Oral Answers to Questions
Andrew Western Excerpts(1 week, 3 days ago)
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Damien Egan (Bristol North East) (Lab)
The Parliamentary Under-Secretary of State for Work and Pensions (Andrew Western)
No specific assessment has been made of the impact of the household support fund on low-income households in 2025-26, although we hear routinely from local authorities across the country about the impact of the fund in supporting those who are struggling. An evaluation of the fourth iteration of the scheme, running from April 2023 to March 2024, will be published shortly, exploring the benefits of the more than 19 million awards made during this period.
Warinder Juss
I agree that the payment of winter fuel allowance should be means-tested, because many pensioners who receive the winter fuel allowance simply do not need it. However, there are pensioners who are not entitled to pension credit who will struggle to heat their homes. Can the Minister please confirm the extent to which the household support fund will assist those pensioners in my Wolverhampton West constituency?
Andrew Western
The household support fund is intended to support a wide range of households in need, including pensioner households. There has been no ringfencing of funding for specific groups since October 2022, meaning that local authorities have the flexibility to support pensioners who are just above the pension credit threshold. In the 2023-24 financial year, 26% of household support funding went towards meeting energy costs.
Alistair Strathern
I welcome the Government’s decision to provide more than £1 billion in new funding for the household support fund, extending it all the way through next year, and to give much more notice to the local authorities that deliver it. The funding is so important not just to countless vulnerable residents, but to great local organisations, such as the Need Project food banks in my constituency. How will the Department work with local authorities to make the most of the notice and to ensure the funding goes as far as possible?
Andrew Western
My hon. Friend is absolutely right. As a former local authority leader, I know that above all else, certainty will allow councils to design and deliver sustainable plans for local welfare assistance. The Government’s commitment to funding the HSF until March 2026 offers that certainty and time to plan with greater confidence. To that end, we will confirm individual allocations for the forthcoming one-year extension to the HSF as soon as possible, and ahead of the scheme beginning on 1 April.
Damien Egan
Because the household support fund is devolved to local councils, there are lots of different examples of how the funding is spent, so how will the Minister ensure that the money from councils goes to the people who really need it?
Andrew Western
Like me, my hon. Friend is a former local authority leader—albeit a directly elected mayor, and with a far greater mandate, therefore, than I ever enjoyed. Like me, he will appreciate the importance of empowering local areas to respond to local need. That said, all councils must develop delivery plans to show how they are targeting the funds to support the most vulnerable, to ensure that the spirit of the HSF is upheld in helping low-income households with the cost of essentials.
Brendan O'Hara (Argyll, Bute and South Lochaber) (SNP)
Euan Stainbank (Falkirk) (Lab)
How many current Department employees cannot receive further sponsorship due to the previous Government’s changes to the skilled worker visa salary threshold?
The Parliamentary Under-Secretary of State for Work and Pensions (Andrew Western)
My hon. Friend asks an important question and I will be delighted to follow up with him in writing.
Nick Timothy (West Suffolk) (Con)
According to the census, 72% of Somalis here live in social housing, compared with 16% of the population overall. In answer to my written question, the Department says it is “exploring the feasibility” of publishing benefits claimed by nationality, which is important for a proper debate on benefits policy and immigration policy. Can the Minister confirm that that work is going ahead and tell us when the data will be published?
Andrew Western
The hon. Gentleman will be aware that nationality and country of origin are not factors in assessing benefit eligibility. We may look at that in future, but I would be delighted to follow up with him in writing about how we will take it forward.
Mr Mark Sewards (Leeds South West and Morley) (Lab)
When I speak to my constituents, from Lofthouse to Farnley, they are extremely concerned about the amount of money being lost to fraud and error in benefits. Can the Minister confirm a timeline and a plan to get back the £35 billion that has been lost since the pandemic?
Andrew Western
My hon. Friend is right to raise that issue. The spiralling nature of fraud in this country since the pandemic and on the last Government’s watch is totally unacceptable. We will bring forward a fraud, error and debt Bill in the coming months, which is part of a much broader package—the largest-ever package brought forward by any Government—to take out more than £7.6 billion of fraud over the forecast period.
