Coronavirus: Supporting Businesses and Individuals

Baroness Laing of Elderslie Excerpts

Tuesday 23rd February 2021 Commons Chamber

[Tracy Brabin (Batley and Spen) (Lab/Co-op) [V]]

It is a privilege to speak in this debate. Today, I will focus much of my contribution on those who have fallen through the gaps in support—commonly known as the excluded.

Nearly a year into the pandemic, there are still 3 million people missing out on meaningful financial support. They are people who have lost homes, possessions and have had to close businesses or saddle themselves with a frightening amount of debt just to keep going during the pandemic, an event not of their making. This has inevitably led to an increase in destitution in our country. It will not have escaped the Minister’s attention that a report by the National Institute for Economic and Social Research found that, by the end of 2020, there were 220,000 more households living in destitution than at the start of the year. Destitution is defined as a two-adult household living on less than £100 a week and a single-adult household living on less than £70 a week, after housing costs. That worrying trend will continue, unless we direct urgent and significant support to the excluded.

There is a regional aspect, too. The Office for National Statistics has revealed that redundancies in Yorkshire have reached a five-year high, with 18,000 people being made redundant in the last three months of 2020—a 63% increase on the same time in the previous year. The all-party parliamentary group, Gaps in Support, has tried to help. We have offered schemes to the Treasury to bring the newly self-employed into eligibility for SEISS, a directors income support scheme, a targeted income support scheme and a one-off, taxable grant. They are not exclusive demands and we are certainly open to any fixes that the Treasury would like to propose.

I would like to focus on one group of people who have significantly missed out—pregnant women and new mothers. Women who were on maternity allowance throughout the period 20 March to 30 October will not have submitted a PAYE real-time information submission, which is required by the scheme, meaning they could miss out on furlough. That really needs to be rectified. The Government should also provide a system to backdate furlough payments to new mothers who have missed out due to insufficient government guidance.

We must also examine the proposals supported by the TUC for a temporary right to shared furlough, which would bring the commendable principles of shared parental leave into the furlough scheme, allowing families to make decisions based on what works for them and their children, because it is frankly absurd that self-employed mothers have no ability to discount their maternity leave from SEISS payments. Tens of thousands of women have been discriminated against and are out of pocket, against a background where women’s wages have already dropped 12%, double that of men; 48% of women have seen their disposable income fall; and women in the 25-34 age bracket are twice as likely to be made redundant.

[Madam Deputy Speaker (Dame Eleanor Laing)]

Order. The hon. Lady has significantly overrun her time. I am sorry I cannot allow her to make her final point.

[Imran Ahmad Khan (Wakefield) (Con) [V]]

Since the beginning of the pandemic, the Treasury has taken unprecedented action. The support provided by Her Majesty’s Government to aid businesses and individuals affected by the coronavirus pandemic has been nothing short of extraordinary. More than 10 million workers have been supported through furlough schemes, ensuring that bills and expenses can be paid. Thus far, 1.6 million businesses have received loans totalling more than £70 billion. For most people and businesses, money was received in a timely manner and proved to be vital in preventing businesses from going under, protecting employees and employers.

For those on low incomes, additional support mechanisms have also been implemented, with a £500 test and trace support payment for those who cannot work from home and have been asked to self-isolate. Some businesses have repaid the support, totalling £1.8 billion, provided to them by the Government through a business rates holiday, including Tesco, Sainsbury, Asda, Aldi and Morrisons.

These support measures have been critical in shielding our economy during lockdown. This is the essence of conservatism—rather than seek to dominate and direct businesses, we seek to protect and support them. These measures are temporary and do not reflect a permanent transition towards increased Government intervention. The Prime Minister’s statement yesterday outlined the road map out of lockdown and a return to normality. It does not, however, spell the immediate end of support measures that businesses still need.

This Conservative Government have outlined further measures that will aid in rebuilding Britain and encouraging economic growth, such as the £5 billion of capital investment projects, which include the rebuilding of schools and maintenance of hospitals. Opposition Members may not be able to control their knee-jerk reaction to attack the Government for their handling of the pandemic, but without the schemes implemented by the Chancellor, businesses, individuals and local government would not have received the support they so desperately needed when, or in the quantity, required. I look forward to the Chancellor’s Budget statement next week and will carefully listen to his comments on the support measures available to businesses, including what additional provisions will be implemented to support and encourage the United Kingdom’s recovery.

