Public Sector Pay: Proposed Strike Action

David Linden Excerpts

Tuesday 1st November 2022 Westminster Hall

[David Linden (Glasgow East) (SNP)]

It is a pleasure to follow on from the right hon. Member for Hayes and Harlington (John McDonnell). I congratulate the hon. Member for Cynon Valley (Beth Winter) on securing the debate and bringing this issue to the Chamber. I should also declare my membership of Unite.

In having this debate, we need to think about how we ended up in this mess. When the Minister gets to her feet later and talks about the difficult choices the Government must make, she must do so reflecting on the fact that they have been in power for 12 years. They have been in control of the economy, and the economic chaos that has been unleashed in the UK recently is a result of the Thatcherite economic experiment undertaken by the former Prime Minister and Chancellor. Working people will now have to pay as a result of the botched mini-Budget, which had to be abandoned, with a new fiscal statement coming on 17 November. As we watch the new Chancellor of the Exchequer start to unpick the mini-Budget, it still astonishes me that, through all the turmoil, one thing that has still not been unpicked is the lifting of the cap on bankers’ bonuses. The idea that the Minister will stand up in this Chamber at quarter to 4 and say, “We need to make difficult choices but, by the way, bankers can continue to have excessive bonuses to encourage them to incentivise risk,” should give the Government food for thought.

When approaching this debate, we should always remember that the right to withdraw labour is a fundamental human right, and it is enshrined in section 44 of the Employment Rights Act 1996—it appears that plenty of Conservative Back Benchers are exercising their right to withdraw their labour by not turning up to this debate, and we extend our solidarity to them in that regard. With this Government, we are beginning to see—we will see this with the Transport Strikes (Minimum Service Levels) Bill—that there will be a continued attack on working people and trade unions. This will not necessarily be popular with Labour colleagues here, but the challenge for the right hon. and learned Member for Holborn and St Pancras (Keir Starmer) is not to play these games with the Government, no to get as close as possible to them and not to go for that middle-ground vote. He should be brave, stand up for workers and not just try to be a pale imitation of the Tories. We know that the Government are determined to attack workers’ rights. We heard only recently that the new Secretary of State for Work and Pensions has talked about ways in which the Government can try to water down rights for those on maternity allowance.

The situation on industrial action in Scotland—this is not to say that we do not have our own problems with industrial action—is that over 70% of Unite’s members voted in a consultative ballot to accept the revised offer made by the Convention of Scottish Local Authorities. The revised offer will fully consolidate £2,000 for those earning up to £20,500; it is the equivalent of an increase of about 10% to 11% for the lowest paid. It is estimated that the revised offer resulted in a £600 million package being brought forward by COSLA and the SNP Scottish Government.

However, there is an uncomfortable reality for someone such as myself and for my party. Given the fixed fiscal framework—the hon. Member for Cynon Valley talked about some of this in a Welsh context—yes, we have limited tax-varying powers in Scotland, and there is a much broader debate to be had about that. However, the reality is that we cannot have Scandinavian public services with Singapore tax rates, and that is something that people in all parts of the UK will have to confront. The Government cannot talk about their desire to level up while simultaneously saying they want to slash tax for people, and that includes things such as a race to the bottom on corporation tax. Yes, there are challenges, and unfortunately the Scottish Government, as a result of rightly pushing ahead with that increased pay offer, will now have a challenge trying to find savings elsewhere. I happen to have a solution to that: Scotland should take all its own economic decisions, rather than having Tory Ministers in London make those decisions for us, but that is a point for another day.

I will finish by mentioning the comments from the general secretary of the Scottish Trades Union Congress, Roz Foyer, who recently spoke at the SNP conference. She said that the Scottish TUC has robust discussions with the Scottish Government, but that one of the biggest differences is that the Scottish Government will actually listen and work with it, unlike the Government in Westminster, who introduce appalling bits of legislation, such as the Transport Strikes (Minimum Service Levels) Bill. When that Bill comes before the House, it can be assured of SNP opposition, and I hope it can also be assured of opposition from Labour and from many people in this Chamber who want to stand up for working people.

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[Sarah Jones (Croydon Central) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Edward. I congratulate my hon. Friend the Member for Cynon Valley (Beth Winter) on securing such an important debate. It is wonderful to see that so many people, at least on this side of the House, have attended.

It would be helpful if the Minister, whom I welcome to her new position, would answer three questions that were raised in the debate. My hon. Friend the Member for Rhondda (Chris Bryant) talked about the fundamental right to withdraw one’s labour. It would be helpful to hear that the Government absolutely support that right, and to establish that that remains Government policy. My hon. Friend the Member for Rochdale (Tony Lloyd) asked why the Minister thinks there are so many people in our country who are considering going on strike, which is, as we have heard, an absolute last resort for people. Why does she think we are in that position?

My hon. Friends the Members for Easington (Grahame Morris) and for Ellesmere Port and Neston (Justin Madders) referred to reports that the Government are looking to restrict the right to strike in certain circumstances. It would be reassuring for hon. Members to hear from the Minister that that is no longer the case. There have been some reports that those plans have been dumped, but some that they have not. Will the Minister tell us?

Many people have raised the dire situation that we find ourselves in after a disastrous mini-Budget and a disastrous 12 years of low wage growth and low economic growth. Communities are fragile, people are fearful, and public services are very vulnerable. As pay stagnates and inflation rises, more and more trade unions are having to come to the difficult decision to ballot on pay deals. The Times reports today that the Treasury is looking at pay rises of 2% across the board. Will the Minister comment on the accuracy of those reports, and on whether the Treasury is considering such a significant real-terms pay cut?

We have talked about public sector workers’ conditions and pay, which are now forcing them out of their jobs. Forgive me for raising this issue, but I was in my constituency this morning. We are supposed to have eight speech and language therapists in Croydon, but we have only two. They cannot recruit to that role, because people find it too hard to do that job on the pay levels they are offered. Labour wants to see a Britain that is fairer, greener and more dynamic, with strong public services that provide security and opportunity. One thing we know for certain is that what does not grow the economy is the fantasy of trickle-down economics. Building the strength of our people is the way to build our economy.

Frances O’Grady at the TUC said recently that the biggest act of solidarity that the Labour party can do for working people is to deliver a Labour Government, and I agree. The hon. Member for Glasgow East (David Linden) said some most peculiar things about my right hon. and learned Friend the Member for Holborn and St Pancras (Keir Starmer). It might be helpful to reassure him of the policies that we would introduce in government. We believe in decent pay and conditions, and the new deal of the deputy leader of the Labour party, my right hon. Friend the Member for Ashton-under-Lyne (Angela Rayner), will be written into law within the first 100 days of a new Labour Government.

[David Linden]

Will the right hon. and learned Member for Holborn and St Pancras (Keir Starmer) stand by the pledges he signed in the leadership contest?

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[Victoria Atkins]

In his speech, the hon. Gentleman spoke about the rising cost of food. The pressures of international events, such as the war in Ukraine and its impact on grain supplies, which we know about from the coverage on our televisions, and on pesticides and agricultural tools, including those that farmers in my constituency need to help to feed our country, all play a part in that. The help we have provided, including the measures regarding wages, which I hope to get to in a moment, is vital and we need to keep the situation under constant review.

The hon. Member for Cynon Valley raised many questions about tax. I reassure her that the top 5% of earners are projected to pay half of all income tax in the next financial year. Income tax provides the largest form of income that the Government have. The top 1% of earners are projected to pay more than 28% of that amount, which is right because those with the broadest shoulders should bear the most.

[David Linden]

rose—

[Victoria Atkins]

I will make a little progress, if I may.

Pay settlements need to be affordable for our economy and avoid driving the wage-price spiral I have referred to. We know that parts of the private sector are unable to match current rates of consumer price inflation, so there would be an impact if we went down that route with the public sector. We have to protect the economy over the long term by not leaving the next generation—our children and grandchildren—with spiralling debt. We are a country that funds our promises and pays our debt.

[David Linden]

rose—

[Victoria Atkins]

I am going to make some progress. I will allow the hon. Gentleman to intervene in a moment.

Members will know that there are different processes for different parts of the public sector. Indeed, the devolved Administrations play a vital role in relation to some of the critical professions that we have just spoken about. In Wales, decisions on pay for teachers, doctors, nurses and other NHS staff are made by the Welsh Government, so I trust that the hon. Member for Cynon Valley will have discussions with the Welsh Administration in relation to those sectors.

In Scotland, decisions on teachers, police, prison officers, local government workers and workers for the devolved Administration are not made by the UK Government. Although health is devolved to Scotland, doctors, dentists and NHS “Agenda for Change” staff are nonetheless covered by the pay review bodies that report in England, which I will deal with in a moment.

[David Linden]

Will the Minister give way?

[Victoria Atkins]

I will do briefly, because I have three minutes left.

[David Linden]

The Minister is talking about those with the broadest shoulders bearing the weight of this financial crisis; will she encourage His Majesty the King to pay inheritance tax on his earnings from the Duchy of Lancaster?

[Victoria Atkins]

We keep all taxes under review. The hon. Gentleman will know that there is a statement coming in two weeks’ time. I am not going to comment on any decisions in relation to taxes, as it would be improper to do so, but I hope that he and the hon. Member for Glasgow South West (Chris Stephens) will speak to their SNP counterparts in their own Administration to ensure that they do as they have encouraged in this debate in relation to matters that are devolved.

Economic Situation

David Linden Excerpts

Wednesday 12th October 2022 Commons Chamber

[Chris Philp]

I have already explained, as I think I said yesterday, that there is a statutory process that happens every single year when these decisions get taken. No decision has been taken on the question yet; indeed, the September CPI figure, which is relevant, has not even been published yet. When the decisions are taken, Ministers will of course have regard to the cost of living pressures and high inflation that we and many other countries are experiencing, although of course the energy intervention will make that inflation lower than it would otherwise be. We also, of course, must pay due regard to hard-working taxpayers who ultimately have to pay the benefit bills, and we will take all of that into account when we make the decisions.

[David Linden (Glasgow East) (SNP)]

Following the Government’s pretty disastrous mini-Budget, the hedge fund manager and Tory donor Crispin Odey is said to have made millions from shorting the pound. It has also been suggested that the Chancellor met Crispin Odey for lunch in the weeks running up to the mini-Budget. Is that true and, if so, what did they discuss?

[Chris Philp]

I am afraid that I have no idea who the Chancellor met. I am sure that if the hon. Gentleman writes to the Chancellor he will set that out, but I do not know.

Oral Answers to Questions

David Linden Excerpts

Tuesday 11th October 2022 Commons Chamber

[Felicity Buchan]

Decisions on the second phase of the levelling-up round will be made by the end of the year, and I wish my hon. Friend well.

[David Linden (Glasgow East) (SNP)]

13. What recent discussions he has had with the Secretary of State for Work and Pensions on the potential effect of inflation on that Department’s budget.