Martin Wrigley (Newton Abbot) (LD)
Citizens Advice tells me that the DWP continues to start action on alleged overpayments more than six years after the event. That is longer than bank records are kept to prove otherwise. Does the Secretary of State think that that is fair and right?
Office for Nuclear Regulation Annual Report and Accounts
Andrew Western Excerpts(4 weeks ago)
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The Parliamentary Under-Secretary of State for Work and Pensions (Andrew Western)
Later today I will lay before this House the Office for Nuclear Regulation’s annual report and accounts for 2023-24. This document will also be published on the ONR website.
I can confirm, in accordance with paragraph 25(3) of schedule 7 to the Energy Act 2013, that there have been no exclusions to the published document on the grounds of national security.
[HCWS162]
Work and Pensions
Andrew Western Excerpts(4 weeks, 1 day ago)
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Andrew Western
On the wider points, I will begin with the question of the adequacy of carer’s allowance, set as it is at £151 per week. Carer’s allowance will be increased in April 2025 by the consumer prices index to help ensure that it maintains its value. As well as carer’s allowance, carers in low-income households can claim income-related benefits such as universal credit and pension credit.
[Official Report, 16 October 2024; Vol. 754, c. 883.]
Written correction submitted by the Under-Secretary of State for Work and Pensions, the hon. Member for Stretford and Urmston (Andrew Western):
Andrew Western
On the wider points, I will begin with the question of the adequacy of carer’s allowance, set as it is at £81.90 per week. Carer’s allowance will be increased in April 2025 by the consumer prices index to help ensure that it maintains its value. As well as carer’s allowance, carers in low-income households can claim income-related benefits such as universal credit and pension credit.
Carer’s Allowance
Andrew Western Excerpts(1 month ago)
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The Parliamentary Under-Secretary of State for Work and Pensions (Andrew Western)
I am pleased to be able to respond to this vital debate, which in both tone and importance has been one of the best I have heard in my two years in this place. I also add my thanks to the right hon. Member for Kingston and Surbiton (Ed Davey) for bringing forward the Opposition day motion today, because this issue is clearly of concern to many Members, and they are right to be concerned.
The right hon. Member is one of many right hon. and hon. Members to have made important contributions and spoken with great passion on this crucial issue. The hon. Members for Salford (Rebecca Long Bailey) and for Carshalton and Wallington (Bobby Dean), my hon. Friend the Member for Hertford and Stortford (Josh Dean), the hon. Member for Harpenden and Berkhamsted (Victoria Collins), my hon. Friends the Members for Wirral West (Matthew Patrick), for Harlow (Chris Vince) and for Paisley and Renfrewshire South (Johanna Baxter), the hon. Members for Stratford-on-Avon (Manuela Perteghella) and for Maidenhead (Mr Reynolds) and others rightly spoke about the important role that millions of family carers play in providing support for disabled or elderly relatives who need care at home. I echo those comments and add my own tribute to all family carers. Much of their tireless work goes unseen and unrecognised.
Like other Members, I am privileged to witness glimpses of carers’ dedication through my correspondence and through events I attend in my constituency. Running through today’s debate was an underlying and understandable anger at the position we inherited from the last Government, whereby family carers trying to do the right thing have been left with staggering overpayments, often running into thousands of pounds. As my hon. Friend the Member for Birkenhead (Alison McGovern) set out earlier, we are making sure that we understand precisely what has gone wrong so that we can put the system right for the long term. Our family carers deserve no less.
Many Members, including the hon. Members for Eastleigh (Liz Jarvis) and for North East Fife (Wendy Chamberlain), my hon. Friends the Members for Shipley (Anna Dixon) and for Bexleyheath and Crayford (Daniel Francis) and the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone), and of course my hon. Friend the Member for City of Durham (Mary Kelly Foy) and the right hon. Member for Kingston and Surbiton, spoke about their own experiences as carers or the work they do locally to support organisations helping family carers. I grew up watching my grandmother care for my grandad, struggling with Parkinson’s disease, before later seeing my mum, one of the many hidden carers up and down the land, care for her mother—my nana—in her final years battling Alzheimer’s disease.
