Oral Answers to Questions

Lloyd Russell-Moyle Excerpts

Tuesday 19th December 2023 Commons Chamber

[Kerry McCarthy (Bristol East) (Lab)]

12. What recent assessment he has made of the potential impact of the OBR’s growth forecasts on living standards.

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

13. What recent assessment he has made of the potential impact of the OBR’s growth forecasts on living standards.

--- Later in debate ---

[Laura Trott]

As the hon. Lady will know, we put billions of pounds into councils this year, and the provisional settlement is above what is expected to be the inflation rate next year. If she has specific issues with her local council, I shall be happy to take that up with her.

[Lloyd Russell-Moyle]

We have seen one of the greatest falls in living standards in a generation, and the Chancellor has callously removed the household support fund from councils. In Brighton the fund pays for free school meal vouchers in the holidays, the warmth and wellbeing scheme, career centres, family hubs, and food banks such as the one in Whitehawk where my constituency office has its surgeries. Will the Minister think again about scrapping the household support fund, so that councils can support the very worst off?

[Laura Trott]

I want to reassure the hon. Gentleman: no decision has been made about the household support fund. More broadly, however, we have pulled in an average of £3,700 per household this year to help people with exactly what we are talking about. This Government are on the side of people during what is a very difficult time.

Points of Order

Lloyd Russell-Moyle Excerpts

Tuesday 11th July 2023 Commons Chamber

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

On a point of order, Madam Deputy Speaker. I have written to the Treasury twice without a substantive reply about Sea Lanes, the first new public lido opened in my constituency in 30 years, and the National Open Water Swimming Centre. They are owed a VAT rebate of over £170,000, which was due back on 19 April. I am sure that Government Front Benchers understand the importance to new businesses of getting speedy rebates.

His Majesty’s Revenue and Customs has no hotline for MPs to ring up. If our question is on VAT matters, we have to ring up the public line, and every 48 hours, Sea Lanes has to reauthorise my office to speak on its behalf. On 25 June, we were told that there was nothing delaying that payment, yet three weeks later, no payment has been received. Madam Deputy Speaker, as there is no hotline and HMRC has not responded to my letters, could you advise me how best to pursue this matter with the Treasury?

[Madam Deputy Speaker (Dame Rosie Winterton)]

I thank the hon. Gentleman for his point of order. From what he has said, I can understand his concern. Miraculously, he has managed to raise his point of order when he has a Treasury Minister right in front of him, and I have a feeling that Ministers may well take back his comments.

Mortgage and Rental Costs

Lloyd Russell-Moyle Excerpts

Tuesday 27th June 2023 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

I beg to move,

That this House is extremely concerned that, under this Conservative Government, average mortgage costs will be increasing by £2,900 per year, with a typical household in the UK paying over £2,000 more per year than in France and over £1,000 more than in Ireland and Belgium, and that renters face huge increases in rent payments; condemns the Government for its slowness in acting to support millions of homeowners and renters and so alleviate the impact of its policies; calls on the Government to bring in mandatory measures, as the current voluntary measures could lead to around one million homeowners missing out on support, and to immediately adopt measures to ease the mortgage crisis and halt repossessions by guaranteeing support from lenders for struggling mortgage borrowers and strengthening the rights of renters; in particular calls on the Government to require lenders to allow borrowers to switch to interest-only mortgage payments for a temporary period, to lengthen the term of their mortgage period, to reverse any support measures when requested and to make mandatory repossession restrictions; and further calls on the Chancellor of the Exchequer to instruct the Financial Conduct Authority to urgently issue guidance that the credit score of borrowers should be unaffected by any temporary switches to interest-only mortgage payments or lengthening of their mortgage period and to introduce a renters’ charter that would end no-fault evictions immediately.

Throughout Britain, families are experiencing the harsh, rolling impacts of the Tory mortgage bombshell. Last autumn, the Tories’ mini-Budget crashed the pound; they trashed our economic institutions and left our country’s reputation in tatters, with higher mortgage rates as the consequence. The current Prime Minister and the latest Chancellor have not turned the situation around. For families across Britain, things are getting worse, not better. The Prime Minister is now lecturing the country to “hold our nerve”. It is easier to hold your nerve when you do not have to pay the price of the Tory mortgage bombshell.

