Covid-19: Economic Package

Anneliese Dodds Excerpts

Tuesday 12th May 2020 Commons Chamber

[Anneliese Dodds (Oxford East) (Lab/Co-op) [V]]

To ask the Chancellor of the Exchequer if he will make a statement on the Government’s economic package in response to the covid-19 outbreak.

[The Chancellor of the Exchequer (Rishi Sunak)]

Thank you, Mr Speaker, for your warm wishes.

This Government’s plan is one of the most comprehensive anywhere in the world. We have provided billions of pounds of cash grants, tax cuts and loans for over 1 million businesses, tens of billions of pounds of deferred taxes, income protection for millions of the self-employed, and a strengthened safety net to protect millions of our most vulnerable people. These schemes speak to my and this Conservative Government’s values. We believe in the dignity of work, and we are doing everything we can to protect people currently unable to work.

Yesterday my right hon. Friend the Prime Minister set out our plan for the next phase of the public health response, and today I can confirm the next stage of our job retention scheme. This scheme has been a world-leading economic intervention, supporting livelihoods and protecting futures. Seven and a half million jobs have been furloughed—jobs we could have lost if we had not acted—and nearly 1 million businesses supported who could have closed shop for good.

As we reopen the economy, we will need to support people back to work. We will do so in a measured way. I can announce today that the job retention scheme will be extended for four months, until the end of October. By that point, we will have provided eight months of support to British people and businesses. Until the end of July, there will be no changes whatsoever, from August to October the scheme will continue for all sectors and regions of the UK, but with greater flexibility to support the transition back to work. Employers currently using the scheme will be able to bring furloughed employees back part time. We will ask employers to start sharing with the Government the cost of paying people’s salaries.

Full details will follow by the end of May, but I want to assure people today of one thing that will not change: workers will, through the combined efforts of the Government and employers, continue to receive the same level of overall support as they do now, at 80% of their current salary, up to £2,500 a month.

I am extending the scheme because I will not give up on the people who rely on it. Our message today is simple. We stood behind Britain’s workers and businesses as we came into this crisis and we will stand behind them as we come through the other side.

[Mr Speaker]

I now call Anneliese Dodds, who is speaking virtually. I ask her to speak for no more than two minutes.

[Anneliese Dodds]

Thank you, Mr Speaker, for granting this urgent question. I would also like to wish the Chancellor many happy returns.

As a constructive Opposition, we want to work with the Government to ensure that people’s jobs and incomes are protected and the furlough scheme is a critical element of that. Many of the more than 6 million people who are currently furloughed were taken aback by comments made in the media by Government spokespeople suggesting that, for example, people needed to be weaned off an addiction to the scheme. There were many intimations that changes might have been announced to that scheme by the Chancellor, potentially in the media, without the opportunity for proper scrutiny.

I have only heard about these changes in the last few seconds. We will look at them very carefully, but there are some critical principles that the Chancellor surely must follow as he redesigns the scheme.

First, we must acknowledge that people did not want to be furloughed. It occurred through no choice of their own and through following the Government’s advice about the closure of sectors. It is critically important that they are not penalised for that choice.

I welcome the flexibility mentioned. We have asked for that repeatedly; it applies in many other countries. It has been a long time coming, but I welcome the fact that it is occurring now.

That flexibility includes an employer contribution, so the Chancellor needs to provide more information about that employer contribution now. He also surely needs to provide more information about alternatives to the scheme. Other countries have job creation, training schemes and redeployment schemes. We do not have those yet. Will the Chancellor work with me, trade unions, businesses, local authorities and further and higher education institutions to create the support that is so desperately needed?

[Rishi Sunak]

I thank the shadow Chancellor for her warm wishes and for the constructive support for today’s announcement. I will address two specific points that she raised. First, the word addiction is not one that I have ever used and it is not one that I agree with. Nobody who is on the furlough scheme wants to be on the scheme. People up and down the country believe in the dignity of their work, of going to work and providing for their families. It is not their fault that their business has been asked to close. It is not their fault that they have been asked to stay at home. That is why I established the scheme to support those people and their livelihoods at this critical time. I wholeheartedly agree with the shadow Chancellor in that regard.

On the next steps, I am pleased to tell her that I have already been talking to the TUC and, indeed, the CBI about the future; helping those people to get back into work who, unfortunately, may lose their jobs through this period. That issue weighs heavily on my mind. Every person who loses their job through this difficult period is a person the Government are determined to stand behind, whether that is with new skills, new training or indeed through supporting businesses to create new jobs. We are determined to make sure that that happens. I look forward to continuing my conversations with Opposition Members and with the trade unions, the CBI and other business groups as we look forward to a brighter future. As we get through this crisis, people can come back to work and we can create the jobs and opportunities, and a brighter future for tomorrow.