Christmas Adjournment

Matt Rodda Excerpts

Thursday 19th December 2024 Commons Chamber

[Matt Rodda (Reading Central) (Lab)]

It is a great pleasure to follow the hon. Member for Keighley and Ilkley (Robbie Moore). Like him, I would like to continue the wonderful tradition of our late colleague from Southend and do a brief tour around my constituency of Reading Central, starting with a quick word about Reading football club, talking about Reading gaol and local art, and moving on to thank small businesses and charities.

The wonderful Reading FC is one of the longest established clubs in the English league, but sadly, because of poor ownership, it is currently languishing in league 1. The club has a glorious history, has had many great cup runs and holds the record for scoring the highest ever points total in the championship:106 points—99 goals— in the 2005-06 season. If I had one request for Santa, I would ask that Reading FC has a new owner for Christmas. I would like to see Dai Yongge pack his bags and head home, and a new owner, who can take the club forward, come in, invest in its future and get us back into the championship. Who knows, maybe we can get back into the premiership, in which we played for three seasons, over two stints? If we could achieve that, it would be truly wonderful and every child in Reading would be delighted; it would be the best possible Christmas present they could ever wish for.

Dai Yongge has had the club up for sale for a year and has turned down two bids. Sadly, he was associated with two overseas clubs that closed, so there is a great deal of concern from fans and other local residents about the future of the club. We have also lost the manager recently, who has moved to Hull City. I wish the new manager, Noel Hunt, well, but there are real concerns about the future of the club. I hope that Dai Yongge can listen, sell the club and move on.

On Reading gaol, we have better news. I wish the new owner, Reading borough council and Historic England well in their efforts to try to turn the wonderful former gaol into something special, by redeveloping it in a constructive way and providing a significant amount of arts provision in our town centre. Oscar Wilde was incarcerated in Reading gaol. It is an incredible building and a wonderful example of early Victorian architecture. If it were open to the public, it would prove to be an incredible visitor attraction. It was briefly open in the mid-2010s when Artangel held installation art and poetry readings in the gaol, which attracted thousands of people from across the country. Having the gaol as an arts hub would be worthy of our town; it has a very successful music festival and many other arts activities, but it does not have an arts venue of this type. I am campaigning for that and I look forward to success in the new year.

Finally, I cannot mention all the winners of my small business competition individually, but I thank them for their efforts in driving growth in our local economy, providing employment and making our town centre, and other local centres, vibrant places to visit, which shoppers and other residents much enjoy. I pay tribute to the many charities in the Reading area that do wonderful things at Christmas, and all year round, in particular Toys and Teens, which is a fantastic appeal that has made many children very happy at Christmas, and the many other wonderful local charities. I also thank all those working at Christmas, particularly those in our NHS, other emergency service workers and many others who provide vital services while we are all enjoying Christmas with our families.

Before I finish, I thank you, Madam Deputy Speaker, and your colleagues, all our colleagues across the parliamentary estate, including the Doorkeepers and the other staff who make this place such a wonderful place to work. I wish the public, especially residents in Reading, a very happy Christmas and a wonderful new year.

Finance Bill

Matt Rodda Excerpts

Committee of the whole House
Wednesday 11th December 2024 Commons Chamber

[Dr Sandher]

I thank the right hon. Member for his kind words. As he will know, the Government are fixing things for those who need special education—there is a huge amount we have to fix in this country—and he should remember the VAT exemption for those with EHCPs.

For those who cannot currently afford a decent life, the situation has become increasingly bleak. Non-graduates and young people are locked out of the opportunities their parents had. Before the 1980s, non-graduates could leave school and find good jobs with decent wages in their local factory. Then came deindustrialisation that destroyed mid-pay manufacturing jobs and led to a divided nation, where non-graduate men have seen their employment rates fall by 20 percentage points since then. Today, twice as many young men as young women are unemployed and we see the political shocks reverberate around us. Manufacturing jobs have been destroyed and replaced by low pay and insecure service jobs that do not pay enough to live on.

A couple with two children, both on average wages, do not currently earn enough for a decent living. On top of that, young people cannot afford the homes they need. Around 40% of my generation are living with their mum and dad.

[Matt Rodda (Reading Central) (Lab)]

May I also extend my congratulations to my hon. Friend on this wonderful day for him and his family? He is making an excellent speech. On the specific point about housing, can my hon. Friend say a little more about his vision? [Interruption.] He was coming on to housing. Can he speak, in particular, about the needs of young families? In many medium-sized towns and cities across the country, such as Reading, which I represent, there is a need for more affordable housing, both to buy and to rent.