What are the consequences? Millions of households will be hit by the bombshell, paying, collectively, a total of £15.8 billion more in mortgage payments by 2026. That will be an additional £240 per month, on average, for those re-mortgaging. In the constituency of the Chief Secretary to the Treasury, the right hon. Member for Salisbury (John Glen), the figure is higher still, with 9,700 households there facing payments, on average, of £280 per month more—or £3,400 per year. People can hold their nerve all they like, but how does the Minister think that is going to pay the mortgage or the rent?

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

My right hon. Friend is making a good introduction. Is it not the case that all this money that will be lost by households does not go to help anyone but the Tories’ friends in the banks, who, of course, have presided over those neo-liberal policies that trashed our economy?

Autumn Statement

Lloyd Russell-Moyle Excerpts

Thursday 17th November 2022 Commons Chamber

[Jeremy Hunt]

That is a good question. I will happily write back to my hon. Friend with what we are doing and what we can do. I would like her to pass on my thanks to Citizens Advice West Berkshire for the incredibly important work that it is doing to support people through a difficult period.

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

This is a Budget of austerity 2.0, is it not? Of course, different decisions could have been made. The Chancellor could have decided to abolish the upper limit on national insurance, raising more than £30 billion and solving adult social care in one fell swoop along with the crisis in council funding. He chose not to do so but instead to burden poorer people and working people. On housing and energy specifically, he has said that he will freeze local housing allowance, which is a freeze at the 30th percentile from two or three years ago—it was last uplifted just at the beginning of the pandemic. Will he please review that decision along with how people living in blocks of flats who receive communal energy have received no support for their energy bills? They need that desperately to come through, and he has promised it before.

[Jeremy Hunt]

As I have explained, we increased local housing allowance at the start of the pandemic—significantly—and we are keeping it at that higher level. He talks about difficult decisions. I would say that there is one difficult decision on the table today: do we do what is necessary to tackle inflation? On the Government side of the House, the answer is yes.

The Growth Plan

Lloyd Russell-Moyle Excerpts

Friday 23rd September 2022 Commons Chamber

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

The reality is that this is a class war Budget. It is an ideological Budget. It is about taking from the poor and giving to the rich. It is about lining their pockets. It is about them and us. That party over there has said, “We do not care about ordinary people in this country; we care about piling on debt. We will make ordinary people pay while our chums in the City get rich.” And will those chums spend the money on the economy? No: they will squirrel it away in tax havens around the world, because that is what they have always done. Is this Budget not a disgrace?

[Kwasi Kwarteng]

Let me reiterate that reversing the national insurance increase, which Labour supported—[Interruption.] Three months ago, Labour voted against the increase in national insurance. I reversed that: we reversed it. That helps people—the 1p cut in the basic rate helps people. That is not class war.

Economy Update

Lloyd Russell-Moyle Excerpts

Thursday 26th May 2022 Commons Chamber

[Rishi Sunak]

My hon. Friend is absolutely right and I know that he is a champion for pensioners in his constituency. I hope that he will be pleased by today’s news that they will receive an extra £300 this winter to help get them through. His point about the long run is right. My belief is that if we can get businesses to invest more, train more and innovate more, spurred on by tax reductions and reforms this autumn, we will be able to drive up our growth and productivity.

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

I welcome the fact that the Chancellor has accepted many of Labour’s calls, but my constituent who is on £1,300 take-home pay and pays a rent of £800, council tax of £100, debt repayments of £100 a month, travel costs of £100 a month and fuel costs of £200 a month is left with nothing to eat with. He is ineligible for universal credit and because he lives in a block of rented flats where the landlord redistributes the fuel, he will also be ineligible for the fuel rebate. Will the Chancellor confirm to councils that their discretionary money must prioritise people who live in park homes or who receive their fuel from their landlords, so that they can get support as well, because they are currently excluded?

