Oral Answers to Questions

Kate Green Excerpts

Tuesday 29th April 2014 Commons Chamber

[Danny Alexander]

I am sure that if the hon. Lady had had longer, she would have welcomed today’s growth figures and the jobs and employment opportunities that that has created for people right across the United Kingdom, particularly in Scotland. The 3.2 million people that the hon. Lady mentions have already been taken out of tax by the actions of this coalition Government—something that she did not welcome. Of course, the extra opportunities to increase their time in work also helps those individuals. We are increasing our support for child care, with the Government providing free hours, extending support under universal credit and introducing tax-free child care, too. This Government have done far more than any previous Government to help working people with children get back into work.

[Kate Green (Stretford and Urmston) (Lab)]

11. What recent assessment he has made of the effect of his fiscal policies on the level of child poverty.

[Chris Ruane (Vale of Clwyd) (Lab)]

14. What recent assessment he has made of the effect of his fiscal policies on the level of child poverty.

[The Financial Secretary to the Treasury (Nicky Morgan)]

This Government are protecting vulnerable groups while taking action to tackle the record deficit we inherited. Work remains the best way out of poverty and last month’s Budget took action to support families by making the tax and welfare system fairer and by further increasing the income tax personal allowance to £10,500 next year, which will take 3.2 million people on low incomes out of tax altogether.

[Kate Green]

I must take issue with the Minister. Most children in poverty are in working families, so work is not a secure route out of poverty. Why are the Government’s policies on the proceeds of growth not reaching those children?

[Nicky Morgan]

I have already said in answer to the question that work remains the best way out of poverty, and I set out the raising of the personal allowance. There is no doubt that children who grow up in workless households are three times more likely to be in poverty. This Government remain committed to eradicating child poverty, but are taking action to tackle the root causes rather than allowing people to continue in welfare dependency.

Finance (No. 2) Bill

Kate Green Excerpts

Wednesday 9th April 2014 Commons Chamber

[Catherine McKinnell]

I thank you, Mr Hoyle, and also my hon. Friend whose intervention was powerful and to the point.

[Kate Green (Stretford and Urmston) (Lab)]

My hon. Friend is right to highlight the disproportionate benefit of the marriage tax break to men. Does she not agree that the argument that couples will benefit as a unit completely fails to recognise financial coercion in relationships, and that those who get the money have the power?

[Catherine McKinnell]

My hon. Friend raises an important point and it goes to the heart of so many of the changes that this Government have made. So many of the decisions that they have made time and again in Budget after Budget have hit women hardest. Back in September 2011, a leaked No. 10 memo admitted that the Government had a problem with women, and promised a new communications campaign to turn things around, but it clearly has not worked. A key recommendation of a No. 10 communications campaign to be female friendly was to “focus on more visible women leaders”, but until this morning women made up only four of the 23 Cabinet members and that figure is now down to three. Let us not let the Deputy Prime Minister off the hook. Only four out of 25 Lib Dem Ministers are women—[Interruption.] Government Members are shouting, “What has that got to do with this measure?” I wonder whether one of them would like to intervene.

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[Catherine McKinnell]

That is an interesting statistic. I know that the hon. Gentleman is committed to the principle of this measure, but I and other Opposition Members are trying to make the point that the policy is not only dud as regards its practical application but further compounds the unfairness in how the Government have made their decisions in Budget after Budget. Let us remember when hon. Gentlemen question what my point has to do with this measure that we know that the majority of gainers from the policy are men.

[Kate Green]

Does my hon. Friend think that the hon. Member for South West Bedfordshire (Andrew Selous) was seriously suggesting that £3.85 a week would encourage more couples to stay married? There is no evidence of cause and effect at all.

[Catherine McKinnell]

My hon. Friend’s point goes to the heart of the matter. It demonstrates what is wrong with this policy and how ill-conceived it is.

