Social Security and Pensions

Jerome Mayhew Excerpts

Monday 6th February 2023 Commons Chamber

[David Linden]

I am grateful to the hon. Gentleman for his intervention. I think I am unique in that I am one of the few people who serve as a Member of this House who has been in his constituency office and spoken to his constituency staff—some of us go on holiday to places like Newtownards. He is absolutely right. I ask the Government to put just as much effort into advertising things like pension credit take-up as they do into propaganda-like billboards in our constituencies about levelling up. If that amount of resource were put into advertising pension credit, perhaps we would see it go further.

The British Government’s assault on pensioners does not just extend to the pitiful state pension. Let us not forget that the Tories also scrapped free TV licences for over-75s, including in Broadland. People who watch on and see the Westminster incompetence of this place will know that pensioners across these islands have already been short-changed by £6,500 on average due to state pension underpayments. Peter Schofield, the permanent secretary at the DWP, recently told our Select Committee that—

[Jerome Mayhew (Broadland) (Con)]

Will the hon. Gentleman give way?

[David Linden]

I am happy to give way.

[Jerome Mayhew]

The hon. Gentleman mentions Broadland and says that pensioners are being short-changed by the Government. How can he reconcile that statement with the triple lock on pensions, which raises pensions year on year by 2.5%, the rate of inflation or average earnings—a ratchet effect increasing the value of pensions when compared with the economy at large?

[David Linden]

The triple lock the hon. Gentleman refers to is the one that he and his party broke a manifesto commitment on recently, resulting in many pensioners being diddled.

--- Later in debate ---

[Jeremy Corbyn]

Could the Minister hold in his excitement for one moment? He is the Minister responsible for the inadequacy of benefits; perhaps he should reflect on that. Yes, the war in Ukraine has had an effect on global energy prices, although the effect has been bigger in some countries than others. Countries such as France deal with that by taking energy companies into public ownership to protect their citizens from the grotesque energy price increases that his Government are quite happy to mete out to the people of this country.

[Jerome Mayhew]

rose—

[Jeremy Corbyn]

No, I will carry on with my speech. The 10% benefit rise is obviously better than no rise at all. During the Budget statement, the previous Chancellor would not even answer the Chair of the Work and Pensions Committee, the right hon. Member for East Ham (Sir Stephen Timms), on whether there would be any increase whatsoever to benefits. A 10% increase is obviously an improvement on what was provided by the last Chancellor, but it does not even meet inflation. It comes nowhere near to meeting the rate of food inflation, which is running at around 15% to 16% per year. Families or individuals who rely on benefits spend a wholly disproportionate amount of their income on food and energy; better-off people spend a much lower proportion on those things. The rate of inflation for the poorest 10% of our country is far greater than the 10% or 11% figure that the Bank of England puts forward.

Many issues could be raised, and I will raise a few very quickly so that all Members who wish to speak can do so. Some years ago, a two-child benefit cap policy was introduced, which many of us were, and remain, concerned about. Those of us who represent constituencies with a considerable number of large families know that they suffer very badly. The two-child benefit cap obviously has a disproportionate effect on the largest and poorest families in our society. I would be grateful if the Minister could tell us where the morality is in saying that the third, fourth or fifth child of a family is less important than the first or second. It is a simple moral question. If we want to look after all the people in our society—I like to think that we all do—that should include all children, irrespective of the size of the family. The third, fourth, fifth or sixth child is completely unaware of where they lie in the pecking order when they are born. They find out later that their presence and that of subsequent siblings reduces income for their family. It does not seem morally right that we should pursue that policy.

The question of the benefit cap and its effect on people in our society is massive, as the Chair of the Select Committee pointed out, as did the hon. Member for Glasgow East (David Linden) and others. The disproportionate effect on people living in the private rented sector is huge. My constituency is inner-city and has a fairly large number of council and housing association properties in it. Their rents are obviously within the local housing allowance, but the vast majority of private rents are nowhere near within the local housing allowance. I was talking to someone in a hostel who was trying to find a private rented flat to move into. They tried every agency they could find; they walked the streets and scoured the newspapers and goodness knows how many websites to try to find a flat within the local housing allowance in inner London, near their school and support network, but they could not get anywhere near it.

