Budget Resolutions

Andrew Gwynne Excerpts

1st reading: House of Commons
Thursday 1st November 2018 Commons Chamber

[Andrew Gwynne (Denton and Reddish) (Lab)]

I beg to move an amendment, after “tax year 2019-20” insert

“provided that the condition in paragraph (2) of this resolution is met.

(2) The condition in this paragraph is that the Chancellor of the Exchequer has, no later than 5 April 2019, laid before the House of Commons a distributional analysis of—

(a) the effect of reducing the threshold for the additional rate to £80,000, and

(b) the effect of introducing a supplementary rate of income tax, charged at a rate of 50%, above a threshold of £125,000.”

We have had the fiction and now it is time for the fact. It is a pleasure to open the final day of the Budget debate for the Opposition. This Budget was sold as ending austerity, but it does not do that remotely. It is a Budget of failure; a Budget of broken promises.

Labour is not opposed to any modest benefit—however modest that may be—for lower and middle-income earners, but that measure is the only one that puts some money in their pockets. We also need to support those who do not reach the lower threshold, which is why we support a real living wage, and the restoration of sectoral collective bargaining and trade union rights. However, putting more money into the pockets of higher earners is obviously wrong, which is why the next Labour Government will increase taxes on only the very wealthiest—people with incomes in the top 5% and the corporations that have had a tax cut under the Tories.

[Bim Afolami (Hitchin and Harpenden) (Con)]

Will the hon. Gentleman clarify what the Opposition would regard as “the very wealthiest”?

[Andrew Gwynne]

The hon. Gentleman was clearly not listening. It is in our amendment and was in our manifesto at the last general election. We mean the people in the top 5% of incomes, and Labour’s amendment sets out the changes to income taxation that we would introduce in order to achieve that.

[Eddie Hughes (Walsall North) (Con)]

Does the hon. Gentleman accept that the people who are in the income bracket that he describes are likely to be the most mobile and will therefore simply take their wealth somewhere else?

[Andrew Gwynne]

It is interesting that Conservative Members seem not to want a fair taxation system whereby those who have done the best out of society can pay back into society.

[Janet Daby (Lewisham East) (Lab)]

Does my hon. Friend agree that the Welfare Reform Act 2012 and the Welfare Reform and Work Act 2016 caused £34 billion of cuts, resulting in 14 million people, including 4 million children, living in poverty? The Government have reduced the deficit by taking from the poor instead of from those who have much more—the wealthy.

[Andrew Gwynne]

My hon. Friend is absolutely right. Whatever this Government say, austerity is far from over for the people who require our help through the social security system.

Turning to communities, it was only a few weeks ago, in a speech that began with the Prime Minister dancing across the stage, that we were told that austerity is over. After almost a decade of cuts that have made life difficult for families across the country, I expect that many people welcomed the news coming out of Birmingham and breathed a sigh of relief. No longer would they have to visit food banks after work because they could not afford to eat. No longer would they feel unsafe in their neighbourhoods after 21,000 police officers had been cut. No longer would too many people be left shivering in the cold, unable to afford somewhere to live and with nowhere to turn. No longer would local councillors be worrying about balancing their books, about providing care for vulnerable children, or about ensuring dignity for the elderly people who need the care that their councils should be providing.

Fast-forward to the Budget presented to the House this week, and many people will have been left bitterly disappointed. This is not an end to austerity, but merely more of the same. Two thirds of the welfare benefit cuts planned by the Government will still happen, and headteachers will still be forced to write begging letters to parents to pay for the basics. No wonder that the “little extras” referred to by the Chancellor—a frankly insulting term to schools at a time when the independent pay review body has said that they do not have the resources to give any pay rises to their staff—were so badly received. Teachers’ pay is down £4,000 in real terms since 2010, and headteachers are writing to parents to ask for donations just to keep services at current levels.

[Leo Docherty (Aldershot) (Con)]

This Budget has delivered a tax cut for 32 million people. Can the hon. Gentleman clarify Labour’s position, because the shadow Chancellor says that he supports that but the Leader of the Opposition says he does not? What is Labour’s policy?

