Working People’s Finances: Government Policy

Debate between Mick Whitley and Mark Tami

Tuesday 21st September 2021 Commons Chamber

[Mick Whitley (Birkenhead) (Lab)]

I welcome the opportunity to say clearly to the Government that their current pursuit of benefit cuts and tax hikes, their economic mismanagement of the energy sector and the housing market—to name but two—and their casual indifference to the spectre of soaring inflation in the price of basic goods and food are combining to inflict poverty, hardship and misery on working people. The other week, the Prime Minister responded to my question on the negative impact of the £20 a week universal credit cut by saying that his Government have always been ready to put an arm around the people of this country. I would contend that the Government’s policies will more likely lead to a hand being clasped around the throats of working people, the unemployed, the disabled and—tragically—their children. This is not levelling up; it is grinding down. This is not building back better; it is a new round of austerity designed yet again to make the poor pay for another fine mess of the Government’s own creation. People’s standard of living is not, as the Government claim, rising inexorably because of recent wage increases. Overall, it is declining because of the toxic cocktail of measures administered by the Government, which they pretend are medicine to make us better.

The Joseph Rowntree Foundation has found that more than 12,500 working-age families in my Birkenhead constituency will be hit by the cut to universal credit, including more than 6,000 working-age families with children. That is almost one third of such families in Birkenhead, and they are set to lose just over £1,000 a year. How can that be fair? In the run-up to the day of shame on 6 October when the axe is scheduled to fall, more people have written to me asking me to oppose the cut than on any other single issue. My mailbag on the cut far outstrips the previous record holder: Dominic Cummings’ emergency eye test at Barnard Castle.

One letter stands out. It is from the seven-year-old son of a constituent who told me how worried he is that this family will not be able to afford to feed to him because he heard that they were about to lose £20. This is a particular concern for children because, as of 2020, 33% of children in Birkenhead—more than 6,000—were officially classed as living in poverty.

This vindictive cut would be bad enough any day of the week, but look at its timing—it is like something straight out of “Hammer House of Horror”. The cut coincides with the increase in national insurance, the surging cost of gas, the prospect of transport costs going through the roof, rents being driven up by the housing crisis and basic foodstuffs costing ever more as the supply chain becomes more and more disrupted.

Let me tell the House what that means to ordinary people. One of my constituents—I will call him Gary—lost his job due to contracting covid-19. He was not furloughed and he rents from a private landlord. He is on universal credit and, with the £20 uplift, after rent he had £46 a week to meet all his expenses. When the cut comes in, he will be left with £26 to meet those same expenses, each of which is going up. Gary, like so many others, faces ruin. I know full well that the Government will respond with their usual refrain that universal credit will help Gary to get a job, but they conveniently forget that their measure, which will put an estimated 800,000 into poverty—including 300.000 children—will have an impact on the about 40% of universal credit claimants who are already in work.

[Mark Tami (Alyn and Deeside) (Lab)]

I intervene to make the point that my hon. Friend has made that there are many working families—those in work—who are on universal credit, which the Prime Minister does not seem to understand.

[Mick Whitley]

My right hon. Friend makes a good point. I made that point to the Prime Minister, who just did not give me an answer.

Those working people will be hit by both the cut and the increase in national insurance. They will number thousands of working hairdressers, shop assistants, street cleaners, hospital porters, farm workers and countless others who are paid peanuts and have no choice but to claim in-work benefits. I genuinely hope that Conservative Members will not cry TINA—there is no alternative—as a previous Government of their persuasion did. Rather I hope that they will withdraw their package of measures that will slash the standard of living for the majority, and adopt the progressive tax policies that my party stands for and that can ensure that those with the broadest shoulders and the most bloated bank accounts pay their fair share, so that my constituents are not forced into a life of poverty.