[The Chairman]

Order. Can we ensure that the interventions are clearly related to the debate in hand? I have no doubt that the answer will be.

Finance Bill

Matt Rodda Excerpts

2nd reading
Wednesday 27th November 2024 Commons Chamber

[Alex Ballinger]

The right hon. Gentleman will have noticed that we reached record NHS waiting lists under the last Government, more than 7 million people waiting and many of my constituents waiting over two years. If he thinks the investment in the NHS by the last Government was enough, he is completely wrong.

Our roads are literally crumbling, working families are struggling and the hope of upward mobility is slipping further out of reach. We cannot let this continue. The Government are faced with what the Institute for Fiscal Studies has described as a genuinely difficult inheritance. The truth is that the last 14 years can be described as, at best, a period of managed decline; or at worst, wilful neglect. The last Government will be characterised as an Administration that allowed services to erode and future generations to be abandoned.

We must take a different approach and offer real change. We are not pretending that the work ahead will be easy, but we are determined to rebuild and restore. A key part of this recovery is investing in our most vital public services, especially the NHS, which cannot survive on good will alone. The Budget commits to injecting much-needed funds into our healthcare system, securing a lifeline for the NHS that will allow it to begin this recovery.

The Budget is also about presenting an offer to working people who have been neglected for so many years, including a rise in the minimum wage to boost the living standards of 3 million low-paid workers; NHS funding to support 2 million more operations, scans and appointments every year; fuel duty frozen for another year, providing relief to drivers and families; a £500 million investment to fund the construction of 5,000 more social homes; a significant increase in the carer’s allowance earnings limit, because those who care for our loved ones deserve our support; and a crackdown on tax avoidance, fraud and waste, ensuring that the super-wealthy pay their fair share of tax.

The decisions in the Budget, though some are difficult in the short term, are the right ones for the long-term good of our country. This is a Finance Bill that prioritises public services and working people without raising taxes on the majority. It is about restoring fairness, rebuilding trust and setting the country on a new path towards growth. It is also important to remember that fiscal responsibility is central to this Government’s approach. The IFS has praised the soundness of our fiscal rules, ensuring that our efforts to drive growth are sustainable and the public finances remain on a stable footing. Changing the fiscal rule to allow more investment is both sensible and necessary, and this investment will boost long-term growth.

The Bill is not just about recovery; it is about securing a prosperous future. Businesses in Halesowen have been struggling, especially on our high streets, where many have been forced to close their doors in recent years. I have heard the concerns of small business owners and the concerns shared by the Black Country chamber of commerce, and I am pleased that the Chancellor’s plans include support for high street businesses, including business rates reform, which will give local shops the chance to compete against tax-avoiding multinationals.

[Matt Rodda (Reading Central) (Lab)]

My hon. Friend is making an excellent speech highlighting a whole series of important points. I just wondered whether he was going to come to the cut in beer duty. I know there are a number of famous brewers in his area and this is an important measure for many brewing towns—[Interruption.] This is an important point for many brewing towns and many small, related businesses in that sector. I have a number of SMEs in my own constituency that will benefit from this, as well as pubs. Does my hon. Friend welcome this measure, as well as the important measures he has mentioned for small businesses in town centres?

[Alex Ballinger]

I welcome the 1p reduction in tax on beer. I have spoken to many businesses in my constituency’s hospitality sector, including many pubs, that are happy with this measure, which they hope will increase the footfall in our town centres and in their businesses.

I am also delighted that the Budget confirmed £20 million of investment in the redevelopment of Haden Hill leisure centre in Cradley Heath in my constituency, and £20 million of investment in Halesowen town centre, to redevelop what is becoming a difficult area.

The Bill will ensure that local assets that serve the community are protected and enhanced. It marks a turning point for our country, laying the groundwork for a better future. It is a plan that protects our public services, supports working people and puts the economy on a sustainable path. I fully support this Bill for Halesowen and beyond. It delivers hope, invests in communities and fixes the foundations of the economy, so that we can deliver the change for which the country voted.

Non-Domestic Rating (Multipliers and Private Schools) Bill

Matt Rodda Excerpts

2nd reading
Monday 25th November 2024 Commons Chamber

[Vikki Slade]

I agree with the hon. Member and thank him for his intervention. I was just about to say that we need a proper tech tax on online businesses, which should be ringfenced to stay in local communities, where councils could use it to support town centres in a way that works for them.