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[Catherine McKinnell]

I am pleased that the hon. Gentleman has entered the debate, because the Liberal Democrats are key to today’s measure, and I shall go on to explain why. I think we know that there is long-term inequality. The mere fact that 85% of those who benefit from the tax cut from 50p are men speaks volumes about how this country is weighted. The majority of wealth is held by men. I understand the hon. Gentleman’s point, but I urge caution as the Liberal Democrats are in an interesting position today when it comes to how they will vote not only on this measure in the Bill but on our proposed review.

[Kate Green]

Does my hon. Friend agree that evidence stretching back over several decades shows that when money is paid to the main carer of a child, usually the mother, that money is more likely to be spent on the children? A Government about to preside over a startling rise in child poverty should be mindful of that when they introduce a measure such as this.

[Catherine McKinnell]

My hon. Friend makes an incredibly pertinent point, and expresses her case powerfully. Child poverty is set to increase by a staggering amount under this Government, and the Institute for Fiscal Studies has clearly said that that is a direct result of the tax and benefit changes that they have implemented. The measure, which Government Members are keen to support, will do nothing to alleviate child poverty or to turn the tide of increasing child poverty over the next few years.

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[Catherine McKinnell]

My hon. Friend makes an important point. I would add that it is not a third of families who will gain from the policy—it is a third of married couples. Five in six households with children, whom many would consider to be families—particularly the Opposition, but perhaps not the Government—will not gain anything from the policy, which only compounds the child poverty issue about which the Government seem complacent.

[Kate Green]

Does my hon. Friend not agree that the reading of the figures by the hon. Member for East Worthing and Shoreham (Tim Loughton) was highly selective? Perhaps the bottom half of the income distribution scale benefits from the measure, but the very poorest will not benefit at all, because they are not tax payers.

[Catherine McKinnell]

Absolutely. That is why many people, including married couples, will not gain anything from the policy, which is why I am astounded by the vehement support for a policy that does not properly recognise marriage in the tax system, which Government Members are usually keen to do.

To conclude the point that I am making about the impact of the measure, I shall give one example of the women who are particularly hard hit by it: low-paid, new mums, who are losing almost £3,000 during pregnancy and their baby’s first year as a result of cuts to child benefit; cuts to the health in pregnancy grant; the axing of the higher rate of tax credit for families with babies under one; restrictions in the Sure Start maternity allowance; and the Chancellor’s “mummy tax”, which will cost new mums £180 by 2015 in real terms—not to mention cuts in public services and the disappearance of Sure Start centres, with three closures a week, which will impact on mums, dads, families and, indeed, married couples up and down the country for years to come.

The policy is a total turkey in terms of its reach and the benefits it brings. Even the Chancellor thinks so, as does the Chief Secretary to the Treasury—and I am sure that we will hear what the Exchequer Secretary thinks later in the debate—but what about its cost and complexity? Surely, Ministers must have learned from the child benefit fiasco, and would not seek to introduce a new, complex aspect to the taxation system—that fiasco must have given them a few grey hairs—or one that might require significant additional administration and input from the taxpayer. Oh—but they are doing so! Her Majesty’s Revenue and Customs has issued a tax information and impact note on the policy that suggests that it will have an Exchequer impact of £515 million in 2015-16, rising to £820 million by 2018-19.

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[Mr Jackson]

Not at the moment. I know the hon. Lady is very keen, and I am sure she will try to get in later.

Given the scale of the public benefits associated with marriage, it is not at all surprising that most people in the developed world live in countries that recognise marriage, as I said earlier in an intervention. There are numerous examples of this benefit that I could highlight, but given the constraints on time I will mention just a few. Regardless of socio-economic status and education, cohabiting couples are between two and two and a half times more likely to break up than equivalent married couples. Women and children are significantly more vulnerable to violence and neglect in cohabiting, rather than married, families. Three quarters of family breakdown in families with children under five comes from the separation of non-married parents. Children are 60% more likely to have contact with separated fathers if the parents were married. Separated fathers are more likely to contribute to their child’s maintenance if the parents were married. Growing up with married parents is associated with better physical health in adulthood and increased longevity. Children from broken homes are nine times more likely to become young offenders, accounting for 70% of all young offenders.

