The Economy

Nick Smith Excerpts

Wednesday 8th July 2020 Commons Chamber

[Nick Smith (Blaenau Gwent) (Lab)]

This pandemic is hitting Blaenau Gwent hard. Its shockwaves are shaking our south Wales valleys now. An entire shopping centre is under threat. A logistics centre that supplies the drinks industry is facing redundancies. Our small-town high streets are under big pressures. Care workers are under the cosh. These heroes have put their lives on the line to look after our loved ones, but now some of them are seeing their hours cut, and others are losing their jobs completely. The whispers and rumours of redundancies are back, and while things are so uncertain, this will keep on happening.

The valleys have seen this before. People in my constituency remember the 1980s, when pit and steel closures hugely impacted our communities. We know how important early investment is during tough times. In 2018, the Government promised to launch the shared prosperity fund, but we are still waiting for it. That pot of money could help Blaenau Gwent to rebuild following this period of uncertainty. It could help to revive our economy, which is facing the threats of these dark times. It would build vital infrastructure, giving us the good-quality roads and the rail tracks that we need. We have waited too long for this fund. The Government need to step up and give us this detail as a matter of urgency.

We also need to invest in young people. Dubbed “generation covid”, they are facing the toughest job market in decades. The kick-start scheme is to be welcomed. At first sight, it resembles Labour’s successful future jobs fund, and I am glad that it is being revived. In Ebbw Vale in my constituency, Cyber College Cymru offers young people future-proof training in this growing sector. The project links up with major employers, helping young people to gain the work experience they need to get into the jobs market. It is a shining example that should be replicated across the whole country. Young people need these opportunities straightaway. Neither they nor our economy can afford to wait. Blaenau Gwent and its young people need a helping hand now—let’s get on with it.

--- Later in debate ---

[John Glen]

I will not, given the time.

It is a plan that puts young people front and centre, with a kick-start scheme that will pay employers to create quality jobs for 16 to 24-year-olds at risk of long-term unemployment, alongside new funding for apprenticeships, traineeships and sector-based work academies. We shall be issuing guidance very shortly on how those schemes will interact with the extra support that we are putting into jobcentres. It also means that we shall invest in infrastructure, decarbonisation, and maintenance projects that will serve the needs of communities across the country, while creating jobs and apprenticeships here and now.

Through our collective efforts, coronavirus has been brought under control in this country, but it has not disappeared completely. Even as our economy reopens, many businesses and families will continue to face significant challenges. The Chancellor made it clear today that the Government are not driven by ideology; we are guided by the simple desire to do what is right. For that reason, we will continue to take significant steps to support the economy in the weeks ahead. We will, for example, inject new certainty and confidence into the housing market by increasing the stamp duty threshold to £500,000 for first-time buyers. That recognises the additional expenditure in the economy derived from a house purchase, and, we anticipate, will have a significant effect.

Few sectors have been harder-hit, though, than retail, hospitality and entertainment, so, from next Wednesday, VAT on food, accommodation and attractions will be cut from 20% to 5%. I welcome the positive comments from across the House for that measure. Through the month of August, everyone in the country will be entitled to a Government-funded discount of 50% in restaurants, pubs and cafés, Monday to Wednesday. The “eat out to help out” discount is the first of its kind in this country, and proof that the Government will leave no stone unturned in our efforts to protect people’s jobs and livelihoods.

I shall now mention some of the themes of this afternoon’s debate. My hon. Friends the Members for Stoke-on-Trent South (Jack Brereton), for High Peak (Robert Largan) and for Keighley (Robbie Moore) emphasised the need for investment in local infrastructure and levelling up, and that means investing now to prevent long-term damage to the economy and support the private sector. That is why the Government have brought forward the shovel-ready projects.

