisions, and why he considers this to be an appropriate part of social security policy.
We are in a cost of living crisis, and the impact of that crisis on larger families is particularly acute. Energy and food prices are soaring, and this Government did little in the spring statement to hand out a lifeline to people who are struggling right now. Can the Minister outline what, five years in, is the ongoing monitoring of this policy? What consideration has been given to removing it altogether? What conversations has he had with the Chancellor about this policy? When the modelling of its impact on child poverty is so clear—I almost wish we were in one of those American Senate hearings where I could show the graph, because it is absolutely crystal clear—why are this Government, dystopian as they are, continuing to pursue a policy that they know has failed in its objectives? It is simply causing more hardship in every passing year. Almost half of all children living in families with more than two children are in poverty, and the Government must know that. I want to know why they refuse to act.
The Scottish Government have done their best to support families with the Scottish child payment, which we brought in and are increasing, and on which there is no two-child limit, under the social security powers we have. With 85% of social security powers still held in this place, the UK Government bear a responsibility to do what they can. In the face of the UK Government cutting giant holes in the safety net, tackling poverty and making Scotland the best place in the world to grow up in is a challenge. Our devolved powers go only so far. We need all the powers of a normal nation to ensure that we can support all our people and value every child, and not just the first two.
Alison Thewliss
I thank all hon. Members who came to today’s debate. I am grateful to them for their support and to those who came to speak or make interventions, because this issue has not gone away. It will continue to get worse as more families move into the scope of the two-child limit. I give particular thanks to the hon. Member for Strangford (Jim Shannon), because he has been at my side through all of this debate, right from the very beginning, and I am particularly grateful to him for that.
My hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown) made the point that at a stroke—by getting rid of this policy—we could lift 250,000 children out of poverty tomorrow. If the Government had the power to lift 250,000 bairns out of poverty, why would they not do it? Why would you deny those children the dignity and fairness of having a warm meal in their tummy and having the heating on at night? Why would you do that? I do not understand.
I will continue to campaign on this policy. I will not let it be forgotten, because there are constituents in Glasgow Central, as there are in every constituency up and down these islands, who are being affected by this, and there are more and more of them every single year. I will be there until this policy is gone. I will keep campaigning on it, because it remains an injustice—it was always an injustice. To value some children more than others cannot be allowed to stand in a moral society. I thank everybody who has come to contribute to this debate.
Question put and agreed to.
Resolved,
That this House has considered the two child limit of working tax credits and universal credit.
Oral Answers to Questions
Alison Thewliss Excerpts(3 years, 1 month ago)
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Dr Coffey
I strongly agree. That is why we are working through local authorities, which understand their communities well, without there being blanket schemes. It is important that that is reflected around the country, including in places such as High Wycombe.
Alison Thewliss (Glasgow Central) (SNP)
The Parliamentary Under-Secretary of State for Work and Pensions (Guy Opperman)
I am advised that all delayed claims have been processed, except for those that require further customer information. Some 70% to 80% of claims are now made digitally by Get your State Pension, with over 50% being cleared the same day. We are, however, introducing a new tele-claims service that will supplement the paper applications, which we accept have been lengthy and have incurred delays.
Alison Thewliss
I thank the Minister for that answer. Two of my constituents should have started receiving their state pensions at the start of August and were on the verge of destitution when I was contacted in October by the welfare rights officer at Glasgow West housing association. Following the intervention from my office, both have now received what they were due from the Department for Work and Pensions, but they are by no means the only people to be hit by this latest DWP shambles. I am really concerned for people who do not have anybody like a housing association or an MP to advocate for them, so will the Minister tell me how many people he estimates have been affected by this altogether? What more can he do to put it right and make sure that those who do not have somebody advocating for them do not get left behind?
Guy Opperman
We accept that there have been delays, and we have taken significant action in the form of the redeployment of 700 staff to address those. I am pleased that the cases of the two constituents that the hon. Member outlined have now been addressed. The particular problem has been in respect of the receipt of further information from particular applicants, and those matters are being addressed on an ongoing basis.
