Lockdown: Economic Support

Anneliese Dodds Excerpts

Tuesday 3rd November 2020 Commons Chamber

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

(Urgent Question): To ask the Chancellor of the Exchequer if he will make a statement on economic support available to individuals and businesses during and after the recently announced lockdown.

[The Chief Secretary to the Treasury (Steve Barclay)]

Yesterday, the Prime Minister set out why we are introducing new measures to tackle coronavirus.

--- Later in debate ---

[Steve Barclay]

Thank you, Mr Speaker.

Yesterday, the Prime Minister set out why we are introducing new measures to tackle coronavirus. This decision is not one we would wish to take, but it responds to the soaring infection rate.

Just as we have a responsibility to protect lives, we must also safeguard livelihoods. That is why the Government have provided unprecedented levels of financial support throughout this crisis, in a package described by the International Monetary Fund as

“one of the best examples of co-ordinated action globally”.

This package includes an extension to the coronavirus job retention scheme, where employees will receive 80% of their usual salary up to a maximum of £2,500, while employers need only pay national insurance and pension contributions. We will provide more support to the self-employed. We are increasing the self-employed income support scheme grant from 40% to 80% in November. This boosts the total grant from 40% to 55% of trading profits from November to January, up to a total of £5,160, aligning it with the furlough scheme. In addition, homeowners hit by the pandemic can continue to claim a six-month mortgage holiday, and businesses that are required to close can receive non-repayable grants worth up to £3,000 a month. In total, these grants are worth over £1 billion a month.

We are also planning to extend the existing business loan schemes and the future fund to the end of January, as well as making it possible to top up bounce back loans. Local authorities will also receive £1.1 billion to support businesses more broadly, and up to £500 million to support the local public health message through the contain outbreak management fund. We will also uplift the Barnett guarantee this week to give Scotland, Wales and Northern Ireland further certainty over their up-front funding.

These measures build on the Government’s economic package that now totals over £200 billion. They will provide security to millions of people while giving businesses the flexibility to adapt and plan, and they underline our unrelenting focus on listening and responding to the damaging path of this virus.

[Anneliese Dodds]

Thank you very much for granting this urgent question, Mr Speaker. The circuit breaker that Labour proposed three weeks ago would have been shorter and more effective, so less damaging to jobs and businesses, than the Government’s last-minute, but lengthy, lockdown. The cost of that Conservative delay will be counted in lives and livelihoods, so was it the Chancellor who vetoed the circuit breaker? Why did he tell the Welsh Government that it was impossible to extend furlough, and why did he dismiss those in the north who said his plans would lead to hardship?

I heard from one restaurant about the strain caused by this panicked, last-minute approach. As rumours of a lockdown circulated on Friday, staff wiped away tears before putting on a brave face to customers. They did not know whether, in the following week, they would be working as normal, facing redundancy, being paid at 67% of their normal wages or being paid at 73%.

Similarly, the self-employed endured intransigence and then rumour, before a last-minute announcement yesterday that still leaves many people with nothing. Businesses need to know what support they will receive if their area faces further restrictions on the other side of lockdown, but the Prime Minister said yesterday that they will not find out until just before those restrictions are imposed.

How can any business plan on that basis? How can people cope with that level of insecurity? The lack of any plan for economic support is making a very, very difficult situation even worse. Will the Chancellor and his Ministers finally get a grip, and set out the plan for the next six months? Will they indicate how the different scenarios facing us will be dealt with, not retrospectively, or at the last minute, or once businesses have gone bust and jobs have already been lost, but in advance? Will they set out a plan for support if the lockdown is extended, or if some regions or devolved nations remain under restrictions for longer? Finally, will I continue having to drag Government Ministers here week after week as this Government stumble from one crisis to the next?

[Steve Barclay]

The hon. Lady started by saying that the circuit breaker would have been shorter, but those on her Front Bench have repeatedly said, when interviewed, that a circuit breaker would have to be repeated.

The deputy chief medical officer was clear that an earlier national lockdown would not have been appropriate, because at the time, the path of the virus was very slow in certain areas, such as the south-west, so the economic damage would have been disproportionate. I might have expected to hear the hon. Lady’s argument from some Members of the House, but it is surprising that the economic spokesperson for the Opposition was willing to see that economic damage. [Interruption.] She chunters, but I am simply quoting the deputy chief medical officer, whose advice was that a lockdown would have been the wrong action to take at that time. I am pointing to economic damage, which she seems to see as trivial and something to be disregarded.

The hon. Lady then claimed that the Government had in some way dismissed certain parts of the United Kingdom. I gently point out that furlough was not ended; it continued to the end of October, and has now been extended. Furlough has continued in all parts of the United Kingdom without any gap in its provision.

The hon. Lady asks whether the Government have a plan in place. My right hon. Friend the Chancellor came to the House on 24 September to set out our winter plan for jobs. It included the kickstart scheme, which is up and running, and provides much-needed training to our constituents across the country. While setting out his winter plan, he said candidly that if the pathway of the virus changed, the Government would listen and adapt, and that is exactly the action that we have taken.

Finally, somewhat strangely, the hon. Lady said that she needs to “drag” Ministers to the Chamber to set out their approach. [Interruption.] She is repeating the point. Mr Speaker, I thought the Prime Minister was here yesterday to give a statement to the House. It is somewhat strange to say, the day after he did that, that Ministers have to be dragged to the Chamber to give updates on the position.