[Madam Deputy Speaker (Dame Eleanor Laing)]

I am grateful to the hon. Gentleman for sticking precisely to the three-minute time limit and not being distracted by the fact that the clock was not working. That is quite the opposite of what we have seen from so many colleagues who pretend the clock is not there. I am sure that will not happen when we go to Sheffield—to Paul Blomfield.

--- Later in debate ---

[Christine Jardine (Edinburgh West) (LD) [V]]

There is surely no more important debate at the moment than how we support businesses and individuals through the pandemic. Just last week, it was confirmed that the UK economy has suffered its worst slump in any year since we began recording gross domestic product after the second world war. This morning, we learned that the unemployment rate is 5.1% and that in my constituency of Edinburgh West, a relatively affluent area of Scotland, it is 4%, having increased by more than a third since this time last year. We have all the evidence we need that businesses and individuals need support.

For most people, businesses are about the individuals. The troubles we are going through will come as no surprise to thousands of shops, households, small businesses, retailers at airports, taxi drivers, cafés, pubs and restaurants—they are all suffering and they need our support. That is why we are all watching very carefully for what the Chancellor says next week. We are hoping—and trying to persuade him—that there will be a further extension of furlough. The summer is not enough; it needs to go at least until the end of the year. We need to give businesses time to recover and we need to give people certainty. We need to give them reassurance that the safety net will not disappear right away. The vaccine will need time to be effective and we will need time to recover. The Chancellor should bear that in mind next week.

I think we have all felt the impact through our constituents and the daily calls we receive. We know that there is nothing more important than supporting businesses and individuals through the recovery. That should be the first thing we think about every day: putting the recovery first. Sadly in Scotland, we have a devolved Administration who are not doing that. They are focusing on an independence debate that many of us feel is inappropriate at this time. We need the strength of the UK economy and we need the ability to work together. For example, we need the strength that comes from our tourism industry: 80% of tourists in Scotland come from the rest of the United Kingdom.

Businesses all need our support, they need certainty and they need the strength of the United Kingdom. That is what I hope the Chancellor and the Government will provide next week. I also hope that they will think about relief from business rates and VAT for small businesses that are losing money and going out of business through no fault of their own, because they are following the rules. We need to put their recovery and our recovery first.

[Madam Deputy Speaker (Dame Eleanor Laing)]

We were going to go to Stoke-on-Trent, but the hon. Member for Stoke-on-Trent North (Jonathan Gullis) has to be dressed as if he were here in the Chamber. We will try to come back to Mr Gullis in due course, but we will go now to Chesterfield and Toby Perkins.

[Mr Toby Perkins (Chesterfield) (Lab) [V]]

Thank you very much, Madam Deputy Speaker. You will be pleased to see that I have all my clothes on.

This is an important debate as we head towards the Budget. As somebody who was formerly self-employed, I think it is incredibly important to recognise not only the importance of the self-employment scheme, but all the people who have been excluded from it. We need to recognise that people do not go into self-employment expecting to rely on the Government for help; they do it because they are willing to focus on their own abilities and to bring about the best outcomes for themselves. When self-employed people are left having to rely on Government, it comes very unnaturally to them.

We should remember that the majority of self-employed people were asked by the Government back in March to stay at home and not to go to work. They were told that there would be a self-employment scheme to support them. It has become transparently clear that so many of them have been missed out, while, simultaneously, other people who have continued to work have still been able to claim via the scheme. Just this week, I spoke to a constituent who has been excluded because, over the course of the three years, he has had periods when he has been employed; and he took a pension when he first became self-employed, to get him through. As a result he is unable to demonstrate, according to the Chancellor’s very arbitrary 50% of income rules, that he is self-employed. He has had almost 11 months during the vast majority of which he has been unable to work and unable to be supported by the scheme. At the same time, he has been working on building sites for people who have worked all the way through—have hardly missed a day—and have said, “This is wonderful: the Government are giving me money, even though I am carrying on.” We have schemes that have not worked as they should.

Directors of small businesses who have paid themselves through dividends have been excluded, and I am afraid that throughout the life of the scheme, too many people have been missed out. That was understandable back in March, as the scheme was being put together in a rush, but there really has been enough time to sort this out now, and the Government should get to getting it sorted out.

[Madam Deputy Speaker (Dame Eleanor Laing)]

We are now going back to Stoke-on-Trent, where I observe that the hon. Member for Stoke-on-Trent North (Jonathan Gullis) is now properly dressed. Lest anyone should be confused, when people are participating virtually they are appearing in this Chamber, the Chamber of the House of Commons, and therefore it is absolutely imperative that everybody taking part in these debates should be dressed in the way that they would be in the House of Commons.