Many councils are not able to keep the business rates accrued in their areas; they are set externally and sent elsewhere to support other communities. That is not understood or even appreciated by local communities. I cannot remember the number of times that, as a local government leader, I was shouted at by people saying, “You’re making all that money as a council.” People think that the councils own the businesses and the properties and that they set the rates. The fact is, they are set elsewhere, and councils do not have the power to provide discounts without having to plug the gap not just for their own areas, but for what they send to Government. That is what real reform would look like.

[Matt Rodda (Reading Central) (Lab)]

The hon. Member is making some wide-ranging points. I think the Government’s policy in this area is excellent. I remind her that there are a range of other policies that local government can implement. I commend my own local council in Reading, where there has been a lot of work to try to keep local small businesses active in the town centre through planning and a range of other things. It is really important to work with the business community. Would she like to comment on that?

Oral Answers to Questions

Matt Rodda Excerpts

Tuesday 29th October 2024 Commons Chamber

[Matt Rodda (Reading Central) (Lab)]

T10. Can the Minister update the House on how the Government will help to secure better returns for pensioners while also unlocking the opportunities for pension savings to help generate growth?

[Emma Reynolds]

The Chancellor launched the landmark pensions review in July, which I am leading and which is looking at measures to drive more UK pension investment into the UK economy, boosting growth but also improving pension savers’ outcomes. I know that there is interest in this agenda across the House.

Fiscal Rules

Matt Rodda Excerpts

Monday 28th October 2024 Commons Chamber

[Darren Jones]

I am delighted to hear the hon. Gentleman tell the House that he welcomes the positive change that this Labour Government in Westminster are delivering to the Scottish people. I agree with him. On early announcements, I can point to GB Energy and the huge commitments we have made on energy infrastructure, which we know will be important to the Scottish people. We absolutely recognise that the Scottish economy has a huge contribution to make to the whole economy of Great Britain and Northern Ireland, and we look forward to working with the Scottish people to make that a reality.

[Matt Rodda (Reading Central) (Lab)]

I commend my right hon. Friend on his work on stability and investment. Would he like to say a little more about the challenging inheritance he has received from the previous Government, and just how dreadful that has actually been?

[Darren Jones]

I welcome my hon. Friend’s question. [Interruption.] I know that Opposition Members find it uncomfortable, but it is a matter of fact that we will return to time and time again, because the sheer truth of it is that the last Government made promise after promise to the British people, knowing that they did not have the money to pay the bills. It is shameful, and the sooner they come to the House and apologise for their behaviour, the better it might be for them in the long run.

UK Economy

Matt Rodda Excerpts

Monday 19th February 2024 Commons Chamber

[Bim Afolami]

As I have said many times this afternoon, inflation is a target for this Government: we aim to ensure that we continue to bring it down, and indeed we expect it to get to 2% in the coming months. In relation to food inflation specifically, at the last fiscal event we introduced full expensing, which will enable food manufacturers, supermarkets and others to increase their investment hugely, because it completely nets off against their tax—100% of the cost of their investment is netted off. The impact will be increased investment that will reduce their costs and reduce the cost of food in our shops. That is one of many measures that we are introducing to reduce food inflation.

[Matt Rodda (Reading East) (Lab)]

The Prime Minister said he was going to grow the economy and he has obviously failed: we are now in recession. In my constituency, families and small businesses are under severe pressure. Can the Minister possibly explain how he is going to address these very serious problems?

[Bim Afolami]

All I would say to the hon. Gentleman is that we are in a very challenging international context and we have performed better than the international forecasts. We had high inflation, which really bedevilled this economy a couple of years ago, but we have more than halved it. We have a plan to grow our way out of this, as was shown by the last fiscal event, where we unveiled, I think, 110 growth measures. That is our plan. The Labour Opposition do not have a plan. If this country sticks with our plan, we will grow our economy significantly over the coming months and years.

Finance Bill

Matt Rodda Excerpts

Committee of the whole House
Wednesday 10th January 2024 Commons Chamber

[Nigel Huddleston]

My hon. Friend is right to point out the timing element with both full expensing and R&D; I will come on to R&D in a moment, because I think that is the £55 billion figure he mentions, but these measures, particularly the full expensing, will of course have a long-term impact over a long period of time. The cost is up-fronted, but the benefit is over a long period, and anyone who has worked in business understands that. He is right to point out the anomaly, and it is a very important point because a lot of people probably would not understand it, but the fact that the OBR has highlighted the incremental impact on the economy overall shows that there is a clear and transparent net benefit. The timing of the impact changes, but we are talking about additional investment right away, because we will be giving businesses the confidence to be able to make those decisions and invest immediately.

[Matt Rodda (Reading East) (Lab)]

I appreciate the Minister’s comments so far. Can he confirm how many times policy has changed in this important area since 2019? While he is making some further points today, it seems that Government policy has changed quite erratically, and that in itself is difficult for businesses to respond to when they are looking for certainty in planning for the long-term.