On the theme of sustainable public finances and recapitalisation, my right hon. Friends the Members for Wokingham (John Redwood) and for Chipping Barnet (Theresa Villiers) and my hon. Friend the Member for North East Bedfordshire (Richard Fuller) recognised the challenges ahead with respect to the third phase that the Chancellor referred to today, and we shall be responding in the Budget later this year. My hon. Friend the Member for North East Bedfordshire raised a particularly important point about the need to encourage the private sector to generate the jobs ahead.

My neighbour, my right hon. Friend the Member for Romsey and Southampton North (Caroline Nokes), made a passionate speech, referring to the need to address urgently the challenges faced by the beauty industry. She also mentioned the disproportionate impact on women, people from the BAME community and the disabled, and we shall be responding to the excellent report that her Committee, the Women and Equalities Committee, produced in the spring.

There was a moment of synergy between my hon. Friends the Members for Buckingham (Greg Smith) and for St Albans (Daisy Cooper) as they backed the “eat out to help out” campaign, and my hon. Friend the Member for South Dorset (Richard Drax) emphasised his commitment to that in terms of support for pubs.

There were also references to the need for resilience with our local authorities, who have received £3.7 billion in new grant funding. We will work closely with local authorities as we move into the next stage.

[Nick Smith]

Will the right hon. Gentleman give way?

[John Glen]

I am afraid that I will not give way because of the amount of time I have left.

I wanted to respond to the point raised by the hon. Member for North East Fife (Wendy Chamberlain)—who is not in her place—on the Treasury’s responsiveness to her constituents’ correspondence. We have had a volume increase of eight times over this crisis, but we will be working very carefully to improve our responsiveness.

Over the past few months, our economy has endured unprecedented levels of disruption and uncertainty. People and businesses have experienced considerable hardship and worry, and many will continue to do so for some time yet. However, over the past few months we have seen the best of our economy. We have seen banks and building societies providing support with mortgage holidays. The hon. Member for Glasgow South West (Chris Stephens) mentioned the important role of credit unions; we will be working closely with them as we move to the next stage. Businesses large and small turned over their production lines to the manufacture of ventilators, PPE and antibacterial sanitiser, and supermarkets, chemists, couriers and utility companies have also assisted; but we now need to move forward. As the Chancellor has unveiled a plan to protect, create and support jobs, everyone in this country has the opportunity for a fresh start. The task is not yet done. It will take time, and there will be more to come from the Government in the Budget and spending review in the autumn.

Economic Update

Nick Smith Excerpts

Wednesday 8th July 2020 Commons Chamber

[Rishi Sunak]

My hon. Friend is absolutely right. Those on the lowest incomes will receive grants of up to £10,000 to cover the full costs, but that is a policy that does all three things: it will create local employment in communities, which right now is what we want; it will save households money on their bills, up to £200 or £300 for typical cavity wall insulation; and it will cut carbon, with the average house installing these measures saving the equivalent carbon of a flight from London to New York. This is a policy that does what we need right now—cuts carbon, creates jobs and saves cash.

[Nick Smith (Blaenau Gwent) (Lab)]

To boost employment in Blaenau Gwent, we need to help more people get on the Ebbw Vale train to Cardiff, but the line needs to be redoubled, with improved signalling and bridging works. A business plan is in the pipeline from the Welsh Government. Will the Chancellor commit to follow through and please look at providing the investment for jobs that we need—in short, to do what is right for the people of the south Wales valleys?

[Rishi Sunak]

I am very happy to look at the proposal from the hon. Gentleman, and I am sure that the Transport Secretary is fully abreast of it. I will pick it up with him as well.

Future Relationship with the EU

Nick Smith Excerpts

Tuesday 9th June 2020 Commons Chamber

[Penny Mordaunt]

I can give my hon. Friend those assurances. We are obviously working very hard to deliver for that sector. It is a sector that was not well served—the whole of services were not well served—by our previous relationship with the EU. The asks that we are making with regard to financial services are in other agreements that the EU has, notably that with Japan, so we think it perfectly reasonable that they be extended to us.