[Kate Green]

I respect the fact that the hon. Gentleman is being very careful with his use of words in saying that there is an association between marriage and some of the outcomes he describes. What he cannot demonstrate, however, is whether there is cause and effect, because we do not know whether there are other personal characteristics that make those couples more likely to be married and whether they also result in those beneficial outcomes.

[Mr Jackson]

I will not take issue with the hon. Lady’s intervention, because it is quite sensible. Nevertheless, the evidence-based data in support of marriage in the tax system have been accumulated over a very long period and are very clear. It is incumbent on the Government not to disregard that evidence, but to take account of it in formulating their fiscal policies.

The list goes on and the findings are put in context by the fact that the Relationships Foundation calculates that the costs of family breakdown amount to £44 billion per annum and that family breakdown outside marriage is the real driver. As the Centre for Social Justice has demonstrated, of every £7 spent as a result of the breakdown of young families, £1 is spent on divorce, £4 on unmarried dual-registered parents who separate, and £2 on sole-registered parents. That is why the Prime Minister was absolutely right to say in response to a question about how the policy could reduce the deficit:

“If we are going to get control of public spending in the long term in this country, we should target the causes of higher spending, one of which is family breakdown. We should do far more to recognise the importance of families, commitment and marriage”.—[Official Report, 2 June 2010; Vol. 510, c. 429.]

I am aware of the arguments that the relationship between marriage and better policy outcomes is merely a coincidence and that the real driver for those better outcomes has nothing to do with marriage and is based on other considerations, especially income. Those arguments simply do not make sense. Apart from anything else, the fact that the millennium cohort study demonstrates that the poorest 20% of married couples are more stable than all but the richest 20% of cohabiting couples makes it plain that marriage is a significant, independent determinant of stability.

Budget Resolutions and Economic Situation

Kate Green Excerpts

Wednesday 19th March 2014 Commons Chamber

[Kate Green (Stretford and Urmston) (Lab)]

There is little in the Budget for families with children. It follows a series of Budgets and spending reviews that have been difficult and disappointing for children and which, the Institute for Fiscal Studies has predicted, will lead to a substantial rise in poverty over this decade.

I recognise why the Chancellor wants to incentivise saving, and of course we want to ensure that pensioners are protected from poverty, but I am concerned that the Budget exacerbates an increasingly unbalanced approach to support between the generations. The first thing that constituents of all ages say to me on the doorstep is how worried they are about the prospects for the next generation.

I am proud that Labour took more than 1 million children out of poverty. The Budget and the Government’s depressingly weak child poverty strategy that was announced the other day represent missed opportunities, and as a result, the gains made under Labour will be all but wiped out. That is not because there was no option: different choices could have been made. The burden of austerity has been predominantly borne by spending cuts rather than by tax increases for the wealthiest, and that has had a disproportionate effect on low-income families.

We know that family benefits have been an important plank in reducing child poverty. According to the Institute for Social and Economic Research, the UK has the second highest child poverty rate, before taxes and transfers, in the 27 EU countries, yet, by the 2014-15 financial year, working age benefits spend will be £22 billion less than in 2010-11 as result of uprating policies, cuts and freezes. That is having an especially harsh impact in households with a disabled family member. One third of people in poverty live in a household with a disabled member, and a quarter of children in poverty live with a disabled adult.

Localising benefits also makes the situation worse. Council tax assistance and local assistance schemes have been criticised by the Public Accounts Committee and the Work and Pensions Committee respectively. The Committees have expressed concern about their impact on vulnerable families. In the meantime, the cost of living is rising—the impact on families with children is especially harsh—yet for first time since the 1930s, the uprating policy for payments for children is now entirely detached from the price rises that affect them. Uprating at 1% bears no relation to RPI or to CPI; the cost of goods and services has risen 15% in past three years. Indirect taxes have hit the poorest families hardest, as a higher proportion of their income is hit.

