Financial and Social Emergency Support Package

Bill Esterson Excerpts

Wednesday 25th March 2020 Commons Chamber

[Jesse Norman]

I am grateful to the hon. Lady for raising that point. I will look into the question of whether there should be any relation between business loans; I am certainly not aware of one myself. It ought to be possible for people to claim business loans as she has described. As regards the business interruption loan scheme, borrowers are not required to pledge their house, but there may be some requirement for personal guarantees of other kinds, which is what one would expect, and which will open up lending in other ways. The Economic Secretary is very engaged on this issue. There are 40 lenders involved, so ironing out the guidance with all of them, to ensure a consistent picture, has not been the most straightforward thing one could imagine.

[Bill Esterson (Sefton Central) (Lab)]

I will read out what Barclays is saying to businesses about personal guarantees:

“Loans will need to have a director’s guarantee, or in the case of partnerships and sole traders, you will be personally liable”.

If a person’s only asset is their home, pledging it and being liable amount to the same thing. Will the right hon. Gentleman deal with that problem? That quote was read to me by a person from a company that will now have to lay off its staff and close, and so will not be eligible for the furlough scheme. This will hit workers as well as businesses.

[Jesse Norman]

I cannot comment, obviously, on the specific circumstances that the hon. Gentleman describes, but I can certainly say that the Economic Secretary to the Treasury is working very closely with the banks to make sure that no business is forced to close as a result of coronavirus.

--- Later in debate ---

[Bill Esterson (Sefton Central) (Lab)]

The badge on the Chancellor’s Twitter account says: “Stay At Home save lives”. I completely agree with the sentiment behind that message. A number of hon. and right hon. Members also have that badge on their Twitter accounts. However, if people cannot afford to stay at home, they simply will not do so. They will have to go out to find the money to put food on the table. That applies, as things stand, to very many self-employed people. It also applies to many people who have lost their jobs because of the financial downturn that has happened so suddenly and unexpectedly. People who do not qualify for sick pay and who have symptoms of the virus will also have to go out to find money, as will those who suffer as a result of the delays in universal credit, which have been so well described by many hon. and right hon. Members. As my right hon. Friend the Member for East Ham (Stephen Timms) said, it will also happen to those who have no recourse to public funds.

Health has to be absolutely paramount in everything that we say and do, by which I mean the health of the individual and their potential to pass on the virus to other people, especially to health workers who we need to look after the rest of us.

[Mr Dhesi]

Today, we have heard the sad and shocking news of the death of a 21-year-old lady in Buckinghamshire who had no underlying health conditions. Does my hon. Friend agree that there are many individuals and employers out there who are under the misconception that those who are younger, or who have no underlying health conditions, will not suffer from this virus? They need to take heed of this story and look after the health not just of themselves, but of those around them.

[Bill Esterson]

I am grateful to my hon. Friend for making that point. It is really, really important that everybody—no matter what their age or health condition—recognises that we are all at risk from this. But there are groups who are especially at risk, and we have an enormous responsibility to protect them as much as possible, including the health workers who we will need to look after us all.

If we want people to stay at home and to observe the 2 metres rule when they are out and about, we have to do everything in our power to make it as easy as possible for them to comply. Delivering financial security is crucial to ensuring that nobody has to go out unless they absolutely have to. I asked the Leader of the House earlier to pass on my point about the construction industry to the Prime Minister. I will make that point again now. There are too many people going on to construction sites that are not essential work. Such construction must stop, otherwise people will carry on going to work. Somebody who works away from home emailed me just this afternoon to tell me that their employer is saying, “I am only interested in the profits of my company”; they do not care about anything else. Those workers are being forced to go to work. If they do not, their pay will be cut and they will have nothing, and they will not be part of any income retention scheme if and when it is applied by that employer.

[Dawn Butler]

The mode of travel for construction workers going to work is often trains and the tube. The Minister and the Government talk about the trains and the tube system, and about how people should be staying at home. How can they marry the two? If we do not close the places where people go to work, they are going to travel on the trains. Does my hon. Friend agree?

