Covid-19

Margaret Ferrier Excerpts

Monday 28th September 2020 Commons Chamber

[Margaret Ferrier (Rutherglen and Hamilton West) (SNP)]

It is a pleasure to follow the hon. Member for Tonbridge and Malling (Tom Tugendhat). I start by paying tribute to all NHS key workers and volunteers in my constituency for their care and commitment over the past seven months.

I will focus my comments on the economic health of my constituents this evening. For many months now, my constituents have been contacting me to express their fears and concerns about the end of the furlough and self-employed income support schemes. They told me how they were at serious risk of redundancy, and they are worried that their livelihoods will be at stake if the scheme ended prematurely. The Chancellor’s announcement last week simply does not do enough to support those people whose jobs are at risk due to the pandemic. Dropping the Government contribution from 80% of wages to 22% of wages in the transition from furlough to the job recovery scheme means that firms that could still be viable but are not yet able to resume business activity now face the awful choice of closure or mass redundancies.

Scottish Government analysis suggests that this move could result in the loss of 61,000 jobs in Scotland when compared with an eight-month extension to the previous furlough scheme. This kind of extension would place Scotland on a similar footing to the French and German furlough schemes if it had the power to extend furlough in its own right. The same considerations apply to the self-employed income support scheme, for the cut from 70% of average earnings to 20% of average earnings does not reflect the reality of many self-employed constituents who contacted me to say that their work is not picking up at a high enough level to survive without the support offered by self-employment income support.

Unfortunately, the Chancellor’s announcement comes far too late for some of my constituents. Tom, a sales rep from Blantyre, was placed on furlough at the end of March, but his company made him and 45 colleagues redundant as a result of restructuring due to the pandemic. He cannot get support through the jobs recovery programme, and there is not an option for him under this scheme to retrain, unlike in Germany, where Kurzarbeit would give him that opportunity to obtain new skills. Kurzarbeit has been established for more than a century in Germany, and it is a great example of using preventive spending to create a safety net during tough economic times.

When recessions have hit the German economy, the Germans have been able to keep skills within the workforce for when times get better, adapting the scheme to reflect the prevailing economic circumstances. As much as the Chancellor would like to think that his jobs recovery scheme achieves similar outcomes to those of the Kurzarbeit scheme, the design of his scheme still makes the inherent assumption that if a job cannot be sustained at a minimum of a third of the hours at this point in time, then it is not possible to retain that job at all. Given that some sectors, such as the events industry, are continuing to rely on furlough because they cannot reopen substantially, cutting the support available to them risks mass lay-offs and will trigger a loss of skills in those industries, which will be felt for years to come.

I think we have to ask ourselves at this moment in time whether the UK Government have truly done everything they can to avoid mass redundancies due to the coronavirus pandemic. Given the history and experience of the 1980s, I believe that this Tory Government will again fail my constituents and fail communities across Scotland by drastically cutting back the levels of support that were offered by the furlough and self-employed income support schemes. That will only strengthen the desires of the people of Scotland to have the powers needed to support our economic recovery and avoid a lost generation.