The living costs that particularly affect families with children have been rising fastest. They include food, energy, rent and child care. This week’s announcement on child care will still leave families without the help that they need. The Institute for Fiscal Studies has confirmed there is no new money to fund the announcement, and the number of families benefiting from the scheme is around half what the Government said it would be. Figures revealed in the Government’s latest consultation document show that around 1.26 million families will benefit from tax-free child care, not the 2.5 million claimed in the original consultation document. Also, there is no new support for those on tax credits, who will not be able to access the tax-free child care.

I welcome the increase in support for child care costs under universal credit to 85%, but it is a matter of concern that that will be met from within the universal credit budget. It is therefore unclear where the money will really come from. Universal credit is already running late and over budget, so how can this extra sum be afforded? We also have no firm timetable for all parents being migrated on to universal credit; we know that the programme is experiencing significant delays.

The Government say that work is the best route out of poverty, but the majority of children in poverty live in a household in which at least one adult is working. Tax breaks do not do enough to compensate those families. The Resolution Foundation has found that 75% of the benefit of the increase in personal tax threshold goes to the top half of the income distribution. The Chancellor himself confirmed this afternoon that higher rate taxpayers—those earning up to £100,000—will benefit from the increase in the threshold. Only a tiny element of the cost of the initiative will go towards lifting people out of tax altogether. I understand why the policy is popular, and why it has been effective for some low-paid workers, but Ministers need to look carefully at whether this is now becoming a game of diminishing returns. Meanwhile, there is no other effective labour market strategy. There is no strategy on progression, for example, and there has been insufficient action on low pay, zero-hours contracts and part-time work.

The gender pay gap is also widening. The element that is totally missing from this Budget—and all previous Budgets and spending announcements from this Government—is a gender analysis. Their policies fail to recognise that child poverty is a product of maternal poverty. Mothers are usually the main carers of children, yet this Government’s policies are positively inimical to women. Universal credit is to be paid to one member of a household, which provides poor incentives for second earners to increase their pay. The marriage tax break will help only one in six families with children, with 84% of that benefit going to men. Meanwhile, child benefit, which is usually paid to women, has been frozen or removed, and the child tax credit uprating has been held back at 1%. Marriage tax breaks are no help whatever to lone parents, the majority of whom are women, and whose children face greatest risk of poverty. Lone parents are also now having to pay for the child maintenance to help to support their children.

Overall, the value of financial support for families with children is being eroded, compared with the minimum income needed for families to raise their children. This is beginning to create real desperation among those families. More and more parents are going without, in order to provide the basics for their kids.

I was disappointed when I looked to the Budget today for a new approach. But a new approach is affordable and it can be done: we could redirect the ill-chosen marriage tax break to benefit low-paid families; we could do more to attack the basic living costs faced by families, and more to freeze energy prices and support low-income families with the cost of child care; we could rebalance the system to recognise the role of mothers as main carers of children, putting an emphasis on money paid to women in the tax and benefits system, and money paid to mothers which will be spent on their kids; we should look again at the structure of universal credit, and at its disincentives for lone parents and second earners to maximise their income from work; and we should look back to the helpful recommendations the previous Government received from Lisa Harker, which I believe were welcomed by all parties, to design employment support in Jobcentre Plus more effectively to recognise the particular parenting and caring needs of parents—that should also be done in the Work programme.

If those measures were undertaken, we would be on track to eradicate child poverty, to boost parental—especially maternal—employment and to end inequality gaps. I hope that Ministers will begin to re-examine the way in which they achieve a balance of measures that properly reach out to all families, particularly families with children. That has been sadly lacking from the Budget today.

