Coronavirus: Supporting Businesses and Individuals
Bridget Phillipson Excerpts(3 years, 2 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Bridget Phillipson (Houghton and Sunderland South) (Lab)
I beg to move,
That this House calls on the Government to support businesses and individuals still struggling as a result of the coronavirus crisis in the forthcoming budget by extending business rates relief for at least another six months, extending the temporary 5 per cent reduced rate of VAT for three months after restrictions are lifted or for another six months, whichever is later, helping British businesses struggling under the burden of Government-guaranteed debt by ensuring that small businesses can defer paying loans back until they are growing again, extending and reforming the furlough scheme so that it lasts whilst restrictions are in place and demand is significantly reduced, immediately confirming that the fourth Self-Employment Income Support Scheme grant will be set at 80 per cent of pre-coronavirus crisis profits and extending eligibility to that scheme to include anyone with a 2019-20 tax return and fixing the gaps in coronavirus support schemes to support those who have been excluded from the beginning of the crisis; and further calls on the Chancellor of the Exchequer to make a monthly oral statement to Parliament updating the House on these matters.
Today’s debate takes place almost a year after the first introduction of national lockdown restrictions due to the pandemic. We all know how trying events since then have been for families and businesses up and down our country, and now, thanks to the vaccine and the incredible work of NHS staff and volunteers, there is real hope that before long we can return to some semblance of normality. While there are grounds for optimism, however, we on the Labour Benches know that there are still deep worries among many businesses and working people about whether their firms and jobs will still be viable when the restrictions are lifted. So many people are concerned about whether they will have a job to return to, and millions of people who have gone for almost a year without support are questioning how they will manage to get by until our economy reopens.
What people want and need right now is clarity. They need a sign that the Government get it, and that they understand and can respond to the needs of businesses and workers who have been placed under such incredible pressure through no fault of their own. The Prime Minister’s road map provides tentative suggestions about when businesses may be able to reopen, but we did not hear how the Government will be able to help to tide them over until that time. As with almost every major announcement throughout this crisis, we have had an update on the restrictions but no update on the economic support. It is not even clear whether the Chancellor believes that there is a relationship between restrictions and additional support, or whether he believes that businesses and workers should simply be grateful for what they have got. He may not be here today—it is becoming clear that accountability is very much not part of his brand—but we should be in no doubt about the harm that this approach has caused. Our country has endured the worst economic crisis of any major economy. Throughout the crisis, Ministers have made the same mistakes time and again and been forced to play catch-up at every turn, long after the problems with support have become apparent.
Whether the Chancellor is being careless or negligent, his approach is the opposite of what businesses need, which is the provision of certainty and assurance so that they can plan ahead. Where issues exist, they expect Government action to address them; they do not expect problems to be dumped in the “too difficult” box. There are few more egregious examples of that than the Chancellor’s persistent failure to help the excluded—the people who fall into the gaps between Government schemes. These are people who have taken risks by starting their own businesses, or perhaps they were changing jobs, but through no fault of their own they have been denied support since the start of the pandemic.
For many months, Labour has called on the Government to fix these problems. At first, Ministers said that it was not practical to do so, and of course we accept that in those fast-moving few weeks right at the start, that was fair enough, but now, almost a year on since the start of restrictions, how can this possibly be justified when the solutions are in plain sight? I repeat my call to the Minister today: when are the Government going to do what is right and fix the gaps in their support schemes? Labour recognises the value that self-employed workers bring to our economy. We want to see people taking risks, becoming entrepreneurs and helping to build the fairest possible recovery and a dynamic economy. That is why we would help those who are excluded from support by extending eligibility for the self-employed income support scheme to anyone with a 2019-20 tax return, and it is why we are asking the Government today to confirm that the fourth self-employed income support scheme grant will be paid at 80% of pre-crisis profits.
Bridget Phillipson
I will give way briefly. I am reluctant to give way much, because of the pressure on time.