[Andrew Gwynne]

As I was speaking about education, the hon. Gentleman must try harder, go to the back of the class and pay attention. Some £1.3 billion of cuts—

[James Cartlidge]

Will the hon. Gentleman give way?

[Andrew Gwynne]

No. Cuts will be hard-wired—[Interruption.]

[Madam Deputy Speaker (Dame Eleanor Laing)]

Order. I said that we would be fair to everyone and that means Mr Gwynne, too.

[Andrew Gwynne]

Thank you, Madam Deputy Speaker.

As I was saying, £1.3 billion of cuts next year are hard-wired into the system—[Interruption.] The Secretary of State for Housing, Communities and Local Government can shake his head, but the statistics come from the Tory-led Local Government Association. The cuts will devastate councils that are already struggling. Austerity is certainly not over for local government. Councils were the first and perhaps the easiest target of the coalition Government, and they have had to endure some of the largest cuts across the public sector.

[James Cartlidge]

Will the hon. Gentleman give way?

[Andrew Gwynne]

No, I am going to make some progress.

After all, by cutting funding to councils, Ministers have shifted the blame on to councillors, including Conservative councillors. Councils of all political persuasions and none are now at breaking point. The effects of that on our communities are plain to see across the country. More than 500 children’s centres have shut down and 475 libraries have closed. Support for disabled children has been stripped away—for example, the transport that helped them to get to school to learn like their friends. Support for older people has been slashed, with 1.4 million older people now not getting the necessary help with essential tasks such as washing and dressing. Bus routes have been cut. Our roads are in disrepair, and before the Government laud the £420 million for potholes, I must point out the £1 billion backlog created by this Government’s cuts. Swimming pools, leisure centres and community spaces have closed. Bin collections have been reduced. Youth clubs have closed. Planning departments have been stripped out. Trading standards offices have been slashed, leaving more people at risk of fraud or dodgy goods. Streetlights have been turned off to save money.

[Ruth George (High Peak) (Lab)]

We see the impact of all those cuts in Derbyshire, where elderly people are not receiving care packages, early help for children is being cut and libraries are threatened. Does my hon. Friend agree that the cuts are actually contributing to long-term growth in the numbers of older people in hospital and children being taken into care? The cuts are not only cruel, but a false economy.

[Andrew Gwynne]

My hon. Friend is absolutely right, because all this does is shunt costs on to other parts of the public sector. That is not a sustainable way of continuing. Sadly, I could give many more examples, yet the Government’s answer to these problems is not to drop the £1.3 billion cut to funding next year, nor to properly address the crises in social care and children’s services, but to offer mere crumbs from the table, which will do little to fix the problem that has been created.

[Charlie Elphicke]

I am listening to the hon. Gentleman’s speech with great interest, but he has not answered the question put to him by my hon. Friend the Member for Aldershot (Leo Docherty). The shadow Chancellor says that he supports the tax cut and the Leader of the Opposition says that he does not. Where does the hon. Member for Denton and Reddish (Andrew Gwynne) stand?

[Andrew Gwynne]

Let me make it very clear. In case the hon. Gentleman has not realised, this is not a Labour Budget. A Labour Budget would look very different. We will not vote today to restrict extra money for the lowest paid in our country, and when we have a Labour Government offering hope for the future, a Labour Budget will rectify the giveaways to the top.

The Chief Secretary to the Treasury believes that the Government have not cut local government budgets, but the fact is that, since 2010, spending power—the Government’s preferred measure—has fallen by 28.6%, which includes the 49.1% cut to central Government grants for local authorities. Yes, local authorities have been given new powers to raise funds, but the reality is that a 1% council tax increase in her area raises significantly more than a 1% council tax increase in mine. She can shake her head, but if she does not understand that areas whose properties are predominantly in bands A and B do not raise the same amount as areas with properties in higher council tax bands, perhaps she should not be Chief Secretary to the Treasury.