Money Transfer Accounts and Remittance Sector

Kate Green Excerpts

Wednesday 22nd January 2014 Westminster Hall

[Kevin Brennan]

I thank my hon. Friend for giving me the opportunity to acknowledge everything he said, including the Somali community in Sheffield. His intervention also allows me to remind the Chamber that Cardiff—my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) is also in the room—has one of the oldest Somali communities in Britain, going back to the 19th century. The community plays a hugely important and positive role in the life of our great city. What my hon. Friend the Member for Sheffield Central (Paul Blomfield) said was right, and I shall say more about aid later.

[Kate Green (Stretford and Urmston) (Lab)]

I congratulate my hon. Friend on securing the debate, and I apologise that I will have to leave for a few minutes in the middle of it. Does he agree that for the Ogaden Somalis—around 500 are resident in my community—the ability to remit money back to families at home is particularly important because so many of them are suffering displacement and persecution? There is a particularly strong link with not only our moral but our economic responsibilities to those communities.

[Kevin Brennan]

My hon. Friend is absolutely right, and I am sure that that was why the International Development Secretary acknowledged, at least in words, the importance of the matter. Today we are seeking to poke the Government into quicker action than we have seen so far.

Autumn Statement

Kate Green Excerpts

Thursday 5th December 2013 Commons Chamber

[Mr Osborne]

We are increasing yield by £40 billion over the current Parliament. It is not just a question of the specific measures that we take to deal with tax avoidance; it is also a question of the resources that we provide for the fraud and tax avoidance units of Her Majesty’s Revenue and Customs. Let me take this opportunity to praise HMRC for the incredible job that it has done.

We must ensure that we collect the revenues that are due. Of course we want to live in a society in which people pay lower taxes, which is why we raised the personal allowance in order to cut income tax, and why I have announced measures to cut business rates for shops and the like. However, people must pay the taxes that are due because they cheat the rest of the country when they do not, and that is why we have taken action to deal with tax avoidance.

[Kate Green (Stretford and Urmston) (Lab)]

One in four families with children is headed by a lone parent, and those are the children who are likely to face the greatest risk of poverty. They do not choose their own family circumstances, and, of course, they will not benefit at all from the Chancellor’s married couples tax break. Will he consider again whether there might be better and fairer ways of spending that £700 million on families?

[Mr Osborne]

We are helping lone parents in particular by offering them more help to obtain work, or to obtain the skills and training that they need in order to find work. All the evidence—and I know that the hon. Lady has spent a great deal of her life examining it—suggests that if children of lone parents can be in working households, that will really assist their life chances. Lone parents often have the least skills and have received the least help, and we are doing a huge amount to change that.

National Infrastructure Plan

Kate Green Excerpts

Wednesday 4th December 2013 Commons Chamber

[Danny Alexander]

I am grateful for the question. The published strike prices are set out in table 3.D on page 50 of the national infrastructure plan. I do not intend to read out all the numbers, as I am sure you will be pleased to hear, Mr Speaker. The real point is that we are moving to competitive allocations for onshore wind and solar earlier than we thought, precisely because prices are coming down. There is a degree of competition to secure the best and most cost-effective projects, and that should help to secure the objectives that he and I share.

[Kate Green (Stretford and Urmston) (Lab)]

I note from the document published today that the Government will monitor progress on the Manchester Metrolink extension programme. What conversations are the Treasury and the Government having with Greater Manchester authorities and Transport for Greater Manchester to ensure that the extension link through Trafford Park is both properly financed and on time?

[Danny Alexander]

That is one of the projects that we will track under our new infrastructure tracking regime, which will make sure that any problems are surfaced for Ministers much more quickly than they have in the past. If the hon. Lady is aware of any particular causes of delay, I encourage her to let me know. I will of course make sure that Transport Ministers are aware of her concerns.

Women and the Cost of Living

Kate Green Excerpts

Tuesday 19th November 2013 Commons Chamber

[Nicky Morgan]

My hon. Friend is, of course, right about that. The best way to address living standards is by dealing with the economic crisis, so that families can find work in a growing economy. He is absolutely right to say that it is not fair to burden future generations with debt, which is why this Government have taken the tough actions they have.