[The Chief Secretary to the Treasury (Chris Philp)]

I have regular discussions with my right hon. Friend the Secretary of State for Work and Pensions. If the hon. Member’s question relates to the operating budget of the DWP, we expect Departments to live within their existing CSR21 allocations. If his question relates to the level of benefits more generally, a statutory process is undertaken every year and no decisions have yet been made. They will be made in due course in the normal way.

[David Linden]

I thank the Minister for his answer, if not for his recent tweets. Has he had any representations from the Secretary of State for Work and Pensions to increase social security payments in line with inflation? Far too often, this Government talk about their agenda for growth, but failure to increase in line with inflation will result only in a growth in food banks in Easterhouse, in fuel poverty in Carmyle and in child poverty in Baillieston. When is the Minister going to do the right thing and commit to raising social security in line with inflation and not with earnings?

[Chris Philp]

I am obviously not going to offer any kind of running commentary on the ongoing internal discussions. I have said that the normal ordinary statutory process is ongoing, but the Government are mindful of the cost of living pressures that people are facing. I would draw the hon. Member’s attention to the large increase in the national minimum wage—I think about 7%—that took place last April or May, and there are now more vacancies in the economy than there are people on unemployment benefits.

Cost of Living: Fiscal Approach

David Linden Excerpts

Wednesday 25th May 2022 Westminster Hall

[David Linden (Glasgow East) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Twigg. As I am sure other Members will do, I pay tribute to the hon. Member for Barnsley Central (Dan Jarvis) for securing this debate and setting the scene so eloquently. I also pay tribute to Unison for its work on the issue. Most of us will have seen the briefing note that came out; I commend everything in it. As the hon. Member for Merthyr Tydfil and Rhymney (Gerald Jones) made reference to hospital car parking charges, he will be aware that it was the SNP Government in Scotland who lead the way on that—not helped by private finance initiative contracts organised by the previous Scottish Labour Executive. I will not seek to be party political any further in the course of this debate.

Something that I have found difficult over the last few months, particularly since the beginning of the Ukraine crisis, has been people talking about the cost of living crisis as if somehow it is a new thing; it is not a new thing. It has been exacerbated by 12 years of Conservative austerity. In many respects, we are right to call it a crisis, but it is something we have been dealing with for quite some time. I would argue that it is not just a cost of living crisis. Ultimately, at its most fundamental level, it is a low pay crisis.

The UK Government like to talk about the living wage, and I am sure we will hear the Minister do so, but we know that to refer to it as a living wage is to inadvertently mislead the House. It is not a real living wage. It does not reflect the true cost of living for many of our constituents, and it is nowhere near the benchmark set by the Living Wage Foundation.

The UK Government must look at whether that real living wage is fit for purpose. As most of us know from our constituency postbags and surgeries, it is definitely not. The Government should also look at the pay discrimination baked into wage rates in the UK. The reality is that 16-year-old apprentices are still being paid roughly only £4 an hour. A young person on £4 an hour certainly does not get cheaper products at the supermarket as a result of their age. They should not be getting a lower rate of pay.

There are other things we can do. We should absolutely look at a windfall tax. That has become incredibly topical in this place, with people talking about putting a windfall tax on the likes of Shell and BP. I would like them to pay a windfall tax. There is no doubt that they are doing immensely well out of the current crisis. Why not also consider an additional windfall tax on supermarkets and Amazon? We know that the future of work is changing and that our high streets are struggling very much. That is a natural consequence of consumers using big, out-of-town supermarkets and getting goods delivered from Amazon. Given that they are doing very well out of this, perhaps we should consider putting a windfall tax on them as well.

The UK Government should also increase benefits in line with inflation. I was really disappointed when they legislated for a real-terms cut to benefits earlier this year. The people whose benefits are being cut are among the poorest and most vulnerable in society. This is no time to leave them behind. They do not have the disposable income to make a slightly more difficult choice at the supermarket. Let us increase benefits in line with inflation.

If the Scottish Government, who have a fixed budget, can uprate benefits by 6%—I accept that that is still below inflation—the UK Government, with all of their borrowing powers, should be able to do so, too. In reality, the biggest difference between the UK and the Scottish Government is that the UK just puts it on borrowing.

We should also reinstate the pensions triple lock. Pensioner poverty is on the rise and we do not talk anywhere near enough about it in this House. The fact that we have one of the lowest state pensions in western Europe should be a stain of embarrassment for this Government. They like to go around talking about being a global Britain, while pensioners are literally having to choose between eating and heating. I ask the Minister to reflect on that.

We should also reinstate the £20-a-week uplift to universal credit in the social security system. The Government were right to concede at the beginning of the pandemic that social security was inadequate in its current form. It was inadequate in March 2020, and, by the way, it is still inadequate now. Taking that £20 a week away from families means that they are losing £1,000 a year when they can least afford it.

[Jamie Stone]

Carers for the elderly, the infirm and the sick are crucial in remote parts of Scotland such as my constituency. I have carers pulling out, giving up and calling it a day right now. I am sure the hon. Gentleman agrees with the hon. Member for Barnsley Central (Dan Jarvis) that we must look again, as a matter of extreme urgency, at—how shall we put it?—payments for carers and the regime for taxation on mileage for them and other health workers who have to travel. It is a crisis right now.

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[David Linden]

Thank you, Mr Twigg. I am coming to the end of my remarks. I pay tribute to the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone), who is himself a carer. More can be done on mileage, and I certainly echo the calls for HMRC to reform it. The Government need to look again at the carer’s allowance, because it is inadequate, particularly south of the border.

There is one last thing that I would like the Government to reflect on. I appreciate that there are massive ideological differences between me, as someone who believes that the state has a big role to play in people’s lives, and the Government, who undoubtedly do not believe that. However, given that Select Committees are receiving evidence from senior figures that the economy is in an apocalyptic situation, the Government should be considering placing price controls on food. I appreciate that they would not be naturally comfortable doing that, but we cannot end up in a situation where our constituents are not even able to choose between heating and eating and are instead left with nothing at all. I know that that view will be borne out.

In closing, many of my constituents have less than £10 in their bank account. They cannot afford to nip down to the local shop for the most basic provisions. Yet we have a Chancellor, who is responsible for the fiscal approach, who managed to spend £10,000 to nip down to Wales for a Tory gala dinner. That strikes me as the action of someone who is quite out of touch, which might be why we are having this debate today.

[Derek Twigg (in the Chair)]

I remind Members that you can see on the clock what time it is.

Tackling Short-term and Long-term Cost of Living Increases

David Linden Excerpts

Tuesday 17th May 2022 Commons Chamber

[Rishi Sunak]

VAT would have been worth about, I think, £8 a month at the time. This is £150 in people’s bank accounts in April.

We also cut the taper rate on universal credit, giving an extra £1,000 to the average household. The warm home discount increased to £150, the national living wage increased, giving low-paid workers a pay rise of £1,000, and we will go further.

[David Linden (Glasgow East) (SNP)]

I want to take the Chancellor back to what he said earlier in his speech about the Government’s acting quickly on the covid crisis. Does he recognise that many of our constituents are in a crisis now? I know he is installing a new swimming pool in the house he lives in, but I can tell him that people in Glasgow East are struggling and his Government need to do more.

[Rishi Sunak]

This Government have always acted to protect this country at times of challenge; we have done so through the past two years and we continue to do so now. As has been said, £9 billion of support on energy bills was announced in February at the same time as the price cap was increased, and it covered 50% of the rise in bills—accepting and being honest with the House, as we discussed at the time, that no Government could cover every pound of an increase when we are in a situation with global inflationary forces, and that it would be both irresponsible and misleading to pretend to the British people that that was possible.

But we are going further: in October, a further discount on energy bills worth £200 and, in just a few weeks’ time, a massive tax cut for workers when the national insurance threshold is increased to £12,500. That is a £6 billion tax cut for working people, the biggest increase in a personal tax threshold ever, and it will mean that everyone in this country can earn £12,500 without paying a penny of income tax or national insurance. That means, in contrast with what we have heard, that 70% of working people will pay less tax this year than they did last year.

Taken together, all the measures I have just mentioned equate to a £22 billion plan to help cut costs for families and help people with the cost of living. Of course, as the situation evolves, our response will also evolve. I have always been clear that we stand ready to do more.

That brings me to the topic of a windfall tax. Unlike the Labour party, we Conservatives do not believe that windfall taxes are the simple and easy answer to every problem. However, we are pragmatic, and we want to see our energy companies, which have made extraordinary profits at a time of acutely elevated prices, investing those profits back into British jobs, growth and energy security. I have made it clear and said repeatedly that, if that does not happen soon and at significant scale, no option is off the table.

Global economic forces are indeed hitting the British people hard, and that is why the Government are stepping in to help. Ultimately, however, over the long term we on the Conservative side know that the best way to raise living standards is to grow the economy. That is why our economic plan and this Queen’s Speech will create more jobs, more investment and, crucially, higher wages.

During the pandemic, we provided billions in support not only to the economy, but specifically to businesses. Because of schemes such as furlough we were able to keep millions and millions of people in work, and the success of our plan for jobs is clear. As we heard from my right hon. Friend the Member for Forest of Dean (Mr Harper), unemployment right now is the lowest it has been in almost half a century, job vacancies are the highest they have ever been, and total pay is rising in real terms and is more than 4% higher than before the pandemic, even adjusted for the inflation we are seeing.

That does not happen by accident. It is the result of a responsible Conservative Government delivering a stronger economy—an economy that grew faster last year than any of our competitors. That strong recovery is making a difference to people’s finances. Taken together, the combination of policy measures the Government have announced and the growth in the economy offset around half the shock to incomes caused by higher global energy and goods prices. Half of that shock has been offset by the result of our actions to grow the economy and support people directly.

Of course we need to do more to create further economic growth. That is why this Queen’s Speech includes measures to do exactly that.

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[David Linden (Glasgow East) (SNP)]

Most people watching this debate on TV tonight will be intrigued by the fact that we refer to the Gracious Speech. The overwhelming message from my constituency of Glasgow East is that this was an inadequate Queen’s Speech, because a number of things were missing from it that we would have liked to have seen, such as an employment Bill, as many other Members have said. The cat was rather let out of the bag by the hon. Member for North East Bedfordshire (Richard Fuller), who is no longer in his place. He spoke about the importance of deregulation; many of us have for some time had the concern that, for the Government, Brexit was about deregulation and attacking workers’ rights.

I accept that, ideologically, the Government and I are absolutely opposed on many issues, but I ask them to reflect on the fact that every year, 100,000 babies are born premature or sick. There is cross-party agreement in this House on neonatal leave and pay. The Government have committed to it, and this will be yet another year when that does not come into force. I understand that aspects of an employment Bill will be controversial, but I ask the Government to look favourably on the idea of bringing forward stand-alone legislation on issues on which we agree.