[Rishi Sunak]

I am very happy to take away that suggestion when we design the guidance for the discretionary fund.

Public Service Pensions and Judicial Offices Bill [Lords]

Lloyd Russell-Moyle Excerpts

Report stage
Tuesday 22nd February 2022 Commons Chamber

[Peter Grant]

The hon. Member is absolutely right. If the new clause was intended purely to limit the activities of the BDS movement as a precursor to possible further restrictions later on, a very different new clause would have been tabled, and it might have been possible to word it in a way that we would not have significant problems with, but this new clause is far too wide. It could give the Secretary of State—any Secretary of State—the power to prevent any public pension fund from considering any kind of ethical, sustainability or other factors simply because they decide that they are contrary to UK foreign or defence policy.

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

The hon. Gentleman is making an interesting argument about why the new clause is too wide. Is there not also the problem that it risks investments themselves due to a chilling effect for investors who might not withdraw from an investment when it is economically advisable to do so because of fear of breaking the rules under the new clause, so we could end up with the devaluation of pension schemes?

[Peter Grant]

I will come on to that later. We need to remember, in all of this, that the trustees of any pension scheme have an absolute fiduciary duty to those who rely on the performance of the fund for their current or future pension. We do not want anything that ties their hands, such as someone saying they should go only for very low-yield investments because that person has objections to the activities of companies that might give a higher yield. There are times when we must question whether it is right to put trustees under that kind of pressure. It is also wrong to suggest that pension trustees, in addition to or instead of their absolute duty to pension scheme members, should have some kind of duty to be a mouthpiece for the British Foreign and Commonwealth Office or the British Ministry of Defence. They are not an arm of Government; these are legally independent trustees, and they have to have that legal independence properly protected.

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[John McDonnell]

I was once, in my callow youth, an adviser to the mineworkers pension scheme, and then I was an adviser at the TUC, working with Lord Bryn Davies, who is one of our colleagues in the Lords at the moment, and there was never a problem with our fiduciary duty of maximising the income to the pension fund itself because of the range of investment opportunities available to us. I think we found in the past that exercising such moral judgment can prove effective in the long term, because it ensures that the fund is not investing in countries that may in the longer term become unstable as a result of the actions they take. I would just say, and I am making a personal point, that I think new clause 1 flies against my ability to exercise my moral duties about investments by my pension fund.

[Lloyd Russell-Moyle]

Will my right hon. Friend give way?

[John McDonnell]

Yes, but then I want to move on to my amendments.

[Lloyd Russell-Moyle]

Is there not a problem with this, in that it leaves the Secretary of State to decide what the foreign or defence policy might be in an arbitrary way, rather than requiring pension funds to set an ethical policy in which they can say that they do not want to invest in countries where there are human rights abuses? We would still have to treat all countries equally, so they could not target one country or another, but there would be an ethical framework, and this new clause does not allow an ethical framework.

[John McDonnell]

I would also come out fairly pragmatically and say that there may be some countries that, according to the Government, were not appropriate to invest in a few years ago but now are. I do not want a little red book to be thrown at me again, but I would just cite the fact that the relationship the Government have had with China has changed over the years and, I hope, is changing again at the moment with regard to the Uyghurs.

Let me move on to the new clause and amendments in my name. New clause 10 is a simple reflection of new clause 8, tabled by my hon. Friend the Member for Hampstead and Kilburn (Tulip Siddiq), on the pensions trap. I want to echo what I think she said really eloquently in Committee and today about how the dialogue on this issue must continue, because there is an unfairness at the heart of the legislation we are pushing through at the moment. This affects firefighters, police superintendents and so on, who feel aggrieved, and I feel that a bit more dialogue may enable us to find a solution and restore their confidence in the pension scheme itself. That is why I support new clause 8.

My new clause 10 is simply more explicit about ensuring that there are consultations with the trade unions and other employee representative bodies, and that we seek to overcome the problem so that we have a non-discriminatory approach that does not fall foul of the law.