I shall now discuss child care. For any mothers and fathers to succeed in the workplace, we need to have the right policy in place to support them. The Labour party is right to draw attention to the importance of parental leave and child care, but let me remind the Opposition that we were the Government who recognised the current system of leave and pay for parents as being not only old-fashioned and inflexible, but as playing a role in reinforcing the idea that women are the primary carers of children. Our new system will give real choice to families, and, from 2015, will allow working parents to share leave once the mother feels ready to end her maternity leave.

I remind the Opposition that we were the party that made sweeping changes on flexible leave and that they were the party that presided over child-care costs rising to the second highest level in the developed world. We are working hard to address that and to make child care more affordable for parents across the United Kingdom. A recent survey showed that 2012-13 was the second successive year in which the price of full day care and nurseries stayed flat in real terms

[Kate Green (Stretford and Urmston) (Lab)]

The Minister is right to draw attention to concerns about the cost of child care. Will she look carefully at what a group of organisations have recommended, which is that instead of giving a tax break to better off parents to pay for their child care, the proportion of child care costs that is covered by tax credits should be raised from 70% to 80%? That would have a significantly more beneficial effect for low-earning mothers.

[Nicky Morgan]

I am always happy to receive submissions on this issue from Members from across the House. We have already committed an extra £200 million for people on universal credit so that coverage of their care costs will go up from 70% to 85%.

Let me remind the House that we are increasing free early education places for three and four-year-olds to 15 hours a week. We are enabling low-income families to recover their child care costs and providing all families with support for 20% of their child care costs from autumn 2015.

Investing in Britain’s Future

Kate Green Excerpts

Thursday 27th June 2013 Commons Chamber

[Danny Alexander]

The A303 is one of the most notorious transport bottlenecks in the country, and these improvements will have a major impact on the economy in the south-west of England. The Highways Agency will be developing the detailed plans, so we will need to consult on those, including, no doubt with my hon. Friend. This is part of the funding that was set out for between now and 2020 to deliver improvements on that route.

[Kate Green (Stretford and Urmston) (Lab)]

I welcome the encouraging news about the Trafford Park extension of the Metrolink. Will the Chief Secretary comment on new Homes and Communities Agency regulatory powers that appear to be restricting housing associations’ ability to open up new and commercial income streams, with a knock-on effect on their ability to build more homes?

amendment of the law

Kate Green Excerpts

Monday 25th March 2013 Commons Chamber

[Kate Green (Stretford and Urmston) (Lab)]

One innovation that has been introduced is a simplified planning system for business neighbourhoods, but very little progress seems to have been made in implementing that in Trafford Park, in my constituency. What will happen to speed up that process?

[Mr Pickles]

I will certainly have a look at the particular circumstances to which the hon. Lady refers. I have been pleased to see the growth in neighbourhood plans, which are analogous to what she is suggesting. Indeed, I visited a village in my constituency that is looking forward to introducing them. They give people and businesses a much bigger say.

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[Hilary Benn]

I am grateful to the hon. Member for Gloucester (Richard Graham) for agreeing that the Secretary of State is having problems with the delivery of housing. I have already indicated that we will support any measures that will help.

Councils will have to make proper assessments of their housing need. On the Prime Minister’s announcement today on council and social housing and migration, the Secretary of State knows that people cannot just get off a plane and get a council house. He will be familiar, of course, with section 160A of the Housing Act 1996, and he will know that councils already have the power to put in place allocation schemes, because the previous Labour Government issued guidance in 2009 and an increasing number of them are doing so. It would be helpful if we could get clarity about precisely what is being proposed, given that the housing lead of the Local Government Association, Councillor Mike Jones, who is a Conservative, has queried the need for the guidance, and given that this morning’s papers reported that the Government plan to impose an expectation on councils. How exactly is it possible to impose an expectation on councils? [Interruption.] I say to the planning Minister that I have a little bit more experience of Government than him—and it shows.