[Nigel Huddleston]

I agree that certainty for business is pivotal, but with both full expensing and R&D the Government, the Chancellor and others have been indicating the direction of travel for some time and therefore giving increased certainty. As I have said, it was mentioned a while ago that we intended to pursue the policy of full expensing when the economic circumstances allowed, and now they do. R&D, which I will come to in a minute, has been discussed for quite a long time and is the result of extensive co-operation with industry.

It is also the reality, though, that Government policy needs to change in response to the nature of a changing economy and to things such as digital, the cloud and so on. When it comes to other investments, we need to make sure that new and emerging policy areas are covered as well. We have seen today, as we saw in the autumn statement, a very clear direction of travel from the Conservative side of the Chamber, which is about incentivising businesses and cutting taxes. Permanent full expensing also simplifies the capital allowances regime overall, as companies can claim the full cost in year one, reducing the need to claim writing-down allowances year on year.

Turning to clause 2 and schedule 1, the Government have also announced the closure of the R&D tax relief review launched in 2021—the point I was just making to the hon. Member for Reading East (Matt Rodda)—alongside a set of changes to simplify and improve the system. Clause 2 makes changes to merge the current R&D expenditure credit and SME schemes for expenditure in accounting periods beginning on or after 1 April 2024, simplifying the system and providing greater support for UK companies to drive innovation.

The merged scheme will have an above-the-line mechanism similar to the R&D expenditure credit, with a rate of 20%. That will make the benefit more visible and easier for companies to factor into their investment decisions. Additionally, small and medium enterprise lossmakers will now be able to carry forward their losses rather than having to surrender them, which will give a total benefit of up to £45 per £100 of R&D expenditure.

There will also be a reduction in the rate at which the merged scheme credit is taxed for lossmakers, from 25% to 19%. That is worth around £120 million per annum to non-intensive lossmakers and will increase the up-front cash benefit for lossmakers. Subcontracting rules in the merged scheme will allow the company taking the decision to do R&D to claim relief on contracted-out R&D. That approach is based on the current SME scheme, which was identified as the best option in the consultation we delivered, and has been refined further following engagement with industry last summer.

Subsidy rules will also be removed, allowing SMEs to claim relief for work for which they receive a grant of a subsidy. This represents an increase in generosity for SMEs as well as being a major tax simplification.

The Government are also legislating for enhanced support for loss-making R&D-intensive SMEs. That was announced at spring Budget 2023 and will benefit 23,000 SMEs a year by providing further support to the most R&D-intensive SMEs while merging the current schemes. The Government are promoting the conditions for enterprise to succeed. Companies claiming the existing SME tax relief will be eligible for a higher payable credit rate of 14.5% if they meet the definition for R&D intensity.

At the summer statement, the Government announced several improvements being made to that enhanced support. The R&D intensity threshold is being lowered to 30% from 40% from April 2024, meaning that around 5,000 more companies will benefit from the support. A one-year grace period is being introduced, providing greater certainty by ensuring that companies that dip under the 30% threshold will continue receiving relief for one year. The same subcontracting rules as the merged scheme will apply to this enhanced support, further helping to simplify the system with one set of rules that both SMEs and larger companies will follow.

Overall, R&D reliefs will support an estimated £55 billion of business R&D expenditure in 2028-29—a 25% increase from £44 billion in 2021-22. Expenditure on R&D reliefs is forecast to increase in every year of the scorecard period. We will also restrict nominations and assignments for R&D relief payment. That measure ensures that genuine businesses get the payment for their R&D claim directly, rather than receiving it through an agent, and is designed to benefit genuine claimants and reduce non-compliance.

Subject to limited exceptions, no R&D tax credit payments will be made to nominee bank accounts, and any R&D tax credit payments must be paid directly to the company that claims for the R&D, so claimants will now receive their payments directly, giving them more control. That will ensure that the person claiming the relief has better oversight of the claim and receives the money into their account quicker. Claimants will also be clearer on exactly how much money is being charged by their agents, rather than just receiving a net amount after fees have been deducted. That builds on previously announced measures and policy changes to help to ensure greater company control over R&D claims.

The Government are committed to making the UK the best place in the world to do business. Full expensing and R&D tax relief support businesses to grow and invest, which will boost productivity and economic growth. That remains the key way to raise everybody’s living standards and to fund high-quality public services throughout the UK. I commend clauses 1 and 2 and schedule 1 to the Committee.

