The Economy

Anneliese Dodds Excerpts

Thursday 24th September 2020 Commons Chamber

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

I thank the Chancellor for his statement and for advance sight of this announcement. I have called for the introduction of a system of targeted wage support 40 times. That call has been rebuffed by the Government 20 times. It is a relief that the Government have U-turned now, but we must be open and honest: that delay in introducing this new scheme will have impacted on businesses’ confidence. I know that from talking to them, and I am sure that Government Members know that from talking to businesses in their constituencies.

The deadline for redundancy consultations by large firms before the end of the furlough scheme came and went last week without a word from the Government. If the package of measures announced today can help people keep their jobs and help businesses through hard times, Labour will of course support it. There is much in the statement that we do support—as I just said, we have repeatedly called for a system of targeted wage support, and we have called for help for indebted, cash-strapped businesses over and over again—but we must ensure that these measures are as effective as possible at keeping workers in employment, getting unemployed people back into work and keeping viable businesses in operation.

As with many previous announcements by the Government, we must wait for the detail to be revealed—presumably following the press conference scheduled for later on today. Workers and businesses are hanging on the Chancellor’s every word right now, and they need to know what is promised here. So can the Chancellor be clear: will the wage support scheme actually keep more people in work? For that to happen, the scheme must make it more attractive for employers to retain more staff on reduced hours than to retain some full time and make others redundant. Does his scheme actually incentivise short-hours working?

What conditions, if any, will be applied to ensure value for public money? Will the scheme require commitments to continuing employment, unlike the existing furlough scheme, where there have been abuses? Will it require those participating to provide decent, sustainable work?

Will the scheme incentivise training and retraining? The German scheme does, and Labour has called for a UK version to include incentives for training, but that is missing here. Indeed, while, as I said, we welcome many of the elements that the Chancellor has announced, the lack of action on training and skills is worrying. I was waiting and waiting for the Chancellor to talk about training. He mentioned the word once, in passing. That is not enough. His Government have already allocated funding for a national skills strategy, but it is not being delivered on the ground. When will the Chancellor get serious about training so that people can be ready for the jobs of the future? He mentioned the fact that our economy is changing. Let us make sure that our population is ready for that change.

Labour has called repeatedly for continued, targeted support for the self-employed, so I am pleased that that is referred to here, but will these measures avoid the gaps in coverage that have bedevilled existing schemes? Why is there no forward plan for the needs of those who are extremely clinically vulnerable to the disease? Belatedly, will the Chancellor do more to demand that his colleagues get a grip on the UK’s public health crisis? Our country is suffering from a double tragedy: the highest excess death rate in Europe and the deepest recession in the G7.

Labour supports the Government in their announcement of additional restrictions this week. The Government’s messaging has been confused enough already, so the last thing we want to do is add to that confusion, but we are concerned that these restrictions are necessary only because of continuing problems with test, trace and isolate. The Chancellor referred to the money put into test, trace and isolate. As I said earlier this week, enormous sums have been devoted to that task, but those sums are not delivering the system that we need. We are still not at the stage of many other countries. The Chancellor must work on that, as well as his other colleagues in Government.

Finally, before the summer recess, Labour called for a back to work Budget focused on jobs, jobs, jobs. We did not get one. We expected a Budget this autumn. It appears, again, that we are not getting one. That is despite the challenges it poses for devolved Governments, and despite the fact that the Government have actually referred to provisions in a future Finance Bill as necessary for their approach to Brexit. The Chancellor announced that he would make a statement to Parliament today only after I had called for him to come here to answer an urgent question; I am very grateful to you, Mr Speaker, for granting that.

This Government have lagged behind on test, trace and isolate. They have lagged behind on wage support. They have lagged behind on support for those having to self-isolate. They are lagging behind on green investment. For these and for other reasons, it looks like our recovery will be lagging behind that of many other countries. So, finally, when will the Chancellor provide the back to work Budget that this country needs?

[Rishi Sunak]

I thank the hon. Lady for her comments. On the question of continued support for jobs, however, I had hoped that she would have welcomed strongly today’s measures, if for no other reason than that she has previously asked for something similar. However, her position on this matter has been somewhat changeable. At different points in the last few weeks and months, she has said that furlough should not go on for ever, and then changed her mind and said that we should extend it. Then she changed her mind and said it should be replaced, and then only yesterday the Leader of the Opposition said it should be extended again. That is not the kind of certainty that British businesses or British workers need.

To address the specific questions, this scheme absolutely does incentivise shorter time working. The company will pay its workers for the time that they are in work, and the Government and the employer jointly will subsidise the time the worker is not working. The conditions will be set out in guidance, which will be published shortly, and then over the next few weeks the further details will be worked through with businesses and unions, as we did with the furlough scheme.

I can reassure the hon. Lady that the new scheme does indeed have the conditionality that is appropriate for this stage of our response. Notably, this scheme will be available only for larger companies that are seeing a decline in their revenues as a result of coronavirus, ensuring that our support is targeted where it is most needed. Similarly, there will be restrictions on larger companies in capital distributions to shareholders while they are in receipt of money for their workers under this scheme. Indeed, they will not be able to give redundancy notices to those workers who are on this scheme throughout its duration.

We have increased training both for post-16 at the Budget and, indeed, in the recent plan for jobs, providing increased access for school leavers to level 2 qualifications across the board. Notably, one of the hallmarks of our skills system is our successful apprenticeship programme. What we announced in July was a significant increase in the incentive payment to businesses for taking on a new apprentice: a £2,000 cash incentive to businesses to take on an apprentice and provide that valuable in-work training that we know makes such a difference to young people’s futures. So we are committed to providing especially our young people with the opportunities that they need to succeed in the future.

The hon. Lady talked about jobs. In July, we outlined a £30 billion plan for jobs—to support, create and protect jobs across every part of our United Kingdom. Chief among the initiatives was the kickstart scheme, where right now employers—small, medium-sized and large—are rushing to put in applications to take on a young kickstarter later this autumn, to provide them with the opportunities that they need at an incredibly difficult time. I can assure this House and the country that my No. 1 economic priority is to protect people’s jobs, and that is what this Government will continue to do.

In conclusion, the Opposition wanted the furlough extended, but they never said for how long. Then they wanted the furlough replaced, but they would not say what with. Then they wanted the furlough targeted, but they would not say on whom. I do stand ready to work with the hon. Lady, if she knew exactly what she wanted. Today, the Government stand with the British people and British business, with the CBI, the British Chambers of Commerce and the Trades Union Congress, in bringing much-needed support to the economy. Yesterday, the Leader of the Opposition called for a plan B for the economy. The Labour party does not even have a plan A.