Universal Credit and Working Tax Credits
Alison Thewliss Excerpts(3 years, 3 months ago)
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David Linden
My hon. Friend is right to draw attention to the difference between what the Conservatives say in the Scottish Parliament and what they do—that is, in Westminster, probably not vote for this motion tonight. Of course, there is a wider question: what is the purpose of devolution? Is it meant to be a sticking plaster for bad social security policy coming out of Westminster? The Scottish Government can introduce measures such as the game-changing Scottish child payment, and can go further and double that, but if the Government vote for this cut tonight, it will mean that the Scottish child payment is essentially nullified, and that will be in the hands of Scottish Conservative MPs.
Alison Thewliss (Glasgow Central) (SNP)
My hon. Friend is making an excellent point about the families who will be affected by this cut. I believe that my constituency holds the record, with 63% of working age families with children who will be affected. Does my hon. Friend agree that, no matter how hard charities, Glasgow SE Foodbank, the local authority and the Scottish Government try to help mitigate that, the cuts from the Tories are so deep that families in my constituency will go hungry this winter, and the Tories will not lift a finger to do anything about it?
David Linden
My hon. Friend is absolutely right, and I pay tribute to the work that she has done in trying to lobby the Chancellor, who appears to have decided that he will deploy the politics of Margaret Thatcher and pit people against each other. Unfortunately, it is my hon. Friend’s constituents who will feel the wrath of that.
The British Government need to face the reality of what the cut will mean for people across these islands. Slashing universal credit will impose the largest overnight cut in the basic rate of social security since the modern welfare state began. It will mean millions of families being plunged into poverty, facing real financial hardship as we go into the cold, harsh winter months. So when the Division bell rings tonight, my party will vote Aye to this motion, and we will continue to push for these cuts to be cancelled. However, it is increasingly clear that independence is the only way to keep Scotland safe from the cruel Tory cuts that only seek to deepen inequalities and poverty in our communities.
Independence will guarantee Scotland the full powers needed to build a strong, fair, and equal economy, while eradicating poverty and supporting the most vulnerable people in our communities. So yes, we will vote for the motion on the Order Paper tonight, but I suspect that the only vote that will truly end the ongoing Tory assault on social security is a vote for Scottish independence in the upcoming referendum, and, frankly, it cannot come fast enough.
Oral Answers to Questions
Alison Thewliss Excerpts(3 years, 7 months ago)
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Alison Thewliss (Glasgow Central) (SNP) [V]
The Parliamentary Under-Secretary of State for Work and Pensions (Will Quince)
I have explored this issue, which is a little bit more complicated than the hon. Lady makes out. We have been working with housing associations. I would be very happy to sit down with her and have a briefing on the matter with officials.
Income Tax (Charge)
Alison Thewliss Excerpts(3 years, 9 months ago)
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Alison Thewliss (Glasgow Central) (SNP) [V]
It is just under a year since I stood up and made a speech in response to the 2020 Budget in a Chamber packed to the gunnels with MPs. The notion of delivering a Budget speech from my front room was absolutely unthinkable, along with many things we have adapted to over this past year, when we have seen economic shocks as well as personal and social ones. Phrases we rarely, if ever, used before are now in constant use: face coverings, social distancing, extended households, and furlough.
I appreciate that the Government had to move quickly to provide support in a rapidly changing and deadly pandemic. Choices were constrained by the circumstances, and large sums of money were rapidly moved to protect businesses from the worst economic crash any of us, we hope, are likely to see in our lifetimes. There is great hope on the horizon with the advancement of the vaccination scheme, but we cannot tell how long this crisis will last. The Chancellor and the Prime Minister have form in telling the public it will all be over by the summer, then by the autumn, by Christmas and by spring, so we need to caw canny with what lies ahead.