[Bill Esterson]

My hon. Friend is absolutely right, and of course those trains and buses are needed by our health workers to get to hospitals. If they are infected by being in close conditions with people who have the virus and who are going to work—not just in construction sites, as this is true of call centres and a number of other places of employment, because of the behaviour of some employers—we run the risk of spreading the virus right across the country.

Health has to be paramount, but if that is to be the case, rent has to be covered. We cannot have people feeling that they are at risk of being evicted; that has to be taken away completely. I am afraid that the Prime Minister’s assurances earlier went nowhere near far enough in demonstrating that the Government are serious about no evictions because, as has already been mentioned in this debate, evictions are already happening.

People who are desperate will do desperate things. I am afraid that it does not finish with people going out to work to earn money to put food on the table. What will happen in those cases, in a few days’ or weeks’ time, where people simply have nothing left to feed themselves and their families? I do not want to paint a picture of too much disaster, but I am sure we can all imagine what might happen if people took it into their own hands to go and get food just to survive, if they do not have the means of paying for it. “Everything it takes” must mean that we do not get to that situation in the coming days and weeks, and giving people the financial security to ensure that that does not happen must be an absolute priority.

I want to talk about some of the practical steps. The behaviour of the banks, in saying that they will put up interest fees from 9% to typically 39%—is nothing short of usurious and extortionate. The same applies to the credit card companies. Where people cannot pay back their credit card debt, there must now be a case for a delay in the repayment of credit cards and a number of different kinds of loan.

There are still gaps in the job retention scheme; many workers will not qualify. A number of Members have mentioned charities. Charities are going to need to carry on working, and we are going to need them to carry on working because they provide essential services and are an important part of the answer in dealing with the health crisis.

[Catherine West]

Is my hon. Friend aware of the situation for religious charities in particular? In cases where there is usually a weekly collection, some mosques, churches and other faith gatherings are really struggling to pay their own bills because they are not getting that regular income.

[Bill Esterson]

My hon. Friend makes an important point about those charities paying their bills. The point that I was getting to was that they will not be eligible for the job retention scheme because they and their workers will have to continue working—quite rightly, and we will want them. Therefore, alternative arrangements are needed to pay their bills, to which she refers, and their wages, if they are to play their full part in providing the support that we all need them to.

My right hon. Friend the Member for East Ham has covered universal credit in the technical detail that pretty much only he in this House can, and I thank him for that. Suffice to say that a constituent of mine said that, after three and a half hours on the phone, they were given a phone appointment for next Wednesday. They will then face a five-week wait before getting any money. They need the money now. They have no money; they need to put food on the table. That is typical of the kind of examples that we are all hearing, and it needs to be addressed.

That brings me to the self-employed. The Chancellor has made clear his preference for a targeted scheme—that applies to a number of the schemes that the Government are coming up with—that gives money to those in need. In normal times I would completely agree with that approach, but I am afraid that time is up. We cannot afford to wait any longer, and if a few people who do not need the money are given extra so that the vast majority—a far larger number—who need the money get it, and get it now, when they need it, so be it. That has to be the sensible way forward in this extreme emergency, and it is not without precedent in normal times. The entrepreneur’s relief gives money to very many people who actually do not need it, according to the Government’s analysis of the application of that scheme. If it is good enough for some wealthy entrepreneurs, it is certainly good enough for our constituents who are self-employed and, indeed, for constituents who need sick pay or universal credit now.

Then there is the behaviour of certain businesses—I can mention Virgin, Sports Direct and Wetherspoons. Travelodge, I believe, has already been mentioned for its behaviour in evicting homeless families. This must end. The Government must make it clear right now that any such behaviours that disadvantage people who will be put into difficulty cannot be tolerated. Intervention is needed, not just words from the Dispatch Box or on television.