--- Later in debate ---

[James Murray]

As I have said, we have long been calling for full expensing, and we welcome the fact that it is being made permanent. I do not mean to sound jokey in my response—I am deadly serious when I say this—but if the hon. Gentleman wants to know what a Labour Government would do if we got into office, there is one way to see that eventuality come about: we could have a general election sooner rather than later, instead of dragging things on throughout the course of 2024.

Frankly, the country needs to move on from the current Government. Just look at their record on capital allowances since the last general election. The hon. Member for North East Bedfordshire (Richard Fuller) spoke about certainty and the need for stability, but let us look at the changes that have happened to capital allowances over the past four or five years. As I mentioned on Second Reading, back at the beginning of this Parliament, the annual investment had been raised to £1 million on a temporary basis. That temporary basis was extended by the Finance Act 2021, extended again by the Finance Act 2022, and then made permanent by the Finance (No. 2) Act 2023. Meanwhile, over the course of this Parliament, the super-deduction came and went entirely. Last year, full expensing for expenditure on plant or machinery was introduced but only on a temporary basis for three years.

Now, of course, Treasury Ministers are amending what their predecessors announced last year by making full expensing permanent. Although we welcome that policy, I wonder how long it will last. Frankly, I wonder how long any policy can be expected to last under this Government, when they are led—in the loosest possible sense of that word—by such a weak Prime Minister. If we accept clause 1 at face value, we welcome its principle of making full expensing permanent, as that is something that we have long called for. I will focus the rest of my questions on some of the specifics of the Government’s approach.

As ever, I am grateful to the excellent team at the Chartered Institute of Taxation for all their thoughts on the detail of what the Government have proposed in this clause and others. I know that one matter of interest to the chartered institute was the fact that, at the autumn statement, the Government said that they would publish a technical consultation on leased assets. I would be grateful if the Minister told us when that will be published.

Furthermore, both the Chartered Institute of Taxation and the Association of Taxation Technicians—to which I am also grateful for its thoughts on the detail of the Bill—have queried which companies and assets are eligible for full expensing. I would be grateful if the Minister clarified which assets are outside the scope of full expensing, and whether the Treasury will publish a detailed list of what does and does not count as plant and machinery. I would also be grateful if he told us how many firms will not be eligible for full expensing because they are partnerships. I know that many who take an interest in this matter would welcome clarity on that.

In clause 2, the Government propose changes to the system of tax credits for research and development. As with their approach to business taxation and capital allowances, the Government have failed to deliver any sense of stability when it comes to R&D tax credits, despite certainty and predictability being so crucial to businesses that are making investment decisions. That much is clear when looking at the list of changes that we have debated in Finance Bills over the course of the current Parliament alone: the Finance Act 2020 changed the rate of R&D expenditure credit; the Finance Act 2021 changed how much R&D tax relief small and medium-sized enterprises could claim; the Finance Act 2023 again changed the rates of R&D tax relief; the Finance (No. 2) Act 2023 changed further how the relief operates; and now, the Finance Bill before us changes the system of reliefs yet again. We accept, of course, that some change is necessary and important to enable legislation to function well, but that does not seem to be what we have seen. What we have seen is a Government incapable of providing stability, predictability, and the long-term plan that businesses need to invest and grow. It is clear that after 14 years in office, the Conservatives are incapable of providing that crucial foundation for our economic success.

[Matt Rodda]

My hon. Friend is making an excellent point, which comes to the nub of the argument: the Government are not capable of providing business with the certainty it needs. That is such a tragedy, because so many wonderful emerging industries in the UK which have incredible potential need that certainty, as indeed do other businesses.

Autumn Statement Resolutions

Matt Rodda Excerpts

Wednesday 22nd November 2023 Commons Chamber

[Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

Before launching into my speech, I will pick up some comments made by the right hon. Member for North Somerset (Dr Fox). He said that his Government were in favour of the measures laid out today but that the official Opposition, represented by my right hon. Friend the Member for Leeds West (Rachel Reeves), were in favour of public spending. I think it worth pointing out, as I have the privilege of chairing the Public Accounts Committee, that this Government have been putting off issues repeatedly until they reach crisis point. It is all very well for them to say that they do not want to spend money on the public sector, but they are actually costing it more. For instance, our Committee recently produced a report on the school building programme which revealed that 700,000 pupils were in inadequate premises; and although a former Prime Minister announced a programme for the building of 40 hospitals, there are still only 32, and the building of those hospitals is expected to “bunch” by the late 2020s or thereabouts.