As I have said consistently, arbitrary cut-off dates in the support schemes are deeply unhelpful. The last cut-off for furlough planned for last year resulted in people losing their jobs as employers just could not manage the additional costs. Six months on, the only thing that has changed for businesses is an additional burden of debt and bills, with VAT deferrals coming back online soon. Businesses’ income has not increased, and adding to their employers’ costs is not risk-free. We on the SNP Benches support an extension to the furlough scheme for as long as it is necessary, in all countries of the UK. We also support the extension to the self-employment income support scheme, as announced by the Chancellor, but it does not go nearly far enough, leaving millions of people still locked out of covid support. The cliff edge in the fifth SEISS grant for those above or beneath the 30% drop in turnover seems incredibly unfair and incredibly steep. The Chancellor said yesterday that he will do “whatever it takes” to rescue our economy. He said that a year ago too and it is cold comfort to those who are yet to see a penny piece in support from his Government. The excluded have been mentioned over 1,000 times in Parliament by the gaps in support all-party group and reports from the Treasury Committee and the Business, Energy and Industrial Strategy Committee. Solutions have been offered to this Government and it is unacceptable that the Chancellor continues to ignore these cries for help.
The Chancellor made much of the Office for Budget Responsibility’s forecasts of a quicker than anticipated recovery, but it struck me that the key considerations of the OBR’s forecasts should not necessarily be the forecasted numbers themselves, but the uncertainty around those numbers. It is that uncertainty that the Chancellor needs to respond to. The OBR has been clear on the unrealistic nature of the Government’s spending plans. The Treasury envisages only a 2% increase in spending after five years. That was already planned pre-pandemic and does not really capture the potential legacy costs of covid for our public services. The UK Government are planning further cuts of £3 billion to departmental budgets on top of the £12 billion cuts announced in November. The OBR describes the Government’s ability to meet those cuts while dealing with the pandemic as
“a significant source of uncertainty”.
I cannot stress enough how much I feel that the Chancellor cutting his way out of the crisis is the wrong way to go. The Chancellor said that once we are on the way to recovery we will need to begin fixing the public finances, but I object to that characterisation of the issue. Public finances are not something that get broken and need to be fixed; they should meet the needs of our population, not the other way around.
All countries around the world have stretched every sinew to save lives in this pandemic. As we see from the US and our European neighbours, the Chancellor ought to use the powers that he has open to him to stimulate growth and provide an investment-led recovery. The Scottish Government have outlined an ambitious five-year infrastructure plan with a particular focus on affordable housing. They are managing to do that even with a 5% cut to their capital budget. The Chancellor had an opportunity to reverse that and refused to do so yesterday. We have called on the Chancellor to provide a £98 billion fiscal stimulus to kickstart this investment-led recovery, with investment focused on creating jobs, boosting incomes and a green recovery. Instead, it looks like the Tories are returning to form and pursuing a contractionary policy against all better judgment. That approach did not help us to recover quickly from the 2008 recession and it certainly will not help us now. The risks of a long-term return to austerity are clear: we face stagnant productivity and years of lost growth. Public services have been cut to the bone. There is no doubt that without the previous 10 years of austerity our public services would have been in a much better position to deal with the impact of the pandemic.
The OBR’s analysis of the Budget explicitly cites
“higher rates of infection, hospitalisations, and deaths”
in the UK as a driver of economy inactivity. Its figures are stark. The UK’s GDP fell 9.9%, the worst in the G7. One in five UK residents contracted coronavirus. One in 150 were hospitalised. One in 550 died—the fourth-highest mortality rate in the world. Under this Government, the pandemic has hit the UK’s economy harder than other major economies and yet the Chancellor continues to underfund our precious NHS, which is expected to return to its pre-covid spending plans after March 2022.
We in the SNP are calling for the Chancellor to look to Scotland for inspiration. The Chancellor should match the Scottish Government’s £500 thank you payments to the NHS. He should prioritise a pay rise for health and care staff, and increase NHS funding to Scottish levels per head, which would deliver an extra £35 billion for the NHS in England and an extra £4 billion for NHS Scotland in Barnett consequentials. We need to shockproof our NHS for the future and make sure that those who have served on the frontline of this pandemic know how much we value their contribution.