I will quote the example of Village Hotels, because my hon. Friend the Member for Cardiff North (Anna McMorrin) asked me to do so. She has had a solicitor’s letter from Village Hotels for raising on social media what was sent to her by one of her constituents who is on a zero-hours contract. They have been told by Village Hotels that they will receive no pay and she has been told to take down the post, which is entirely true because she has quoted and shown a copy of the letter. Such behaviour by the company is completely unacceptable, and it should withdraw its letter to my hon. Friend. Her constituent and everybody in that position on a zero-hours contract needs to be the same position as every other member of staff at Village Hotels and everywhere else, so that they can be part of the job retention scheme. I hope that my raising this in the Chamber will enable a change of heart.

I really do not want to say what I am going to say next, but I have now heard from doctors who are saying that they believe, and they have had this confirmed by senior people in the health service, that the time is fast approaching when they will be forced to decide who lives and who dies. We know, I am afraid, that that must be true because of what is going on in other countries. That is why it is so important that we reduce the impact on the national health service and minimise infection. The points I have made and the examples I have given, like those of all hon. and right hon. Members, are designed to do just that. We have to make sure that people are financially secure and have somewhere to live, whether they are self-employed or unemployed; whether or not they have recourse to public funds; and whether they are renters, mortgage holders, homeless or rough sleepers. The “stay at home, stay safe” advice is absolutely right, and we must make it possible for everybody to follow it.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

It is a real privilege to speak in this incredibly important debate. As I am, I think, the last speaker from the Back Benches, it is appropriate to start by paying tribute to the Leader of the Opposition and the shadow Chancellor on the day of what may be their last appearances on the Front Bench. I regard both of them as comrades and friends, though I would not necessarily say that I have agreed with everything that they have said and done—but that is how it is in our great Labour movement. I particularly thank them for always bringing a deep care and concern for the most vulnerable in our society to the heart of our debates; for vanquishing austerity economics, which had such a grip on our political debate five years ago, and still has consequences for so many in our society today; and indeed for the way in which we are responding to the covid-19 crisis.

Like most Members here, I have been overwhelmed with emails from constituents—from a supply teacher who does not know how he will feed his family; from a plumber who feels that his health is in jeopardy, and feels abandoned by the Government; from a cancer survivor who needs to self-isolate, but does not know what she will eat on Monday; and from a circus owner who does not know whether her Newcastle-based circus will survive this crisis. Parliament should not be the only circus to survive the pandemic; I hope it is not disorderly to say that. It is really important that all our performers, and all our self-employed, of whom there are 5 million in this country, have the support that they so desperately need.

When I took the tube to Parliament today, I felt a bit of a fraud, because I did not feel like a key worker. I was not going to save lives. But when I thought about the impact of the Government’s delay and intransigence—I am sorry to have to use those words—in providing the support that is so desperately needed by freelancers and the self-employed, I realised just how much they need our voice. I have constituents who lost their jobs because the Chancellor delayed announcing the very welcome job retention package. The delay in respect of measures for the self-employed will not only cause lost jobs, but lead to deaths. The Minister shakes his head, but as we have heard in many excellent contributions, the absence of support for the self-employed is driving people to go to work when they should not, and to put themselves and others at risk, as well as causing enormous mental distress.

Parliament rises tonight, but I urge the Minister, Chancellor and Prime Minister to set out immediate measures to support the self-employed. Unfortunately, all those who are employed are not necessarily protected. We have heard again and again from Members of Parliament the desperate appeals from constituents whose employers are not protecting them from the coronavirus. I am going to name some from the emails I have received, and they can get in touch with me and explain how they are protecting their employees. DHL, the delivery service, is not offering any personal protection equipment to its deliverers and is not following the 2-metre guidance. Tolent builders are not following the 2-metre guidance. Serco and EE, which have many call centre employees in large rooms, are not following the 2-metre guidance. Santander is apparently bringing in contract workers to work on PPI, which I do not believe to be an essential service, and is not following the 2-metre guidance or social distancing. Then there is our very own Mike Ashley, the owner not only of Newcastle United but of SportsDirect, who, after claiming that SportsDirect was an essential service and finally—

[Bill Esterson]

It’s essential to his fortune.

