Tackling Poverty in the UK

Chris Williamson Excerpts

Thursday 10th June 2010 Commons Chamber

[Mr Field]

I am happy to give assurances to my hon. Friend. The law is quite clear about the objectives. I have no idea what the report will contain, but those objectives that we have are ones that we should achieve. The primary definition that we used before the 2010 Act was not only difficult to achieve mathematically, but has not been achieved in any country in the free world—hence we asked in the document that we published whether we should use an average of those countries that do best in achieving that definition in setting our target.

Time is scarce, and I obviously do not want to be delayed by a narrowly focused, technical debate on definitions—I hope there will be plenty of time for that—but my hon. Friend says that other aspects of the 2010 Act that are used to define poverty are important. Of course they are important, but I want to focus much more clearly on pathways out of poverty and on increasing life chances. I hope that those Members of Parliament who have views—they clearly have, given today’s maiden speeches—that will add to that side of the review, as well as to the debate on the technical definition of poverty, will contribute to the review.

[Chris Williamson (Derby North) (Lab)]

Does my right hon. Friend agree that measures such as the future jobs fund, tax credits and the increase in child benefit provide an important pathway out of poverty? I hope that he will touch on that—I see from his notes that he might—because I am very concerned about the coalition Government’s proposals to undermine those schemes.

[Mr Field]

If my hon. Friend had really good sight, he would be able to see that No. 3 on my extensive notes is the jobs fund.

There will be two tasks for Opposition Members as the Government begin the necessary task of reducing public spending towards the level of what people in this country are prepared to pay in taxes. We will no doubt have a rigorous debate, but even when the details are decided, I hope that stage 2 will be to argue whether any cuts are being made in the right areas. My plea to Ministers is that they look most carefully at their choice of making initial cuts to the new deal jobs fund programme. When I sat on the other side of the House, I was clear in my criticisms of the new deal. One has only to look at the outcomes regarding levels of unemployment, levels of NEETs—those not in education, employment or training—and levels of retreads to conclude that that huge area of expenditure clearly needs to be examined.

The one thing that I hoped we would do in our first year in office—we got round to it only towards the end of our time—was to ensure that we could give some job guarantees to our constituents, including our younger constituents. That is important for two main reasons, the first of which is that, as we all know from our constituencies, many people try desperately hard to get jobs yet fail to do so, and the cumulative effect of that failure has an enormously crushing effect on them. The jobs fund was beginning to offer concrete jobs for people to go to, and that was a lifeline that had never been offered by any amount of new deal, any amount of retreading the new deal, or any amount of rhetoric from our side. The fund was one of the most precious things with which the previous Government were involved.

The second reason why the scheme was valuable was because we all have individuals in our constituencies, especially young lads, with no intention of working, although this is not the time for us to delve deeper into why that is so. If we are telling people that their benefits will be time-limited, cut or ended, we will carry the electorate with us only if we can definitely offer someone a job. Those young lads who have worked out how to fiddle the new deal and know that, if they turn up in a certain state, no employer in their right mind would ever give them the job on offer will know that it is decision time for them if, through the jobs fund, we can guarantee to offer them jobs irrespective of how they turn up. As I said, the fund was one of the most precious initiatives that the Labour Government introduced, so although I am not arguing with Ministers against their cuts, I ask them to think differently about how the cuts are distributed among people on benefits whom we would hope would be seeking work.

I am grateful for being called to speak, and I am even more grateful for the interventions because they have given me a bit of extra time. I look forward to hon. Members’ contributions to both this debate and the review.

--- Later in debate ---

[Chris Williamson (Derby North) (Lab)]

I, too, congratulate you, Madam Deputy Speaker, on your elevation to your new role. I am sure that you are probably getting tired of hearing such congratulations, but I wanted to add mine.

I also congratulate hon. Members on their maiden speeches. Having made mine a couple of weeks ago, I know what a daunting prospect it is. I particularly welcome the contribution by the hon. Member for Mid Derbyshire (Pauline Latham). We were colleagues on Derby city council before we were elected to the House at the general election, so it is especially fitting to address the House directly after her.

Poverty is an incredibly important issue, and a recognition of its importance is shared by hon. Members on both sides of the House. In many ways it defines the sort of society in which we live. I welcome the coalition Government’s commitment to the previous Labour Government’s commitment to eradicate child poverty by 2020. The big question is, of course, how we will get there under the new regime.