None of us in this House is blind to the work that carers do. They are fortunate to have some wonderful advocates. Those include their MPs, as we have seen today, but also organisations such as Carers UK, the Carers Trust and the Learning and Work Institute, to name but three. The Minister for Social Security and Disability, my right hon. Friend the Member for East Ham (Sir Stephen Timms), and I have already met a delegation of carers and Carers UK, and he will be doing so again shortly. He will also meet separately with the Carers Trust and the Learning and Work Institute, because we are determined to ensure that the voices of family carers and the organisations supporting them are at the heart of everything we do.
I also want to pay tribute to the hundreds of DWP staff, largely based in the north-west, who provide financial support to a million family carers through carer’s allowance, day in, day out. The Government will spend record amounts to support unpaid carers. Real-terms expenditure on carer’s allowance is forecast to rise from £4.2 billion in 2024-25 to just over £4.7 billion a year by 2028-29.
I turn to some of the other points raised during the debate, with apologies that time will permit me to address only some of them. Let me take the opportunity to congratulate and pay tribute to my hon. Friends the Members for Clwyd North (Gill German) and for Weston-super-Mare (Dan Aldridge) and the hon. Member for Torbay (Steve Darling) on their excellent maiden speeches. They painted vivid pictures of their constituencies and I feel certain that they will go on to make significant contributions in this place.
On the wider points, I will begin with the question of the adequacy of carer’s allowance, set as it is at £151 per week. Carer’s allowance will be increased in April 2025 by the consumer prices index to help ensure that it maintains its value. As well as carer’s allowance, carers in low-income households can claim income-related benefits such as universal credit and pension credit. Those can be paid to carers at a higher rate than to those without caring responsibilities through the carer element and the additional amount for carers respectively. For example, over 750,000 carer households on universal credit can already receive an additional £2,400 a year through the carer element. That said, the House should be aware that issues beyond the scope of the independent review announced today are not being ignored; this is merely a first step towards progress. The Government are also looking at the broader question of how to provide the best possible support for family carers, although I do not want to pre-empt that work today.
Let me turn to the question of a taper, which was raised by a number of right hon. and hon. Members. At the moment, introducing a taper in carer’s allowance would significantly complicate the benefit, with awards having to be adjusted manually on a weekly basis for some of those declaring earnings. That would add to administrative costs and could mean more fraud and error. Those also receiving universal credit would need to have that adjusted if their payment of carer’s allowance changed because of an earnings taper rate. A taper could be introduced only following significant changes to the IT system that supports payment of carer’s allowance. For the moment, therefore, it is not possible.
On the potential writing off of overpayments, which was at the heart of many of the excellent contributions that we heard, an overpayment can occur through fraud, or through claimant or official error. The Secretary of State has an obligation to protect public funds and ensure that, wherever possible, overpayments are recovered, but determining what best we can do to support those who have accrued overpayments is within the scope of the independent review, as is how such overpayments occurred and what we can do to ensure that we take all the steps we can to reduce the risk of such incidents happening again.
Let me turn briefly to the comments of the shadow Secretary of State, the right hon. Member for Central Devon (Mel Stride). He listed the many interventions that the last Government supposedly made to improve the lot of carers—seemingly including the private Member’s Bill of the hon. Member for North East Fife—but after 14 years of Conservative government, we see carers who find themselves in heartbreaking situations having racked up huge overpayments. However, the right hon. Gentleman correctly set out the incredibly complex nature of the carer’s allowance system, with allowances for legitimate expenses, pension contributions and so on, and why resolving this matter is therefore not straightforward. That is why the independent review is the correct mechanism and next step to fully understand what went wrong and why, and how we can put things right. I welcome his support for the review.
Many colleagues referred to the role that family carers play in easing pressure on the social care system, and indeed in supporting our economy, and they were entirely right to do so. I acknowledge everything that carers do. They are heroes. We appreciate how much society relies on unpaid carers, we recognise the challenges they face and we understand the need for change. Supporting carers is both a moral and an economic imperative, so we will help carers stay in paid work, we are spending record amounts on carer’s allowance and we will sort out the overpayments scandal we inherited. That is why we have announced the independent review today: so that, together, we can rebuild the trust that has been lost and ensure that those who offer comfort, dignity and support to the ones they love are given all the help they need in return. I hope right hon. and hon. Members will acknowledge that work today by supporting the Government amendment.
