Caroline Flint
Main Page: Caroline Flint (Labour - Don Valley)
Caroline Flint (Don Valley) (Lab)
I beg to move an amendment. At the end of the motion add:
‘but believe that the Gracious Speech offers no answers for squeezed households facing a cost of living crisis; regret that the economy is flatlining, unemployment is rising, borrowing is set to be £245 billion more than planned and the Office of Budget Responsibility has confirmed that by 2015 people will be worse off than they were in 2010; and call on your Government to take real action to get people back into employment, build more affordable homes, tackle rising energy and water bills, tackle the growing cost of getting to work and instability in private sector housing rents and tenancies and end extortionate letting agents’ fees and charges.’.
We debate the Queen’s Speech at a time of crisis for millions of people in our country. This was a golden opportunity for the Government to show that they were in touch with the nation’s concerns and that they would help with the rising cost of living and offer hope to families who are seeing their dreams evaporating with every year that passes. But this Queen’s Speech will not take the pressure off the squeezed middle, lessen the anger of commuters powerless to halt the relentless rise of rail fares or address the choice between heating and eating for our most vulnerable senior citizens. For the shop worker whose hours have been cut, putting them with the 1.5 million people who are part-time through no choice of their own, for the middle manager workless for the first time at 50, for the design graduate offered only unpaid internships and for the parents whose child is still living with them at an age when they should have a home of their own, this Queen’s Speech has only confirmed what they dreaded: jobs and growth will have to wait and living standards will continue to fall.
While the wealthiest 1% will see their earnings rise with the Chancellor’s spring bonus, everyone else will have to settle for less. They will be expected to make ends meet, cut corners, postpone the holiday and perhaps join the 5 million families who, according to Which?, use credit or savings to pay for food. The Queen’s Speech is not just a missed opportunity, but a denial of the power of Government to change lives for the better. I believe that Government can stimulate jobs, foster growth, encourage investment and skill a work force for today’s jobs and those of tomorrow, but not if the golden rule, at every turn, is to cut the deficit first, whatever the impact, cost and evidence.
Andrew Selous (South West Bedfordshire) (Con)
Of course, the right hon. Lady is right that the employment market is tough for many people, but in these difficult times, will she welcome the fact that there are now 750,000 more people in work than when her Government left office and that the UK’s overall employment rate is growing at twice the rate of the United States’ and is the fastest growing of any G7 country? That is not a bad record in tough times.
Caroline Flint
The Prime Minister promised change, but things have got worse, not better. He inherited an economy in which growth had returned, inflation was low, unemployment was falling and borrowing was lower than forecast. Today the economy is still flatlining, with more people out of work than when he became Prime Minister, the slowest economic recovery for more than 100 years, prices rising faster than earnings and real wages down £1,700 since 2010, while energy bills, train fares and the cost of a weekly shop have spiralled out of control.
Andrew Gwynne (Denton and Reddish) (Lab)
My right hon. Friend is right to mention train fares. The Government talk a lot about reducing the cap to 1%, but is not the truth that they have removed the ban on so-called flexibility, meaning that train companies can now increase their ticket prices by as much as 5% above the retail prices index, which was something the Labour Government removed?
Caroline Flint
My hon. Friend is absolutely right, which is why our amendment puts forward an alternative to the Government’s proposal that would help commuters.
Meg Hillier
Will my right hon. Friend add to her list the trap that many of my constituents find themselves in, not earning an £81,000 salary and unable to afford the £17,000 deposit on an average-priced property—generation rent trapped in an unregulated private rented sector? What comfort are the Government giving them?
Caroline Flint
They are offering them no comfort, and I will address that issue later, as too will my right hon. Friend the Member for Leeds Central (Hilary Benn).
Even by the Government’s own tests, they have failed to face up to the stark reality that whatever the intention, after all the cuts, pain and hardship, the plan is not working. The credit rating test was to ensure our triple A status, but that has been downgraded by not one, but two agencies. The borrowing test was to eliminate the deficit by the election, but that is £245 billion off course. Struggling families, pensioners and businesses cannot afford another two years of stagnation, so the challenge for the Government in this Queen’s Speech was to get our economy back on track, get people back to work and stop the slide in people’s living standards.
