Budget Resolutions

John Hayes Excerpts

Thursday 12th March 2020 Commons Chamber

[John McDonnell]

To give the Government their due, the Chancellor did announce a £150 million contribution to the IMF, so there is an element of financial involvement and engagement. However, it requires the co-ordination of policy to ensure that those resources are directed effectively and successfully to tackle the very issue that my right hon. Friend raised. I hope that will be a model for the future when other global issues have to be confronted. As in the past—and this has happened under various Governments and political leaders—the UK should now be playing a critical role in mobilising the international bodies we have, in particular the UN, to agree a global response to deal not just with the current wave of this pandemic, but with the possibility of subsequent waves.

[Sir John Hayes (South Holland and The Deepings) (Con)]

The right hon. Gentleman is right about the need for collaboration, and he is also right about needing alacrity and the response to a dynamic set of circumstances requiring leadership. Can the Commonwealth play an active role here? He talked about an international body, and it is of course a body in which we play a pivotal part, and that would very much be in tune with what he has proposed.

[John McDonnell]

I fully concur with the right hon. Gentleman. The various international vehicles that we could mobilise are available to us, and we just need to do it now. It needs to be done at a senior level, in a way that sends out a message of determination across the globe to people and families, but also to the markets. We need to ensure that this medical crisis does not create the long-term recession that some are predicting as a result of its global implications. I will now move on from the coronavirus.

In addition to the coronavirus, we face other emergencies, and we must not lose sight of the two other crises that we face. One is the crisis in our public services—it is a social emergency—with the levels of poverty and inequality in our society. The other is of course the existential threat of climate change. I have to say that yesterday’s Budget failed to address the social emergency. We have discussed it on the Floor of this House before, but this social emergency sees 4.5 million of our children living in poverty, with 70% of those children living in households where an adult is in work. We have—I do not know how else to describe it—a crisis of in-work poverty that perhaps we have not seen for generations in this country.

I have to say that there was nothing in the Budget to relieve the hardships inflicted on our community by universal credit, the bedroom tax and, especially for disabled people, the brutality of the work capability assessments undertaken against them. In fact, the Government’s own table accompanying the Budget shows that the bottom 10% fare the worst as a result of tax decisions made in this Budget and the last spending round, which cannot be right. It cannot be right. It states that the bulk of the benefits are flowing to higher paid households. Yesterday some people were saying that this could have been a Labour Budget, but whoever said that was not looking hard enough at who wins and who loses in it. I believe that not one family will be lifted out of in-work poverty because of yesterday’s announcements. Yesterday we again heard the Government’s aspiration to get the national living wage to two thirds of median earnings, but that is not a real living wage; it is an aspiration for four or five years’ time. Some may also have seen the small print, which says, “if economic conditions allow”.

Worryingly, there is nothing of any substance in the Budget to tackle the long-term crises in our public services. Let us take the justice system, for example. In prisons there has been

“a sharp rise in deaths, violence, self-harm”

and suicides, which can all be

“linked to cuts”.

That is not my statement; it comes from the Institute for Government. The House of Commons Justice Committee has pointed to a £1.2 billion gap in justice funding, so the small sums in this Budget, such as £175 million for prison maintenance, just will not cut it. Not one prison officer will be safer on the landings because of this Budget, yet in some of our prisons, those people put their lives at risk on a daily basis.

On domestic violence, according to Women’s Aid, 10 domestic abuse victims are turned away from women’s refuges every day because of a lack of space. This Budget needed to commit £173 million to ensure that no survivor is turned away. It has not done that, and without that funding, the measures in the Domestic Abuse Bill simply cannot be delivered. Not one women’s refuge can feel assured that it will get the funding it needs from this Budget.

The National Education Union said that class sizes are rising, subjects are being dropped, and inadequate pay is making the education staffing crisis worse, but there will be few teachers from whom the pressure will be lifted as a result of this Budget.

On housing, the sums earmarked for rough sleeping are totally inadequate, and we know that at least £1 billion is needed to reverse cuts in homelessness services. Yesterday, the Chancellor said that he would end homelessness, but we heard that from the Prime Minister who, when he was Mayor of London, said that rough sleeping would be ended in London by the 2012 Olympics. Rough sleeping doubled during the Prime Minister’s second term as Mayor.

It goes on: not one library will be reopened as a result of yesterday’s Budget. Not one youth centre will reopen; not one Sure Start centre.