I want to talk about the comments, typical of the UK Government, from the hon. Member for Redditch (Rachel Maclean). I gave her advance notice of the fact that I planned to mention her. The irony of somebody on £106,000 a year telling clerical assistants in Easterhouse, refuse collectors in Carmyle and people who work in the retail sector in Shettleston that they have to work more, or get a better job! It shows how completely disconnected from reality this Government are.

I also praise the hon. Member for Lichfield (Michael Fabricant), who visited his local food bank. In the House of Commons this week, he has rightly said to the Government that they need to uprate benefits. That shows that when Members on the Government Benches interact with their constituents and connect with reality, they see that far too often this Government fall far short of giving the support that is required.

I absolutely support a windfall tax on energy companies. I would like it to go further; it should apply to the Amazons of this world. We should be serious about understanding the changes to retail and how our high streets operate. The reality is that Amazon is the big beneficiary of that, so let us look at a windfall tax on it. There are other things we could do, such as reduce VAT on energy bills and reinstate the £20 to universal credit.

My local newspaper, the Glasgow Times, is running a campaign to “Beat the Squeeze”. That is entirely commendable—I commend the Glasgow Times to all hon. Members—but it should not fall to a local newspaper to tell people how to get through the cost of living crisis. We should look at taxing companies such as Shell, not hiking up national insurance for people from Shettleston.

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[The Secretary of State for Work and Pensions (Dr Thérèse Coffey)]

It is an honour to conclude this debate on the Gracious Speech. Understandably, a lot of people have contributed today. I want to take this opportunity to join right hon. and hon. Members in paying tribute to Her Majesty in her platinum jubilee year. This is a Queen’s Speech that will deliver for the British people: safer streets, stronger schools, a secure supply of energy, speedier access to social security for those people near the end of their lives, streamlined financial services unlocking investment, stripping out unwanted EU regulation, and legislation to help level up across the United Kingdom. All these measures will help to grow the economy, which will help to address the cost of living challenge that families are facing.

We should remember that this is a global challenge. Countries around the world are having to deal with inflation, and the covid aftershocks are still ripping through the world’s supply chains. On top of that, Putin’s brutal invasion of Ukraine has exacerbated spiking energy prices. On this side of the House, we are the champions of freedom and democracy around the world and it is right that we do all we can to end Putin’s onslaught, but sanctions are not cost-free for us here at home. They come on top of the impact from covid. These are global inflationary forces, and it would be wrong to pretend that we can protect everyone from their impact.

Thanks to our strong recovery from the pandemic and having got the big calls right over the last two years—such as our plan for jobs—we have helped families across the country. We can see that in the labour market statistics published today. Our unemployment rate today is below the low level we saw before the pandemic. Not only that, it is the lowest since 1974. The number of people on payrolls is at a record high, and over half a million more people are now benefiting from a regular pay packet than in February 2020.

I am also delighted to say that we have met our 2017 commitment to get 1 million more disabled people into employment in 10 years. In fact, we announced today that we have hit 1.3 million more people. That is good news for people with disabilities and it is good news for the economy too. The level of youth unemployment is now at a record low. This means greater security, more financial resilience and better prospects for people.

[David Linden]

The Secretary of State talks about employment, but when I go to my local food banks, one of the things that people tell me on a regular basis is that the number of people using the food banks as a result of in-work poverty is up. What does her local food bank tell her?

[Dr Coffey]

The hon. Gentleman is right to say that food banks are present and providing support in many communities, especially where people are trying to work out the best way to spend their resources. He mentions in-work poverty, and it is why we have a plan for in-work progression, why we have been investing in skills, why we are investing in our jobcentres and why, through the plan for jobs, we are doing more to help people not only to get back into work but to get on in work too. That is what we are doing.

On top of the activity we have been undertaking, there are things we can do and are doing to cushion families from the worst effects of inflation and to ease the squeeze on household budgets. As my right hon. Friend the Chancellor set out, £22 billion has already been committed to support the hardest hit this year. The £150 of support for households in bands A to D is landing in people’s bank accounts, with a further £144 million discretionary fund available to councils. From October, the £200 reduction in energy bills will help families spread this year’s increased costs over the next few years.

We initiated the household support fund, through which we invested £500 million across the UK to help with the cost of household essentials. We are increasing that to £1 billion every year. For the second phase of the grant we have put a particular focus on people on fixed incomes, which is why a third is ringfenced for pensioners. That is on top of existing targeted support such as the warm home discount, cold weather payments and winter fuel payments. We are stepping in at this challenging time, and we are ready to do more to help.

We are discussing an Opposition amendment, and I make it clear that we will reject all Opposition amendments to the Queen’s Speech as a matter of precedent. The Queen’s Speech sets out the Government’s legislative programme for the year, and it is for my right hon. Friend the Chancellor to introduce fiscal measures, and he will make all future decisions on tax in the usual way. I reiterate that he told the House today that no option is off the table.

We know that the best way to raise living standards over the long term is to grow the economy, to invest in skills and to get people moving into and progressing in decent jobs. The latest statistics cut through the Opposition’s charge that poverty has increased since the Conservatives came into power. There are 1.2 million fewer people, including 200,000 fewer children and half a million fewer working-age adults, in absolute poverty, before housing costs, than in 2010. In March we published statistics that, for the first time, combine absolute low income and material deprivation among working-age people. Those statistics show a fall of three percentage points, from 3.1 million when we came into power to 2.2 million in 2019-20.

Financial Statement

David Linden Excerpts

Wednesday 23rd March 2022 Commons Chamber

[Rishi Sunak]

I thank my right hon. Friend for his support, and I can give him that reassurance. Apprenticeships are fantastic and we want to ensure that they are continually supported, but we will look at all aspects of this to ensure that we also provide incentives for the training that we want to see. My right hon. Friend is right to emphasise that this is the party of the workers, and that is in no small part thanks to his campaigning. I congratulate him on making the case so well.

[David Linden (Glasgow East) (SNP)]

It is clear from the Chancellor’s statement that he wanted the buzzword to be security, but one of the issues that did not appear in the statement was food insecurity. Given that 60% of Glaswegians do not possess a car and many of my constituents do not own their homes to put solar panels on them, what does the Chancellor say to the people whose children will go to bed hungry tonight, and why was there no mention of that in his statement?

[Rishi Sunak]

We have already created the holiday activity and food programme, which provides both food and enriching activities for children outside term time. There is also the household support fund, and Barnett consequentials will enable the Scottish Government to provide the same support for vulnerable families in their communities.

Draft Social Security (Contributions) (Rates, Limits and Thresholds Amendments and National Insurance Funds Payments) Regulations 2022 Draft Tax Credits, Child Benefits and Guardians Allowance Up-rating Regulations 2022

David Linden Excerpts

Tuesday 22nd February 2022 General Committees

[David Linden (Glasgow East) (SNP)]

It is a pleasure to serve under your chairmanship, Sir Gary.

I will not detain the Committee for too long given that we are expecting a vote in the House but I want to put on the record that the proposed uplift, particularly that dealt with the second SI, does not reflect the true cost of living that many of our constituents are experiencing now.

When we debated the matter a couple of weeks ago, it was widely accepted by Members across the House that basing the uplifts on September figures will have to be reconsidered by the Government because the change is not working for our constituents. Far too many households in my constituency of Glasgow East and right across Scotland have been left behind and will not benefit from a paltry 3.1% increase from a Government who know that we are heading for a 7% inflation rate by April.

We have obviously had discussions about national insurance and it would be remiss of me not to put on record that the United Kingdom Government’s decision to go ahead with a regressive hike in national insurance will undoubtedly impact on the youngest and lowest earners in society. The Government often talk about supporting people in society, and the Minister uttered warm words about the social security net, but for far too many people who I represent that security net is getting weaker and there are more holes in it than ever before. The SIs before the Committee will not solve that.

Cost of Living Increases

David Linden Excerpts

Monday 24th January 2022 Commons Chamber

[David Linden (Glasgow East) (SNP)]

I beg to move,

That this House notes there is a cost of living crisis hitting homes across the UK; regrets the UK Government’s current plan of reductions in certain benefits and tax rises coupled with rising costs of the UK leaving the EU; is concerned that the UK has the worst levels of poverty and inequality in north west Europe and the highest levels of in-work poverty this century; and calls on the Government to take immediate action with a package of measures to boost incomes and reverse rising poverty, including reinstating the £20 universal credit uplift, introducing a Real Living Wage of at least £10 an hour, introducing an energy payment for low income households, and matching the Scottish Government’s Scottish Child Payment for families across the UK.

Normally, during an Opposition day debate the Tories will berate Opposition parties for not dealing with the issue of the day, crying distraction and somehow suggesting that the discourse in this place of those on the Opposition Benches is focused solely on the interests of the SW1 chatterati, not what matters most to our constituents back home. However, today of all days, not least in the light of what Lord Agnew has just done along the corridor, that seems somewhat ironic, given that the Tories themselves are engaged in a civil war and are besieged by paralysis, with a Prime Minister who might be in office, but is certainly not in power. Let us be clear that we have a British Government and Prime Minister who are so focused on saving their own skins that they are neglecting to get on with the day job; indeed, they are overlooking the biggest issue of the day: the cost-of-living crisis.

The impact of the cost-of-living crisis is far-reaching, but as constituency MPs, we know that it is certainly impacting the poorest and most vulnerable members of society, and yet this British Government indulge in navel-gazing, while our constituents are stuck in the middle of an economic tornado. Simply, the Tories are more focused on saving “Big Dog” than on saving our constituents’ money from spiralling energy bills, and more focused on Operation Red Meat when our constituents can hardly afford red meat, as inflation causes the average supermarket shop to skyrocket.

Like most Scots, I think that the Prime Minister is utterly unfit for office and should have resigned long ago.

[Douglas Ross (Moray) (Con)]

The hon. Gentleman just spoke about the Government navel-gazing and having the wrong priority. Does he therefore agree that Nicola Sturgeon has absolutely the wrong priority? She was on TV again yesterday, saying that she is going to kick-start yet another campaign for independence, at a time when we should be focused on the economic crisis, the energy crisis, affecting all our constituents?

[David Linden]

I am grateful to the hon. Gentleman for his intervention. I have great respect for him, and I only wish that that was extended to him by the Leader of the House, who I think said he was a “lightweight”. The reality is that the people in Scotland have voted in successive elections to put Scotland’s future in Scotland’s hands, to ensure that the likes of the Prime Minister and the Chancellor, who are posted missing, do not have the economic levers that are causing such distress just now.

[James Daly (Bury North) (Con)]

The hon. Gentleman made reference in his previous comments to the impact on constituents of the cost of living. I therefore ask him to take this opportunity to tell the Labour Front Bench that Andy Burnham’s Greater Manchester clean air zone, a tax on business and jobs in my constituency emanating from the Labour party, should not come into place—it should be scrapped. I would welcome the hon. Gentleman joining me in our joint campaign to improve the standard of living for constituents all across the country.

