Household Energy Bills: VAT

Gill Furniss Excerpts

Tuesday 11th January 2022 Commons Chamber

[Gill Furniss (Sheffield, Brightside and Hillsborough) (Lab)]

I am grateful for the opportunity to speak in this important debate on an issue that is already causing so much distress to my constituents.

The covid-19 pandemic has exacerbated the stark inequalities in our society. The poorest families are the most likely to feel the greatest impact, whether that is in seeing their incomes shrink while on furlough or struggling with increased data bills to ensure that their children can continue learning. Those families were already suffering, even before the pandemic, from the effects of a decade of austerity, insecure work and stagnant wage growth.

Those same families are now being hit hardest by the cost-of-living crisis. That crisis calls for competent leadership, but the Government have failed to step up to the challenge. In the face of soaring inflation and families struggling to put food on the table, what did the Government do? They took £20 a week away from those who needed it most. It comes as no surprise that the Government have turned their heads and looked the other way while the UK hurtles towards an eye-watering 50% rise in energy prices in April.

Only a few months ago, I stood here and raised the impact that the cruel cut to universal credit and the tax rise are having on my constituents in Sheffield, Brightside and Hillsborough, but the Government refused to listen. Now we stand in the midst of yet another hammer blow to working families as energy costs soar.

It is not just Labour that sees the devastating impacts that Government policies are having on working families; economists have warned in the Financial Times that inflation will outpace wages this year and that, at the same time, high energy costs and tax rises will hit those on the lowest incomes the hardest. Covid has of course affected all nations, but decisions by this Government have meant that we are on track to see living standards lag behind those of our European neighbours.

Many constituents have contacted me because they simply do not know what they will do if their energy bills rise by those monumental amounts. On their behalf, I ask the Government a simple question: how are families who are on the breadline, already making choices between heating and eating, supposed to find an extra £600 a year to pay their bills? How are they supposed to put food on the table when the cost of their weekly shop continues to rocket upwards?

Those are the questions that so many families are now having to ask themselves. It should bring shame to us all that in 2022, people are still making choices that we should only expect in a Charles Dickens novel. That is the impact of this Government’s policies on my constituents.

It is not too late to avert that crisis, however. The Government can and must step in to protect people from the energy price rise in April. Labour’s fully costed and common-sense proposals would be a crucial step to support my constituents on lower and middle incomes. By scrapping VAT on domestic energy and expanding the warm home discount, many households in my constituency would see their energy prices rise by only £5 a month in April, instead of more than £50 a month.

The Government talk a lot about levelling up, but that is just an empty phrase without the policies to back it up. My constituents need Ministers to step up to the plate and stop burying their heads in the sand in the midst of this cost of living crisis. I urge the Government and Conservative Members to act now before even more families are plunged into never-ending poverty.