Management of the Economy and Ministerial Severance Payments

Beth Winter Excerpts

Tuesday 15th November 2022 Commons Chamber

[Beth Winter (Cynon Valley) (Lab)]

I rise to speak in support of the motion on the management of the economy. The mismanagement of the economy by the Conservative party and the inaction on runaway inflation and profiteering has meant that millions of people are struggling with the impacts of inflation on their household incomes. The Bank of England decision to raise interest rates, the biggest rise since 1989, is going to hit mortgage and private rental costs, with devastating impacts on so many people and communities, including mine. The rise will have an immediate effect on over 2 million people on a variable rate mortgage, and while more than 6 million on fixed-rate mortgages may be currently insulated, when their deal expires in the coming weeks and months they will be paying £500 more per month on average. Recent analysis from the Joseph Rowntree Foundation reveals that nearly 2.5 million people with a mortgage are already in poverty. It also found an additional 400,000 people will be pulled into poverty over the coming year.

Even before the rate rise, the housing system was broken. Shelter has done a lot of research, and it shows that one in three adults in Britain are affected by what it calls housing’s “national emergency”, an apt description of the current situation in the housing sector. We have a severe shortage of affordable, accessible, habitable, safe and secure housing. Having worked for many years in the housing and homelessness service, including with Julian Trust night shelter in St Pauls in Bristol, Cyrenians in Bristol and then Shelter Cymru for a number of years, I have seen at first-hand the pain and suffering of people in desperate housing need—and it can affect anyone, including people sitting here in this Chamber today.

I recently held an appreciation event in my constituency office in Cynon Valley for the housing providers, including Llamau, Hafal and the local authority. They are absolutely terrified about the current situation in housing and the cost of living emergency.

One of the few benefits of frequently speaking last in debates in the Chamber is that I can listen intently to all the contributions. I want to take the opportunity to set the record straight on the current situation and where blame lies. The blame for the current economic crisis and the cost of living catastrophe lies solely with the Tory Government and their economic and ideological approach. While others were speaking, I was looking at some figures. The Office for National Statistics said that, by 2020, almost half the wealth in the United Kingdom was concentrated in the hands of the top 10% of households, while the bottom 50% had only 9%. It has been estimated that the utility companies will make in excess of £170 billion in the next two years, and bankers’ bonuses are absolutely extortionate. We are the fifth richest nation and yet we have some of the highest levels of inequality in the world. Shameful, it is. More than 330,000 deaths have been directly attributed to the austerity policies of the Tory Government. The eminent Professor Sir Michael Marmot recently called the impact of the cost of living catastrophe a “humanitarian crisis” that will lead to thousands more deaths. That is the reality of the situation that we are experiencing.

I return to the specifics of the motion. Housing is and must be regarded as a fundamental right. In Wales, the Welsh Government are trying to do things differently by reducing short-term evictions, and they have a commitment to end homelessness. However, the Welsh Government and other devolved nations and regions throughout the United Kingdom are constrained by the fact that the purse strings rest here in Westminster. More must be done by the UK Government. We need a mass-building programme for affordable, appropriate and climate-proofed housing. The Government must provide a fair, needs-based funding settlement to Wales and the devolved nations. The homelessness charity Crisis has called for an increase in housing benefits and for the Tory party’s commitment to end no-fault evictions to be honoured. London Renters Union is calling for a day of action to freeze rents and link local housing allowance to market rates. We must extend financial support for people struggling with mortgage payments.

Alongside increasing the supply of genuinely affordable housing and better support for those on low incomes, we must see: a strengthening of the social security system; social security benefits increasing in line with inflation; a continued commitment to increase the national living wage; inflation-proofed increases in wages; and employment rights protected and, indeed, improved. We should be introducing windfall taxes and a wealth tax. Tax Justice UK has estimated that £37 billion could be raised by introducing a wealth tax.

The Government are to blame and are allowing the Bank of England, through its independence, to hit living standards as it seeks to tackle inflation. I pose this question before the autumn statement: should the Bank be required in future to take account of the impact of its decisions on real incomes and on living standards measurements?

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. The wind-ups are starting unusually early—there are reasons for that—so, before I call the Front Benchers, I will say that, whatever the agreed time limits were for wind-ups, you can both go longer, if you so wish.