Question put (Standing Order No. 31(2)), That the original words stand part of the Question.
Oral Answers to Questions
Andrew Western Excerpts(1 month, 2 weeks ago)
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Mr Will Forster (Woking) (LD)
The Parliamentary Under-Secretary of State for Work and Pensions (Andrew Western)
The Child Maintenance Service is committed to ensuring that separated parents support their children financially and to taking robust enforcement action against those who do not do so. Between March 2023 and March this year, the percentage of parents paying something towards maintenance through collect and pay increased from 65% to 69%. This Government recognise that child maintenance payments play a crucial role in keeping hundreds of thousands of children out of poverty each year, and we are determined to do all we can to increase those collection levels further.
Mr Forster
Given that around half of children in separated families—that is 1.8 million children—are receiving no support from their non-residential parent, does the Minister know when that figure might change?
Andrew Western
The hon. Gentleman raises an important point about those families who receive no support. I am told that the figure is actually around 40%, but none the less it is not good enough. Although there are varied reasons for that—indeed, there are some parents who do not want an arrangement—we are looking, as he may be aware, at a recently concluded consultation on the future of the Child Maintenance Service. We will consider our next steps with a view to trying to increase collection levels wherever we can.
Mr Speaker
Members have to stand to be called. I am not a mind reader; I am pretty good, but I cannot win the lottery.
Andrew Cooper (Mid Cheshire) (Lab)
Two constituents have contacted me with separate but similar cases relating to obtaining child maintenance payments from abusive ex-partners. In both cases, their abusers have been able to use features of the system to avoid paying their fair share to their victims and their children, leaving my constituents with a shortfall of thousands of pounds. Can my hon. Friend tell me what steps are being taken to reform the child maintenance system to protect victims of abuse, such as my constituents?
Andrew Western
The Department takes domestic abuse extremely seriously. My hon. Friend will be keen to hear that the recently concluded consultation I referenced in my previous answer looked to address some of the issues with the direct pay service. Indeed, it consulted on the potential removal of that service moving forward. That service has been open to abuse and has led to victims of domestic abuse continuing to be terrorised. That is unacceptable, and we will look to address it moving forward.
Bradley Thomas (Bromsgrove) (Con)
Patrick Hurley (Southport) (Lab)
The Parliamentary Under-Secretary of State for Work and Pensions (Andrew Western)
To be frank, the current system is focused on the problems of yesterday. In the last Parliament, economic inactivity increased and the employment rate fell. We are planning fundamental reforms to the system that will focus on the problems of today and get more people into work, details of which will be set out in our forthcoming White Paper, “Get Britain Working”.
Patrick Hurley
Will the Minister set out how the proposed merger between Jobcentre Plus and the National Careers Service will help to tackle economic inactivity and change the way that jobcentres work with their customers?
Andrew Western
I thank my hon. Friend for his question; I was pleased to hear that one of his earliest visits as the first ever Labour Member for Southport was to his local jobcentre with the Minister for Employment, who I know would want me to commend all the staff at the Southport jobcentre. The truth is that, at present, jobcentres seem to function more as places from which benefits are administered than as centres supporting people into work. The merger of Jobcentre Plus and the National Careers Service will address that, enabling us to get more people into employment and help those on low pay increase their earnings, through more personalised and localised support, ensuring that no one is left behind.
Tim Farron (Westmorland and Lonsdale) (LD)
The challenge that jobcentres in Kendal and the rest of Cumbria face, as well as getting people back into work, is the fact that our workforce in Westmorland is far too small. The average house price in our constituency is 12 times average earnings, and waiting lists for social housing are through the roof. Some 66% of all employers surveyed in our community recently said that they were working below capacity because they could not find enough staff, so if we want to tackle the problem in our economy, we need to do two things: first, increase the amount of social housing and secondly, allow more flexible visa arrangements. Would the Minister’s Department work with housing colleagues to provide more housing grants for our community and sign up to the youth mobility visa arrangements?