Throughout the pandemic, the voluntary sector has been instrumental in ensuring our communities are resilient enough to weather the many emerging challenges, including food security, tackling rough sleeping, combating loneliness, improving digital connectivity or finding safe places for those experiencing domestic abuse. Increasing gift aid temporarily from 20% to 25%, making it easier to claim for small donations, would be a real boost to the sector. I ask the Government to consider that for the upcoming Finance Bill.
A choice has been made in this Budget not to place the burden of the debt on those who can afford it the most. The Treasury said that this is not the time for new fiscal rules, but instead announced the intention to start a consultation at the end of the month. They have kicked the can further down the road. I think the Chancellor has done that for two reasons. First, by doing it outside the Budget process he will avoid the fiscal analysis and proper scrutiny a Budget would face. Secondly, he is giving high earners enough time to shift savings into ISAs or other tax-free schemes. We are already seeing financial advice cropping up on how people can avoid the coming tax hikes.
The Chancellor’s message of fairness rings hollow if he is only buying time to protect himself from scrutiny and to give high earners a head start to hoard their wealth. Instead, we have seen a stealth tax rise for ordinary earners. The personal allowance, after which people start to pay income tax, will rise from £12,500 to £12,570 from 6 April, but will then be frozen until 2026 rather than rising with inflation. That is a tax rise in real terms—the OBR says that it will bring 1.3 million people into the taxation system, with households that earn least the hardest hit.
I want the Chancellor to bring forward measures to tackle child poverty and boost household incomes. As page 14 of the Red Book recognises:
“The economic impact of restrictions has not been felt equally. Staff in the hardest hit, largely consumer-facing sectors, such as hospitality, are more likely to be young, female, from an ethnic minority, and lower paid.”
But the UK Government have done nothing in the Budget to tackle the problem they have identified.
Conditionality in universal credit is forcing people out to work and putting their health at risk unnecessarily. The Government could establish a real—not a pretendy—living wage at the real Living Wage Foundation rate. They could end no recourse to public funds, increase statutory sick pay and match the Scottish child payment throughout the UK. They could ditch the Tory public sector pay freeze and make the £20 uplift to universal credit permanent.
The Chancellor could extend support to those on legacy benefits, including many people who are disabled and carers, who have been completely forgotten by the Tories. He could scrap the benefit cap and remove the two-child limit and the pernicious rape clause, which forces so many families into poverty and increasing numbers of women into making heartbreaking choices like terminating a third pregnancy. What a cruel, wicked Government this is.
As things stand, we face a six-month cut-off date for the uplift to universal credit that will coincide with the end of furlough, the end of mortgage payment holidays and a likely peak in unemployment. The Chancellor has accepted that the uplift is a lifeline for families through the pandemic, so why does he plan to rip it away at the worst possible time? If nothing else, I expected the Chancellor to understand the importance of the social security system as a safety net that allows for a flexible labour market. If he wants people to be able to retrain and equip themselves to face a post-pandemic world, he needs to provide the support to enable that.
We are seeing the Tories shy away from redistributive policies during the worst recession that we are likely to see in our lifetimes. History is reporting itself yet again, as we in Scotland watch with horror a Tory Government that we did not vote for trying again to balance the books on the backs of those who can afford it the least.
It is often the case that the people most affected by austerity policies are women. During the pandemic, women have shouldered the disproportionate burden of caring duties and are more likely to have switched to part-time work, and they are more likely to struggle in the scramble for jobs when things start to open back up again. They are more likely to have already been impacted by the welfare reform before the pandemic began. I had hoped to see some commitment from the Chancellor on the disproportionate economic impact that women have felt over the past year, but there was not even as much as a patronising pat on the head for mums in his speech yesterday.
