Jobseekers (Back to Work Schemes) Bill

Kelvin Hopkins Excerpts

Tuesday 19th March 2013 Commons Chamber

[Grahame M. Morris (Easington) (Lab)]

It is not often that, when I rise to oppose a Government Bill, as I do again on this occasion—for the avoidance of doubt, I will be going through the No Lobby—I follow six hon. Members in succession with whom I agree. Perhaps that is an indication that no Government Back Bencher is prepared to stand on their convictions and argue the point. Therefore, this is quite a rare occasion.

I am proud to represent the Easington constituency. This is a matter of social justice for me and I have a number of concerns about the Bill. The issue of retrospection is an important and fundamental one. I suspect that the Government are opening a Pandora’s box here. In the debates on last year's Finance Bill, I heard the same Minister warning of the dangers of retrospective measures to deal with tax avoidance and loopholes, so using this route will have consequences. If he was so confident about the quality and strength of his argument, why did he not challenge the decision in the Supreme Court, rather than using primary legislation? Perhaps he might answer that question in his response.

It is not just an issue of retrospection—the Government's arguments are wrong. They are trying to justify this measure, but they have made the mistake. It is an issue of wording. Nevertheless, the Government have made the mistake and they are seeking to sell their argument to hon. Members on both sides of the House by saying that, if the funds are not recovered from those who were incorrectly sanctioned, they will have to be recovered from elsewhere in the welfare budget. That is outrageous blackmail; I am sorry if that is not parliamentary language, but I find that deeply offensive. It goes against every grain of fairness in Members on both sides of the House. The view I am expressing is the view that has been unanimously expressed to me. I have received numerous e-mails and messages from my constituents over the past 48 hours, all of them asking me to vote against this Bill as it is unfair and unjust.

The Government, and especially Government Back Benchers, have characterised jobseekers who have been sanctioned as workshy and feckless—the sentiment expressed was “Are you really suggesting these people shouldn’t be sanctioned?” Let us have a look at the Work programme, however. It has gone from chaos to farce. We talk about “workshy”, but what about wage-shy employers who exploit the unemployed, with the connivance, approval and funding of the Government?

Many commentators have severely criticised the Work programme as not representing value for money, and so, too, I believe, has the Public Accounts Committee—I am sure the Minister will correct me if I am wrong about that. Indeed, it has been suggested that the programme is worse than doing nothing, and I am certainly aware that major retailers have exploited free labour from the Work programme to meet seasonal demand, rather than, as would otherwise have happened, employing temporary staff or, even, giving existing employees additional hours. The programme has therefore had the perverse effect of blocking real jobs, and I agree with other Opposition Members who feel it should be subjected to a root-and-branch review.

What we have is a £3-million black hole, and it seems to me that the only people profiting from it are the privately contracted organisations—some of whom were mentioned by my hon. Friend the Member for Hayes and Harlington (John McDonnell—who have done well out of the programme. I am therefore surprised that one of the Government’s principal arguments here is about the protection of the national economy, when they are seeking to introduce primary legislation to rewrite history and withhold social security payments that were denied because of unlawful sanctions. We must not beat about the bush. The judgment is clear and specific; my hon. Friend the Member for Slough (Fiona Mactaggart) read it out in her passionate and excellent speech. The Government are at fault here, in how they have implemented things.

I oppose the concept of two nations, as does my party, but what will the consequences of these measures be? The Government are creating two nations. They are seeking to penalise and punish the poor for the mistakes of the rich and powerful, in part of a continuing series of policies that are badged as “austerity”. Those policies are pushing the poorest in society further into poverty.

As my hon. Friend the Member for Liverpool, Walton (Steve Rotheram) said, one of the most galling things is that Ministers have shown absolutely no contrition or understanding of the consequences of their actions. That might be because they do not understand the consequences, because they do not live in the real world where they would rub shoulders with some of the poorest people in society who are suffering hardship. People in my constituency in east Durham ask me, “Why are we suffering for the consequences of this crisis? Was it created in Horden, Shotton, Haswell, Blackhall or even Murton?” No, of course not; the crisis was caused by the mistakes of the banking sector and City speculators. I raise that point not only because I despise the casino bankers for the state they have reduced the economy to, but because there is another avenue that Ministers could pursue to recover the £130 million, which I will return to shortly. In fact, we touched on this issue last year in the Finance Bill Committee. Why on earth do the Government not legislate for a general principle of tax avoidance? Instead of robbing people who have been inappropriately sanctioned, the Government should consider the huge reservoir of unpaid tax that individuals could well afford to contribute to. To my mind, there was a failure by Governments.

[Kelvin Hopkins (Luton North) (Lab)]

My hon. Friend is making an excellent speech and a very good point about where money could be found. He mentioned the tax gap, which, according to Richard Murphy and others, is some £120 billion a year. We are talking today about £130 million, which is roughly one thousandth of that amount.

[Grahame M. Morris]

My hon. Friend, who is very knowledgeable and has a background as an economist, has hit the nail on the head. The general public, my constituents and many Opposition Members do not understand why the Government do not address this problem. There is a relatively straightforward way to do so: by legislating for a general principle of tax avoidance. The Government are quite happy to use primary legislation retrospectively to deprive people who have been illegally sanctioned of £130 million, but they will not use the same route to recover moneys properly due to the Exchequer.

There is a contradiction here. Although the Government have been highly critical of what has happened, they continue to push the case for further deregulation. Just yesterday, in a Delegated Legislation Committee the statutory period of notice for compulsory redundancies for employers employing more than 100 people was reduced from 90 days to 45. This Government are still very much pursuing the Beecroft agenda.