SportsDirect (USC Dundonald)

Debate between Jim Cunningham and Brian H. Donohoe

Tuesday 27th January 2015 Westminster Hall

[Mr Donohoe]

I agree with my hon. Friend wholeheartedly. I spent most of the Christmas period attempting to contact the company, and I was treated with total and absolute contempt.

[Mr Jim Cunningham (Coventry South) (Lab)]

I congratulate my hon. Friend on getting the debate. We had a similar one last Thursday, about City Link. He has spoken about changes to the law, and with City Link the pattern was the same. Workers were told over the Christmas holiday period that their jobs had gone. More than 1,000 men contracted to it could not take their jobs, because of the law. We have been pressing the Minister on those points. This is very similar.

[Mr Donohoe]

I am grateful to my hon. Friend for that intervention. The Scottish Affairs Committee is about to call that company to book, or has already done so, and has approached me to ask whether to call Mr Ashley to the Committee for what he has done to the company for which he is responsible. Do we agree with the BBC’s 2009 quote from a self-confessed asset stripper that the law in such circumstances is a pirates’ charter? I wonder whether that description could apply to Mr Ashley.

Has the Magna Carta principle that no citizen should unreasonably be deprived of their livelihood been breached by Mike Ashley and SportsDirect? Given how he has behaved on the issue, is Ashley, SportsDirect’s supremo, a fit and proper person to buy shares and give loans to Glasgow Rangers football club, and to appoint his men to the board? Should not the Scottish Football Association look more closely at this person’s credentials for involvement in a team that is not just a business venture, but a Scottish—indeed, a UK—institution? His track record, particularly his treatment of USC workers, shows that he has scant regard for anything but balancing the books and maximising profits, even if loyal staff are thrown on the scrap heap as a result.

Fairness in Pension Provision

Debate between Jim Cunningham and Brian H. Donohoe

Tuesday 8th April 2014 Westminster Hall

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

It is good to see you in your place, Mrs Riordan. You, too, have a great interest in pensions, in the fairness of the system and in applying that fairness.

Since I was a very young person, I have always accepted that pension provision is part of deferred income and should be treated by employers and Government as such. All my life, I have believed that fairness should be applied to the whole question of pensions. At the bottom of this debate in many respects, however, is the unfairness in the application of the state pension scheme over a great number of years. I commend the Government for some of the changes to the scheme, making it much simpler than it was, but there is still a long way to go in terms of how we see the future for some elements of the situation. I will cover that later.

I come before the Chamber mainly because of the many constituents who came to see me to complain about the system. None of the three I will mention is after anything for themselves. They all accept that they are at an age when nothing further can be done for them, but by making themselves available to public scrutiny they want to help and protect those who follow to have a more level playing field.

I want to talk first about Ann Aitken, a constituent of mine for some time. She, as well as the other two, has worked since she was 15. She worked for ICI locally in various jobs, and then went to a knitwear company. She took five years off employment to bring up her first child and afterwards worked in shops and factories, before going to a local computer company, Fullerton Fabrication. Since then, she has worked in Crown Paints for some 22 years. She retires this Thursday, so I congratulate her.

Ann wants to bring to the attention of the House what she sees as an anomaly. Over that whole period, she never put her hand out for any form of Government assistance, other than the credits available for the times off she took. That would be in connection with the additional state pension. She is a friendly person and, from talking to her friends, has discovered that her additional state pension is less than that of someone who has never worked. She receives something like £16.22 for the additional state pension, while others she knows receive £21. Although she took five years off, she got no tax credits, because no such thing existed, yet she is now facing the penalty. She has a simple question: what reward was there for her working? What reward has she had for all the years that she has given? She hopes that her situation will not be repeated in future. That is what Ann is concerned about and why she has raised the issue with me.

The second person I want to talk about is Jean Dickson, another constituent who has come to me about her position. She worked from the age of 15, for all her days. Sadly, she lost her husband in 1998, and was grateful for the widow’s pension she received as a consequence, but she has worked all her days, even taking five years out to improve her educational standards. Latterly, she was employed as a nurse in an acute surgical area of the hospital. She, too, says, “Look, I have a state pension, and I am very grateful for it”, and it will be £566 per month. In addition, because of the occupational pension, she is receiving £240 per month before tax. As a result of her husband having a pension, she receives another £300 per year. As a consequence of the unfairness that I will cover in the latter stages of my presentation, she receives £166 per annum for the state earnings-related pension scheme, SERPS. In her last job, she paid 6.5% of her pay towards superannuation, so she still feels that there is injustice in her situation. She retired in October 2012, but is being penalised for working all her days, compared with those who perhaps were not.