Mr Speaker
Order. The hon. Member should know better. He gets in a lot, so he should not take advantage of other Members.
Andrew Western
The hon. Member will be pleased to know that we intend to work considerably more flexibly to support the needs of communities in a varied and bespoke way. He has particular challenges because of the rural nature of his constituency and various other factors, but he will appreciate that I will not make housing or Home Office policy on the hoof from the Dispatch Box.
Mims Davies (East Grinstead and Uckfield) (Con)
Jobcentres are extremely good, as we just heard from the hon. Member for Hackney South and Shoreditch (Dame Meg Hillier), who is leaving the Chamber. Yet the new Minister for Employment previously described jobcentres as places nobody wants to go, and claimed that they do not offer real help. Our jobcentres help to ensure that almost 4 million more people have work, compared with when her party left office in 2010. More than 2 million of those employed are women. Will the Minister and the DWP team who have made disparaging remarks apologise to work coaches and DWP staff, who she and they have rubbished but who now have to look up to them as the new ministerial team?
Andrew Western
I fear that the hon. Lady has misunderstood the criticism, which is levied not at our outstanding work coaches but at the policies of the previous Government, who have left us with economic inactivity at its highest rate in years. We are the only G7 economy with a lower employment rate than before the pandemic. Those are the challenges that we have been left with, and the problems that we will solve.
Paul Davies (Colne Valley) (Lab)
The Parliamentary Under-Secretary of State for Work and Pensions (Andrew Western)
My hon. Friend is entirely right to raise this issue. He will be pleased to know that this Government are looking to utilise new powers to obtain a liability order without recourse to the courts, reducing the time taken to secure such an order from 22 weeks to around six.
Markus Campbell-Savours (Penrith and Solway) (Lab)
Andrew Western
I welcome my hon. Friend’s support for the proposed fraud Bill. The level of fraud in the welfare system is absolutely unacceptable; almost £10 billion was lost last year. Increased use of data will be essential to clamping down on both capital fraud and broader fraud. However, we will do that without sharing any information at all with banks and financial institutions.
Graham Stuart (Beverley and Holderness) (Con)
I thank the Secretary of State for her personal commitment to transparency. Further to the question asked by the shadow Secretary of State, my right hon. Friend the Member for Central Devon (Mel Stride), will she share with the House how many thousands of people will die as a result of Labour’s choice to cut the winter fuel payment?
Oliver Ryan (Burnley) (Lab/Co-op)
My constituents want a fair and robust welfare system, but they have no truck with fraud. Can the Secretary of State assure my constituents that she is doing everything she can to crack down on fraud, and to make sure that those who genuinely need help get it?
Andrew Western
My hon. Friend is correct to raise this issue. As I said, we will not tolerate the current levels of fraud in our welfare system. He will be pleased to note the Prime Minister’s recent announcement of the forthcoming fraud, error and debt Bill, which will begin the necessary work to drive down fraud in the Department.
Dave Doogan (Angus and Perthshire Glens) (SNP)
Can I share with the Secretary of State the plight of my constituent, who went without child maintenance payments for six months? That happened not because of anything done wrong by her, or the paying parent, or the paying parent’s employer, which processed the direct deduction of earnings order, but because the Child Maintenance Service misplaced the payments. Will the Secretary of State apologise for that mishap? What plans does she have to rectify that deeply flawed organisation?
Andrew Western
I am very sorry to hear of this case. I am not familiar with it, but I will look into it, if the hon. Gentleman contacts me with the details.
Oral Answers to Questions
Andrew Western Excerpts(9 months, 2 weeks ago)
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Mims Davies
I thank the hon. Lady for making the important point about the numbers. I agree that behind each of those is somebody we should be concerned about, and I am absolutely looking at this point. We are continuing to learn from decisions overturned by appeal, and we will continue to make improvements to our decision-making processes to help people to get the correct decision earlier in their claim journey, and to be able to work and have the support where it is needed. Not everybody on PIP is out of work, so we need to be listening to the needs of the people in those queues. I am conscious that every one of them is not a statistic but a person who needs our support.