Jacob Rees-Mogg (North East Somerset) (Con)
Will the right hon. Lady tell us something that the Labour Front-Bench team have been reluctant to tell us, which is how much higher borrowing would be if Labour was in charge and what effect that might have on interest rates?
Caroline Flint
I am afraid to say that the Chancellor’s spending cuts and tax rises, which went too deep, too fast, have left our economy flatlining. As I said, the Government are borrowing £245 billion more than they planned. [Hon. Members: “Answer the question!”] I am going to. That is why we have called for infrastructure investment to be brought forward and for a temporary cut in VAT as part of Labour’s five-point plan for jobs and growth. These measures would lead to a short-term rise in borrowing, but getting growth and confidence back into the economy from a boost such as the VAT cut and investment such as in the building of affordable homes would increase our tax revenues, help reduce the welfare bill and see borrowing fall in the medium term.
Seema Malhotra (Feltham and Heston) (Lab/Co-op)
Does my right hon. Friend agree that that much-needed boost to the economy is precisely the message of encouragement that young people in this country need? It is a damning indictment of the Government’s policies that more than 1 million young people are unemployed.
Caroline Flint
My hon. Friend is absolutely right, but we are not just about providing answers on jobs—we would expect something back too—which is why, under our jobs guarantee, if someone did not take a job, they would lose benefits.
Caroline Flint
I want to make some progress, because there are only six minutes per speech, and I am sure that many right hon. and hon. Members want to get in.
Let us take a closer look at the real lives of hard-working Britain. On energy bills, the facts speak for themselves. In just three years, bills have risen by more than £300, and, despite falling between 1997 and 2010, fuel poverty is now increasing sharply. There has been a doubling in the number of pensioners dying from hypothermia compared with five years ago. What have the Government done about it? The Secretary of State mentioned the energy company obligation, the ECO. But less than half the budget of that will go to people in fuel poverty. He has tried to claim credit for the warm home discount, but he will not want to talk about the hundreds of thousands of low-income families with children that are missing out on help. He mentions the green deal, which is going so well that the Government still will not tell us how many people have taken out a package.
But one thing I am sure he does want to talk about is the Prime Minister’s now infamous pledge to force the energy companies by law to put everybody on the cheapest tariff. I will not forget Wednesday 17 October 2012 when the Prime Minister said:
“I can announce…that we will be legislating so that energy companies have to give the lowest tariff to their customers.” —[Official Report, 17 October 2012; Vol. 551, c. 316.]
It sounded great; it is a shame his own Ministers did not know about this announcement until it happened. When the Government finally published their proposals in February, it confirmed what we knew all along; that this was an impossible promise from an out-of-touch Prime Minister making it up as he went along.
You do not have to take my word for it, Mr. Speaker. We can look at the Government’s Energy Bill, which categorically does not require the energy companies to put everybody on the cheapest tariff. All it says in clauses 121 to 124 is that the number of tariffs the energy companies are allowed to offer will be limited and that those tariffs may have to be standardised, and that customers will have to be provided with more information about cheaper deals. If the Secretary of State disagrees, I am more than happy to let him intervene to tell us that all energy companies will be required by law—as the Prime Minister promised—to put everyone on the cheapest tariff, the date on which the switchover will happen, how many of 22 million households will be affected and how much money on average they will save.
Caroline Flint
There we have it, Mr Speaker. They cannot explain it because it was a false promise. The Prime Minister told this House 12 times that his Government would legislate to put everyone on the cheapest tariff; that is just not going to happen.
Jim Dowd (Lewisham West and Penge) (Lab)
My right hon. Friend will be aware of the great potential of smart metering to reduce people’s bills. Is she as disappointed as I am, and the rest of the country, that the Government have now delayed the roll out of smart metering by 12 months?
Caroline Flint
Yes, further delays to that programme were announced last week. Whether it is smart metering, the green deal or changes to the feed-in tariffs, we have seen one mistake after another and bad handling of what should be very good policies not just for consumers, but for creating jobs and growth in this country.
Curbing the costs of energy for Britain’s households is very important, but the Government have introduced an energy market reform Bill that does nothing to reform the energy market. They have cut winter fuel payments for pensioners, despite promising not to. They have halved the fuel poverty budget while claiming it is bigger and better than ever. They have closed Warm Front, which helped well over 2 million households to insulate their homes. They stand proudly as the first Administration since the 1970s not to have a Government-funded energy efficiency scheme.
