Covid-19 Economic Support Package

Kate Osborne Excerpts

Wednesday 14th October 2020 Commons Chamber

[Kate Osborne (Jarrow) (Lab)]

It is an honour to follow the hon. Member for Oxford West and Abingdon (Layla Moran). I agree with so many of her points.

In my constituency of Jarrow, people have been living under local restrictions for over a month without any clear support package in place. The Chancellor’s indecisiveness has left workers and businesses across all constituencies, particularly in areas under local restrictions, in complete limbo and often confused by ever-changing rules and regulations. It is no secret that wealthy areas, including the Chancellor’s own seat of Richmond, are avoiding being locked down, despite higher covid-19 rates than in less wealthy areas that are subject to restrictions.

It begs the question: if London and the south of England had been asked to live under the same restrictions as those implemented in the north, would the Government have found new strategies a long time ago? This utterly stinks of classism and serial incompetence at the heart of this Government, and the empty Government Benches tell me how much the Government are not listening.

The Chancellor has made a U-turn of sorts, but people in my constituency have already suffered, and for many this has come far too late. It feels to many like an intentional managed decline. This is not levelling up; it is levelling down.

Let us take the example of Kieran, a bar manager in my constituency who got in touch, heartbroken that his bar has turned from a hiring business to a firing business in the weeks since the local restrictions were introduced. Kieran’s business saw infection rates staying stable for the two months after reopening, so like many of us he is at a loss to understand why the hospitality industry is being made a scapegoat for the rise in cases, when no concrete evidence has been produced by the Government to prove that, despite Members from all parts of the House asking repeatedly for that evidence.

There is nothing new for the self-employed, nothing again for those who have been excluded from the start and nothing for businesses that are not forced to close, but are suffering because of their local restrictions. In fact, some local hospitality businesses and others have told me they would rather be in tier 3 than tier 2 due to the lack of financial support. The Chancellor’s chaotic habit of trying to fix problems of his own making at the last possible minute is costing jobs and causing chaos. The UK is on course for a 1980s-style jobs crisis, and the Chancellor’s name is all over it.

I fully support the proposals by the shadow Front Bench team that would put in place a job recovery scheme that fixes the problems so that many employers can keep more staff on. If the Chancellor’s current plans are not reformed, millions of people will be pushed into unemployment, yet the Government will still be required to offer financial support through many benefits, such as the inadequate universal credit. Households will feel the squeeze and the prospects for recovery will be hampered by a lack of income and low confidence among British households. The legacy from the last period of mass unemployment already casts a shadow over the British economy, particularly in the north, and I can only imagine what the legacy of the Prime Minister and this Government will look like. Nobody is asking for the furlough scheme to go on forever, but workers and jobs must be protected if we are to return to any kind of normality when we finally defeat this virus. The Government should put the correct levels of support in place, make the correct political decisions and save jobs by supporting all businesses, no matter the size or the sector.

Finance Bill

Kate Osborne Excerpts

2nd reading & 2nd reading: House of Commons & Programme motion & Programme motion: House of Commons & Ways and Means resolution
Monday 27th April 2020 Commons Chamber

[Kate Osborne (Jarrow) (Lab) [V]]

I am sure that all Members agree that the covid-19 crisis is unlike anything we have experienced in our lifetimes, and life will possibly never be the same again. This Government, however, have a duty to ensure that people’s jobs and incomes are protected. The crisis, as we know, has caused serious financial suffering for businesses, for people and for their families. Although everyone’s lives have been affected by the efforts to contain covid-19, so many people are struggling to cope with the financial and practical repercussions of tackling the spread of the virus.

According to the Centre for Economics and Business Research, households across the UK face a fall in disposable income of £515 a month due to the pandemic. Well over 1 million new claimants have signed on for benefits since the start of the coronavirus crisis, and there are genuine fears that unemployment is heading towards levels not seen since the 1980s. The Government’s emergency measures are welcome, but, along with the measures set out in the Finance Bill, they simply do not go far enough.

My constituency of Jarrow has already been hit hard by a decade of austerity and remains an area of high unemployment. The north-east has the highest unemployment rate in the country, which is extremely worrying, but equally concerning is that many of the tens of thousands of people employed across our region are in low-paid, part-time or insecure jobs or on zero-hours contracts. If the coronavirus crisis leaves 2 million more people unemployed, as suggested by the Office for Budget Responsibility, it will be crucial that the Government do everything in their power to minimise the depth and length of the economic impact.

My two local authorities, South Tyneside Council and Gateshead Council, have lost more than half of their funding during the past decade, leaving services stripped to the bone. That cannot continue, and they cannot be expected to pay for the crisis. In the South Tyneside and Gateshead local authority area, one in three children are already living in poverty and thousands more families are living on the edge of the poverty line.

Nationally, people have lost their jobs or seen their income fall during the pandemic and the lockdown, and there have been more than five times as many claims for universal credit in the space of a month. I am regularly contacted by constituents who receive universal credit and have been left with no choice but to turn to a food bank, left unable to pay for heating and struggling to pay their rent. This Government say that universal credit is working, but from the people of Jarrow and the whole of the country I tell the House that it is not.

We know that businesses have been hit hard, but the coronavirus business interruption loan scheme, though welcome, is going only a small way to helping those firms that are now struggling to stay afloat. Providing 16,000 loans in four weeks in a country of 6 million small and medium-sized enterprises is simply not good enough. Those 16,000 loans amount to £2.8 billion of lending to SMEs. In comparison, the French scheme has provided 174,000 loans worth €24 billion.

So many workers are falling through the cracks. I have written to the Chancellor about the cut-off date for employees to receive support through the coronavirus job retention scheme. Although the extension from 28 February to 19 March will allow more employees to be furloughed, a lot more new workers will still miss out because they are paid towards the end of each month. Some have contacted their previous employer and asked to be re-employed on furlough, but I am informed that some companies are either unwilling or unable to help. The Government must consider further extending the cut-off date for the coronavirus job retention scheme to include the large proportion of workers who are paid monthly and giving the opportunity for other new employees also to be furloughed.

With economic growth already predicted to fall even further in the months ahead, the coronavirus crisis must not be used as cover for all the problems that have resulted from the lack of investment over the past 10 years. Lessons need to be learned from this crisis. This Government’s Finance Bill does not come close to reversing the damage of the past 10 years of austerity. The Government need to make sure that no families, workers or businesses fall down the cracks, because there is no doubt whatsoever that after this crisis is over our society and our economy will have to be very different.