[Chi Onwurah]

It is an essential service for his fortune, but not in this crisis. He finally agreed to close his shops, hiking prices online while still making employees come into empty shops to act as security.

The Government’s payroll support and job retention scheme are very welcome, but we must have greater clarity for businesses on what they need to do to stand by their employees, as the Prime Minister said. Any private sector bail-out must have strings attached to it. Banks were bailed out in the 2008 financial crisis and people were rewarded with austerity. In this crisis, we must champion the good businesses that are doing the right thing.

[Chi Onwurah]

The right hon. Gentlemen makes exactly the point that I was going to make. It is pleasing to see that that is at least agreed across the Opposition Benches, and I hope to hear a message from the Government that in this crisis, after this crisis, the people must be rewarded and not asked to bear the burden.

[Bill Esterson]

On the behaviour of the banks, I mentioned the 39.9% interest rates that the banks have announced that they will charge pretty much across the board—funny that, isn’t it? Does that not suggest that they are already embarked on exactly that approach of trying to make everybody else pay when they should be taking the opportunity to pay back for their role in the financial crisis?

[Chi Onwurah]

My hon. Friend makes an excellent point. Without wishing to go into the financial crisis and the, in my opinion, very well deserved backlash against the financial sector, which continued to make profits while so many people felt the impact of that crisis, it now has the opportunity to demonstrate the social value and support it can provide in times of crisis and emergency, especially, as my hon. Friend says, for those who have taken out loans or credit cards and those who need loans. Many businesses are still saying to me that they are not getting the loans that they are promised, particularly the tech sector start-ups, which rarely have the assets that banks feel are necessary to offer such loans. We want greater corporate citizenship from the financial sector and from other businesses, too.

I applaud and echo what many of my colleagues have said about those who are suffering the most in this crisis, but my focus is on the impact of the digital divide in our country in relation to coronavirus. We know that access to and ability to use the internet is not evenly spread across our society. In the UK, data from the Office for National Statistics indicates that in 2018, 10% of adults said they did not have access to the internet at home, while 4.3 million had no demonstrable digital skills. That data also showed that 12% of those aged between 11 and 18 years reported having no internet access at home from a computer or tablet.

Since 2011, adults over the age of 65 have consistently made up the largest proportion of adult non-users of the internet. More than half of all adult internet non-users were over the age of 75. Across all age groups, disabled adults make up a large proportion of adult internet non-users.

In normal times, access to the internet improves hugely the chances of, for example, finding work. It also, as we have heard, makes it easier to access universal credit—in fact, it is essential to access universal credit—and it enables people to connect and communicate better with family, friends and the community. These are not normal times, however, and for the next few weeks and perhaps the next few months, social distancing is going to be the norm. Social distancing must be accompanied by digital coming-together, and for that we need digital skills and digital access. We have heard about the implications for mental health of isolation without the ability to communicate. I want the Minister to think about what that means for the 11% who have no access to the internet.

What I want to see from the Government in the next few days is first, digital skills. There are those who have access to the internet but do not have the real digital skills to use it. They need to be able to take advantage of the many different courses and means of entertainment and so on, which are all fantastically being developed at the moment. They need the digital skills to be able to access that. In that respect, I recommend the work of Sue Black with the #techmums initiative, which is still rolling out during coronavirus, and also the work of many other charities.

Secondly, there is the question of capacity. Here I am really concerned, because all we have had from the internet service providers and network operators is general vague promises that there will be the capacity and it will all be fine and all right. To be frank—I have been known to mention this, but I will say it again—as someone who worked designing telecom networks as an engineer for 20 years, that does not reflect at all my experience. Capacity needs to be dimensioned and built in. There will be capacity now that is dedicated to business networks that may need to be moved over to support home networks with the huge increase we are seeing in working from home.

Moreover, we need to be able to secure capacity for our essential services. I am already hearing that in Newcastle, for example, Newcastle upon Tyne Hospitals NHS Foundation Trust cannot provide the capacity for administrative workers to work from home. If those essential services can be delivered from home, it frees up space and hospitals and car parks and so on.