[Matt Rodda (Reading East) (Lab)]

My hon. Friend is making an excellent speech, and has just made an important point. My local hospital, the Royal Berkshire Hospital in Reading, is one of those that were promised something but have not yet received anything. This is a problem for many communities around the country

[Dame Meg Hillier]

It is a real concern. Those 32 hospitals are just the tip of the iceberg of what is needed, and nothing is in train yet, so if it bunches into the late 2020s and then into the 2030s, that could leave some—the seven affected by reinforced autoclaved aerated concrete—beyond their useful life, and it will mean a squeeze on construction.

For schools and hospitals alone this is a huge challenge, but it is also worth mentioning an animal health centre in Weybridge, in the constituency of the hon. Member for Runnymede and Weybridge (Dr Spencer), which has suffered from under-investment for a long time. If we had two zoonotic diseases in this country, we could not currently cope with that, because the centre is greatly in need of public sector investment.

These are things that the Government cannot dodge, because it is not possible to bring in other resources. It is easy to make jibes, but in reality there is a big challenge. We have, of course, seen councils squeezed until the pips squeak, although they are vital to the delivery of services that will not be delivered by anyone else. There is no private sector alternative, even for those whose ideology leads them in that direction.

Overall, there was a great deal of smoke and mirrors in the statement. I have had a look at the Green Book, although I cannot claim to have gone through every pledge in enormous detail because there has not been time since the Chancellor sat down, but we have already seen pledges in earlier Budgets and autumn statements unravel. One pet idea of a former Chancellor, the lifetime ISA, was not mentioned today; I certainly could not see anything in the Green Book about it. Those who have a lifetime ISA can invest in a property that is worth up to £450,000. In my constituency, it is impossible to find any new-build property for £450,000. The level has not kept up with prices, and as far as I can see there is to be no uprating. This means that many young people who hoped that this would help them to get a foot on the housing ladder have no hope. If any of the Treasury Ministers can say anything about that, my constituents will be glad to hear it.

I have just given an example of a dud financial product, delivered and then forgotten about. The Chancellor also mentioned childcare. Notwithstanding the pledge to provide free childcare for parents of children aged one and two, not enough places are available, because the money has not gone into delivering those places. Childcare facilities will not be able to provide childcare at less than the cost of the hourly rate of the people providing it. This is simply a pledge without any back-up, which is of real concern.

I am pleased to see that the local housing allowance has received its long-overdue increase, but I am not sure whether it will make any difference in many parts of the country where there is still a shortage of housing, apart from very expensive private rented housing. I will be touching on housing costs in Hackney.

Local government is struggling and failing, and the much-vaunted levelling up has been opaque. We cannot see exactly where the money has been spent and we have not really seen results. There is a lot of flim-flam and promise but the money is spread very badly, as reports this week have highlighted. Local government is one area that is being squeezed considerably, and now there is this idea that if a big planning application is not dealt with in a given timeframe, the council will have to refund the planning fees. Where are all the planners who are supposed to do this work, given the enormous shortage of that skill in local government?

Also, the fees do not currently even cover the costs of a planning application, as many developers tie planning departments up in knots as they argue for more storeys or fewer affordable housing units, and they can go on doing that for a year. It is not always the fault of the planners when there are delays in planning applications, but that is an easy statement to make. My party wants to ensure that the planning system works so that we can get those new homes built and get all the necessary capital infrastructure moving. There will be a proper plan behind the pledges of my party when we get to our manifesto.

On skills, we all want to see a skilled-up economy, but again we are looking at a failure over 13 years, after all the promises. The Green Book tells me that there will £50 million for a two-year pilot to stimulate training in growth sectors and address barriers to entry. I think we have heard this one before. It is great to see a pilot, and great to see investment in it, but it is always too late. I was arguing over a decade ago that we needed skills in the green growth industries. An industrial strategy that included that would have boosted the economy and got us ahead of the game internationally on green issues. We need construction industry skills, including in the skilled trades. That was predictable when we went through the Brexit vote in 2016, yet here we are in 2023 and we still have those challenges.

There are huge skills issues in civil and nuclear defence, as my Committee, the Public Accounts Committee, has repeatedly highlighted. We cannot create highly experienced people in a decade, but we could have gone a long way if work had been done earlier. We also lack skills in fire safety. I should declare an interest in that I live in a block that had cladding. We need fire safety engineers to get through the process, and there is a shortage of them. It only takes three years to train for that role, and if we had started doing that after Grenfell, we would be much better placed now.

I will be generous and say that I welcome some things in the autumn statement. The piloting of additional jobcentre support for universal credit claimants at seven weeks in 90 jobcentres is a good thing. As we repeatedly say on the Committee, it is good to pilot initiatives—and 90 is quite a big pilot—so that we can learn and make sure that they work properly and become embedded. Seven weeks—nearly two months—is a long time to be without work, and if people can get that extra bit of intense support early on to keep them off long-term unemployment, that will be a good thing.

