Queen’s Speech

Lord Shipley Excerpts

Wednesday 16th May 2012 Lords Chamber

[Lord Shipley]

My Lords, on a wide range of measures the Government’s legislative programme is very welcome, not least on banking—particularly the green investment bank—on pensions, on support for children, on competition policy and on constitutional reform. I welcome in particular the decision to consult further on adult care through a draft Bill, because an agreed policy direction is urgently needed.

There has been some criticism in this debate that more should have been said about economic growth in the gracious Speech. However, we should remember that driving growth and rebalancing the economy is the day-to-day work of government, not least through the Budget process. I find the amendment moved by the Opposition today disingenuous because they fail to acknowledge that their own plan for recovery could never have been delivered.

I should like to raise specifically issues arising from impact assessments of Bills and, in particular, the cumulative impact of different Bills passing at the same time. My reason for doing this will become apparent in a moment. We need to understand better that cumulative impact of Bills—for example, the Welfare Reform Bill, the legal aid Bill and the Localism Bill, particularly its housing elements. Each had provisions which impacted on the others. Therefore, individuals and households on low incomes, women, children, single parents, part-time workers and those in rented accommodation, among others, may have found themselves affected by several Bills and not just one. Sometimes, as with universal credit, they might gain; in other cases, the impact might be negative. However, the overall position can be opaque. It is not clear to me that the overall direction in terms of impact is properly and fully assessed across Whitehall, and it seems to be left to third parties to do this.

Take child poverty. In October last year, the Joseph Rowntree Foundation reported:

“Relative child poverty will rise from 20 per cent currently to 24 per cent by 2020/21, the highest rate since 1999/2000 and considerably higher than the 10 per cent target in the Child Poverty Act (2010)”.

The foundation has pointed out that universal credit should reduce poverty substantially, but that poverty-increasing effects of other government changes to personal taxes and state benefits will more than offset that. Another source, the Institute for Fiscal Studies, said in January this year that relative child poverty is set to increase by around 400,000 between 2010 and 2015 and absolute child poverty by a further 100,000. Yet the Queen’s Speech specifically says that the Government,

“will strive to improve the lives of children and families”.

So I hope that, in the coming year, we will see real outcomes to this clearly expressed intention. Perhaps a start could be made with the Local Government Finance Bill, which will devolve council tax benefit to local authorities to manage, along with a 10% cut in funding worth some £500 million. Why 10% and who will pay this? Local authorities will be empowered to increase charges on empty properties and second homes but, if a council does not have many second homes or empty properties, the cost will fall either on individuals in receipt of council tax benefit now—by definition the people least able to pay—or on council taxpayers generally by increasing the level of council tax, which is, in practice, cost shunting from central to local government. As pensioners will be excluded from any benefit loss, it means that those on low incomes—many of them families with children—will have to pay the full cost unless it is spread across council taxpayers generally. I find it odd that this is not explained in the summary impact assessment, nor is there an explanation about the impact on child poverty. No doubt we can debate this further at Second Reading and throughout the passage of the Bill.

I pay tribute to the right reverend Prelate the Bishop of Durham for his contribution in his maiden speech on the state of the economy and sources of investment and in particular for his realistic, and in some cases optimistic, assessment of the opportunities, successes and problems of the region that we both live in. I concur with his comments. He drew out in the debate the skills deficit, which is not unique to the north-east of England. Exactly the same issue would apply in other regions; most notably, I attended a recent meeting in the West Midlands, where employers said that in manufacturing, processing and engineering, around 25% of employers are having difficulty recruiting staff at the correct levels. I was quite astonished by the fact that, despite the millions of pounds that have been spent in recent years on the skills agenda, we have, particularly at levels 3 and 4, a clear skills deficit.

I believe that the problems of the construction industry need to be addressed urgently. The contraction that is now happening may be alleviated by some extra demand arising from the announcements, particularly in housing, in recent months but overall I think further stimulation will be needed, not least in social housing. Hence the need for more thought to be given to increasing councils’ powers and flexibilities to borrow and the need for greater use of their capital receipts from the right-to-buy scheme to be permitted at the very least.

Today’s employment figures show a chink of light. The need for investment in infrastructure seems to be well understood and I hope that the next 12 months will see the underlying rebalancing of our economy set firmly on its course. Meanwhile, inequalities in the face of our financial problems simply must be minimised and fairness maximised to ensure that everyone is in this together.