I and other Labour Members strongly believe that work is indeed one of the best pathways out of poverty, but to ensure that it is a genuine pathway out of poverty, it is vital not only that we continue to support measures such as the national minimum wage and move towards a living wage, but that we recognise that we must also support initiatives such as child tax credits. Child trust funds have also made a big contribution by encouraging people to save. I very much regret that the Government have decided to do away with those funds. Particularly for families from low-income backgrounds, not to have that start in life or that incentive to continue to save and to build up a nest egg for when they reach the age of 18 is a very big mistake.

On work as a pathway out of poverty and the importance of the measures that I have identified, we must acknowledge—I used to work in welfare rights, so I have some knowledge of this—that the work disincentives that used to exist have now been addressed in large measure. Although I accept that more probably needs to be done, work has become a genuine pathway out of poverty. I stress that I am very concerned about the Conservative party’s proposals. The precise detail of some of them remains to be seen, but I would be concerned about any attempt to reduce support for things such as tax credits, which are so vital to the process of helping people into the labour market.

Of course, ensuring that employment pays is one of the most important methods of addressing poverty, but we should also acknowledge the measures that are vital in relation to tackling pensioner poverty and the fact that many disabled people also experience poverty. Again, that is why I would be concerned if measures were proposed to undermine some of the support mechanisms that we put in place. For example, concessionary travel has liberated whole swathes of older people in our country who were previously imprisoned essentially in their own homes, unable to travel beyond their immediate neighbourhoods. The pension credit system has also made a big contribution to tackling poverty, as have the cold weather payments. I remember that many elderly people simply could not afford to heat their homes in the 1980s, but those sorts of things are no longer among the concerns of many elderly people in our country because of the measures put in place by the previous Labour Government.

In the end, growth is the key to tackling poverty, so the big question is how we deliver growth in our economy so that we make the welfare payments that are so important to addressing poverty a reality. Labour Members believe that it is vital that the state and public spending play a role in ensuring that the economy continues to grow. Conservative Members say that they are sick of hearing history lessons from us, but if we do not learn the lessons from history, we will make the same mistakes. It is therefore essential that we acknowledge the role of the state in ensuring that the economy continues to grow.

For example, Bombardier, a company in my constituency, is bidding for the Thameslink contract. We hope that the announcement will come shortly and that it is in favour of Bombardier, because that will secure 2,600 jobs directly in the company, as well as a further 5,000, 6,000 or even 7,000 jobs in the supply chain. If we cut public spending and such programmes, however, that would throw 7,000, 8,000 or perhaps 9,000 people out of work, which would put more pressure on the state, because of increased unemployment benefit, and lead to the downward spiral of having to make cuts to people’s welfare provision to accommodate the diminishing tax revenue resulting from a declining economy. I therefore urge Conservative Members to learn the lessons of history because they are otherwise destined to repeat the same mistakes, and it will not be they or many Labour Members who will pay the price of those mistakes, but ordinary working-class people in my constituency and throughout the country. They will pay the price for a failed economic prospectus that was tried in the 1980s and the 1930s but proven not to work. For goodness’ sake, people need to look at their history books and learn these vital lessons.

[Andrew Percy]

We are hearing a lot about history from the hon. Gentleman, but the Labour party does not seem to have learned one lesson from history: whenever it has left government, the country has been more bankrupt, more in debt and with unemployment higher than when it came in. Interesting as it is to hear history lessons from the hon. Gentleman, he should perhaps look to his colleagues before he starts lecturing Conservative Members.

[Chris Williamson]

The hon. Gentleman ignores the fact that we have just experienced the most significant worldwide recession for 80 years. Worldwide opinion acknowledges that the previous Government’s leadership, particularly under the auspices of the former Prime Minister, is getting the world’s economy back on its feet. It is somewhat unfair for the hon. Gentleman to talk in such terms about the economic situation that the coalition Government have inherited.

As independent commentators have said on a number of occasions, without the measures put in place by the previous Government, at least 500,000 more people in this country would be out of work. The largest proportion of this country’s deficit is a direct consequence of unemployment. If the Government parties’ policies are put in place, however, I fear that unemployment will continue to grow, which will put further pressure on the public finances and mean that we will not get the growth that we desperately require.

I know that the Government parties are set on a course, but we will scrutinise very closely and expose all their shortcomings to ensure that, at the next general election, they are held to account for the actions they take.