If this was our Queen’s Speech, we would be providing real help now for people and reform of the energy market for the long term. Here are three Labour policies that we would have included. [Interruption.] Well, we have been mentioning all these policies for the past year and this is another opportunity to confirm them again. First, elderly customers, who are most vulnerable to the cold weather and most at risk of fuel poverty, are among the least likely to be able to access the cheapest online deals or to switch supplier. We would put that right and put all those over 75 on the cheapest tariff for their gas and electricity. If we did that, as many as 4 million pensioners—including nearly 8,000 in the Secretary of State’s own constituency—could save as much as £200 a year off their bills. [Interruption.] The Minister of State, the right hon. Member for Bexhill and Battle (Gregory Barker), might like to listen, as I am offering him this policy to put in the Energy Bill. The energy companies know that that is our policy and they know that it can be done. The Government can have that policy for free; take it, put it in the Energy Bill and get help to those who need it most.
We also want everyone to benefit from a competitive and more responsible energy market. That means wholesale reform of the way in which energy is bought and sold. At the moment, no one really knows what the true cost of energy is. If energy companies were forced to sell the power they generate into an open and transparent pool, anyone could bid to retail energy.
But it does not stop with energy prices. Let us look at another basic need on which every household relies; water. Ofwat estimates that some 2.2 million households—one in 10—spend more than 5 per cent of their income on water and sewerage. As my hon. Friend the Member for Wakefield (Mary Creagh) has pointed out, despite Labour’s legislation, which allowed for new social tariffs to help people squeezed by rising water bills, the Government have washed their hands of any responsibility and are leaving it to water companies to decide whether to introduce social tariffs. We think that that is a responsibility that the Government should take on and deal with.
Mrs Eleanor Laing (Epping Forest) (Con)
The right hon. Lady is coming forward with all these ideas now, but why did her Government spend 13 years neglecting the country’s energy needs? Why did they not bring those matters to the House during that time?
Caroline Flint
I refute that accusation; investment in energy was up, there were more starts in terms of renewables, some of which will be completed under this Government—that is our legacy—and by tackling fuel poverty, the insulation programme through Warm Front and the decent homes programme we helped millions of households.
To answer honestly, I have witnessed things over the past three years that have made me challenge what we need to do for the future in terms of how the energy market works. It is up to all of us to reflect on where we are today and on what has happened in the past three years and try to put it right. That is why we believe that we need to encourage new entrants, increase competition and ease the upward pressure on prices.
One of our other proposals is to deal with Ofgem. Ofgem removed price controls a decade ago, so in the belief that competition had developed sufficiently and that privatisation had delivered a functioning competitive market. I believe it is clear now that that was a mistake. We need to create a tough new regulator that people can trust and ensure that the regulator has the power it needs to protect consumers. That is why we would abolish Ofgem and create a tough new regulator with a statutory duty to monitor the relationship between the prices that energy companies pay for their energy and the bills the public pay and the power to force them to cut prices when wholesale costs fall. We believe that that is very important.
Mr Davey
The right hon. Lady has explained to the House the Opposition’s policy to get rid of a regulator and to replace it with another regulator. Given that we need to attract £110 billion of investment in energy to this country, is she aware that one of the things that investors prize about the UK is regulatory stability and certainty? Will her proposal improve that or make it worse?
Caroline Flint
Investment in the renewables sector in this country has gone down; we are a less attractive place to invest. The Secretary of State makes much of the so-called “decarbonisation target” in the Bill. The truth is that there is no such target. Investors say to me that they need certainty, which is why we need to have strength behind a decarbonisation target to make sure that that investment comes forward.
I also believe that we cannot have a regulator that people do not trust. It has not been doing the job it was asked to do; it is not fit for purpose. To get our energy market and sector into a better place, we need consumers to have confidence in the regulator, which is why it needs to change. There is no point in trying to hold up a regulator that does not command confidence. We need a regulator that does just that and can move us to a better place, where energy has the certainty it needs for investment but also has the confidence of consumers.
Mr Anderson
That was very good decision by my colleague. Is not the truth that investors see this country as having stable regulation, but that they see it as wide open? That was the way privatisation was set up in the 1980s, so that companies can rip off the public and put bills up on a whim and do not care how they do that as long as they can get away with it. Ofgem has failed continually and it needs to be reformed; my right hon. Friend is absolutely right in what she says.