I turn to my amendment 24, which addresses a complex issue. It reminds me of the debate we had on the d’Hondt proportional representation system, as there were only two people who understood it: Mr d’Hondt, who died, and Jack Straw. Let me just go straight to the point on this matter. I am sorry if I go into some detail. The Chief Secretary to the Treasury said in Committee that

“it is vital that we establish now, for the avoidance of any doubt, that no member benefits will be cut and no member contribution rates will increase as a result of the 2016 valuations. Any benefit improvements due will be honoured, but no additional costs will be imposed. I reassure the hon. Lady”—

my hon. Friend the Member for Hampstead and Kilburn—

“on her important question, that the costs of our remedy genuinely sit with the Exchequer, not scheme members.”––[Official Report, Public Service Pensions and Judicial Offices Bill [Lords] Public Bill Committee, 27 January 2022; c. 10.]

This is complicated stuff. There is a confusion of two issues here. The Government did make a mistake and were challenged in the courts. I fear that that cost burden will now fall on to members of the pension fund, if it is included in the cost mechanism as an employee cost. That is the issue.

I turn to two points in that regard. First, there is the cost to the scheme of giving members the option to choose which benefits—old or new—they want to accrue during the remedy period. Some members will choose benefits that are better for them than they would have received before the McCloud and Sargeant judgments. The scheme will clearly have to meet the cost of paying those benefits—fine. We got the assurance from the Minister that the money will flow—we think it is £17 billion; that is the last estimate—and the burden will not fall on to the members themselves, but that is not what we are talking about here. The issue here is what impact the cost of the remedy should have on the cost control mechanism. I remind Members that this is the mechanism for deciding whether members’ benefits should be changed or, alternatively, whether contributions could be changed.

There is no doubt that treating the cost of the remedy as an employee cost for the purposes of the cost control mechanism leaves members worse off than they would have been had it been treated as an employer cost. I draw the Chief Secretary’s attention to the helpful report from the House of Commons Library entitled “Public service pensions: the cost control mechanism”, which tells us that if we go back to the initial results of the 2012 scheme valuations, which were reported in 2018, the Government said that

“the protections in the new cost cap mechanism mean public sector workers [would] get improved pension benefits for employment over the period April 2019 to March 2023.”

It is those improved benefits that I believe are now at risk if the cost of the remedy is included as an employee cost and not an employer cost.

What does this mean? The improved benefits were required because members had suffered a reduction in the value of their expected benefits over the period 2012 to 2016 because of lower than expected pay increases and because longevity had not increased by as much as had been expected. In other words, the changes would not make members better off; they would simply maintain the value of the benefit package at the level that had been agreed. I apologise to Members, because this is complicated stuff, but it has to go on the record if we are to get redress on this, either today or in subsequent legal actions.

Given the requirement under the cost control mechanism, the respective scheme advisory board then set about agreeing the necessary changes in benefits. In other words, because the pay settlements had not been as large as predicted, and because people were not living as long as the predicted life expectancies, the cost burden on the scheme was less, which should have been reflected in benefits given back to members. The scheme advisory board started looking at what those benefits would be, and the Library report gives an example of packages of changes proposed for the civil service scheme, which included

“a reduction of member contributions; reform of the current contribution rate structure; and increased death benefits.”

The other schemes reflected similar sorts of benefits, so members would gain significantly as a result of this unfortunate situation—unfortunate because they never got enough pay settlements and never had the increase in life expectancy. Nevertheless, because those costs never fell on to the scheme, they should have been paid back to members.

In December 2018, the Court of Appeal ruled that part of the reforms amounted to unlawful discrimination. That was followed by the decision by the then Chief Secretary that the cost control element of the 2016 valuations should be put on hold. In other words, the members were to gain those benefits because of the cost control mechanism, the court decision took place, and the Government then froze the whole process. Eventually, the Government restarted the process and published the Treasury directions in October last year. The problem with the directions is that they treat the cost of remedying the Government’s mistake, as calculated for the purposes of the cost control mechanism, as a member cost, not an employer cost.

