Women and the Cost of Living

Brian H. Donohoe Excerpts

Tuesday 19th November 2013 Commons Chamber

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

Perhaps the Minister will give the hon. Lady a glass a water to help her throat. May I just ask about pensions for young people today, and what will happen to them in the future? Child care today does not mean that those young people will get a pension tomorrow—in fact, quite the reverse.

[Tessa Munt]

I thank the hon. Gentleman for intervening. At least we are making sure that young people have a better chance to access a better education early on. Everybody knows that the money put into education early on can transform children’s life chances so much more dramatically. Those children will be the ones paying my pension and his, so it is important to concentrate on education.

For parents who wish to return to work and, through the Lib Dems, are given recognition and respect for choosing to do so—just as we respect parents who wish to stay at home and look after their children—the importance of good-quality child care is paramount. We know that child care is very expensive and is a problem for families. It was a problem for many years under Labour, and when I was bringing up my children under the preceding Conservative Government.

We are helping mothers with the cost of child care. We are providing 15 hours of free early education for all three and four-year-olds, which we will extend to 260,000 two-year-olds from next year. We are planning to introduce tax-free child care that, when fully implemented, will save a typical working family with two children under 12 up to £2,400 per year. In total, the coalition Government are investing about £1 billion a year in additional support for child care by 2016-17, including £750 million for the new tax-free child care scheme and £200 million in expanded support through universal credit.

The Lib Dems are wholeheartedly committed to shared parental leave, which creates more flexibility for parents, locks female talent into the labour market and will ultimately achieve a fairer balance for both men and women at home and in the work place. That Lib Dem priority for Government is one that we have delivered. Flexible working and shared parental leave is important in helping to create a fairer society, and the coalition Government have already implemented their commitment to extending flexible working to all parents with children under the age of 18. We now intend to extend the right to request flexible working to all employees.

The Lib Dems welcome the fact that in many modern families, child care is no longer the sole responsibility of the mother. Fathers and male partners play an increasingly vital role in raising children, and it is important that the Government should accommodate that by providing for shared parental leave. The system of maternity, paternity and adoption leave and pay that we inherited from the previous Government was inflexible and outdated. The coalition’s reforms will ensure that, for the first time, mothers can go on maternity leave or shared parental leave at the same time—during the first weeks after a birth—as fathers.

We are working hard to help improve living standards, but we cannot get away from the fact that they started to decline under the previous Government. It was a painful symptom of their disastrous economic record, and the fact is that they left us with an annual deficit of £160 billion.

To conclude, the Lib Dems are on record as saying that economic sustainability is important and that we want

“an economic system where the current generation can enjoy the fruits of its endeavours without relying for its living standards on a legacy of debt left to the next generation.”

That means that we have to deal with the huge financial crisis with which we are faced. That is why we are committed to the changes that we are making. The Deputy Prime Minister was campaigning on the effect of the current situation on women more than a year ago, before the Labour party focused on it. He said that

“despite rising since the 1960s, female employment has stalled over the last decade. It is, however, a problem we can no longer afford. Just as working women drove up living standards in the latter half of the 20th century, all the evidence suggests that living standards in the first half of the 21st century will need to be driven by working women once again and this absence of women from our economy is costing us dearly.”

Several motions on this issue have been passed at Liberal Democrat party conferences and we are committed to improving child care and extending free child care. We will face the next election with that commitment in our manifesto.

--- Later in debate ---

[Sheila Gilmore]

I will continue with what I was saying, because it is important to realise the cost of this policy to many women.

This generous gesture, which has advantaged more people on upper earnings, has been balanced by taxes and cuts elsewhere, such as the raising of VAT. Many of the cuts have affected women in particular. The cuts in tax credits have more than cancelled out the rise in the tax threshold for the lower-paid. People who have been affected by that will not be saying, “It was great that the tax threshold was raised.” They would probably rather have stayed in exactly the same position as they were in before.

[Mr Donohoe]

Surely a consequence of that is that fewer women are able to put their children in day care and get back to work.

[Sheila Gilmore]

Indeed; the work incentives that were provided by tax thresholds, particularly to single parents, cannot be underestimated.

The hon. Member for Wells (Tessa Munt) brushed aside my intervention in which I said that the gains from raising the tax threshold had been more than cancelled out for the lowest-paid, but they have been. The argument is made that raising the tax threshold allows people to keep more of their earnings, instead of tax being taken away with one hand and paid back with the other. The problem is that the policy has not been even-handed. Some people have ended up worse off as a result of it. Those who used to benefit and have lost out are predominantly women.