The third case is that of Lawrence Clark, who came to see me and whose case particularly caught my imagination. He started working at the age of 15, similarly to people such as myself and my colleagues—he is of our age group. He started as a trainee accountant at Hyster, a local company, and went on to work for various companies, including Simpson Turner as a toolmaker. He moved on to Wilson Sporting Goods, another local company, where he worked for 25-odd years. He then worked for Digital, a local company that went bust, and for Scottish Golf Cast, which again lasted a few months. He ended up at the charity Quarriers for 15 years.

After that working life, he has managed to accrue £97 a month from his Wilson Sporting Goods occupational pension and £223 as a consequence of his work at Quarriers. In addition to that, on the basis of advice he received—another point I want to address in my conclusion—he paid towards a private pension that gives him something like £14 a month. From November 2015 he is going to receive a state pension of £123 a week. He is saying that, after 47 years, as a consequence of all that, as well as of being unemployed—if that is the right terminology for him—up until that point next November, he gets £60 a week for his pension credit guarantee, whereas others are apparently receiving £140. If he had not paid something like £30,000 into a superannuation scheme, he believes that he would currently be better off per week until he retires. That seems very unfair, and it should be looked at. He thinks that, had he not taken out a private pension or been involved in superannuation, he would have been better off. That is the unfairness that those three constituents believe they face.

I have outlined three cases in which there are problems with the pension provision directly, but we can also compare other aspects of the life they have lived with those of other people. Others have had free dentistry, free prescriptions for glasses, and housing benefit has been part of their scheme. The situation may have changed in Scotland now, but some people had to pay for their prescriptions all their lives. I am not saying for a minute that it is wrong that unemployed individuals are receiving these elements, but those three constituents say that perhaps more concern should be given to how they deal with the situation and how the Government deal with their problems.

On that basis, I want to broaden the argument. That is the difficulty for each of those individuals, but the position is more general too. The problem is that the great mass of people in this country do not have a clue, when they are aged 25, 35 or 55, about what provision they are making. They do not know what the result of their contributions will be for their pension. This issue has plagued me over the years, and it still does. Even here in the House, there are hundreds of Members of Parliament who do not have a clue what their pension provision is, and I say that as someone responsible for trying to educate them about that. It is clear that there must be a fundamental shift—information must be provided to every individual in this country to make them aware of the provision and advice available.

I commend the Government, because at the very least, and on the basis of all-party agreement, we now have financial advisers who are independent—in every sense of the word—in the advice they are giving. It used to be that financial advisers worked for companies on commission. The same individuals now charge for their services. That, at the very least, is a bit fairer, or gives the impression of being fairer.

[Mr Jim Cunningham (Coventry South) (Lab)]

I certainly remember the early ’80s when people were encouraged to take out a private pension, but unless they worked for a reputable company it was not explained how a private pension could sometimes affect the state pension. There must be thousands of people in that situation in this country. Whatever my views about the Government’s pension proposals, at least they will explain them to people. When I worked at Rolls-Royce, it spent a lot of money trying to persuade us away from the state pension to a private pension scheme and to some extent we got reasonable advice, but I can think of other car companies in the Coventry area where even today there are still problems with pensions.

[Mr Donohoe]

My hon. Friend has focused on an issue that was dear to my heart and about which I argued forcefully when a previous Administration allowed people to contract out of their company’s superannuation scheme. I was a joint secretary of the Scottish Transport Group when, for the first time in about 1982, people were given the opportunity of opting out of its pension fund and going private. I argued forcefully with everyone and anyone that that was a big mistake, that they were leaving themselves open and that when they eventually retired they would find themselves in a different situation. We had what was recognised at the time to be the best pension scheme—perhaps not as good as that for MPs, but certainly a very good pension scheme. Some people are now in a worse position because they were pounced on by supposedly independent financial advisers who told them that they would be far better off in a private scheme, when the truth was the exact opposite.