The important point to understand is that there is nothing inevitable about the remedy as a member cost. It has always been accepted that there are certain elements in the calculation involved in the cost control mechanism that are regarded as member costs that will impact on the cost control mechanism itself, but there are also other elements in the calculation that are employer costs and do not impact on the cost control mechanism. For example, the impact of changes in pay increases and mortality are obviously member costs, but changes in the discount rate and price increases are the employer costs. It is strongly argued by the trade unions, completely understandably, that mistakes made by the employer—that is, the Government—are employer costs.

What has never been discussed is how to treat the cost remedy incurred by the Government’s own error, and that is what needs to be addressed today. It was the Government’s mistake to have age discrimination in the scheme. The Minister in Committee said it was reflected in trade union representations, but as has been said by the Public Accounts Committee and others, the Government are the Government; they should have foreseen that there was the potential for discrimination. It is the Government who introduced the measures. It is the Government who are responsible for the Treasury directions and any legislation. It was a mistake by the Government. It is therefore logical that the cost of the remedy should be treated as an employer cost for the purposes of the cost control mechanism.

I apologise to hon. Members for the complexity of this, but it is important that we get on the record very explicitly that members of these pension funds should not have to pay in the long term for Government mistakes and should therefore have gained the benefit of either reduced contributions or enhanced benefits, because that is contained in what the Government agreed a number of years ago as the cost control mechanism.

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[Zarah Sultana (Coventry South) (Lab)]

I rise to speak to new clause 1. The year was 1985. After a campaign lasting decades, 123 councils answered the call for solidarity with the South African anti-apartheid movement and adopted policies opposing that injustice, including 39 councils that had divested from companies operating in South Africa and Namibia. While the Prime Minister, Margaret Thatcher, was calling the African National Congress and Nelson Mandela terrorists and Young Conservatives were proudly wearing badges calling for him to be hanged, local authorities were on the right side of history, standing up to the horror of apartheid. Of course, the Conservative Government could not tolerate that, so, a few years later, to weaken the anti-apartheid movement, they brought in laws making it illegal for local councils to boycott South African and Namibian goods. Looking back, it is crystal clear who was on the right side of history and who was on the wrong side.

The new clause, in the name of the right hon. Member for Newark (Robert Jenrick), would ban local councils from taking such a stand. Had it been in place back in 1985, because the Conservative Government supported apartheid South Africa—let us not forget that—local councils, no matter the strength of local feeling or the righteousness of the cause, would have been prevented from divesting pension funds from apartheid South Africa. They would have been compelled to be complicit in injustice.

Government Members may argue that that is history and things are different now. I contest that the facts say otherwise. The House knows that British-made weapons and diplomatic support are integral to the Saudi war in Yemen. Even as that war has claimed the lives of more than a quarter of a million people, pushed more than 20 million into absolute destitution and resulted in grave violations of international law, British complicity has continued. The new clause could deny councils the right to divest from arms companies whose bombs rain down on the people of Yemen. Similarly, if a local authority wanted to align its pension fund with international law and divest from companies operating in illegally occupied Palestinian lands, the new clause risks denying it that right, too.

[Lloyd Russell-Moyle]

The Israeli Labor and Meretz parties, our sister parties in Israel, have both written to the leaders of the Labour party and to all of us to say that they want divestment from companies that invest in the occupied territories. Israeli Members of Parliament are asking us to do this. New clause 1 goes against what they are asking us to do, does it not?

[Zarah Sultana]

Yes, it does, and I was proud to stand on a Labour manifesto committed to that policy, too.

With the rapidly accelerated threat of climate catastrophe and the need to consign the fossil fuel industry to the dustbin of history, new clause 1, at the worst possible moment, risks outlawing councils from standing up for climate justice and banning divestment of pension funds from companies that are setting our planet on fire. [Interruption.] The hon. Member for Brigg and Goole (Andrew Percy) laughs, but this is an actual threat. I am not sure if he is a climate denialist, but he should really look into that.