[David Linden]

Gosh, that could have been a career-ending one for me there. At the moment, it appears that the Labour party and the Conservatives are getting on quite well. The fact that a Tory MP can cross the Floor to the Labour party suggests that the back channels between both parties are relatively good at the moment. I am sure that those can convey whatever message to Andy Burnham that the hon. Gentleman wishes.

As I was saying, if Scotland were independent, we would not have the likes of Boris Johnson and his ilk anywhere near the levers of economic power. In many respects, however, revelations about Downing Street being turned into a frat house during a deadly pandemic are just the latest in a long litany of bad decisions by a Prime Minister Scotland did not vote for. So I must confess that I find myself somewhat baffled and wondering why being economical with the truth in this Chamber is the tipping point for Tory MPs on the Prime Minister.

Why did Tory MPs not see the Prime Minister for what he really is when he compared Muslim women wearing the hijab to looking “like letter boxes”? Why did they not see him for what he really is when, talking of the war-torn Libyan city of Sirte, he said it could be the “new Dubai” and that all that had to be done was

“to clear the dead bodies away”?

Why did Tory MPs not see him for what he really is when he unlawfully shut down Parliament, misled the Queen and tried to run the country like a tinpot dictator?

The fact is, this Prime Minister should resign because he is morally bankrupt—he always has been. But if we do not tackle the cost-of-living crisis now, frankly, it will be many of our constituents who are bankrupt. [Interruption.]

I see that the hon. Member for Shrewsbury and Atcham (Daniel Kawczynski), who has managed to come to the Chamber rather than touting for a second job, wants to intervene. If he wants to intervene on the speech, he is welcome to do so, otherwise than chuntering from a sedentary position.

[Daniel Kawczynski (Shrewsbury and Atcham) (Con)]

I am wondering when the hon. Gentleman was going to get on to the subject of the debate, which is the cost-of-living crisis.

[David Linden]

I find it rather ironic to take lectures from the hon. Gentleman about getting on with the job. He was touting for plenty of jobs recently, so that is rather a sticky wicket for him to be on. If he bears with me for a moment, we will get on to the substance of the matter. I look forward to seeing how he votes on the motion tonight and what he does for his constituents in Shrewsbury.

At the beginning of the pandemic, the Chancellor of the Exchequer was everywhere; he was all over the airwaves. Indeed, if Rishi’s slick Instagram graphics could be used as a currency, we would probably all be millionaires, just like the Chancellor himself. However, it is clear that the Chancellor does not have a plan for the biggest issue of the day: soaring costs. He talks endlessly about his plan for jobs, but it is clear that his only plan for a job is moving next door when the Prime Minster is forced from No. 10. But I guess we can all console ourselves that at least when he does take over Lord Brownlow will not have to worry about WhatsApp messages looking for a tap to pay for an expensive new wallpaper.

Spending £840 on a roll of wallpaper gets to the very heart of why this Government are so detached from the economic reality of the everyday lives of our constituents. Inflation is rising at a frighteningly rapid pace: this month it rose to 5.4%, the highest in almost 30 years, since March 1992, when it was 7.1%. But we have not reached the summit yet: Paul Dales of Capital Economics has said that inflation is now expected to hit 7% by April.

These abstract figures have a very real impact on people in difficult financial situations, and they often under-represent the true effect of rising inflation, as highlighted in an excellent Twitter thread by Jack Monroe, which I commend to the House. Monroe wrote:

“This time last year, the cheapest pasta in my local supermarket…was 29p for 500g. Today it’s 70p. That’s a 141% price increase as it hits the poorest and most vulnerable households.”

That rise becomes a pattern for many essential household items. The cheapest rice was 45p for a 1 kg bag; today it is £1 for 500 grams.

[Duncan Baker (North Norfolk) (Con)]

May I ask a quick question? Can the hon. Gentleman recall which of the following schemes rolled out since March 2020 he did not approve of: the job coaches or kickstart schemes; the restart schemes; the lifetime skills guarantee; the holiday activity fund; the household support programme; or perhaps we should just remember the furlough schemes that protected the jobs and livelihoods of millions of people throughout the United Kingdom? Did any of those schemes not help the Scots?

[David Linden]

It is on the record that the SNP supported a number of those schemes. For example, the furlough scheme was hugely important, certainly at the beginning of the pandemic; about 13,000 of my constituents were involved in that scheme and it was something the SNP called for. However, we profoundly disagreed with the Government winding the scheme down too early, and there was such a lack of clarity on that; I know personally many constituents who lost their job in the intervening period from the Government saying it would be wound down to then extending it. The Government could have continued with a number of other schemes, too. We know fine well that as we come out of the teeth of this pandemic the economy is incredibly fragile, and my criticism, which I would reflect back to the hon. Gentleman, is that so many of these schemes were wound down far too early and that has led to the difficult financial pressures many of our constituents feel right now.

I was telling the House about some of the rising costs our constituents are facing in their average supermarket shop. Canned spaghetti was 13p and is now 35p, a price increase of 169%. These price changes will force more people towards food banks, and more people towards having to make that horrendous decision between heating and eating.

On top of the increasing price of food bills, energy prices are surging, delivering yet another devastating blow to families who are already struggling. Household energy bills were the biggest driver of inflation after Ofgem, the energy regulator, lifted the price cap on domestic gas and electricity. That meant that gas bills rose by 28.1% in the year to October, while electricity climbed by 18.8%. National Energy Action estimates that there are already 4.5 million fuel-poor households in the UK, which is nothing short of a disgrace, and if the cap rises, as is predicted, the number will rise to 6 million. Only two weeks ago there was an Opposition day debate in this Chamber and I was highlighting the rising cost of energy to Ministers, yet still, two weeks on, no action has been taken; indeed, if press reports are to be believed, a meeting between the Chancellor and the Prime Minister on this issue was cancelled last Wednesday because they were both so busy courting Tory backbenchers. When I met with Age UK and Age Scotland after their snap survey, it was revealed that 96% of their respondents were worried about their energy bills.

Again, these statistics have real-life consequences. I have heard far too many stories of people in my constituency moving their beds into their sitting room so they will only have to heat or light one room over the winter months. That an image not of Victorian Britain but of 21st-century global Britain.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

My hon. Friend is making a very powerful point about the poverty faced by people in this current cost of living crisis. The all-party parliamentary group for terminal illness last year produced a report that pointed out that the energy costs for people diagnosed as terminally ill double when they are at home. When people are struggling anyway, that is an absolutely damning statistic for people with a terminal illness, yet the Government have failed to move on bringing forward faster access to benefits to support them. Does my hon. Friend agree that that is just a disgrace from this Government?

[David Linden]

It is. I pay tribute to my hon. Friend, who very ably chairs the all-party group for terminal illness. It is one of the things that really sticks in the craw of many of us. My hon. Friend highlights some of the very real struggles facing people with a terminal illness. The idea that the biggest issue of the day—the cost of living crisis and spiralling energy bills, which people who are terminally ill are struggling with—is being overlooked at the expense of things like “Fizz with Liz”, and the Chancellor and the Prime Minister courting the Tea Room really is an absolute disgrace.

[Matt Western (Warwick and Leamington) (Lab)]

I thank the hon. Member for giving way; he is being generous with his time. On energy bills and the cost of living, does he agree that one of the great losses to these islands is the fact that the Government prevented more land-based wind turbine arrays which would have brought down the cost of energy significantly as the cheapest provider of electricity? That would have made a significant difference to energy costs.

[David Linden]

I am grateful to the hon. Gentleman for that intervention. I agree that it is important that we invest in renewable energy. That is why we on the SNP Benches are fully committed to that. It is only a shame that the official Opposition have such a bizarre fascination with investing in nuclear, but perhaps he will reflect on that.

The current Tory austerity policies do absolutely nothing to relieve the suffering of people who are impacted by the cost of living crisis. In the last year alone, the British Government cut the £20 a week uplift to universal credit. Indeed, they refused to extend the £20 uplift to the 2.5 million disabled people on legacy benefits. That is subject to proceedings in the High Court at the moment. The Government battled against extending free school meals to the poorest children in society. We learned only at the weekend about the allegations that the then Secretary of State for Education, the right hon. Member for South Staffordshire (Gavin Williamson) personally threatened Members of this House who dared to vote for that with the withdrawal of funding from their constituencies. The Government scrapped the triple lock for pensioners who already have one of the worst pensions in the OECD.

All of that is important, because those cuts only deepen and cement the inequalities in our society. They will impact the lives of the poorest people we represent for decades to come. The British Government must reflect on that. When people fall into destitution, it is other parts of the state, almost certainly councils, that have to bear those eye-watering costs. We know that destitution is bad for the economy. It is not good for the economy for people to be unable to afford their weekly food shop or heating bills. Let me be especially clear to the Government that a proliferation of foodbanks is not a sign of the big society; it is a sign of bad policy from people who think that spending £840 on a roll of wallpaper is somehow normal.

[Stewart Hosie (Dundee East) (SNP)]

My hon. Friend is making a number of excellent points about the damaging nature of UK Tory policy. Does he agree that the benefit cap is one of those problems as well? Is he happy today to put on record the SNP’s support for the Poverty Alliance “Scrap the Cap” campaign?

[David Linden]

I am grateful to my hon. Friend for that intervention. Yes, absolutely. The SNP has stood on successive election manifestos with a commitment to scrap the cap: both the benefit cap and the welfare cap. I am only disappointed that the SNP had to lead the charge against the welfare cap in a vote only a couple of weeks ago. Perhaps when people in Scotland are considering who best serves them, whether it is Westminster or the Government they elect in Scotland, they will reflect on that. My hon. Friend makes a very good point.

It is imperative that the Government bring forward solutions to address the cost of living crisis and lift millions of people from experiencing poverty this year, just as we have set out in the motion. The Government must introduce an emergency package to boost household incomes and reverse rising poverty levels across these islands. We want the Chancellor to launch a multi-billion-pound Brexit recovery fund to mitigate the worst, and growing, costs of Brexit.

Those solutions should go hand in hand with other suggestions to tackle rising energy prices. We need a one-off payment to low-income households, which could be identified by way of the council tax reduction mechanism. We must increase and extend the warm homes discount, delivered through customers’ bills and funded by the UK Government. We need the child payment, as seen in Scotland, to be rolled out right across these islands. We need the April benefits uprating to better reflect inflation rates and to reinstate the £20 a week uplift to universal credit which so many of our constituents described as a lifeline.

There is no shortage of suggestions to Ministers for how we can alleviate family income pressures, but there is, I am afraid, a shortage of urgency and energy on the part of a Government distracted by their own internal wrangling. I have a huge amount of respect for the Chief Secretary to the Treasury, but the fact that, on a day when we have another debate about the cost of living increase, the Chancellor of the Exchequer is nowhere to be seen raises a lot of questions about what he is doing.