Many years ago, I was a convener and shop steward in a shipyard where the blue-collar workers were not in a pension scheme. I argued with the employer and succeeded in persuading them to introduce a scheme. That company is still in my constituency and I still have people telling me, some 40 years later, that it was the best thing that was ever done and that they have never been better off after taking advice and voting overwhelmingly to join that scheme. I do not know whether I am an anorak in terms of pensions, but I believe that making provision for a pension is more important than anything else in life. People should understand that, and do so earlier.

I seek clarification on one or two points, but I want to make a plea to the Minister. How widely defined are “employees” and “new arrangements”? Are the self- employed, carers and the unemployed included? They exclude zero-hours contracts and people who may have two part-time jobs. That is unfair and should be looked at.

I have grave reservations about the new scheme because people will be able to take out money and go on a world cruise or buy a Ferrari. That worries me. It will send the signal to many people who do not understand pensions that they can draw on that money, but at the end of the day they will be a lot worse off. I want an assurance that they will be protected. Financial advice is important, and that must be stated clearly.

A business man came to me and said that every business man in the UK received a letter from No. 10 Downing street telling them about the advantages of the latest Budget proposals on national insurance from 6 April. Will the Minister have a word with No. 10 Downing street to see to it that every single person in the country is sent a letter telling them how fundamental it is for them to look after their old age, and telling them that if they were to die in service, that would be looked at as far as their families are concerned? If I get that assurance, I will go back to my constituents and tell them that the debate has been worth while. I look forward to hearing what the Minister has to say.

West Midlands Economy

Debate between Jim Cunningham and Brian H. Donohoe

Wednesday 19th December 2012 Westminster Hall

[Mr Cunningham]

The present economic situation started with Lehman Brothers in America, and the bankers. Some bankers in America faced Senate inquiries, and some were charged, but I do not want to go into that today. I want to talk about Coventry in particular, the west midlands in general, and some of the issues that affect Coventry and the west midlands.

We have issues concerning the police, and the problem of police numbers and cuts are well known. There are also issues with fire brigade cuts, and a running issue during the next few months will be changes to employment law. I will not develop the arguments too much today. Some have been well rehearsed, and some will be. There is a west midlands campaign for a fair deal for Birmingham, but there must also be a fair deal for the other districts that make up the west midlands, including Coventry. I am looking for a fair deal for Coventry.

Coventry was mentioned once in the autumn statement. It is one of the 12 smaller cities that will be included in the super-connected cities programme, and will receive funding for ultra-fast broadband. I am obviously pleased at the news, and I recognise the impact that superfast broadband can have on growth. I particularly understand the importance of encouraging small and medium-sized enterprises to realise the opportunities that superfast broadband can bring. A Lloyds Banking Group survey found that 45% of digitally mature small businesses had registered growth, compared with 35% of digitally immature SMEs.

Some research suggests an £18.8 billion opportunity for SME revenue growth through more high-tech approaches to marketing, data optimisation and more, so I am pleased with the Government’s commitment to broadband expansion. We can say something positive about the Government for a change, but we will be looking to ensure that they proceed intelligently to ensure that small businesses make the most of the available opportunities.

I am also optimistic about the city deal in Coventry and Warwickshire. Over the past month, Coventry MPs and councillors in particular have lobbied hard, as have Warwickshire MPs and councillors. The city deal could bring great benefits to the region, including giving cities the powers and tools they need to drive local economic growth, unlocking projects or initiatives to boost their economies, and strengthening the governance arrangements of each city. Each city deal includes at least one major commitment specific to the city, which generally involves leveraging private sector funding. Many have included tax increment financing and community infrastructure levies, and there is a focus on investment and trade.

I very much hope that Coventry and Warwickshire local authorities will make the case for Coventry’s candidacy for the deal. Coventry is a strong contender, and has been working for months to develop infrastructure plans that are ready to go ahead given sufficient funding and support. The plans reflect local understanding of the asset base, transport issues, the financial situation, and what can be achieved. An example of the work that Coventry is already undertaking to stimulate growth is the gateway project. It is controversial because environmental issues are involved, but I understand that it is on the way to obtaining planning permission, or has already received it. I am not clear about that. The project will be interesting, but controversial.

Another excellent example in Coventry is the Friargate project next to Coventry railway station. It is a 300,000 square metre development, which will extensively renovate the area to include 14 grade A office buildings, two hotels, new pedestrian routes, high quality public spaces, new residential buildings, and space for retail outlets and bars. Outline planning consent was granted in July 2011, and the first phase of the development has started. I hope that the development will transform the city centre, making it welcoming and lively. More importantly, I hope very much that the renovated city centre will raise optimism and encourage investment in the city.