These are just some of the blatant affronts to local democracy and ethical investments. New clause 1 is so vague and so badly worded that it would have a chilling effect on public sector pension investments. It could be weaponised against any human rights campaign that raises concerns about pension investments in any company that is not formally on a UK sanctions list. As Amnesty International and Human Rights Watch warn, it is so badly worded that, in fear of committing an offence, pension scheme managers could be forced to break their fiduciary duties.

In 1959, an anti-apartheid campaigner and Nobel peace prize winner called Albert Lutuli put out a call for global solidarity. In Britain, hundreds of thousands of campaigners responded, launching a boycott of South African goods. People across the country did what they could do to end the injustice. In my city of Coventry, the local Labour party led the fight, distributing leaflets, holding public rallies and even displaying a large poster in the city for a whole month, publicising the boycott and raising awareness about apartheid. As so often in history, it was the actions of local people, anti-racist campaigners, trade unionists and local councils that led the way, counteracting Westminster’s complicity.

Those actions, while small in themselves, were part of a global anti-apartheid movement that was instrumental in bringing an end to this injustice. We should learn that lesson. I strongly encourage Tory Members to learn the lessons of history. We should empower local councils to make democratic ethical investment decisions, not outlaw them, as new clause 1 does. [Interruption.] I therefore encourage Members on the Government Benches, especially the very enthusiastic hon. Member for Brigg and Goole, to vote against it.

Oral Answers to Questions

Lloyd Russell-Moyle Excerpts

Tuesday 1st February 2022 Commons Chamber

[Derek Thomas (St Ives) (Con)]

17. What steps he is taking to help people with the increasing cost of living.

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

18. What fiscal steps he plans to take to help reduce the impact on households of the rise in the cost of living.

[Kirsten Oswald (East Renfrewshire) (SNP)]

20. What recent assessment he has made of the effect of his fiscal policies on the cost of living.

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[Rishi Sunak]

My hon. Friend is absolutely right to highlight pensioners and their needs. As I said, I am proud of the Government’s track record in supporting them. I can also provide him with the reassurance that we continue to look at the best way to provide support to all those in need, as we have done over the last year of two. In the meantime, he will be reassured to know that we have protected pensioners this coming year with the double lock and, as I said, the winter fuel payments providing up to £300.

[Lloyd Russell-Moyle]

Energy prices are rocketing but the price of producing energy has not, meaning that energy companies are experiencing record bonanza profits this year if they are producers. The Chancellor is, of course, worth more than a billion pounds. Could he tell constituents struggling to pay their energy bills what should be taking the cut? Should it be the profits of the energy companies or the lifting of the energy cap that he proposes, costing constituents £1,800 on average a year?

[Rishi Sunak]

The energy price cap has already protected millions of people against rising energy bills. On the taxation of companies, it is probably worth bearing in mind that one thing that the last few months have shown is that there is an opportunity to invest more in providing natural gas as a transition fuel as we make our way to net zero in a measured manner. To that end, we should be encouraging investment in exporting our natural resources, not disincentivising it.

Household Energy Bills: VAT

Lloyd Russell-Moyle Excerpts

Tuesday 11th January 2022 Commons Chamber

[Mr Clarke]

The share of our support is going up. We are also increasing the number of people who are likely to be in scope. We are consulting on increasing the number of people for whom that discount provides a benefit by 780,000. It will also likely rise in value from £140 to £160, so it is an expanding benefit.

Vulnerable households will also be supported with the cost of essentials through the £500 million household support fund. That funding has been made available to local councils across England to support their residents this winter. Importantly, in recognition of the fact that families should not have to bear all the VAT costs they incur to meet their needs, domestic fuels such as gas and electricity are already subject to a reduced VAT rate of 5%. In response to the Opposition’s calls to go further on VAT costs, I would note that that would mean our spending a significant amount on subsidising the fuel consumption of some of the wealthiest. When we look at our response to all these challenges, we need to ensure that we spend taxpayers’ money on the most effective possible interventions to support the households struggling the most with the cost of living.

The cost of living is not about any single bill or expense. That is why, at the autumn Budget, the Government put in place a host of measures to help families with the cost of living.

