Financial and Social Emergency Support Package

Debate between Jesse Norman and Jeremy Corbyn

Wednesday 25th March 2020 Commons Chamber

[Jesse Norman]

We have discussed this quite a lot, so as I have quite a long speech, and a fair number of colleagues want to speak, I will press on, if I may.

We must face facts: it may take several weeks—possibly longer—before this national effort is reflected in a fall in infection rates, and it may take longer still to defeat the virus completely, but however long it takes, we will do what we can to support businesses and workers. As the House will know, under the jobs retention scheme, the Government will pay 80% of staff wages up to £2,500, provided businesses keep those staff employed. Her Majesty’s Revenue and Customs is working tirelessly to get the scheme up and running. The first grants will be made in a matter of weeks.

Of course businesses face cash-flow concerns, and we are recognising that through the business interruption loan scheme. For larger enterprises, the Bank of England is providing a new facility to help overall liquidity, and HMRC’s existing time to pay arrangements are available to help businesses make ends meet. We have deferred VAT payments for the next quarter, so that VAT-registered businesses will not need to pay VAT alongside their normal returns; that intervention alone is worth over £30 billion. Those measures are on top of those announced in the Budget earlier this month.

As colleagues across the House have mentioned, this is a particularly worrying time for the self-employed. I am acutely aware, as are all Ministers, of how deeply these concerns are felt across the House. Let me be clear that the Government recognise the specific challenges that self-employed people face. We will respond shortly. There has already been discussion of this, and a commitment from the Prime Minister on this issue, with tailored and targeted action. As the Chancellor has said, this problem is very far from straightforward. We are trying to be as inclusive, but also as fair, as possible.

[Jeremy Corbyn]

Could the Minister tell us how quickly this will be done, because the levels of stress out there among the self-employed are absolutely huge?

[Jesse Norman]

I understand that. The right hon. Gentleman will appreciate that if we date the official recognition of the need for intervention on coronavirus from the Budget, we are two weeks into the situation. The Prime Minister knows the situation; he made a commitment to the right hon. Gentleman an hour or two ago, and I cannot do better than the Prime Minister.

As of Monday, sole traders and freelancers have been able to gain access to the coronavirus business interruption loan scheme, provided that their activity is channelled through a business account. We are removing the universal credit minimum income floor, so that self-employed workers have access to universal credit, and we have deferred the next deadline for self-assessment income tax payments until 2021, so that self-employed people can manage their finances better over the course of the year.

It goes without saying that more needs to be done and, as I have said, we will do that, but as my right hon. Friend the Chief Secretary to the Treasury made clear to the House yesterday, it is essential that that support reaches the people who need it the most. The Chancellor will provide a further update, as I have described, shortly. Until then, the Government will continue to listen carefully to hon. Members and, crucially, to those most directly affected. As the House knows, just as we are supporting businesses and employees, so we are also supporting families through the crisis. Those on low incomes will benefit from a package of measures worth more than £6 billion, including a £20 a week increase in universal credit standard allowance and the working tax credit basic element—an increase from £318 to £410 a month for a standard claimant over the age of 25. Those who are new to universal credit will not be required to attend assessment interviews. Advances for those claimants who need them will be available by phone or online.

Through these measures and others, the Government are absolutely clear that the burden of this pandemic must not fall on the lowest paid. We are particularly mindful of the needs of the most vulnerable members of our community and the charitable organisations that are working so hard to support them. The jobs retention scheme is available to all PAYE employers, including charitable and not-for-profit organisations. Furthermore, the business interruption loan scheme is applicable to social enterprises and to charities that receive half their income from trading. Charities will also benefit from a three-month VAT deferral to the end of June, and many are already eligible for 80% charitable rate relief as well, and, of course, as you will know, Madam Deputy Speaker, we are giving councils an additional £500 million in hardship funding to ensure that help is available for the most vulnerable people in our society who may be struggling to pay council tax bills.