Cost of Living Increases

Ben Lake Excerpts

Wednesday 16th March 2022 Commons Chamber

[Ian Murray]

Apart from chairing the debate wonderfully, of course.

Let us make the serious point. We are debating the motion in front of us and we cannot get clarity from its mover about whether it includes a windfall tax on the oil and gas companies that would give every single household in Scotland £200 off their bills and the poorest 815,000 households £600 off their bills. That is what we are talking about. That is the substantive point that I am making.

Children will be going to bed cold or hungry—or both—and the best that the Chancellor can do is put up their parents’ taxes and lend them their own money to take a tiny amount off their energy bills. It is simply not good enough. The Trussell Trust says that two out of five people on universal credit are forced into a spiral of uncontrolled debt. Labour’s plan to tackle the cost of living crisis would put money in the pockets of Scottish families, helping them to make ends meet, and take worry out of receiving that unaffordable direct debit increase from their energy supplier. Across the UK—I repeat this again, because the right hon. Member for Dundee East (Stewart Hosie) wants a substantive point—we would introduce a fully costed, worked out plan for a windfall tax on oil and gas companies through which every single household in Scotland would get £200 off their bills and the 815,000 hardest hit households would get £600.

In Scotland, the Scottish National party has the power in its hands to do more than just bring Opposition day motions; it can change lives, too. That is what Labour would do. We would use the Barnett consequentials that the SNP has spent on replicating the Chancellor’s unfair policies to give a Scottish fuel payment of £400 to nearly 600,000 households facing the brunt of the crisis. We would top up the Scottish welfare fund so that local authorities could use their discretionary offer further to support households.

[Ben Lake (Ceredigion) (PC)]

I am interested to hear about the shadow Secretary of State’s proposals for Scotland. Has he had an opportunity to raise them with his colleagues in the Welsh Government, who have done exactly the same as the Scottish Government, whom he has criticised so heavily?

[Ian Murray]

The bottom line is that I should not be getting £150 off my council tax bill. That seems fair, and I think that we agree on that. We need much more imagination in how to get money into the pockets of the poorest who require it. The best way is to ask those with the broadest shoulders to put a little more into the pot. It is certainly not the whole host of Ponzi schemes reeled off by the Minister whereby people are lent their own money and will have to pay it back later. We need to implement long-term solutions to keep bills low such as improving the energy efficiency of Scottish homes and, as was mentioned, dealing with off-grid, which is a huge issue in Scotland.

That is a proper plan to tackle the cost of living crisis, unlike this back-of-a-cigarette-packet plan designed to help solve a political problem for the Scottish nationalists—who do not want to back a windfall tax on oil and gas but will not even tell us in public if that is what their motion is intended to do—or the Chancellor who is not only doing little to help but is costing people much, much more and making it worse. That is the difference Labour can and would make in power. We do not want just to oppose the Government in Opposition day debates; we want to replace them altogether, which the Scottish National party can never do.

--- Later in debate ---

[Ben Lake (Ceredigion) (PC)]

Diolch yn fawr, Mr Deputy Speaker. I shall endeavour to ensure that I am seated again in just under five minutes.

It is a pleasure to follow the hon. Member for Midlothian (Owen Thompson). In the interests of time, I will say that I agree with every point that he made. Indeed, many points have been made this afternoon with which I would like to associate myself. We have heard a lot about the various pressures that are combining to fuel the cost of living crisis and those points have been well made.

We have heard about the rising cost of heating homes. I very much associate myself with the comments of the hon. Member for Tiverton and Honiton (Neil Parish), who drew attention to the fact that for many people in rural areas, the cost of heating their home has been further exacerbated by many premises being off-grid. With the price of heating oil and liquid gas rising, I have heard accounts from constituents whose heating costs have trebled in the few months since September last year. That is a pressing issue that is hitting rural areas.

Another driving force of the crisis in rural areas is the rising cost of fuel at the pump. Unfortunately, Wales has the highest car dependency in the UK with nearly 80% of commutes done by private car. Nearly half our businesses are located in rural areas where, sadly, people would be lucky to have multiple bus services a day. Of course I wholeheartedly support the rapid decarbonisation of our transport system to meet our net zero commitments, but many of my communities are devoid of the public transport infrastructure that would make that a reality. Sadly, they depend on private car use for essential journeys, whether going to work or going shopping.

With the RAC calculating that, on current rates, the Treasury will take an additional £2.9 billion from fuel prices, my party is calling on the Chancellor to urgently implement two measures. First, he should reform the rural fuel duty relief to extend it to more rural areas in Wales and improve its eligibility criteria to account for local transport provision. That would bring immediate relief at the pump for rural areas and would target areas with below UK average investment in public transport infrastructure, which would hopefully incentivise the longer-term solution that is represented by better public transport links.

Secondly, I urge the Chancellor to support the Road Haulage Association’s call for an essential user category to be developed to reduce petrol prices for key services, such as logistics, and essential professions with high mileage, such as carers. Indeed, I have been told by constituents who are carers and who typically travel upwards of 50 miles a day that they are recompensed by only 30p a mile. At current fuel prices, that is simply unsustainable.

I draw attention to the impact that the rise in national insurance contributions will have on families, a point that has been well made today, and on businesses. It is effectively a tax on employment, which is why Plaid Cymru supports the proposal to increase the employment allowance from £4,000 to £5,000 a year, as advocated by the Federation of Small Businesses.

An expanded relief to allow eligible employers to reduce their national insurance liabilities would achieve several key objectives. First, it would make widespread and welcome pay rises more financially sustainable for businesses. Secondly, it would reduce the risk of higher costs being passed on as higher prices to consumers. Thirdly, it would help to protect businesses’ ability to invest, which would boost our economy’s productivity and economic growth at such a crucial time.

In sum—with time to spare, Mr Deputy Speaker—I urge the Chancellor to make use of the slightly improved picture of public finances and take the opportunity next week to introduce measures to help families and businesses and to avoid the energy crisis turning into a shock that stalls the economy.