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

There has been a £67 council tax rise, a national insurance rise of £250 and an income tax rise of £150—those are averages, for the average person. How on earth can the Chief Secretary say that his Government have put measures in place to help the ordinary person in this cost-of-living crisis when he will be clobbering them with, on average, a £1,405 bill? What they are doing is disgraceful.

[Mr Clarke]

That was a typically temperate intervention from the hon. Gentleman. To make sure that work pays, we have cut the universal credit taper rate by 8p, from 63p to 55p. That is an authentically Conservative response to make sure that we target our interventions to help people. We are increasing the work allowance by £500. Taken together, that is a tax cut for 2 million low-income families, which is worth £2.2 billion, or an extra £1,000 a year in their pocket. It was a Conservative Government who introduced the national living wage in 2016, and it will be a Conservative Government who increase the national living wage in April by 6.6% to £9.50 an hour for workers aged 23 and over.

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[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

The cost of living is ratcheting up, but it did not need to be this way. It did not need to be this way because the Government have implemented a number of tax increases. It did not need to be this way because the Government have failed to ensure that food prices, energy prices and other costs of living, including housing costs—with the inflated housing market, people are paying far too much for renting their houses—have been controlled.

It did not need to be this way because, for over a decade, this Government have made poor choices on energy. They banned onshore wind farms. This is now one of the cheapest forms of electricity known to this country, but it was banned for 10 years by this Government, who only U-turned last year, in the midst of a pandemic, when they realised there were very few options left for them. They cut the solar feed-in tariff, which meant that hundreds of poor families who would otherwise have chosen the option of having solar panels on their roofs could no longer afford to do so, and it became a luxury limited to the rich and middle classes. And, of course, they failed to invest in truly insulated green homes, and their insulation schemes have been a disaster.

I am no fan of the tactics of Insulate Britain, although I defend to the hilt their right to protest, but what they are right about is the simple failure of this Government to insulate every single home in the country. It is possible that family energy bills could have been reduced, almost decimated. We could still do that now, in just a few years: every council house, every social house, every house in the rented sector and then the houses that are owned could be transformed through a street-by-street measure. However, this Government have no answers apart from silly giveaway grants that do not even touch the sides of the insulation of a home, let alone its transformation into a Passivhaus or something approaching it.

As for our proposal, it is a short-term fix for the year. It means slashing VAT, but also ensuring that we make long-term investments in green energy. Investing in our country and our infrastructure can be a possibility, but only by voting for this motion today will we start to turn the tide of Government failure on the cost of living, on bills and on our climate.

Health and Social Care Levy

Lloyd Russell-Moyle Excerpts

1st reading
Wednesday 8th September 2021 Commons Chamber

[Alison Thewliss]

What the hon. Gentleman fails to understand is that we are starting from very different points. He does not acknowledge that, and he does not understand it.

The response from equality and anti-poverty groups has been absolutely damning. The Women’s Budget Group has said:

“We believe there is a fairer way to fund social care. This is because, as they currently stand NICs are more regressive than income tax—with a lower threshold at which payments start, and a higher rate threshold beyond which employees pay a lower rate.”

The Resolution Foundation has described the policy as “generationally unfair”. Paul Johnson of the IFS has said:

“Remains the case pensioners will pay next to nothing for this social care package—overwhelmingly to be paid by working age employees”.

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

There are many ways in which this policy could have been made progressive, one of which would have been to look at the upper threshold for national insurance, which has not been addressed. A young graduate will now have a marginal tax rate higher than a rich Conservative on the Government Benches.

[Alison Thewliss]

The hon. Gentleman makes an excellent point. For young people who have perhaps struggled through this year, who have graduated and who are going out into the world of work, it is a real hammer blow to their prospects.

Many families are already facing a historic £1,040 cut to their annual incomes and are staring down the barrel of impending cuts to universal credit and working tax credit. The Joseph Rowntree Foundation has described the new levy as adding “insult to injury”. The New Economics Foundation has calculated that 2.5 million working households will be affected by the £20 a week cut to universal credit and the increase in national insurance. On average, they will lose out by £1,290 in the next financial year. Working households are doing their very best to put food on the table and support their children, and this cruel UK Tory Government caw the legs from under them.

