Covid-19 Pandemic: Fiscal Policies

Jim Shannon Excerpts

Monday 17th July 2023 Commons Chamber

[Mary Kelly Foy (City of Durham) (Lab)]

The austerity programme has been one of the most damaging policies our country has seen in decades, and one statistic demonstrates its complete failure: there were more than 300,000 excess deaths between 2012 and 2019. More than 300,000 people died as a result of austerity—they were human beings, with families and friends. Like us, they had aspirations and dreams, but now they are gone, perhaps because of decisions made in Departments and in this House. That is an injustice; after all, the first duty of the British Government is to keep their citizens safe and the country secure. Were those 300,000 people kept safe? Evidently, they were not. That is the sort of statistic that future generations will read and wonder how on earth we could have allowed it to happen.

The subject of my debate is fiscal policies and the covid-19 pandemic, but what I want to get at is the extent to which austerity left us unprepared for the pandemic. I started with that statistic to present the situation in Britain prior to the outbreak of the virus. My speech will discuss healthcare, and the Minister may think, “What’s this got to do with the Treasury?”. I hope that I can convince him on that by saying that our health services require money from his Department, because what matters about cuts is their effects.

It is clear that the austerity programme hollowed out our welfare state, including the NHS. To be ready for a pandemic, we need a strong healthcare system, but we just did not have that in 2020. I was outraged by former Prime Minister David Cameron and former Chancellor George Osborne at the covid inquiry. They denied that their austerity programme had any impact on the pandemic, and it was especially chilling watching George Osborne. Their justification for austerity is at odds with scientific evidence and opinion, which I shall outline.

In their expert evidence to the covid-19 inquiry last month, Professor Clare Bambra and Professor Sir Michael Marmot stated that austerity policies post-2010 had an adverse effect on health inequalities; that health inequalities narrowed in the period of higher public expenditure, from about 2000 to 2010, but widened again post 2010—

[Jim Shannon (Strangford) (DUP)]

I commend the hon. Lady for securing this debate. She is right to say that covid has affected health, but it has also affected finance. Does she agree that covid-19 will have rippling effects upon finances for years to come, and that many people are now grappling with the reality of prices increasing at a greater rate than wages? Does she also agree that the Government must take hold of the financial market once again with a firm grasp and with a strategy to help families in my constituency and hers, and indeed across this great United Kingdom of Great Britain and Northern Ireland?

[Mary Kelly Foy]

I thank the hon. Gentleman for that intervention, and I will come on to that issue in my speech. He is completely right that there will be an ongoing impact on future generations not only from covid, but from the impact on the public purse.

The scientific research also found that between 2000 and 2010, geographical inequalities such as infant mortality rates and life expectancy were reduced, but they then increased after 2010. Why did that happen? It was about money. By 2019-20, after a series of austerity Budgets, health spending was about £50 billion below what it should have been had it matched previous Government commitments. This far surpasses the much-vaunted cash injection of £20 billion between 2019 and 2024 as part of the NHS long-term plan. That level was too little, too late for what was to come.

The results of austerity are not hard to find right across the NHS, with one of the more tangible measures being bed capacity. Between 2010-11 and 2019-20, the average daily total of available beds contracted by 8.3%—nearly 13,000 beds. Britain had less than half the number of critical care beds relative to its population than the average in OECD European Union nations.

Austerity also meant years of pay caps and pay freezes. In other words, there were pay cuts, in real terms, for NHS workers. They were earning thousands of pounds less in real terms in 2019 than in 2010.