Ministers are looking to councils to identify housing need, but I say to them that the Growth and Infrastructure Bill will not assist councils in doing so, because clause 1 threatens to take away the power of local communities to decide whether housing is provided. The planning Minister, who is being very vocal, said that “vanishingly few” councils would be caught by that provision. However, to judge by the latest figures, as many as 21 local authorities could be stripped of their democratic accountability in taking decisions on housing planning applications if developers choose to go straight to the Planning Inspectorate.

How does the planning Minister think that will assist communities to take responsibility for housing provision? All of us have to face up to the need to provide more homes. That is the point that he has been making. However, is it better to let developers decide where houses should be built or to allow communities to take that responsibility for themselves?

I turn, finally, to one of the effects of what the Government are doing, which was not mentioned by the Chancellor in his speech on Wednesday. That is the effect that the decisions taken by the Chancellor, the Secretary of State for Communities and Local Government and the Secretary of State for Work and Pensions will have on people on low incomes and their homes. So far in this debate, we have talked about the need to build homes so that people can move into them. I want to turn to the problem of people being forced out of their homes because of the Government’s bedroom tax and the Secretary of State’s poll tax.

One consequence of what the Government are doing is likely to be rising rent arrears. That is exactly what councils and housing associations up and down the country are anticipating. Last week, the evidence from the universal credit pilot showed rising rent arrears. That is creating a lot of uncertainty, not least for housing associations. A number of them have had credit rating downgrades recently. If lenders think that housing associations will have difficulty collecting rent, it could put up their borrowing costs, which could impact on their balance sheets and their ability to borrow. Ultimately, it will affect their ability to build the homes that the Secretary of State says he wants to see. All of that will create huge challenges for families, councils and housing associations, not least because of the debt that people will get into.

At the very time when the Chancellor has decided that the most important thing to do is to cut the top rate of tax, the Secretary of State for Communities and Local Government has brought in his new poll tax and the Secretary of State for Work and Pensions has brought in the bedroom tax. What is so astonishing is that they are both singling out one group of people in our society. Whether they are working, seeking work or unable to work, the people who will be affected are those on the very lowest incomes, because that is why they get council tax benefit and housing benefit.

Given that the fundamental problem in the country is a lack of growth in the economy—the Chancellor’s crowning failure—have Ministers paused for a second to consider what impact those two taxes will have on the economy? All the evidence shows that when people who are on low incomes have money, they tend to spend it. In Leeds, £9.4 million—[Interruption.] I know that the planning Minister, who is chuntering from a sedentary position, does not want to hear this, but the people on the lowest incomes in Leeds are going to lose £9.4 million that they do not have because of rent increases and council tax rises.

Incredibly, last week the Secretary of State tried to blame local authorities for his policy, when he said that they

“seek to persecute and to tax the poor.”—[Official Report, 18 March 2013; Vol. 560, c. 611.]

That is extraordinary. The only person who is to blame is the Secretary of State. It is his legislation. He is the reason why bills are landing on people’s doorsteps that many of them will find hard to pay. Ministers know that people will do their best to stay in their own home—indeed, the Government’s assessment expects that to happen—because they want to stay with their friends, family and community.

[Kate Green]

Is my right hon. Friend interested in research just released by the Centre for Local Economic Strategies which shows that the Government’s welfare reforms, and the loss to family incomes, mean that on average 80% of money lost will be lost to the local economy as a result of reduced local shopping, reduced use of local transport, and reduced socialising?

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[Kate Green (Stretford and Urmston) (Lab)]

Not everything in the Budget is unwelcome, but the cumulative effect of this Budget and previous Budgets and spending reviews is dire. I am fearful that in some respects we will never escape their effects—family lives have been blighted and futures lost as a result.