But I am massively concerned about ending benefits after 18 months for people who say that they will not go to work. People have many issues that are health-related but that do not qualify them for the personal independence payment. I pay tribute to the jobcentre coaches in the jobcentre in Hackney, and particularly those who work with the most vulnerable and disabled people. They provide amazing support to people, but we need a lot of those really good people to deliver this, and they will all need to be trained and developed. All previous work programmes show that health is one of the big final barriers to getting people into work, and that there is a residual group of people who, for various health reasons, cannot easily access work. The DWP is often called the Department of wonderful people, but however great its staff might be, they cannot always cross that barrier to deal with someone’s health problem, because that is a whole different issue for that individual in relation to their medical support, if they have it. The Public Accounts Committee has repeated endlessly that sanctions do not work and that they just cause real problems for people. In Hackney, we have just over 16,000 people claiming universal credit and over a third of them are in employment, so these are not all people who are not working.

But there are many other barriers, including childcare and travel costs, as well as significant logistical barriers matched to particular jobs. I vividly remember a gentleman coming to my surgery who was a kitchen porter. He wanted to improve his English, as it was not his first language, and he was struggling to get a job. He went to the jobcentre and they were sending him to zone 6. For people outside London, my constituency is in zones 1 and 2, and zone 6 is quite a distance away and a lot more expensive to travel to. The time and cost of travel for someone on a kitchen porter’s wage, even with an uplift in the minimum wage, will still be challenging in London, combined with the fact that he had two small children and a wife who also had a low-paid job. It was logistically impossible for him to do what the jobcentre was asking of him. If we are going to have all these changes, there needs to be an awful lot of investment in jobcentres to get anywhere near making them work. What will happen at the end of 18 months if someone is not in work? Will they be left destitute? There are lots of questions there.

I am interested in the national insurance contributions for self-employed people. The Public Accounts Committee has looked at serious challenges with pensions and pension records in the DWP. I will not go into too much detail now—for those who are interested, our work is all on our website—but there have been issues with inaccurate record keeping and the databases and systems in the DWP not talking to each other. The problem first affected a group of women—widows over 80 and others—who did not get their full state pension, but an issue was uncovered more recently that affects mostly women who had caring responsibilities and should have had credits but, because of the links between HMRC and DWP not working properly, those were not properly recorded and reflected.

Whatever the policy, we need to make sure that it works technically. It says in the Green Book that credits will be applied, but we need to make sure that the technical system is in place, because it would be a tragedy if people who are self-employed found later down the line that they could not claim the state pension because that circle had not been squared.

The 1%-a-year increase in funding to Whitehall is, of course, a repeat of what was said earlier in the year, but it is a real-terms cut, so every Department will have to trim what it is delivering.

There are so many other failing areas. We have talked about hospitals and schools, where we know that demand is really big. The Department for Education wanted to build 200 new schools a year. In the 2020 spending review, it was allocated £1.3 billion for just 50 new schools a year. Now, there are 100 schools with reinforced autoclaved aerated concrete that need to be in that programme—the Secretary of State identified that problem at the end of August, just days before term started—and they are knocking other schools down the list. Eventually, there will be 500; goodness knows how long that will take on the current timeframe. Public spending is not always a bad thing; in fact, delaying it can cost a lot more to the taxpayer and those trying to receive services in the meantime.

I welcome the money for debt management in HMRC. That is good, but we on the Public Accounts Committee will of course be watching closely how it works. If money is invested well in the DWP and HMRC, we can see real dividends for the taxpayer, and no one wants to see fraud and bad debt.

Despite the increase in local housing allowance, which is a help, the LHA rate still causes problems. In the private rented sector in Hackney, the average rent for a two-bed is just shy of £2,000 a month, and there are 30% fewer private rented properties available now than there were before the pandemic. Before today—I have not been able to establish whether today’s announcement will have a real impact in Hackney—not a single property was available to those on low incomes at LHA rates. If we are only going up to the 30th percentile, there will still be a real challenge in a borough where we have seen more homes for rent built at the luxury end of the market than at the lower end. Anyone lucky enough to be in a low-cost, relatively stable private sector home does not really have the option to move, so the supply is not being replenished.

That brings me to a really difficult issue for my constituents. One in two children lives in poverty, we are the 22nd poorest borough in the country and we have such a serious housing problem. I mention that every time I speak in the Chamber, and I make no apology for that. Not only do we have generation rent living in insecure properties, with rents spiralling out of control, but we have a huge shortage of social housing. In the year to 2022, only 671 social housing units became available, down from 1,200-odd in 2016-17.