Caroline Flint
I thank my hon. Friend for that intervention. The truth is that we do not have a competitive market: six large companies dominate 99% of it, so we have to open it up. We need to make it more dynamic and more transparent, so that the public feel they are paying a fair price for the energy they buy.
Caroline Flint
No. I will make some progress; I have taken a number of interventions.
I have discussed energy and water, but what about those families who get up to do the right thing and head off to work each day? Among them are hard-working commuters forced to travel at peak time. Often, they have moved a long distance away from their workplace to stand a chance of buying their own home. Their reward for doing the right thing, day in and day out, is season ticket price hikes of up to 9.2%. What understanding have the Government shown them? How about squeezing them further by allowing new “super peak” fares? As my hon. Friend the Member for Garston and Halewood (Maria Eagle) has made clear, if we were in government and if this was our Queen’s Speech, we would put passengers first, not siding with the powerful private train operators. Our consumers Bill would cap fares at no more than 1% above inflation in each year of this Parliament and ban train companies from introducing even higher “super peak” fares.
Caroline Lucas
Would the Queen’s Speech of the right hon. Lady’s party include a Bill to bring the railways back into public ownership? Reports suggest that doing so would save around £1 billion a year in administration costs.
Caroline Flint
What we are clear about is that the rail companies must prove themselves when it comes to their franchises being renewed. On my local line—the east coast line—the operator has done a remarkable job. Unlike some of the other operators, it has paid premium payments back into the Government’s coffers to spend on other things. However, we must ensure that each rail company is fit for purpose, and where a company is not doing the job and we need to take action, we can make a decision on a case-by-case basis at the time.
On housing, as my right hon. Friend the Member for Leeds Central will set out in his speech later today, the Government are not just failing to tackle the housing crisis; their policies are making it worse. House building is at its lowest level since the 1920s, annual housing starts are down and housing completions were lower in both years of this Government than in Labour’s last year in power. As a result, more and more people are locked out of home ownership, stuck on local authority waiting lists or forced to live in the private rented sector. Whereas this Government sit back and do nothing, Labour would act now to change the private rented sector so that it works for all—landlords and tenants.
Mr Andy Slaughter (Hammersmith) (Lab)
In my constituency, both house prices and private rents went up last year by 8%, which is eight times the rate at which wages rose. It costs £650,000 to buy the average property in my constituency and £800 a week to rent a three-bedroom house, yet the Tory response is to sell off council homes when they become vacant and to put families into bed-and-breakfast accommodation, at a cost of £1 million a year.
Caroline Flint
My hon. Friend makes some important points. I seem to recall that we were told that the Government’s housing policies would not lead to an increase in private rents, but the opposite has happened. I, too, saw the headline—I think it was in the Evening Standard a few weeks ago—about private rents in London rising eight times more than wages.
If this was our Queen’s Speech, we would have had a housing Bill in it and we would be taking action to encourage landlords to offer families longer tenancies, so that they have security and stability. We would introduce a register of landlords and empower local authorities to strike off rogue elements, and we would end the rip-off fees and charges imposed by letting agents. However, this Queen’s Speech offers nothing to address those concerns. It is a no-answers Queen’s Speech from a tired, failing and increasingly fractious Government.
This Government promised change, but nothing is changing for hard-working Britons. Our country faces big challenges, but this Government and this Queen’s Speech are not equal to the task. The Queen’s Speech fails to provide a reboot for flatline Britain; it fails to address the rising cost of living; and it fails to listen to hard-working people. The big question that those people are asking of Government is: how can they afford to secure a roof over their head, heat their home, feed their family and get to work? However, this Queen’s Speech has no answers for them. The promise is that we will get there in the end, but like so much with this Government, it is wearing thin. Even the Government’s own independent Office for Budget Responsibility is saying that British people will be worse off in 2015 than in 2010.
I do not relish the rising levels of young people out of work, or the months turning into years among the adult jobless. I regret that our economy remains in the doldrums. None of us has all the answers, but our amendment shows that there are ways to help people through these harsh times. At no cost to the Government, we could cap train fares, put the over-75s on the cheapest energy tariff and stop private landlords ripping their tenants off. Labour’s amendment is about what is fair, what is reasonable and what is just, and I commend it to the House.