Unless we raise or abolish the benefit cap, we have to intervene in the housing market and freeze private sector rents, so that living in the private rented sector is at least sustainable, and those living there do not have to pay part of their rent out of the benefit that they receive. What is going on is simply unfair. I would hope that the Minister would understand the issue with the cap, and the poverty that it brings for so many people in our society. In my constituency, probably more than a third of the community live in the private rented sector—there are probably more in other constituencies—and they are suffering as a result of this issue.

Another issue that I would like to raise is that of people with no recourse to public funds, and the difficulties that they face in our society. It is a bold, dramatic and strong statement when a Government announce that someone is allowed to enter the country but is not allowed any recourse to public funds whatsoever. This issue was raised two weeks ago at the Parliamentary Assembly of the Council of Europe in the context of our adherence to the Istanbul convention on the protection of women, of which the Minister will be aware. The report that we received raised concerns that in some member countries in which there is no recourse to public funds—the problem is not exclusive to the UK—women in an abusive relationship might not have settled status when their partner does. Those women are unable to gain independent security and safety, and often are unaware of the domestic violence provisions that they might be able to call on. Will the Minister look seriously at the very well thought-out report from the Council of Europe about our adherence to the Istanbul convention, which I am sure he supports? Will he recognise that no recourse to public funds affects not only the individual concerned but the wider family, if there is one?

If hon. Members talk to people who are sleeping rough on our streets, turning up at food banks in our communities or begging on tubes and elsewhere, they should ask them what their situation is. Many have been unsuccessful in their initial asylum application, but may ultimately win on appeal, and they have no access to any benefits whatsoever. They live in the most desperate poverty, are prey to crime and abuse, and can be abused and exploited by those with criminal intent in our society. Through this policy, we are creating an incomeless underclass in the major cities of this country. I know the Minister would not want that to be the case, but unfortunately the implementation of this policy leads to that.

The last point I want to raise is to follow on from what the hon. Member for Glasgow East and others have been saying about the pension level in our society, and the numbers of pensioners who are entitled to support beyond the level of the state pension but are simply unaware of it, do not know how to apply for it and do not get it. I also want to mention the women who were duped by the way in which the state pension retirement age was raised and are now living in desperate poverty—colloquially known as the WASPI women. I think they deserve justice. They were very badly treated and my friend, the right hon. Member for Hayes and Harlington (John McDonnell), certainly took their case up when he was shadow Chancellor of the Exchequer.

Pensioner households, like everyone else, are facing terrible stress at the moment from food and energy price rises. I heard from the media yesterday that the Government have no intention of continuing the energy price limitation after April, but if I am wrong on that I am happy to be corrected. The protection that exists now is only a protection relating to the 100% increase in energy prices that we have already had. If you go down any street in any poorer part of this country in the evening, you see darkness; you do not see people with their lights on. You see people going to bed early because they cannot afford to heat their home. This is real. Children in the poorest households are underfed and they are cold because their homes cannot be properly heated. Many elderly people are huddling in libraries during the day just to try and keep warm. Is this really a sensible or fair way of going on? Other Governments, including the French Government, have intervened to try to control the energy market and ensure that energy price rises do not get to the levels they are in this country. Our Government are not prepared to do that.

This benefit uprating will no doubt go through this evening, but all it does is meet the headline of inflation that the consumer prices index set last year. What we need is something much more bold, with much more intervention, that recognises energy price rises, food price rises and the enormous rent rises in the private rented sector. Those are the biggest drivers of poverty in our society.

[Jerome Mayhew (Broadland) (Con)]

It is a pleasure to follow the right hon. Member for Islington North (Jeremy Corbyn). He refused to give way to me during his speech when he made reference to France being a particularly good example of a country that had reacted well to energy inflation. He forgot to mention that 80% of all French energy is generated by nuclear power and is therefore not affected by the Russian invasion of Ukraine. I look forward to his support for the roll-out of nuclear power stations across the United Kingdom.

Turning to the main body of the debate, I welcome the Government’s draft benefits uprating order, but I stand here to represent an argument that I do not think has yet been made in this debate but that has been raised many times by my constituents and those of other Members, certainly on the Conservative side of the House: is it fair, during a period of full employment, that we should increase benefits at the rate of inflation when those in employment are seeing their wages rise by about half as much? This has been raised multiple times, and forcefully, by constituents of mine. They say that it is simply not fair that people who are just about managing, who are working to support their own families and who are paying tax but also being self-reliant, should have wage rises of about 5% when benefits are being raised by double that.