Just as with personal protective equipment—we had a lot of time to prepare that was perhaps not best used, and there was a lot of talk about everything being okay, which has turned out not to be the case—I fear that over the next few weeks, when we are all confined to our homes with only the internet to serve as a social medium that we can take advantage of, we will find that there is not enough capacity. Networks will fall over. There will be delays and, as always, it will be the most vulnerable and the poorest who will suffer most. I would like to see modelling of the traffic impact on our networks. I would also like to see a commitment to digital access for all, particularly for young people and schoolchildren who will be expected to be learning from home. They need to have free access to the internet to enable them to do that.

Moving on, I want to say a little bit about where we need to go from here. In economics classes, we were taught that the virtue of a capitalist market economy is that it ensures the efficient allocation of capital, as market competition drives inefficiencies out of the system, ensuring the cheapest, most innovative products and services possible. The best the state can do, we were told, is to get out of the way. But the capacity to deal with a major health or economic shock is, by definition, inefficient when that shock is not there, so extra ventilators and stocks of masks or toilet paper are inefficiencies that the free market system drives out. They can only be provided and stocked by the state, and the problem with the lean, mean state machine that the Conservatives advocate and have done their best to create over the 10 years of austerity is that the state is then no longer equipped to provide the resilience, the stock and the inefficiencies that are necessary to support our population in a time of crisis as we have now.

This is a war, and as a war it has real heroes—NHS workers, care workers, teachers, transport workers and cleaners. Not all of them are in the public sector: we have heroes in the private sector too, in supermarkets with our retail workers, and those isolating at home, which is something we have never asked people to do before. As a woman of colour, I know that there is despair at the realisation that natural hair may no longer be a choice, but the only option for us. There are many sacrifices, large and small, which are expected to be made over the next few weeks. Obviously, not everybody faces the particular challenge I just mentioned.

The heroes of this war must be rewarded. After the second world war, we had the national health service, homes fit for heroes and the welfare state. After this battle, we need an economy fit for heroes. We who have the privilege of walking in these corridors of power are insulated from some of the worst impacts—the desperation, the fear and the confusion that I know is going on in homes across Newcastle. I want the Minister’s reassurance that we will build a better and fairer economy out of this desperate crisis in order to be an economy fit for the heroes who are now helping us to drive out coronavirus.

I want to end on a note of hope and optimism, because in Newcastle and across the country we have vibrant, active people who want to do the right thing and want to support and look after others. We have great communities across our country, such as in Newcastle with the Newcastle City Council city lifeline, which allows people to volunteer their time to support community organisations and projects. We have already heard that the national Government scheme for national health service volunteers has been inundated.

Newcastle upon Tyne Central has 11 active community Facebook groups that residents can post their needs and volunteers commit their time to. Slatyford tenants association in my constituency, which offers bingo and tea once a week, has closed down for the duration of the coronavirus crisis, but is looking forward to opening again. Mrs T’s Café in Blakelaw, which supports the local community through excellent nutritious food, is looking forward to getting back.

Of course, we also have our food banks. Newcastle United Supporters Trust is one of the most impressive organisations I have ever seen. As a Newcastle United supporter, one of the most inspiring sights on a Saturday when walking past St James’ Park is the Newcastle United Supporters Trust stall, where those shaking the buckets, as I have done, will find people putting in £1, £5, £10 or £20. We should not need food banks, but when we do, such generosity from Geordies and people across the country is inspiring. Although we cannot have stalls on the streets—we have no more football matches for a while—we still get fantastic support online. Food is being donated by businesses such as Fenwick, TK Maxx and Thorntons. Geordies from Newcastle, but also from Brighton, London and, I understand, the Falkland Islands have donated money online. We also have Newcastle United Foundation, which is delivering hot meals to schoolchildren. They all need our support, as do our theatres, cinemas and charities.

Much of the real world is going online and we need to ensure that we have a real-world community, as well as real employment and a real support and welfare sector for when the crisis is over, when we can build an economy fit for the heroes we will create.

Royal Assent