In contrast to the cruel policies in Westminster, the Scottish National party Government have committed to relieving poverty wherever they have the power to do so. That is why we have doubled the Scottish child payment, rolled out 11 benefits—seven of them brand new—extended free school meals and are working actively to reduce poverty and inequality, and all the while Westminster undermines those efforts. However, the constitutional reality is that, with limited tax-raising powers, no borrowing powers and 85% of welfare spending still controlled in this place, those policies can only go so far when they are continually undermined by Tories and Tory Governments whom Scotland did not elect.

Since being elected four years ago, I have stood in this Chamber warning the Government about the impact of their policies that make life so much harder for my constituents in Garthamlock, Craigend and Easterhouse. When I make those pleas, it is not from a purely dogmatic or ideological point of view. I do so because every Friday morning at my surgeries I meet people who, because of the way life has panned out, rely on the safety net of the social security system, to which we all contribute and which is frankly no longer able to cope. I appreciate that a Tory MP in the home counties probably does not have much care for, or cause to interact with, the Department for Work and Pensions on a daily basis.

[Duncan Baker]

It is interesting listening to the number of fiscal policies mentioned that are so terrible and have led to the United Kingdom’s recovery being so poor. Can the hon. Gentleman then explain why every economist predicts that the United Kingdom economy is expected to show the highest growth and bounce back of any nation within the G7?

[David Linden]

I ask the hon. Gentleman to reflect on the fact that the UK was one of the worst hit by coronavirus, perhaps due to the bungling of this Government in the initial days in locking down far too slowly.

[Daniel Kawczynski]

One thing the hon. Gentleman has not mentioned in the course of his speech is the extent of the national debt. We have a debt-to-GDP ratio of over 100%, we have more than £2.4 trillion in debt and we are spending more on servicing the national debt than on the entire education budget—£55 billion. Will he not at least acknowledge that the extraordinary levels of debt incurred over the banking crisis and now the pandemic inevitably mean that the Treasury is unable to do straight away everything he seeks to have it do for our constituents?

[David Linden]

The problem with the hon. Gentleman’s intervention is that he suggests that this is some issue the Government have just happened upon. His Government have been in power for 11 years, so the level of national debt is something they have a direct link to. He should reflect on that.

As I said, a Tory MP in the home counties—or indeed Shrewsbury—might not have much opportunity to interact with the DWP on a daily basis, but I do, and my constituents often tell me—[Interruption.] Mr Deputy Speaker, the hon. Gentleman chunters somewhat. I know he might be quite excitable, and he is probably envisaging this as some sort of on-screen job interview, but if he will calm himself for a moment, I can perhaps make a little bit of progress with my speech—[Interruption.].

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. Mr Kawczynski, this is not a conversation; it is a debate.

[David Linden]

You are right, Mr Deputy Speaker—it is not a conversation, and I am not in a position to help the hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) with his school fees, so if he just hangs on, I will deal with him a bit later.

I say to the Government that although the DWP does not often act very helpfully towards my constituents, it is clear from people back home in Glasgow East that the Government are out of touch and do not have the solutions for the big issues of the day. They say that a week is a long time in politics, and yes, for Westminster watchers and the chattering classes, defections, letters to the 1922 committee, Tea Room gossip and “fizz with Liz” are probably all very exciting, but for most of us, it just feels like groundhog day. The Prime Minister, the Chancellor and this whole Tory Government are simply not listening. They are not listening to charities and non-profits, which have repeatedly highlighted the cost of inaction, with soaring prices. They are not listening to the voices of Opposition Members, even though we were told that Brexit meant that Parliament would take back control. Ultimately, and worst of all, they are not listening to the people of Scotland and they are not acting when people need help most.

Inflation is rising, costs are soaring and time is running out for hard-pressed families. The Tories need to stop navel gazing and start acting to head off the cost of living crisis. Frankly, anything less is only a further dereliction of duty on the part of a Government whose focus is elsewhere. Yes, we can debate this tonight, but in reality, the time for talking has passed. Talk alone will not pay our constituents’ energy bills at the end of this month. We need to act now and the Government need to start getting on with the day job. I commend the motion to the House.

--- Later in debate ---

[Mr Clarke]

It is good to see the hon. Gentleman back in the Chamber. The reality is that nobody came into politics to raise the burden of tax on our society. We all feel that keenly, but we are equally clear that we face a £400 billion bill for covid costs. We have a clear programme of targeted investment in the NHS and in social care, designed to alleviate the backlog in treatment and the longstanding challenges that we know we face with an ageing society. We owe it to people to be candid that there are no easy solutions to how to pay for that. I certainly do not want—and I know the Chancellor does not want—to put more borrowing on to the books, when we know that those are structural challenges that need to be paid down, and therefore a tax increase is the most sensible and honest way for us to pay for that. In that spirit of total candour, that is why we are bringing that forward, and we believe that it is the right thing to do. The sadness is, of course, that the Opposition did not support us in that, and persistently criticise us for not spending enough on the NHS when they will not will the means for that investment.

Direct financial assistance, help to find work and support for people in every region and nation of the UK are just some of the ways in which the Government are aiming to secure a more prosperous future for this country. I note that the motion tabled by the hon. Member for Glasgow East (David Linden) calls for the Government to spend more. I should remind him that the devolved Administrations already have the power and the money to make spending decisions of their own. The Scottish Government have significant tax and welfare powers, so they can choose to raise more tax if they want to spend more on welfare.

For our part, we have shown unequivocally that we are not afraid to make the big decisions to do right for the people of this country. That is why we are investing £600 billion in the public sector over the course of this Parliament, on our health service, our education system, and securing our borders. That is why, at the spending review, we took the total we have committed to the economic infrastructure to £130 billion. That is why, to respond the hon. Gentleman’s point, we are spending more on the NHS as a result of the health and social care levy as well.

[David Linden]

The Chief Secretary to the Treasury talks about the big decisions that the UK Government have taken. Of course, part of the reason they can take these so-called big decisions is that they have the ability to borrow; he just talked about £600 billion. He knows fine well that in Scotland we do not have those powers. If he wants people in Scotland to have them, why will he not give Scotland the borrowing powers to do so?

[Mr Clarke]

This Government have worked very closely and co-operatively with the Scottish Government in Holyrood to make certain that we can, together, provide the most effective, targeted package of support for all our constituents. I have talks with Kate Forbes, the Scottish Government Finance Minister, coming up later this week as part of the fiscal framework. We continue to discuss all the issues that fall within the relationship between Holyrood and Westminster, and we do so on a genuinely open and constructive basis. We are quite clear that we have provided the devolved Administrations with a huge—indeed, a record—Barnett settlement precisely to make sure that all contingencies thrown up by the pandemic can be covered.

The broad context of our need to deliver the right package of support does not come at the expense of our commitment to safeguarding the country’s finances. As I have said to the House before, reckless promises are the privilege of opposition; tough choices are the task of parties that are in government. We cannot fritter away our achievements on unfunded pledges. That is particularly true at a time like this when our level of debt means we are vulnerable to shocks, including changes in interest rates and inflation. In fact, a sustained one percentage point increase in interest rates and inflation would cost over £22 billion by 2026-27. Given that this country has suffered two so-called once-in-a-generation shocks in just over a decade, the case for building a stronger economy with the headroom to guard against shocks is clearer than ever. We must act to build on that headroom now, because to fail to do so would be folly.

I recognise, as do all my ministerial colleagues, the very real pressures that are facing families in every part of the United Kingdom right now. I have set out the comprehensive action we are taking to address those challenges. That is why, as my hon. Friend the Member for Moray (Douglas Ross) said, it is so disappointing that Nicola Sturgeon’s first priority, as the omicron wave eases, is not the cost of living but rather another divisive independence referendum. The SNP’s record of failure in government stretches back years. Before the pandemic, the SNP presided over the lowest rate of job creation in the United Kingdom. Under the SNP, Scottish schools have plummeted down international league tables, denying children a good education. Scotland has the highest drug death rate in Europe, tripling on the SNP’s watch.

Now, instead of supporting Scotland to recover from the pandemic, here we are, on an Opposition day, with the SNP again fixating on issues with the negativity that has become its hallmark. The SNP has entered into a nationalist coalition with the Scottish Greens, taking on extreme policies that will be hugely damaging for Scottish workers, in exchange for pushing ahead with its plans for that divisive second referendum. It is more focused on the break-up of our United Kingdom than on supporting Scotland to recover from the challenges the pandemic has created. By contrast, throughout this pandemic, the United Kingdom Government have taken the difficult decisions necessary to steer the country through the crisis we have faced. We will continue to strive to secure the better and more prosperous future that the people of this country deserve.

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[Ian Murray]

It is a strange thing that over the past five minutes we have heard SNP MP after SNP MP justify why they cannot lift 80,000 children out of poverty. If that does not show how this country is stuck between two bad Governments, nothing will.

[David Linden]

Unfortunately, we on the SNP Benches have to turn our guns everywhere because there are very few guns behind the hon. Gentleman. He is focusing on social security and what we can do—I agree with him about how we can alleviate poverty and inequality—so will he tell us from the Dispatch Box that the next Labour manifesto will commit to the abolition of the welfare cap, about which Labour had nothing to say two weeks ago?

[Ian Murray]

There was not a vote on the welfare cap a few weeks ago. It was about giving more money to the poorest people in this country and SNP Members know that. I take umbrage with what the hon. Gentleman said about the number of people on the Labour Benches, because the criticism we always hear during SNP Opposition day debates is that the Labour party takes up too much time. We leave most of the time for SNP Members to speak and that has always been the case. SNP Members constantly complain that they do not get enough time in this place; they will get as much time as they like today.

I was delighted by that intervention; let me repeat my paragraph. Young children and families in Scotland might be wondering why the Scottish Government will not listen to charities or, indeed, to Scottish Labour’s policy and increase the Scottish child payment to £40 a week. SNP Members cry, “Where would we get the money from?” Such a move would lift 80,000 Scottish children out of poverty and could be done tomorrow under the powers of the Scottish Government. They are wasting money on ferries, Prestwick and vanity projects. The underwriting of the Gupta organisation puts half a billion pounds on to the taxpayer of Scotland. That is what we should focus on.

The Scottish Government passed their budget last month and pushed incredible cuts on to local authorities. They then turned round to those local authorities and said, “If you want the money to run local services, put it on council tax.” Nothing affects Scottish people more than their having to pay massively increased council tax bills because the Scottish Government are slashing the budgets of local government.