That diminution is explained partly by the fact that, once someone has got social housing, they do not move out, because there is nowhere to go. That is leaving many of my constituents living in massively overcrowded conditions. Someone came to see me at my last surgery who has three children in a one-bedroom housing association flat, but the housing association has nowhere to put him, so he is bidding on the council list. If his case is typical, he will be waiting 12 years for a two-bedroom property. We have 3,759 children in temporary accommodation, which is enough to fill eight primary schools and is 1% of the population of my borough. We are having to close schools because children are leaving, as lots of families cannot afford to live in Hackney any longer. Those children are often housed outside the borough, because of the cost of housing in Hackney. So this is a really big concern.

In the year to 2023—in the last financial year—more than 4,000 residents approached the council seeking housing help, which is an increase of 18% on the figure for 2018-19. These figures are increasing exponentially every year, despite the best efforts of our excellently run Labour council. Under the new mayor, Caroline Woodley, and her predecessor, there has been a real desire and effort to build properly affordable social housing, including council housing. However, this is a drop in the ocean for the need. This autumn statement does nothing to help the people I am talking about. People are living in poverty and in overcrowded conditions. As my hon. Friend the Member for Ealing North (James Murray) says from the Front Bench, they are not better off than they were 13 years ago. They are considerably worse off and there is no hope—except, I hope, a general election, when my party will come in to try to sort out this mess.

Mortgage and Rental Costs

Matt Rodda Excerpts

Tuesday 27th June 2023 Commons Chamber

[Matt Rodda (Reading East) (Lab)]

I would like to speak in favour of the motion. Time is pressing, so I will touch briefly on the scale of the problem facing the UK.

It is fair to say that many families—indeed, up to 7.5 million—face a very difficult challenge at present because of the increase in interest rates and the effect on mortgages. As we have heard, it has been calculated that that increase means around £2,400 extra on household mortgages every year, which is £1,000 more than the increase in mortgages in the United States.

The situation affects both buyers and renters, because landlords put up rents as well, but the Government are proposing only a voluntary scheme, which obviously falls well short, and about 1 million families are likely to be missed by this inadequate measure. Earlier, the Shadow Chancellor set out a much more effective scheme, which I obviously commend to the House.

Given the lack of time, I will move on swiftly and speak about how the Government’s mortgage bombshell is affecting local residents in Reading and Woodley. This crisis is making what is already a difficult housing situation far worse for local people in our part of Berkshire. We have had high house prices and rents for some years, given the shortage of supply and many other related housing matters.

To give colleagues a taste of the situation locally, terraced houses in Reading town centre can sell for as much as £300,000, so these are quite expensive properties. There is also a real shortage of property and a large waiting list for local authority properties. For a family house, the price may be as much as £600,000 or £800,000, so we are already talking very large amounts of money. As I said, renters face additional problems. We have an issue with dangerous cladding not being removed in some cases, as well as issues with leaseholders and landlords. There are, therefore, serious problems in our area, and that is on top of the national problems facing families, which I mentioned earlier. Colleagues from across the House have also mentioned the 20% rate of food inflation and the UK inflation rate being the worst in the G7.

I would like to point out some of the problems facing individual constituents. Without giving away too many personal details, perhaps I could just give a flavour of the problems involved, and I hope the Chief Secretary will reflect on them. One constituent—a gentleman called Peter—is in a good job. He has a young family, with two children, and they live in a three-bedroom house. They face an increase of £800 a month in their mortgage, and they simply do not know how they will cope.

Another constituent, Donna, who lives in a flat in Reading town centre, faces a £400-a-month increase. Again, that is an absolutely incredible increase in what she has to pay for her home. Sadly, she is one of many residents locally who have been affected by the cladding scandal and by delays in removing various types of dangerous cladding. She is already under enormous pressure because of the emotional stresses and strains of having a flat with cladding problems. In addition, she now faces this enormous extra increase in her payments. She is self-employed and has a small business. Imagine how this feels to her. This truly is a dreadful crisis.

I realise that time is limited, and I hope my hon. Friend the Member for Stockton North (Alex Cunningham) can get in shortly, but I ask the Chief Secretary to report back to the Chancellor just how dire the situation is and how it is affecting people up and down the country—both my residents and those of colleagues from across the House. I also urge him to think about the five-point plan outlined by the shadow Chancellor, which has been well researched and well received across the industry.

[Mr Deputy Speaker (Mr Nigel Evans)]

Alex Cunningham is the final speaker.