UK Poverty

Esther McVey Excerpts

Wednesday 4th February 2015 Westminster Hall

[The Minister for Employment (Esther McVey)]

It is a pleasure to serve under your chairmanship, Mr Crausby. This is an incredibly important debate, and I thank the hon. Member for Wigan (Lisa Nandy) for securing it. I begin by putting what I have heard today in context. Every story that has been brought here is important, and it is important that we listen to them, but let us look at the independent figures on inequality, which show us what is happening. Income inequality is lower now than it was at the election. There are 600,000 fewer people in relative poverty than at the election. Why do I use relative poverty? There are various measures, but relative poverty is Labour’s preferred measure against which it set its targets. Labour said that it would halve relative poverty by 2010, but it missed that target. [Interruption.]

[Mr David Crausby (in the Chair)]

Order. Ms Nandy, you have had your opportunity to speak. Let us listen to others who want to speak.

[Esther McVey]

There are also 300,000 fewer children living in relative poverty.

[Helen Goodman]

Will the Minister give way?

[Esther McVey]

I will not give way for a while, because I would like to put these figures on the record.

The top 1% of income tax payers will contribute nearly 30% of this year’s income tax bill. We talk about the richest helping most to get us out of the financial situation in which we found ourselves after Labour left office, and that is what is happening. The top 20% of income tax payers are paying 80% of the bill, which is key. We also have 390,000 fewer children living in workless households, and in-work poverty has fallen by 300,000. In fact, in-work poverty rose 20% between 1998 and 2008.

[Debbie Abrahams]

Will the Minister give way?

[Esther McVey]

I will not give way for the moment.

It is also key to know that 1.75 million more people are in work. When my hon. Friend the Member for Esher and Walton (Mr Raab) talked about what sorts of jobs those people are doing, he was right to say that, since the election, three quarters of them are full-time jobs. In fact, in the last year 80% are full-time jobs. What sorts of jobs are they? The vast majority, 75%, are skilled, managerial and professional. If we want to look at the figures from the other point of view, we could say that, at the election, 600,000 more people were in relative poverty and there were 670,000 more workless households. We could say that there were 300,000 more children and 200,000 more pensioners in relative poverty. We could also say that there were 50,000 more households in which no member had ever worked. That is what we were picking up. As my hon. Friend the Member for Daventry (Chris Heaton-Harris) pointed out—I hope this is a point of consensus for all of us—there had been a financial crash and the GDP of the whole country had shrunk by 7%. The truth of the matter is that everybody had to bear the brunt of the crash that we had from the Labour party, but we have ensured—[Interruption.]

[Mr David Crausby (in the Chair)]

Order. Please allow the Minister to respond.

[Esther McVey]

We have ensured that the richest are paying the most. We are ensuring that the richest people are now paying more than they ever paid under Labour. The hon. Member for Wigan talked about working for Barnardo’s, and I congratulate her because I am a child of Barnardo’s. When we talk about poverty and how we take people out of poverty, the key building blocks have to be education and employment, and the Government are creating those key building blocks.

When we look at this, what have we done? We have brought record rates of women into work. We are increasing and supporting lone parents into work. We have put £2.5 billion into the troubled families initiative, and we have put the same amount into the pupil premium. We have ensured that 3 million people are out of tax altogether and that 26 million people have had their tax reduced. We have increased the minimum wage to £6.50 an hour, which is the first real increase since 2008—a 3% increase—and which benefits more than 1 million people. People in full-time work on the national minimum wage are getting an extra £355 a year. All those things are key, and we are doing them.

[Debbie Abrahams]

Would the Minister like to comment on her point about the reduction in inequality? The OECD’s report before Christmas and the International Monetary Fund’s report from a similar time show that inequality has actually increased. In fact, we have the worst rate of inequality in 30 years. The reports show that inequality is harming growth and that the trickle-down economics to which the Government are absolutely committed does not work. It actually stifles growth and hurts human beings.

[Esther McVey]

I never recognise where the hon. Lady gets her figures. I have given the independent facts, which are correct. The only thing I will say is that here is a party that delivered the biggest financial crash in living memory. This is the party that said there would be 1 million more unemployed people now, but we are near to having 2 million more people in employment. [Interruption.] Labour Members would do better to listen for a change, rather than charging forward with things that really are not true. It is sometimes worth listening, rather than talking, especially when the Labour party delivered such a disaster for the UK, which we are all now having to cope and deal with. It is worth remembering that, because of our long-term economic plan, we are the fastest-growing developed nation. The UK has delivered more jobs than the rest of Europe added together. Those are the facts.

My hon. Friend the Member for Esher and Walton read out a list of facts about the constituency of the hon. Member for Wigan. He talked about the unemployment figures and the claimant count rising by 100% between 2005 and 2010, but let us look at what is happening in Wigan now: the employment rate is up by 7.9 percentage points; the claimant count is down by 49%; the long-term claimant count is down by 44%; the youth claimant count is down by 70%; and the long-term youth claimant count—[Interruption.]

[Mr David Crausby (in the Chair)]

Order. The Minister must be allowed to respond.

[Esther McVey]

The long-term youth claimant count is down 80% on the year. In fact, youth unemployment across the country has had its biggest fall in living memory. More than 170,000 more young people now have jobs. Those are just the facts. In the north-west region, the number of workless households is down by 41,000 since 2010, which is a decrease of 1.7%.

Last week, the local paper in Wigan stated that the number of apprenticeship vacancies in Wigan has hit a record high. There has been a 72% increase in the number of apprenticeship vacancies in Wigan posted online, and the paper said:

“An upsurge in firms willing to take on apprentices has been credited with bringing about a dramatic fall in young people not in employment”.

[Lisa Nandy]

One reason why we have managed to get young people into apprenticeships is because the council has taken exactly the opposite approach to the Government. The council pays the living wage, has stamped out zero-hours contracts and has created apprenticeships. If everything is going so well across the country, why does the Minister think that the incidence of scurvy and the number of hospital admissions for malnutrition have exploded under her Government?

--- Later in debate ---

[Esther McVey]

The numbers I have given are for private enterprise. Equally, I do not know what the answer was when the hon. Lady stood up to explain why there was a 100% increase in the claimant count between 2005 and 2010, but our claimant count has come down. The increase in malnutrition is a debate for another time.

[Helen Goodman]

It is not a debate for another time.

[Esther McVey]

I think it is. Many people who have gone to hospital with malnutrition have actually put on weight, which is down to a poor diet. That is a much bigger debate for another time. What we can talk about is what is happening, how we are getting people into work and how worklessness is falling in the constituency of the hon. Member for Wigan. [Interruption.] Obviously she does not want to listen to these answers because they do not play to the things she was talking about. Equally, her local paper celebrated that Wigan has received the pupil premium award. A headmaster said:

“We couldn’t be more pleased to win the award”.

The award is key to helping young people to go forward.

I listened to the hon. Lady’s stories about sanctions, and I would like to know about the specific instances. I replied to a letter the other week—I hear that she has sent me another, to which I will be writing back in due course—but if she gave me the names of the people, rather than keeping them anonymous, I could find out what happened at the jobcentre. If someone wanted to go to a funeral, it would be good cause. Somebody with learning difficulties is a vulnerable person and has good cause. There is a booklet that the hon. Lady can download from the website that outlines the guidance, which is substantial. It is a heavy document that says how people will be given good cause. Equally, there have always been sanctions in the benefit system. This is nothing new—

[Mr David Crausby (in the Chair)]

Order. I am pleased to say that we will now move on to the next debate.