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

I congratulate my hon. Friend on securing this debate. Coventry’s economy has been greatly assisted over the years by the car industry, particularly Jaguar. What does he think about Tata’s proposal to open a factory in China?

[Mr Cunningham]

There are a couple of schools of thought about that, but my understanding is that the trade unions are worried and will be having discussions with Tata. Some years ago, there was concern about Jaguar’s trade with China. Some people thought that cars would be built in China, but they were only assembled there, and there had been a misunderstanding. We need to find out more about the current deal, and discussions are ongoing.

Coventry city council is suffering from Government funding cuts. From 2010-11 to 2012-13, the council has suffered cuts of £101.89 per capita. That is among the hardest hit 20% of local authorities. More unjust and distressing is the fact that of those local authorities with cuts of more than £100 per head, including Coventry, 85.71 % are Labour-run, and only 5.36 % are Tory-run. Meanwhile, of those local authorities with cuts of less than £100 per head, 60.82% are Tory-run and 19.4% are Labour-run. It is hard not to be concerned about the Government’s fairness when the cuts seem to be distributed across local authorities on party lines. Coventry council had expected to lose 1,000 jobs over four years to 2014-15, but it is now predicting 1,600 job losses over the four-year period, with a cut of more than 10% in the work force.

Those cuts are impacting on the council’s services for the vulnerable. For example, its funding for early intervention will be cut yet again. Two years ago it was £22 million per annum, but from next year it will be £11 million. That is particularly damaging given the current increased pressure on social care. Every penny spent on early intervention in families with young children to help them help themselves is of paramount importance in taking people out of poverty and improving children’s life chances. Those pressures are increased by a social care budget for children of £64 million which has not significantly changed for two years. Similarly, the pressures are increasing daily on the adult social care budget because elderly people and disabled people are living longer, but that is not reflected in the budget, and the extra cost of care is not recognised in financial terms.

Those are only a few of the extreme budgetary pressures on the council; to put the huge cuts in funding into context, there are others. In my constituency alone, 920 households have already received letters from Her Majesty’s Revenue and Customs informing them that their child benefit is likely to be reduced or withdrawn. Across Coventry, that figure is 1,740 households. The jobseeker’s allowance claimant rate in Coventry and across the west midlands is 6.2%, well above the UK’s rate of 5.2%. Even worse, the rate of jobseeker’s allowance claims by 18 to 24-year-olds across the west midlands is 8.7%, far higher than the UK’s 7.1%.

Road Fuel Duties

Debate between Jim Cunningham and Brian H. Donohoe

Tuesday 13th September 2011 Westminster Hall

[Mr Donohoe]

I agree entirely. It is interesting to note that Shetland has some of the highest petrol prices in Scotland, although half the United Kingdom’s total oil supply flows through two pipelines there. Another instance is Grangemouth, where the refinery for Scotland is based. The price of fuel there is also among the highest in Scotland. That does not stack up.

[Mr Jim Cunningham (Coventry South) (Lab)]

I was interested by the intervention of the hon. Member for Newton Abbot (Anne Marie Morris), because not far from Newton Abbot is the Devonshire coast. I was down there about 12 months ago or more, and it was amazing to see the number of tankers lined up that were not being unloaded. Does my hon. Friend not think that there might be a case for an investigation into oil companies and hoarding to force up prices? Price is as much an element of the problem as taxes.

[Mr Donohoe]

I thank my hon. Friend for that intervention. I am sure that the Economic Secretary will address that issue when she sums up, along with the points made by other hon. Members.

My third point concerns the social and economic consequences of the situation. Everybody can see that many kinds of damage have been done to consumers and businesses, particularly small businesses. As I have mentioned, the erosion in the number of forecourts is obvious, particularly in rural areas, and it will lead to fuel deserts in many parts of the UK. A vital immunity for low-income families, pensioners and the disabled has been lost. Journeys to fill fuel tanks are longer, increasing carbon emissions needlessly. Consumer choice has been reduced. There are fewer facilities for HGV and van users, as supermarkets do not cater for them. The impact on the UK’s ability to cope with emergencies has also been massive. Perhaps most importantly, jobs and job opportunities are being lost.