--- Later in debate ---

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

When I first heard that the Prime Minister was going to come forward with a plan for social care, to tell the truth I am so desperate for any improvement in social care that I even considered voting for it. Even until yesterday I would have considered voting for it. As the details came out, however, I was not only disappointed but completely devastated, as will be many of my constituents. Not only does the plan fail to deal with any of the real issues in social care, which I will come on to in a second, but it is actually just a tax hike pretending to deal with health and social care. In reality, at the beginning it is not even linked to that, and later on there is some vague promise that it might trickle down to social care if we are lucky.

This is a tax rise that will hit the youngest, the poorest and the hardest working in our communities the hardest. It exacerbates the crisis in intergenerational justice that we have in our society at the moment. Far too many young people feel that the ladder is being whipped up behind them by an older political generation that is currently in power. I think that is sometimes unfair, because actually the issue is class-based and wealth-based, but this will exacerbate that feeling. A young graduate with student loans will be paying a marginal tax rate of almost 50%, which is more than many people on £90,000 and vastly more than someone whose earnings are from property, shares or other forms of wealth.

There are other options. The Government had other options. They could, of course, have lifted the lower rate of national insurance into the higher rate. Most people do not realise—most hard-working people, of course, do not earn £50,000 or more—that those earning more than £50,000 pay only 2% national insurance. That could easily have been made 12%, or now included the additional for everyone. That would have provided £14 billion in one stroke and not affected any hard-working person in our country. It would have already raised more than this non-existent plan. They could have looked at a wealth tax for people who have wealth higher than £5 million, an amendment that I and other colleagues tabled for today; capital gains reform to bring it in line with income tax, for example; or making inheritance tax fair so it is based on what you receive, not necessarily on what you give, so that those in large families can receive a fair amount while ensuring that everyone pays their contribution.

None of those options were considered. Why? Because this Conservative party is paid for by developers, landlords and the very people this tax will not touch. It is a party not of capitalism, but of extraction: extracting the wealth from hard-working people and small and medium-sized businesses, and redistributing it to landlords and capitalists who work in the stock market and in the City, not in the factories that run our country.

[Dr Andrew Murrison]

I always listen very carefully to what the hon. Gentleman has to say. Why, then, does he think that Gordon Brown did something remarkably similar to what my right hon. and hon. Friends are proposing—on that occasion, in 2003—for exactly the same reason: to raise the spend on our national health service and care services? Was he wrong?

[Lloyd Russell-Moyle]

Because then, wages were growing and the economy and working people were doing better, and now they are not. We are coming out of a pandemic. Everyone has suffered and suddenly putting a tax on small and medium-sized businesses and on working people is the very last thing we need to do.

This is also about the lack of a plan for social care. There is no plan for social care. In fact, we have been asked for a begging bowl, but we have not really been told how the money is going to be spent. How are we going to recruit social care workers, who are currently paid miserable wages for 15-minute appointments and no travel time? How are we going to reform the sector so that is not fragmented between people? How is this going to improve someone’s grandmother’s care home or someone’s brother’s care worker? It is not, because this does not deal with that fragmentation, it does not integrate social care into the NHS, which we desperately need, and it does not relieve the burden on councils. At the moment, the truth is that council tax has to subsidise social care time and again. People complain about the roads, their parks or youth services being shut, but the reality is that it is because the Government have not dealt with funding social care properly. They have put the burden on councils and council tax, which was never designed for social care, and this does not deal with that fundamental problem. When people complain about their bins or potholes, I say to them, “It is not your council’s fault. It is the fault of this Government, failing to deal with that drain on your council.”

This levy will not aid us one bit to close the gap that has been growing. That gap will continue to grow under this Government. So holding my nose and desperately sad, I will unfortunately be voting against this, not because I think that we need no action, but because this action is the worst of all worlds.