There is no better example of dither and delay than the devolution of welfare powers. In 2016, we agreed on a cross-party basis to the devolution of a whole host of welfare powers to the Scottish Parliament. Indeed, in essence the Scottish Parliament could now create its own welfare system if it implemented the policies. Six years on, the Scottish Government still delay the full implementation of the policies. In fact, they will take until 2025 to take full control of the devolved powers. It is important because with skyrocketing energy bills and increasing child poverty, the powers could be used to give, for example, a supplement to the winter fuel payment to help pensioners who are stretched by increased fuel bills. That is what should happen in respect of the changes to welfare powers in Scotland, but it cannot, because the welfare powers have not yet gone through as they should have.

We know that the best way out of poverty is the creation of highly skilled, highly paid jobs, so I must give credit to the SNP Scottish Government because over the past 15 years they have created a host of highly skilled jobs in turbine development, in the construction of ferries and in steel manufacturing. But none of those jobs have been in Scotland: they have been in China, Turkey, Poland and elsewhere. The decisions that the Government make have a fundamental impact on the way we deal with things in Scotland. The newly announced Scotland projects could generate billions of pounds of economic activity in Scotland, so every single job created should be in Scotland, with fabrication plants, British Steel and others.

Of course, as the cost of living crisis develops, the Prime Minister faces some difficulties of his own. Although much of the country is about to spend all their income from their jobs on energy, the Prime Minister is spending all his energy on saving his job. It seems that the choice in No. 10 is not so much about heating or eating but about whether it should be red or white. Little does the Prime Minister know that the cost of living crisis will affect him as well as everyone else in the country. Will the Minister tell us how much more a suitcase of wine from the Co-op will cost next year than it did this year?

As the Government party through the night, Labour offers a serious solution and leadership on the crisis. While the Government are hopelessly distracted by the chaos of their own making and more focused on infighting than on tackling people’s energy bills, we are calling on the Government to address the situation now. They could bring in a motion now to sort out this problem, with fully funded measures to reduce the expected price rise in people’s energy bills in April through a VAT cut on home energy bills that would save most households £200 or more, and targeted extra support for the squeezed middle, pensioners and the lowest earners, who would receive £600 off their bills, paid for by a one-off windfall tax on the North sea oil and gas producers who have profited from the price rises. Under Labour’s plan, every household in Scotland would save more than £180 off their energy bills, and 800,000 households in Scotland struggling with the cost of living would get an extra £400 in additional support. That is nearly £600 for those hardest hit by the energy price rises—critical money into the pockets of hard-pressed Scots now.

While everyone is dithering and delaying as we talk about new referendum Bills and why the Prime Minister is more concerned about his job, Labour proposes genuine action that would help families pay their bills over this most difficult year. That is the difference that Labour and leadership can make, and we will make it in power. With the support of the people of Scotland and those across the United Kingdom, that is exactly what we plan to do at the next election.

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[Douglas Ross]

It turns out that that was exactly the same question and the same point that the hon. and learned Lady has already made three times. She mentions the British Retail Consortium, but she also has to accept that there have been labour shortages and driver shortages in other parts of the European Union, the United States and many other parts of the world. I understand that it fits her narrative to paint her question in that way, but we also have to remember that these are global issues that Governments across the world are having to address.

Governments in this country have to think carefully about the effect that their policies have on family budgets. That is why I was amazed, but sadly not surprised, that there was not a single mention in the SNP motion calling on the nationalist coalition of the SNP and the Greens in Holyrood to take some decisions itself that could make an immediate and direct impact on the cost of living in Scotland. The SNP motion that we are debating makes reference to tax rises, which is very interesting given that for the past decade and a half SNP colleagues have been running the country that is the highest-taxed part of the United Kingdom. [Interruption.] The hon. Member for Na h-Eileanan an Iar (Angus Brendan MacNeil) says it is about the rich, but it is not; it is about the 1.1 million Scottish taxpayers who earn more than £27,393. That is not rich; that is 1.1 million people across Scotland. Those who earn just over £27,000 are not the rich; people across Scotland are being punished by SNP decisions.

[David Linden]

It is reassuring that at least today the mantra from the Tories is that Scotland is the highest-taxed part of the United Kingdom, because sometimes we are told we are not doing anything with our tax powers.

To go back to the point of what we are doing for people on low incomes, the hon. Member will know that the regressive tax hike in national insurance will take away 20% of the pay increase for a band 5 nurse in Scotland. Does he support the Government’s plans for a tax hike in national insurance?

[Douglas Ross]

I have listened carefully to the hon. Gentleman, and I make this point: the tax rises that his Government are introducing in Scotland have made Scotland the highest-taxed part of the United Kingdom, and that is affecting nurses, teachers and police officers. That is who it is affecting right now in Scotland.

[Douglas Ross]

We have been clear, as my right hon. Friend the Chief Secretary to the Treasury said, that the Government have taken a difficult decision to focus that vital funding on health and social care—an issue that has not been grappled with for decades by parties on either side of the Chamber. It certainly has not been grappled with by the Scottish Government. Sometimes difficult decisions must be taken to ensure that we have a health service and support for older people in this country that has not always been available.

The hon. Member for Glasgow East mentioned local government, and I suddenly got excited, because I thought we were finally going to hear an SNP politician standing up against the disastrous cuts that Nicola Sturgeon and the SNP are imposing on local government, but he said “local government”—Hansard will show this when the report is published—and then did not say another word. The SNP has the highest ever block grant since devolution. Since 1999, more money than ever before has been going from the UK Government to the Scottish Government, and what do they do to local councils? They cut the local government budget by £371 million. That is a cut from the SNP Government to local government, when the UK Government are giving them more money than ever before to spend.

[David Linden]

rose—

[Douglas Ross]

I will give way in a second, if the hon. Gentleman will show that he stands up for his constituents, just like SNP council leaders have stood up to the Scottish Government and said, “That is a cut too far”, and that they should change their view on the £371 million cut to local government.

[David Linden]

I know the hon. Gentleman is used to running the line on a Saturday, but we are not all going to play his game this afternoon. On the issue of local government, will he pass comment, given that he has the floor, on Councillor Tim Eagle from his council in Moray, who suggested that free school meals, free tuition and free bus travel for under-22s are somehow “little treats”?

[Douglas Ross]

The hon. Gentleman knows that that was taken completely out of context. If he wants to repeat to the House the entire comment that Councillor Eagle made to the Moray Council committee meeting, he is welcome to do so. I gave way to the hon. Gentleman, so I will do so once more: does he agree with the SNP council group leaders who are saying to the SNP that the cuts are too much?

--- Later in debate ---

[David Rutley]

We have shown what we can do when faced with challenge. We are monitoring the situation and looking at all the solutions—we will come forward—as, I understand, the Scottish Government are monitoring the situation to see what more they can do.

[David Linden]

rose—

[David Rutley]

I will not give way just yet: I will make further progress.

The latest job figures tell a very positive story. There is now a record number of people in payroll employment in the UK, with 23,000 people added to payrolls in Scotland in December alone. With around 1.25 million vacancies across the UK, up 33,000, or 2.7% in a month, and by 467,000, or 58.9% since the start of the pandemic, there are many further opportunities for people to move into and, importantly, progress in work and increase their earnings.

Current estimates also show that the number of online job adverts in Scotland has risen by 13% since the start of the pandemic. We know the importance of employment, particularly full-time work, in substantially reducing the risks of poverty, especially in households with children. That is why the focus of the Secretary of State and the whole DWP ministerial team is on matching people looking for work with those opportunities, which will also boost key sectors and the economy as a whole. As well as getting people into jobs, we are taking action to boost the take-home pay of low-income working households by giving 2 million families an extra £1,000 a year through our cut to the universal credit taper rates and increasing work allowances. Raising the national living wage by 6.6% to £9.50 from April will mean an extra £1,000 a year for full-time workers.

To help people to take advantage of the record number of vacancies, our plan for jobs is helping people at any age and any stage of their career, as the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Mid Sussex (Mims Davies), is fully aware. Since the start of the pandemic, we have recruited 13,500 new work coaches to ensure that claimants, no matter where they live across the country, can access support and opportunities to get a job, progress in work and realise their potential. It is good to know that there are 1,200 extra work coaches in Scotland alone. In addition, the flexible support fund is available to remove barriers for anyone looking to access the labour market and is administered by work coaches on a discretionary basis, so it is a great tool to help people overcome their own personal barriers to work. For those who have been unemployed for between three and six months, the job entry targeted support programme provides intensive support to help them bounce back as quickly as possible, and for individuals requiring upskilling to take advantage of a vacancy in a certain sector—Members have discussed particular concerns in specific sectors—sector-based work academy programmes, or SWAPs, provide claimants with those key skills and a guaranteed job interview at the end of the placement.

For young people, who are of course most at risk of long-term unemployment and have been hit particularly hard by the pandemic, we have the £2 billion kickstart scheme, which has seen over 122,000 young people start a six-month work placement across many different kinds of jobs and sectors, with 10,000 starts in Scotland alone. There are youth hubs in every jobcentre to support young people—150 youth hubs have been opened, 19 of them in Scotland—and extra support is available for those aged over 50 as well, to help them find the work they need and help them progress with their career aspirations.

We recognise the pressure people are facing with their household finances and are providing extra support for those who need it in this period of cost pressures. We must of course highlight the household support fund, which has provided £500 million of support across the United Kingdom, with £41 million going to Scotland and the Scottish Government.

We have provided extra support as well over the years, recently by increasing the local housing allowance in cash terms, with an extra £600 on average to 1.5 million households. As we look at the rising energy prices, we are working with Ofgem and the Department for Business, Energy and Industrial Strategy to ensure that we have the correct response to the recent pressures and make the appropriate changes where needed to increase our resilience to future price fluctuations. There is the energy price cap, and the winter fuel payments, cold weather payments, and the warm home discount, all of them making a real difference to people facing energy cost challenges across the country, including in Scotland.

So, we have done a lot. We will continue to do more. We are committed to working with the Scottish Government to help them achieve their devolution aspirations. We look forward to hearing more about them so we can help them in this task, and we are absolutely committed to help those—

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[David Linden]

On a point of order, Madam Deputy Speaker. During the Brexit campaign, we were all told that Parliament would be taking back control. Given that the House has just voted by a clear majority for a motion calling for the Government to reinstate the £20 universal credit uplift, introduce a real living wage of at least £10 an hour and an energy payment for low-income households, and roll out a child payment similar to that in Scotland—given that the Parliament that has been given all this control has just voted for that—can you inform me when the Government will introduce such measures to help people with the cost of living crisis?

[Madam Deputy Speaker (Dame Eleanor Laing)]

I thank the hon. Gentleman for his very reasonable point of order. I am looking at the motion which the House has indeed just passed, and I note that the crucial point is that the House

“calls on the Government to take immediate action”.

Well, the House has called, and I am sure that the Government have heard.

Leasehold Reform (Ground Rent) Bill [Lords] (Programme) (No. 2)

Ordered,

That the Order of 29 November 2021 (Leasehold Reform (Ground Rent) Bill [Lords] (Programme)) be varied as follows:

(1) Paragraphs (4) and (5) of the Order shall be omitted.