I was startled at the total lack of ambition and vision for the economy expressed in the Budget. There were one or two welcome announcements—the employer national insurance break is welcome—but where is the strategy for improving the quality of jobs that is so necessary to improve our productivity and competitiveness? The rise in private sector employment that Ministers trumpet is, to a degree, illusory. It represents, in part, the fact that the working-age population has grown, so it is hardly surprising that more people are in work. It represents to a degree a re-characterisation of public sector jobs into the private sector. It is a reflection of wage cuts and freezes that mean that people are in work, but worse off, and that 80% of the increase in jobs is in involuntary part-time work.

As the hon. Member for Newton Abbot (Anne Marie Morris) said, business rates remain a serious burden. They have risen by 13% in the north-west in the past three years. There was deep disappointment in my region at the decision last year to delay the revaluation, and disappointment last week that there was nothing in the Budget to help in the meantime or to take the opportunity to use the period of the freeze to review totally the purpose and structure of the business rate.

As I said in an intervention, business will also be hit by the impact of welfare reform on household budgets. Work by the Centre for Local Economic Strategies has shown that for every £1 cut in social welfare reform, 63p is being lost to Stretford’s town centre economy, as people cut back on shopping, socialising and the use of taxis and local transport, while the loss to the local economy across the whole of Greater Manchester is estimated at £400 million. The business announcements in last week’s Budget will not put that money back into our local economy, and I am concerned by the warning of further restrictions on annually managed expenditure in the June spending review.

I am glad that the Government recognise the pressures on those trying to buy their own home, and I recognise that home ownership is the aspiration of many of my constituents, but the Government refuse to recognise that renting is a valid and, indeed, necessary option for many families. The support being offered to renters is minimal and the policies divisive. If it is right to offer a public subsidy to enable a young person to get a mortgage to buy their first home, why is it wrong to give a proper subsidy, via housing benefits, to another young person aged under 35 to rent a home of their own? Let us remember that both young people could be in work.

If it is right to provide a public subsidy to a young couple wanting to buy a new and perhaps larger home for a growing family, why is it wrong to subsidise the same family if they want to remain in social rented accommodation and also need more space as kids grow and develop? As my hon. Friend the Member for Inverclyde (Mr McKenzie) said, Government support to buy a home or get a mortgage will be of no use to those of my constituents who are either not working or in short-term insecure employment, which means that they are not attractive to mortgage lenders and have no choice but to rent.

Failure to support working families on the lowest incomes and those on out-of-work benefits feeds across to other policy areas. The child care announcements will benefit many better-off families, but as the Resolution Foundation pointed out, only 40% of those on universal credit will benefit from the maximum 85% rate, while those looking for work will not get any help at all when engaged in a job search. The same is true of the increase in the personal tax threshold, which is of no help to those on very low wages whose earnings are too low for them even to pay tax. The poor and the working poor have therefore once again totally missed out in the Budget, and as a result deprived families and communities will become more deprived.

[Mr Speaker]

I will call the Opposition Front-Bench speaker no later than 9.36 pm.

Economic Policy

Kate Green Excerpts

Monday 25th February 2013 Commons Chamber

[Mr Osborne]

Of course we want to help people who are not currently working the hours that they want to work; we want to help them by helping businesses to expand to take on more people. As well as jobs going up by 888,000 in total and private sector jobs going up by 1 million or more, the number of hours worked in our economy has also gone up. Labour argues that it is all to do with under-employment, but that is not the case. Of course we want to help people who are working part time but want to go full time and people who want to work more hours. The best way to do that is to create an environment in which businesses want to expand and take people on.

[Kate Green (Stretford and Urmston) (Lab)]

Does the Chancellor not accept that the reason why gilts have not really moved in the wake of the downgrading is not a tribute to the Government’s economic policy, but is symptomatic of a deep pessimism about the long-term growth prospects for our economy?

[Mr Osborne]

If that were the case, why would German rates be lower than ours?