--- Later in debate ---

[Sir John Hayes (South Holland and The Deepings) (Con)]

Budgets must take account of immediate circumstances, but they must also address the pattern of trends that shape our economy and fashion our society. Given what we know now, few will argue with the Chancellor’s bold action, in an attempt to stabilise an economy rocked with the uncertainty of the coronavirus. His comprehensive, generous and tailored stimulus, totalling £30 billion, will strengthen the safety net that our welfare system needs and bolster our precious health service. Businesses, too, will receive the support they need to get through these difficult times. The instability and uncertainty that fear spawns is bound to create an economic shock, and it is right that the Chancellor has responded to it.

The Chancellor’s commitment to support workers, including the self-employed and those on zero-hours contracts, is welcome and virtuous, and I want to say a bit more about that later. The creation of a hardship fund, coupled with his pledge to refund statutory sick pay for small firms, will enable ordinary businesses to prevail and flourish in the face of this uncertainty. This pragmatic, sensible and ambitious Budget should embolden us, confident that, as he said, he will take whatever steps necessary to guarantee our national interest and the common good.

This is a time, by nature, for leadership and unity, for let there be no doubt that there will be foreign powers who can—and, because they can, will—leverage instability caused by the virus to their own advantage. As the President of the United States has made clear, it is pivotal to examine further the behaviour of the Chinese state—whom the western economies are not only affected by but, to some degree, dependent upon—regarding their transparency throughout this crisis. The Chancellor is right: this Budget provides security and lays the foundations for prosperity in the future.

While it is laudable to be responsive, beyond the immediate circumstances we face, we must address some of the suffocating facts in our society. There is too much societal emphasis in our time on the immediate and the trivial—at worst, the facile and the brutal. In happy contrast, it is good to see a Budget that is holistic, measured, serious and sustainable. First and foremost, it is strategic. One of the problems in democratic polities is that Governments are, by the nature of the five-year terms they serve, often tempted to do things that deliver a short-term payback and thereby neglect those things that are strategic and infrastructural. That cannot be said of this Government and this Budget—rather, the opposite. The Government have taken a long-term strategic view, and that is certainly to be welcomed.

The investment in road and rail is, of course, welcome. It builds on the road investment strategy, which I was happy to launch when I was Minister for Transport. It is vital because the connectivity of our country is the lifeblood of local economies as the way that people get to work and the way they move goods are critical.

It is also important to note that the Chancellor is investing in skills, as the hon. Member for Stretford and Urmston (Kate Green) said, although there are question marks about intermediate level skills. I would simply amplify the remarks she made. There are also issues about the effect of the apprenticeship levy and its unintended consequences. However, the investment in skills, through the extra support for further education, will allow us to build a workforce fit for the future.

A lot is said about capital, but too little is said about human capital. Unless we invest in the human infrastructure necessary to deliver those ambitious plans, they will not work. We need people to engineer, to design, to project manage and to deliver those big infrastructure projects, and further education and skills lie at the heart of all that.

Research and development funding is also welcome. However, I have three words of warning about research and investment for the Financial Secretary, which I know he will address with his usual diligence when he sums up. The first is that risky development is all very well, but what we actually want is bold investment that is mindful of risk. Secondly, we need to avoid the bureaucracy that is often associated with Government funding. Finally, that kind of investment also has to be long term, because the sort of projects that innovate require people to commit to them—and, by the way, to be attracted to the relevant science and innovation—over an extended period. So, long-term funding, funding that is tailored and measured, and funding that is not bound up with bureaucracy all become critical.

Furthermore, we have to address the issue of job insecurity and the character of the employment we are creating. It is really important to grasp that societal solidarity is framed by people having a sense of self-worth that comes from having a sense of purpose. It is not enough just to have jobs; we have to have jobs that are meaningful. We have to believe again in the nobility of labour. We have to understand that people’s wellbeing is in part fuelled by their sense that they are making a difference over the long term by employing their skills in a virtuous purpose. That may sound rather like an emulation of the sentiments of William Morris, but I make no apologies for emulating that great man because I have reservations about the gig economy and some of the job insecurity to which it has given rise.

Finally, let me say a word about globalisation. A few years ago, it was heralded as a great virtue, but now the support we have given for small business could and can be the beginning of a reappraisal of what really matters in the economy. I believe it is the particular and the local—shorter supply chains and facing up to the downsides of globalisation—that lies at the heart of protecting the national interest and delivering the common good. That is precisely what this Budget begins and what the Government should do.