Andrew Western (Stretford and Urmston) (Lab)
Simon Fell (Barrow and Furness) (Con)
The Secretary of State for Work and Pensions (Mel Stride)
There are, of course, significant costs related to an increase in long-term sickness and illness rates in work. That is why we have our £2.5 billion back to work plan, to help 600,000 disabled people and people with health conditions start and stay in work. That approach, along with others, has seen economic inactivity reduce by 330,000 since its peak during the pandemic.
Andrew Western
NHS waiting lists are currently at 7.8 million, with more than 177,000 people on waiting lists in my own NHS trust area. When it is this difficult to access medical treatment, it is no surprise that we have a record 2.8 million people out of work due to ill health. Does the Minister accept that this Government’s failure on the NHS is stymying economic growth, denying people the dignity of work and costing taxpayers billions of pounds?
Mel Stride
On NHS waiting lists, there has been progress, in that the two-year waiting lists have almost been entirely dispensed with and those of 18 months have been very substantially reduced. Our Department recognises that work is part of the solution to improving people’s health, which is why we are putting forward the WorkWell service, bringing together medical input and work coach input; fit note reform to help at an earlier stage of the journey; and the reforms to the work coach assessment. All those things are moving towards getting more people into work, which is good for their health.
Oral Answers to Questions
Andrew Western Excerpts(11 months, 1 week ago)
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Mims Davies
I thank the Chair of the Select Committee for his question. In fact, I have an Uber T-shirt from my time as employment Minister, which the company gave me when it brought in the pension. I applaud the work that Uber has done to support its workforce. The right hon. Gentleman makes an important point, which is actually for another Department, but I will take those messages away.
Andrew Western (Stretford and Urmston) (Lab)
Janet Daby (Lewisham East) (Lab)
The Parliamentary Under-Secretary of State for Work and Pensions (Mims Davies)
In 2023-24 we are spending around £124 billion through the welfare system on people of working age and children. Evidence shows the importance of work in reducing the risk of child poverty. With over 900,000 vacancies across the UK, our focus is on supporting parents into, and to progress within, work. Our recent autumn statement announcements, which included the back to work plan, increasing benefits and increasing the national living wage, are all part of our clear approach to ensuring that everybody gets the right support to progress and thrive.
Andrew Western
I hear what the Minister says, but a recent report from UNICEF showed that of 39 OECD and EU countries, the UK came last in terms of improvements in child poverty between 2012 and 2021. As a result, one in five children in my constituency of Stretford and Urmston are growing up in poverty. What more can the Minister do to address this truly appalling situation?
Mims Davies
I thank the hon. Gentleman for raising that report. I have looked at it, and it is important that we react to it. I point to our record of action. When it comes to further support for households with low incomes, we have heard in the Chamber—indeed, the Secretary of State mentioned this—about raising local housing allowance back to the 30th percentile, which will benefit 1.6 million low-income households by, on average, £800 a year in 2024-25. When that is added to the national living wage, the uprating of benefits and the availability of work, we are determined that those families will progress.
Paul Maynard
That is certainly one reason why we are trying to get people to engage in a more considered way with what they do at the point of the decumulation of their pension funds, but I am more than happy to meet my hon. Friend to discuss his specific concerns about annuities in due course.
Andrew Western (Stretford and Urmston) (Lab)
The Trussell Trust has recently reported that in the past year there has been an 80% increase in the number of children in Stretford and Urmston being supported with food parcels. Can the Minister tell me why it believes that is the case?
Mel Stride
The record speaks for itself: this Government have been behind £104 billion-worth of support for the most vulnerable over the period 2022 to 2025; poverty in absolute terms, after housing, has fallen by 1.7 million since 2009-10, when the hon. Gentleman’s party was last in office; we have 400,000 fewer children and 200,000 fewer pensioners in absolutely poverty—under the last Labour Government, we had the fourth highest level of pensioner poverty in Europe; and we have put the national living wage up by 9.8% and cut taxes as well.
Budget Resolutions and Economic Situation
Andrew Western Excerpts(1 year, 8 months ago)
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Andrew Western (Stretford and Urmston) (Lab)
I congratulate my hon. Friend the Member for West Lancashire (Ashley Dalton) on her outstanding maiden speech. Having known her before her election to this place, I knew she would quickly make an impact and she certainly did that with her contribution today.