I will make the position clear, because Treasury Ministers appear to have found these calculations very difficult. The Chief Secretary to the Treasury told “Newsnight”:

“We are not making cuts to local authorities. What we have done is give them more revenue raising powers so that decisions can be taken locally.”

I am happy to give Government Front Benchers the calculations provided by the Tory-led Local Government Association and by the National Audit Office. The Institute for Fiscal Studies has gone further and provided an analysis of how the cuts have fallen across the country:

“the most deprived authorities, including Barking & Dagenham, Birmingham and Salford, made an average cut to spending per person of 32%, compared to 17% in the least deprived areas, including Warwickshire, Wiltshire and Dorset.”

These hardest-hit councils have been dealt a second blow by the Government’s reliance on council tax to fund the struggling social care sector, as they are unable to raise anything like enough through the social care precept compared with councils in wealthier areas.

The Secretary of State for Housing, Communities and Local Government can shake his head, but this year Tameside Metropolitan Borough Council, one of the two authorities that make up my constituency, has a £16 million social care funding gap. One per cent. on council tax in Tameside brings in £750,000. The Tamesides of this world are never able to fill that social care gap from council tax, and that is what is so unfair.



Instead of providing the much-needed reform of social care, this Budget has once again shown a Government committed to sticking-plaster solutions. There is no Green paper and no long-term plan. Just as the £1.3 billion cut hits next year, the Government will need to find £1.5 billion just to keep social care running. Behind these figures are real people who need help, and the Government sit idly by.

Sadly, the Government’s small contribution to alleviating this crisis will for many people be far too little, and, for many councils, far too late. One of the most sacred values and duties of any Government is to ensure that the most vulnerable in society are protected. With overspending on children’s services hitting a new high of £800 million a year, the Chancellor’s pledge of £84 million for just 20 councils—I am interested to know which 20 councils they are—comes nowhere close to addressing the national crisis. Both crime and the fear of crime are rising in our neighbourhoods, yet this week’s Budget offers not a single extra penny for neighbourhood policing. The National Audit Office and the Select Committee on Home Affairs are warning that, without funding, our police service is teetering on the edge of collapse. The number of police officers has already fallen by 21,000 since 2010, and the independent police watchdog is warning that

“the lives of vulnerable people could be at risk.”

But instead of fixing the problem, the Treasury sees fit to play fast and loose with public safety with a £165 million raid on pensions. We are now in an unprecedented situation where police chiefs are threatening legal action against this Government.

The chief constable of Greater Manchester police has warned that upcoming budget cuts could take officer numbers back to levels last seen in 1975, wiping out the 50 additional officers funded by this year’s council tax precept. Another 600 officers need to be cut, on top of the 2,000 we have already lost, because of this Government’s mess on pensions.

[Mike Amesbury (Weaver Vale) (Lab)]

The police and crime commissioner for Cheshire has written to me to say that austerity is far from over there and that funding pressures mean 250 police officers might be cut from the frontline in that patch alone.

--- Later in debate ---

[Andrew Gwynne]

If Conservative Members really cared about the safety of our citizens, and about the soaring crime in some of our communities, they could have fixed it by stopping the police cuts.

The Budget shows that this is not a Government who are interested in public safety, in our children’s future, in our elderly, in our public sector workers—our doctors, our nurses, our teachers, our police officers, our firefighters—or in the disabled. Indeed, they are not interested in our constituents.

Politics is always a question of priorities, and this Government have clearly got their priorities wrong. Since 2010 they have handed out £110 billion in tax giveaways to the richest and to corporations, but the services on which most people rely have been cut to the bone and to breaking point. In the coming days and weeks—as children’s centres and libraries remain closed, as roads continue to go without repair and as crime continues to rise—people will recognise that the Prime Minister’s promise to end austerity has been broken. In fact, it was a mirage from the start.

We need a fresh approach: a real end to austerity, investment in our communities, and a Government intent on rebuilding Britain for the many, not the few.