[David Linden]

Will the hon. Gentleman give way?

[Jerome Mayhew]

I will give way in a moment, because what I am about to say might answer the hon. Gentleman’s question.

I think the answer is: yes, it is fair. That is because it is morally right to protect the purchasing power of those very poorest families at an absolute level, even when other people in employment are suffering as well. I think it is right, because personal inflation is at its highest in the poorest families and food inflation is responsible for a higher percentage of their spending. It was mentioned earlier that food inflation might be running at about 19%, but I think it is about 17.1%. It is morally right for the Government to represent and look after the very poorest in society while at the same time, crucially, always making sure that work pays.

In my constituency we have 2% unemployment. We have a huge demand for staff. I have a very odd situation in a town that I represent called Fakenham. I visited a food bank there that is run by the Samaritans, and it is only a few yards away from a jobcentre where they told me that anyone who had two arms and two legs could get a job. There are lots of jobs available, and I have had meetings with frustrated employers in Fakenham who cannot get enough staff, at every level of the employment sector, including those with no specialist skills other than their natural talent. That jobcentre is 200 yards away from a food bank.

[David Linden]

The hon. Gentleman and I could probably have a long drawn-out debate about why there are so many vacancies in the jobs market and how the UK Government’s immigration policy impacts on that. I would ask him to reflect on the misconception that food banks are used solely by people who are out of work. We are increasingly seeing people who are in work and suffering from in-work poverty using them. Has his local food bank told him how many of the people using it are experiencing in-work poverty?

[Jerome Mayhew]

That is an interesting question, and I have asked exactly the same of our food bank. I have asked it to give me the data on how many of the people are on benefits and whether they are in work or unemployed, because it is a mystery to me. It refused to give me that data, which I think is really surprising, because that is important to us as policymakers. We need to know whether people need to use food banks because benefits on their own are the cause or whether it is about in-work benefits and the low level of pay.

[Amy Callaghan]

Further to the point made by my hon. Friend the Member for Glasgow East (David Linden), it would be interesting to know how many people working in that jobcentre are having to access that nearby food bank. It would be really useful if the hon. Gentleman could inquire about those figures.

[Jerome Mayhew]

That certainly has not been raised with me. That is not information that I can supply, because I simply do not know the answer, but I would be amazed if they were using it. The people working in the jobcentre are very optimistic about the local economy and the opportunities that are available in Fakenham and more widely.

The hon. Member for Glasgow East (David Linden) raised in passing the role of immigration in low pay. In my submission, this is one of the areas where the Government have been right to limit immigration, particular low-skilled immigration, because that gives increased bargaining power to the lowest paid. Anecdotally, I have seen hourly rates across my constituency going up in industries that are seeking to attract harder-to-find staff. The hourly rate is going up to £9, £10, £11 and even £12 an hour for unskilled work in order to attract new staff where they are harder to find. That is a key benefit and a good economic case for taking control of immigration in a way that the SNP would not like to see.

[David Linden]

I am certainly very much in favour of people in Scotland having control of their own immigration system, because our problem has never been immigration; frankly, our problem has been emigration. The hon. Member talks about how successful the UK Government’s immigration policy has been. Can he explain why there are fields all across these islands where fruit is rotting because we do not have workers coming here to pick it?

[Jerome Mayhew]

The hon. Member should know that the seasonal agricultural workers scheme allowed, from memory, 40,000 seasonal workers to enter the country last year, and that its application was not fully taken up by the agricultural sector, so that is not the reason why fruit was left rotting in the fields.

Returning to my main point, the Government are right to protect the buying power of the poorest. At the same time, they are also right to ensure that work always pays. The reduction in the taper rate from 63% to 55% is crucial in raising the income of those in work so that they do not need to rely on food banks, as is increasing the work allowance by £500. Perhaps the difference between Government and Opposition Members on this is that we on the Government Benches think that the best solution to poverty is always work—allowing people to get back into work; encouraging them to grow their skills and employability, and the value of their employability, as they progress through their career. I think the Government have got the balance right, supporting the poorest families while ensuring that work continues to pay.