In his Budget speech yesterday, the Chancellor said:
“In November we delivered stability; today it is growth.”—[Official Report, 15 March 2023; Vol. 729, c. 847.]
That is a bold statement, and upon closer inspection one may even say a brazen one: brazen not only because that stability was required because of the Conservative Government’s kamikaze Budget and their crashing of the economy, but more pertinently because on this Chancellor’s watch our economy will not grow, but will shrink, by 0.2% this year. In fact, we only avert technical recession this year because the pain is distributed in such a way that it avoids two successive quarters of output decline—not because this Government have averted economic shrinkage, and not because they have delivered the laser-like focus on growth that our economy needs. Far from it, the evidence tells us that this Government have been asleep at the wheel: while we in the UK see economic contraction this year, every other G7 country is forecast growth. While we in the UK see an economy that is still some 0.8% smaller than before the pandemic, every other G7 economy has grown to be larger than it was before the virus intervened.
Conservative Members tell us to look at the longer-term picture: they say that this was always going to be a difficult year and their action has lessened the blow. That is nonsense, because this claim fails to take into consideration that growth projections for years three to five of the forecast period are revised down, and at the same time our underlying debt is set to increase from 92.4% of GDP this year to 93.7% of GDP next year. This is Tory Britain: they crashed our economy last year, and they have no plan to put it right this year.
But let me turn to what this Budget says about the Conservative approach to basic fairness. The uplift in the annual tax-free allowance on pension contributions, from £40,000 to £60,000, benefits only those whose retirement funds constitute the largest 1% of pension pots in the country. Alongside lifting the lifetime allowance, that amounts to a huge tax break for some of the wealthiest people in the land. That this announcement came on the very same day that the OBR informed us we will have the lowest real living standards since records began speaks volumes about the appalling priorities of this Government.
I have said before in this place that politics is ultimately about choices, and this Tory Government have made the wrong choices yet again. Not once in his speech yesterday did the Chancellor mention the words “fair” or “fairness,” and I cannot say I am surprised. They have form on fairness, and time and again they show us whose side they are really on.
I accept that we need to address the shortage of doctors somehow, particularly as the Government continue to reject Labour’s fully costed proposal to scrap non-dom status and fund the largest workforce expansion in NHS history. So while I welcome the pension changes as they pertain to NHS staff, this should have been a bespoke offer available only to them, and in my view it should initially have been a pilot so that we could assess its future impact. Moreover, although the Government claim to want to help over-50s back to work, their unfair tax break for the wealthiest 1% has created a perverse situation whereby some over-50s may well be able to retire sooner, because their pension pots will have grown large enough for them to do so at a younger age than they had planned. Joined-up government? Don’t make me laugh. We have a Government at sixes and sevens, and a Chancellor without the clarity of purpose that is needed to turn our economy around.
How do we know this? Well, let us recap. The Government want to level up, but we have the lowest investment in the G7. The Prime Minister wants debt to go down, but debt as a share of GDP will be up next year. The Chancellor wants to help with living costs, but we have the worst real living standards since records began. The Health Secretary wants to fix the NHS workforce, but the Prime Minister will not scrap non-dom status to fund it. The Work and Pensions Secretary wants to get over-50s back to work, but the Chancellor has just given a huge tax break to the richest, which means that they may well retire earlier than ever. It is preposterous. You could not make it up.
We have had 13 years of this grotesque contradiction between words and action, this lack of vision, this fundamental mismanagement. The Government have no idea, no clue, and no plan for economic growth. They have crashed our economy, they have undermined our standing in the world, and they have decimated our public services. We are seeing sticking-plaster politics time and again, rather than the long-term solutions that our country needs. Because they are unable or unwilling to unleash the ambition of the British people to realise the fastest growth in the G7, we languish at the bottom of the pile.
The Chancellor said yesterday that this Budget showed that his plan was working, but the reality is that this tired, out-of-touch, failing Government have no credible plan at all. It is time for a change. It is time for a Labour Government. For me, the next general election cannot come soon enough, and given this half-hearted attempt at a Budget for growth, it cannot come soon enough for the Conservative party either.