It is undeniable that our labour market is heavily segregated by gender, and some of the sectors that are dominated by women have been the most affected by covid restrictions. For example, the childcare sector employs mostly women and is vital for ensuring that many more women can go back to work. It has been struck by lockdown restrictions to the extent that the Institute for Fiscal Studies has questioned the sector’s long-term sustainability as demand changes and unemployment increases after the furlough.
The hair and beauty industry is also a large employer of women and is heavily supported by women’s money. I have met staff from salons in my constituency, as have, I am sure, many others in the House. Hundreds of jobs for women are on the line if the Government provide no support. Chopping VAT for the sector, as demanded by the Save Our Salons campaign, would be a real boost to a sector where it is feared that many will not survive this crisis.
My colleagues and I have previously asked the Treasury to look at VAT reductions for specific sectors or economic areas. We have called for and welcomed the VAT cut for hospitality and tourism, and would have preferred the 5% rate cut to last longer so that the sector could really see its benefit. That is particularly true for the music and events sector, which has not been able to sell many tickets this past year.
VAT cuts for repairs to buildings would help to end the scourge of derelict buildings in my constituency and many others, and encourage investment in our built environment rather than demolishing and rebuilding. VAT cuts could also be used to boost investment in energy efficiency measures, thereby contributing to our net zero ambitions.
The Tories long claimed that all sorts of things would be possible after Brexit, but now that we have left the EU, Budgets are coming and going with no regard to those issues. Not only have Scotland’s industries suffered after Brexit, but we are not even seeing the promised targeted tax cuts, which could lead to real benefits in our economy.
I am sure I was not the only one to notice that the Budget made scant mention of Brexit, which will be of little consolation to Scotland’s shellfish industries and the countless others affected by delays to exports and charges applied to imports. The OBR did not miss this, though, and says that
“we now expect the temporary near-term disruption to EU-UK goods trade to reduce GDP by 0.5 per cent in the first quarter of this year. This reflects both that exports appear to have been hit harder than imports and that the trade disruption will affect UK supply chains.”
It does not rule out further disruption either, as well as a long-run loss of productivity of 4%.
The SNP has called on the Chancellor to mitigate some of the damage done by Boris’s botched deal by providing a Brexit compensation package for Scotland in line with the EU’s €1.5 billion for Ireland. Scotland’s community stands to be battered further by some of the impacts of Brexit. We have seen the end of EU structural funding, and the threat of a shared prosperity fund controlled from Whitehall, bypassing our democratically elected Scottish Parliament. There are madcap money-spinning schemes such as the Boris bridge through the Beaufort’s dyke munitions dump, rather than schemes that our communities want and need, with local jobs focused on a green and sustainable recovery.
Scotland’s ambitions to grow our tax base and maintain the long-term funding for public services are massively undermined by the hostile environment for immigration. Brexit and the pandemic have conspired to stop people moving to Scotland. The Tories are actively and brutally cutting migration to satisfy their own arbitrary targets, and Scotland’s economy will suffer for it. I was absolutely furious to hear the Chancellor talk about attracting in highly skilled IT professionals, as outlined on page 62 of the Red Book, because he seems to forget that there are already many people here whom the Home Secretary has tried to deport for the heinous practice of making a legitimate amendment to their tax returns. Highly qualified migrants, many of whom work in IT already and who have made their home here, have been treated abysmally by this Government. Having heard how their friends and relatives have been treated, bankrupted and made to feel like criminals, many will not want to come here. The rule 322(5) scandal is still affecting people today, including my constituents. I urge the Chancellor to listen to organisations such as the Migrants’ Rights Network, and fix this injustice once and for all.
On a whole host of issues, the economic illiteracy of this UK Tory Government knows no bounds. Further polling out this morning shows that 71% of people in Scotland believe that we would fare better outwith the UK, with 53% already backing independence. We face a choice of two futures in Scotland, and I hope that soon we will have the opportunity to take matters into our own hands.