(2) Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion two hours after the commencement of proceedings on the Motion for this Order.

(3) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion three hours after the commencement of proceedings on the Motion for this Order.—(Gareth Johnson.)

Household Energy Bills: VAT

David Linden Excerpts

Tuesday 11th January 2022 Commons Chamber

[Rachel Reeves]

In fact the poorest households spend a higher proportion of their income on gas and electricity bills, with pensioners spending the highest proportion, so the beneficiaries of this measure would be the people we know need that support more than anyone.

We have had a decade of dither and delay from the Conservatives on energy policy. There is indeed a global price spike for gas, but this Government have left Britain uniquely exposed. They have failed to insulate homes properly and they have failed to invest in the new nuclear or renewables that we need. They have failed on gas storage, leaving us reliant on Russia and Qatar for our gas supply. They have failed to regulate the market, with 27 companies now having gone bankrupt, which has left rising prices hitting millions.

[David Linden (Glasgow East) (SNP)]

Does the shadow Chancellor share my incredulity at the suggestion by the hon. Member for West Worcestershire (Harriett Baldwin) that, somehow, giving assistance to people in big houses is the wrong thing to do when the Conservatives are giving them £300,000 of levelling-up money to do up their driveways?

[Rachel Reeves]

That is levelling up in action, filling in the potholes at the Lord’s manor.

On this side of the House we want to keep bills low, which is why Labour is bringing forward this vote to reduce VAT on home energy bills to 0% for a year. It is why we would spread out the price increase that is about to hit bill payers because of the collapsing energy firms, and it is why we would help the squeezed middle, those on lower incomes and pensioners by increasing and expanding the warm homes discount to 9 million people. Our plan would save households £200 from their bills, and up to £600 in total for those who need it most. We would pay for this with a windfall tax on North sea oil and gas profits. These companies have profited massively because of exploding prices, so much so that some in the industry have referred to soaring energy prices as a “cash machine” for producers and their shareholders.

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[Alan Brown]

The right hon. Gentleman seems easily confused, but of course he is a climate change sceptic. If Scotland was in charge of its own energy policy, there would be more investment in renewables and greater hydrogen development, and we would not be paying for nuclear power. I have already said that the nuclear power stations will put up to £63 billion on to our bills; that is the estimate. We would have a much better energy policy that we could implement as an independent country and we would not have the highest grid charges in the whole of Europe.

[David Linden]

I am looking on with a degree of bemusement—the hon. Member for South Thanet (Craig Mackinlay) is engaging in a debate about Scottish independence. Does my hon. Friend welcome the fact that the Government are finally engaging in the debate about Scottish independence? Perhaps the hon. Member for South Thanet will come up and campaign in the coming referendum.

[Alan Brown]

I welcome that intervention. It is good that people recognise that Scottish independence through a referendum is going to happen, and we look forward to a continued debate about the nuances of what will happen in an independent Scotland that has control of its own policies and can choose to go back into Europe.

As I said, we need to understand that the warm home discount is actually paid for by other bill payers. I am uncomfortable with the fact—the Chief Secretary did this earlier—that the Tories brag about the warm home discount as if it is a Government-funded measure. The reality is that, as a stand-alone tax measure, the warm home discount is actually regressive, because the people who can least afford it pay the same levy as those that can afford to pay more. So while the warm home discount does help people that require help, it is actually a regressive tax measure. If Labour’s proposals were implemented in the way the scheme operates just now, that would add £200 per annum to the bills of those who are left paying for it. It is inferred that Labour’s proposals would be funded from £3.5 billion of additional Treasury receipts, but that needs to be made clear. We also need to make sure that the Tories are not allowed to do a fudge when they raise the warm home discount, but by making other bill payers pay for it, giving them a free pass to pretend they are doing something. Similarly, there has been a call for policy levies to be removed from our electricity bills. I have argued this for a while because state levies on bills are also regressive, so we need to come to a fairer taxation measure to pay for our transition to net zero.

I have another concern about current Labour rhetoric about tax rises. It is as if all tax rises are bad. That plays to the Tories’ narrative and encourages them to make tax cuts ahead of the next election. So yes, the national insurance rise is an unfair tax on workers, and it is correct to highlight that, but we need to debate fair taxation. The Chancellor shied away from setting capital gains tax at the same rate as income tax. Had he done that, it would negate the need for a national insurance rise.

In Scotland the Scottish Government have shown that this can be done differently with a low starting rate of income tax and incremental increases across the bandings so that those can afford to pay a bit more do so. This is a model that Labour should be espousing. It should be demanding that the UK Government match our £20 per week child payment and reinstate the £20 per week universal credit cut.

It has been highlighted that tax burdens are the highest in peacetime since world war two. If this were to create a fairer society as part of a genuine levelling-up agenda, it could be managed. But we have right now in the UK the worst levels of poverty and inequality in north-west Europe and the highest levels of in-work poverty this century. The UK has one of the worst pensions in the world, made worse by the Government’s cap on the triple lock, so the Chancellor is balancing the books on already hard-hit pensioners struggling to heat their homes. How is it credible to reduce pensioners’ income by over £500 a year on what it otherwise would have been this year? The UK has one of the lowest sick pay rates in the OECD with the current rate of £96 per week. That is wholly inadequate, especially if people still need support in self-isolating.

Small independent countries continue to demonstrate that they can create a fairer, more equitable society. It is time Scotland had these powers rather than having to continually tinker around the edges and have decisions imposed on us. The debate has started today. I look forward to continuing the debate in that form.

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[David Linden (Glasgow East) (SNP)]

This is the second day in a row that the Chancellor of the Exchequer appears to have been posted missing. At the beginning of the pandemic, he was absolutely everywhere: we could see all his branding on Instagram and he was clearly trying to pump himself up in advance of a Tory leadership bid. This Government often talk about their plan for jobs, but it is becoming increasingly clear that the Chancellor has a plan for only one job: his next job, which the Prime Minister seems to be doing his best to expedite today.

Yesterday, I met Age UK and Age Scotland, which told me that 96% of respondents to their snap survey last week were worried about their energy bills. People are already making really tough choices between heating and eating: for example, some people are making the decision just to live in the one room in their house that they can heat.

The Government need to reflect that, when people fall into destitution, the state bears the cost anyway, so there is a preventive argument as well. What we need from the Government is not just a plan for jobs, but a plan for their cost-of-living crisis and a plan to tackle pensioner poverty. We need a one-off payment to low-income households, which could be identified by way of the council tax reduction mechanism. We need to increase and extend the warm home discount, delivered through customers’ bills and funded by the Government. We need the April benefits uprating to better reflect inflation rates and certainly to reinstate the £20 that was cut from universal credit, which was so callous on the Government’s part.

We need to reinstate the pensions triple lock, on which the Government broke their own manifesto commitment only a couple of months ago, because pensioner poverty is on the rise and the UK already has one of the poorest pensions in the OECD. We were told that an 8% rise in pensions would be disproport- ionate, but reasonable economic forecasts now expect inflation to run at 7% in April. We need bold action on pension credit. Over 3,000 constituents in Glasgow East are eligible for pension credit but do not take it up, so we need more action from the Government to promote it.

The Department for Work and Pensions needs to look again at the £500 million household support fund. Initially, we had £41 million of that Barnettised to the Scottish Government. Rather than winding the fund down, the UK Government should increase it. We need to reintroduce and mandate the social energy tariff, reinstate the free TV licence for over-75s, who largely spend more time at home, and reduce or remove VAT and environmental levies on energy bills.

Those are just some of the things that could be in the Chancellor’s plan for the cost-of-living crisis but, as we all know, his only plan for jobs is for his next one. This place is clearly not going to deliver anything for Scotland, so the only way to do it properly is with Scottish independence.

Charter for Budget Responsibility and Welfare Cap

David Linden Excerpts

Monday 10th January 2022 Commons Chamber

[John Redwood (Wokingham) (Con)]

Let me return to the subject of the debate, the charter for budget responsibility. I will not follow the Opposition into a debate on the general state of the UK economy, which I am sure we will have other opportunities to discuss.

I see this as the Maastricht rules tribute debate. Every year under the Maastricht treaty, whether under Labour, coalition or Conservative Governments, we used to have a debate. We had to look at the two fiscal rules, which of course both came from the European Union: rule one was that the budget deficit had to be 3% of GDP or less; and rule two was that we had to either be below 60% of GDP with our state debt, or we had to show how we were going to get down to 60% of GDP with spending cuts or tax rises. The UK normally favoured the tax rise route, rather than the spending cut route.

That was characterised by the Opposition parties of the day, once the Conservatives or the coalition were in office, as austerity economics, although they would never accept that the cause of the austerity was the rules designed in Brussels. They would point out, when I made that point, that, “Oh well, because the UK is not a member of the euro there are not the same penalties imposed if the UK fails to comply.” The fact was, however, that the whole UK economic machine—Bank, Treasury and officialdom—believed they were very serious commitments and that, as they were treaty commitments, the UK had to keep to them. So when we finally got out of the EU, I was one of those voices saying to the Government, “Let’s scrap all that. Let’s not have those Maastricht tribute debates”—although I think we had one even after we left—“and let’s have our own UK framework.” That is what we should be debating tonight.

The Government have come up with a charter for budget responsibility, which I welcome, but reading the detail, it has a familiar ring to it. What are the two main rules in the charter? One is that we must keep the budget deficit down to 3% or below. It has been repackaged in relation to investment, but it is basically the 3% Maastricht budget deficit rule. The second rule is that, by the third year, debt should be falling as a percentage of GDP. Of course, our debt is well above 60%, and it will be quite a long time before we get back to 60%, if at all. It is now built into the framework as a regular review item, although it has the extra twist that it is a three-year average, so there is a bit more scope for flexing things.

I think we can do better than this Government. We could come up with an economic framework geared to the modern needs of an independent country, and I would suggest that our charter should embed two great aims of economic policy. The first aim that it should definitely embed is controlling inflation. It is right that the so-called independent Bank of England—this House regularly changes the rules and shows that it is actually in charge of the Bank of England—is charged with the duty of keeping inflation down to around 2% on average. I have no problem with that as a target, but the Government need to adopt it as a target as well, because as Ministers must well know, we cannot do all of the heavy lift through monetary policy—we cannot do it all through interest rates or quantitative easing. We also need to have a sensible fiscal policy.

Above all, the Government, who control such a huge chunk of the economy, need to manage their own affairs well, in terms of productivity, sensible real wage growth and so forth, and they have a duty to follow an anti-inflation strategy for the public sector directly under their control as a back-up to what the Bank and monetary policy are trying to do. I think that we should embed the inflation policy more firmly in the charter and that the Treasury should have to tell us how it is contributing to controlling inflation. It will be very topical this year, because clearly inflation is considerably above where we would all like it to be and there is no immediate sign that it is about to drop down, although I think it will drop down towards the end of the year, unless policy is particularly foolish.

