Areas with Additional Public Health Restrictions: Economic Support

Anneliese Dodds Excerpts

Tuesday 6th October 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 in areas of the country subject to additional public health restrictions.

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

The decision to extend tighter lockdown measures to Liverpool city region, Warrington, Hartlepool and Middlesbrough was based on the latest health evidence, including advice from the chief medical officer and local public health authorities. The resurgence of the virus has demanded further action to minimise harm to health and wellbeing, while preserving the ability of people to work and businesses to trade in the areas affected. That is why, throughout this crisis, we have sought to strike a balance between minimising the burden faced by businesses and protecting public health. To that end, we have provided one of the most generous and comprehensive packages of support for people, businesses and public services, totalling £190 billion by July.

As the path of the virus and the threat to the economy have become clearer, we have taken further decisive action. Last month, the Chancellor announced the winter economic plan—a package of targeted measures to protect jobs and businesses, including the job support scheme to support the wages of employees in viable jobs and an extension of the self-employed income support scheme to the end of April 2021. We are also continuing the temporary reduction in VAT for hospitality until the end of March 2021 and the Government-backed loan schemes until the end of November this year. We are also providing an additional £100 million in surge funding to support the hardest-hit areas in containing covid-19. That is on top of the £300 million provided through the test and trace programme. We are offering grants to businesses that have been required to shut because of the new measures, worth up to £1,500 for each three weeks of closure.

Throughout this pandemic, we have prioritised a flexible and adaptable approach to economic support. We will continue in that spirit, and we stand ready to evolve our policies as required.

[Anneliese Dodds]

Thank you, Mr Speaker, for your courteousness and patience, as always.

Seventeen million people—one in four of us—are living under additional covid-19 restrictions. That was not inevitable: experts agree that it is linked to the continuing failure to deliver a functioning test, trace and isolate system. That failure has profound economic consequences and puts businesses and jobs at risk. Today, nearly 1 million people are still on furlough in the areas of the country that are subject to local restrictions or are on the watch list.

Support for local areas has only ever come after restrictions have been imposed—for example, a month later in Leicester’s case. There are leaked suggestions that the Treasury will be involved in decision making around restrictions, potentially to prevent such delays. When will the Government finally be in a position to deliver support hand in hand with the imposition of restrictions, not trailing them?

The response has been inconsistent: £3 million for Leicester, £7 million for Liverpool city region, an undefined funding package for the north-east of England and nothing for Greater Manchester or the west midlands. What criteria determine the allocation of support to areas under local restrictions? Will they be published? If not, why not? Do they truly reflect the needs of areas subject to restrictions? I note that the Chief Secretary did not talk at any point in his statement about support for areas with economic needs, not health needs. He referred to the local restrictions support grant, but can he confirm that no area currently qualifies for that grant because of current restrictions?

The millions of people living under local restrictions deserve better. When will the Government grasp the scale of the challenge and act to recover jobs, retrain workers and rebuild businesses?

[Steve Barclay]

The shadow Chancellor almost implies that the resurgence of the virus is unique to the United Kingdom, yet anyone who looks across the continent will see that many other countries, as we come out of the summer period, are seeing exactly the same trend and are dealing with it in in many of the same ways as we are in the United Kingdom.

The hon. Lady says that support has not been offered to those suffering from economic harm, but that ignores, for example, the announcement that I made in the Chamber some weeks ago about the £1,500 of support for businesses for every three weeks of closure as the result of a local lockdown—[Interruption.] Hon. Members should let me answer, rather than chuntering from a sedentary position.

The hon. Lady also ignores the fact that my right hon. Friend the Chancellor has extended many of the measures that we introduced in our initial response, including the package of loans, the tax deferrals and pay as you grow. Those are universal offers to support businesses, irrespective of whether they are in areas of acute lockdown or otherwise.

As I said at the start, and as my right hon. Friend the Chancellor said yesterday, we will keep listening, and we will keep striving to be creative in response to the challenges that we face. Where we can, he will act. That shows our willingness to adapt. The package of measures that my right hon. Friend the Chancellor brought to the Chamber just a few days ago, with the winter plan, illustrates that willingness to listen, to evolve and to respond to the virus, as the economic needs of the country dictate.