Jim Shannon
Is the shadow Minister aware that those who are self-employed make up some 15% of our workforce? A survey that came out in September 2020 found that 64% of those self-employed people said that they were less likely to be, or unsure whether they wanted to be, self-employed or freelance workers in the future. Does that not tell us that we will be in deep trouble if we do not sort this out right now?
Bridget Phillipson
The hon. Gentleman makes an important point. As we start to emerge from the crisis phase of the pandemic, we want to encourage people to take that risk and start up their own business. The self-employed and people starting small businesses were central to driving the recovery post-2008, and we want them to be part of the answer right now, but that requires Government action to ensure that people can get through the difficult weeks and months that still lie ahead.
Bridget Phillipson
I will give way one final time. I appreciate that we are pressed for time.
James Cartlidge
The hon. Lady is very kind. She said that she would extend self-employed support. Would that be to anybody, regardless of their earnings?
Bridget Phillipson
We would work within the parameters of the scheme that has been set out, with the extension around 2019-20. We understand that, at the start of the pandemic, when it was not possible to draw upon those tax returns, there was an argument, but the position has now changed and we are calling on Ministers to reflect and to reconsider their position in the interest of fairness, and also to ensure that self-employed people can keep their businesses going through this very difficult time for our economy.
Bridget Phillipson
It does rather disadvantage Members who are not here if I take further interventions, I am afraid.
It is not just the self-employed who need greater clarity at this time, but workers and businesses, large and small, right across our country. That is why what Labour is calling for is grounded in the concerns that we hear from them. I heard such concerns myself last week, when I met small business owners from Teesside in Cumbria, echoing those I have heard time and again from businesses right across our country. From the future of the furlough scheme to the considerable debt that many have accumulated since the start of the pandemic, there is huge worry about the decisions they will have to make over the coming months, and Government inaction is making those pressures worse. It is why the Labour party has set out the constructive steps that we would take to support businesses—steps like extending the scheme. We know that 4.6 million workers are still on furlough. Every day that passes without the Chancellor explaining how long it will last puts more of those jobs at risk, and that is why he should commit now to extending the scheme in line with the health restrictions remaining in place.
More than that: the Chancellor should undertake the common-sense reforms that we have called for, with new training to help furloughed workers improve their skills, alongside tough conditions on employers to stop abuse. We also want to see far more done to give businesses breathing space, by temporarily extending reduced VAT rates and also extending business rates relief for at least another six months.
The Government could do much worse than to learn from the example of the Labour-run Welsh Government. They have consistently offered more generous support for businesses through a more targeted and responsible approach, capping rates to free up extra money to support those who need it the most. It is a reminder of the values of Labour in government: prepared to take difficult but responsible decisions to support businesses properly throughout this crisis. Those values could not be further from the approach taken by this Government, who only next month will demand that businesses start paying back covid loans. These economically illiterate plans risk crushing British business and our recovery under a mountain of debt. Not only do hundreds of thousands of businesses risk going bust, but the taxpayer will have to pick up the tab if billions are lost in defaulted loans. The Government should heed our calls to ensure that smaller businesses start repaying bounce back loans only when they are growing again, to help secure jobs and our economic recovery.
Measures like these could have been announced long before now, and could be rolled out immediately if the Government had the political will. However, once again, businesses and workers are being forced to endure an excruciating and inexcusable wait so that the Chancellor can have his day in the sun at next month’s Budget—more proof, as if it were needed, that it feels sometimes that he is more interested in boosting his own brand than he is in supporting hard-pressed British businesses. It is a reminder of what Labour would do to secure our economy, compared with the Tory incompetence and indecision that risks derailing our recovery; a Labour party that is responsible and on the side of families and businesses compared to the Tory party that simply will not listen. Above all, we are a Labour party that believes that by working with business and trade unions, we can emerge from this crisis with a fairer and stronger economy and build a more prosperous future.