The second criterion or objective that I would put in the charter is a growth objective. Labour made an entirely fair point by saying that what matters is growth. The faster the growth—as long as it is not inflationary—the more we would solve our deficit and debt problems. Our economy and our figures are incredibly sensitive to the growth rate. In the first half of the current financial year, we had very fast growth. It was a recovery phase and things were going fairly well from the covid lockdowns. As always, the OBR and the Treasury completely misjudged what favourable impact growth has, so they overstated the deficit for the first six months of the year by a whopping £50 billion. The deficit tumbled by £50 billion more, with no tax rises. But there was a huge tax rise—it was called tax on growth. More people went to work, and more people earned higher wages, bonuses or salaries. More people spent more money, so there was more VAT. So income tax receipts, VAT receipts and other receipts in the economy greatly outperformed the OBR and Treasury forecast, demonstrating that, if we can go for growth, we will make much better progress on the debt and deficit, which we need to do, than if we go for austerity economics, slowing the economy with tax rises and a too abrupt monetary deceleration.

I urge the Government to look again at whether they can improve on the objectives in the charter, to reflect on it and to see how an independent Britain can have a growth policy. If the Government established a growth target—they would not always hit it, but they could establish it—it would start to inform the actions of every Government Department that has a bearing on the strength of our economy, new jobs and all the rest of it. That is what we want. We want a Whitehall that is positive about Britain, not one that is trying to hold it back. We want a Whitehall that thinks Britain can achieve things—can invest here, have more jobs here and substitute for imports—rather than a negative Whitehall that says, “Gosh, there is too much borrowing, What can we cut? What can we tax? What can we stop?” We want less stopping and more positive going. We want more ability, generated by a growth policy, to show that an independent Britain can produce more of its own energy, grow more of its own food, catch more of its own fish, and make more of its own personal protective equipment and of its own medical requirements.

[David Linden (Glasgow East) (SNP)]

That speech would perhaps have done even better with “Jerusalem” on in the background. The right hon. Gentleman speaks about growing more food, but can he tell me who is going to pick that food from our fields?

[John Redwood]

It will be picked by people paid decent wages, and if that requires wages to go up a bit, I have no problem with that. It will also be picked by the growing mechanisation of agriculture. Our agriculture is not as fully mechanised in a lot of farms as it is possible to do when there are better capitalised farms, like those that have been growing more food elsewhere. How pessimistic that was—why is the hon. Gentleman not proud of the United Kingdom, Scotland or wherever, thinking that we can achieve more and do more? Why do we always have to be stopping people doing things, and saying that nothing is going to work and so let us import all our vegetables from Spain, all our flowers from the Netherlands and all our energy from Russia, Germany or the Netherlands or wherever because we are not able to do it here in Britain? It is just not good enough. We have this huge opportunity. We have a very talented people. We have many natural resources. We have a perfectly good temperate climate for growing most of our own food. So, Government, get on with it. Having a growth target would help energise a Whitehall that still seems to be very disappointed in the country it is trying to govern and seems to be trying to hold it back.

One other thing that the Chief Secretary mentioned in his remarks, which is mentioned briefly in the text we are debating tonight, intrigues me. It says that balance-sheet items are being worked on but have not yet reached a state of development where they can be shared with the rest of us. How long does it take? Why do the officials to the Government not know the asset and net asset position for the country? I believe there are some figures we can get from public sources that show that we do have some guesses about all that, but is it not rather important that when we debate the state of the nation’s finances, we understand the balance sheet as well as the income account and that we know whether the public sector is adding value and long-term wealth or not? If it is, why do we not claim some credit for it? If it is not doing enough of that, we need to ask the difficult questions about the wisdom of the investments, the productivity of the schemes and all the things that go into making that a success.

I did ask the Chief Secretary about a balance-sheet item. I think it actually makes a difference if you have bought in your own debt, because you owe the debt to yourself. I am not asking for anything imprudent to be done. I understand why we have gone through this rather tortured process, as has the European Central Bank and the Federal Reserve Board, and as, for many years, has the Bank of Japan. But we should not then fool ourselves into thinking that we have a worse problem than we have. The fact is that all these countries and currency areas spent a lot of money and created a lot of money to buy in debt over the pandemic, and we have got away with it, with a caveat that we have a little too much inflation. That debt is purchased; it is now both an asset as well as a liability of the state, so it is wrong to think that it is just a liability. The new argument is, “We owe the Bank of England and if the short rates go up, we owe the Bank of England more interest and so forth”. Yes, but it gets the receipt. If we want to do the transaction, the Treasury pays the Bank and the Bank can pay the Treasury back, because the Treasury owns the Bank. If I had bought in my mortgage from a mortgage company, I would probably just forget the whole thing. However, on Bank of England and Treasury logic, every month I would pay interest to myself because I still owe the mortgage, but then I could take that money back and spend it because I own the mortgage company and it is no longer a proper debt.

I think we have to understand that something different has occurred with quantitative easing, and I do not think we should go on doing it. It is normally very inflationary and very dangerous. In the strange circumstances of a covid lockdown in which a huge amount of demand and activity were taken out of the system, we could get away with it; indeed, it was right to do it, and I supported the Government at the time and praised them for the stimulus they offered. However, that has gone, and we now need to have sensible finances. To run those well, I strongly recommend a firm inflation target—inflation is a little too high at the moment, and needs to be taken very seriously—coupled with a much more optimistic growth target, because that is the way to grow the balance sheet and get the debt and the deficit down.

--- Later in debate ---

[David Linden (Glasgow East) (SNP)]

It is a pleasure to follow the right hon. Member for Hayes and Harlington (John McDonnell), and I agree with everything he said. He is right to take aim at the coalition Government. I note that there are no Lib Dem MPs here tonight to defend their role in that Government, particularly in relation to the welfare cap.

In the interests of time, I will focus my remarks largely on the second motion before the House tonight, but I think that this Government will at some point have to confront the blatant contradiction of their mantra on budget responsibility and fiscal discipline and how it correlates with their new buzzword of levelling up. If I understand the Government right, levelling up either means giving more money to the traditional red walls seats at the expense of the traditional Tory shire seats—something the Government deny and have denied off the back of the by-elections in North Shropshire and Chesham and Amersham—or it means spending new money in the old red wall seats, which flies in the face of the fiscal discipline this Government and the Chief Secretary to the Treasury like to talk about. They cannot have both. That is a fact that the Chancellor will need to realise, especially when he has one eye on a Tory leadership race against the Foreign Secretary. I do not know where the Chancellor is tonight. Maybe he is planning his next series of Instagram posts.

I thought it was interesting that the hon. Member for North East Bedfordshire (Richard Fuller) spoke about the importance of adhering to these fiscal rules once they are set in place. Perhaps the Government’s approach will be the same as that of the Secretary of State for Northern Ireland, which is that it is okay to break rules in a very specific and limited way.

I rise primarily to indicate my opposition to the principle of the welfare cap, which I will vote against tonight. We are also being asked this evening to vote on a charter for budget responsibility, but I would like the Government to bring forward a charter for societal responsibility, because it is clear that the contract between Whitehall and the most vulnerable in my constituency has been eroded to the point of breaking down entirely.

Yes, there has been limited devolution of social security powers to the Scottish Parliament, which excites me and gives me hope for the future, not least because we can implement social security policies that are underpinned by dignity, human rights and respect, but the inescapable constitutional reality is that 85% of welfare expenditure and income replacement benefits remains the responsibility of this institution and the British Government.

However, as constituency MPs we know that an arbitrary cap on welfare is neither useful nor adequate, as has been demonstrated by previous breaches of the cap. Quite simply, the welfare cap does not address the fundamental and clear structural issues that leave people relying on social security: issues such as low pay, gender inequality and wider labour market inequality.

I understand that it is easy for me, as an opposition MP, to stand up and pan the British Government’s policy agenda without offering solutions on how we can strengthen the social security net, so I want to set out where the SNP would do things differently. For a start, I think the British Government need to spend less time obsessing over the ideological plaything of a welfare cap and instead fix the fundamental flaws in our social security system. Straightaway, at the stroke of a pen, they could end the sanctions regime and conditionality. They could abolish the five-week wait for universal credit. They could end the bedroom tax in other parts of the UK. They could reinstate the £20 uplift in universal credit. Indeed, they could extend the uplift to the 2 million legacy benefit claimants who were so heartlessly left out in the cold at the beginning of the pandemic, because people with a disability have increased extra costs, and that £20 uplift should have applied to them too. The Chief Secretary to the Treasury spoke earlier about putting arms around people during the pandemic, so I remind him that those 2 million legacy benefit claimants certainly did not feel the embrace of the Government’s hug then.

Before I draw my remarks to a close, I want to focus specifically on the role of the devolved Governments in social security provision and, in particular, offer some thoughts on the Scottish context. I mentioned before that, with limited social security powers, Scotland is already making clear its intentions and priorities when it comes to supporting the most vulnerable and tackling poverty. One such example is the game-changing Scottish child payment rising to £20 per child per week. That equates to an investment of £197 million and will help lift 40,000 children out of poverty in 2023-24. Absolutely, that goes some way towards undoing the damage of years of Westminster actions to undermine and weaken the social security net.

But people in Scotland have to wake up to the fact that fighting poverty and inequality will only be hindered, not helped, by a Government in London who are fixated on a welfare cap and removing vital financial support for the least well off, because in many respects devolution is increasingly having to act as something of a sticking plaster to mitigate the very worst effects of Tory austerity and Westminster’s welfare cuts. Yes, the Chancellor—wherever he is tonight—might be a wealthy multimillionaire who thinks that £20 a week here and there does not make much difference, but for my constituents in Carmyle, Carntyne and Craigend, £20 is an awful lot of money. That £20 can mean the difference between cheap ding dinners and proper nutritious meals for their children that help fuel them to learn and grow healthily.

Yes, devolution in Scotland means doing things differently, with a focus on greater free school meal provisions, abolishing the bedroom tax, or indeed introducing the Scottish child payment. But there are limits to devolution, especially when it comes to the lack of borrowing powers. I believe that tonight’s debate again makes the case for Scottish independence, because Scottish independence means we will not have an arbitrary cap on welfare, thereby capping our ambitions to tackle structural inequality and poverty. Scottish independence is about creating a charter for societal responsibility and looking after the most vulnerable people in our communities.

Tonight’s motions show that Scotland being governed from London, and by London, will not achieve that. It was noticeable that even the Labour Front-Bench spokes-person, the right hon. Member for Wolverhampton South East (Mr McFadden), made hardly any reference to the welfare cap. It is clear that regardless of which party is in power, that will be an issue for people in Scotland. Only independence can tackle poverty and inequalities that are prolonged and perpetuated by an arbitrary Westminster welfare cap, which I will oppose tonight.