[Nick Smith (Blaenau Gwent) (Lab)]

Ebbw Vale in Blaenau Gwent has a European-based car parts manufacturer that provides well-paid jobs. What engagement have the Government had with this sector and its trade unions about their role in these negotiations?

[Penny Mordaunt]

I thank the hon. Gentleman for his question. One of the areas that I look after in the Cabinet Office is our communications. We have had a complete overhaul involving every Government Department, including those for local government and for transport, which will be key to the sector that he raises, to improve our communications. Clearly, a lot of policy announcements are yet to happen because they are contingent on decisions that have been taken, but that structure is now in place. I make the commitment that the communications between all sectors and Government will be considerably better than what happened last year.

Covid-19

Nick Smith Excerpts

Monday 11th May 2020 Commons Chamber

[Nick Smith (Blaenau Gwent) (Lab)]

I congratulate the right hon. Member for Chipping Barnet (Theresa Villiers) on her contribution. The devastating effect of covid-19 on care homes is being felt in Blaenau Gwent and across the world. A quarter of New York’s fatalities happened in care homes, 200 people died in just one care home in Italy, and in England, a full 16% of covid-19 deaths have happened in care homes. This is clearly a far-reaching issue. Today, though, I want to talk about a local tragedy in my constituency.

Blaenau Gwent has one of the highest numbers of coronavirus cases per head in Wales. A brave care home staff member contacted me to say that, early on in this crisis, their care home had inadequate PPE. It was also reported that a resident showing symptoms of covid-19 was discharged back from hospital and allowed access to communal spaces. I have sought confirmation of that from the health authority, but the exact situation remains unclear. Altogether, 16 residents have died.

My question is, were the processes in place so that care homes could deal with this crisis? We knew that the coronavirus would hit the elderly and the vulnerable hardest, and that those in care homes were most at risk. More should have been done at the start of the outbreak to protect residents and staff.

This has been a dreadful time for my constituents, for care home residents, their relatives and hard-working staff. Almost daily, I have been raising my concerns on this one issue with a range of local decision makers. Those decision makers have been pulled in 101 different directions. I know they are doing their very best, but the truth is that health officials have had a focus on the NHS and we have been playing catch-up with care homes. Social care is a vital sector, but we have not been treating it that way.

This crisis has revealed to me that we need to mend the broken structures of accountability. We need fast action to shield those who are most vulnerable and daily updates on deaths in individual care homes. There must be an open discussion about the issues that respects the rights of residents and the needs of staff. We need to build something better.

I end by paying tribute to our care workers across the country who are putting their lives on the line. I have been lucky enough to visit many care homes over the years. At their core, they are places of love. Those cared for are more than residents; they are like family. For the homes, coronavirus deaths are not just numbers; they are painful losses. It is vital that we ensure that tragedies of this scale are never allowed to happen again.

Coronavirus: Employment Support

Nick Smith Excerpts

Thursday 19th March 2020 Commons Chamber

[John Glen]

As ever, my hon. Friend makes a sensible suggestion. I will look at it carefully.

[Nick Smith (Blaenau Gwent) (Lab)]

I do wish Ministers would stop using hyperbole such as “whatever it takes”, when they do not follow through sufficiently quickly. Will the Government extend SSP to support all workers and pay it at the rate of the real living wage straightaway?

Economic Update

Nick Smith Excerpts

Tuesday 17th March 2020 Commons Chamber

[Rishi Sunak]

My right hon. Friend is right to highlight the need to provide support for businesses with their fixed costs, rather than their variable ones. That is what we need to help bridge through—the cash grants today related to rateable value, with reference directly to rent payments—but he is right that other fixed costs are people, which is why we are working up measures in that area.

[Nick Smith (Blaenau Gwent) (Lab)]

The measures in the Red Book are nowhere near enough. For families in need, can statutory sick payments be available from day one, for all workers when they are sick, and can it be set at the level of the national minimum wage?

[Rishi Sunak]

As a result of the actions of my right hon. Friend the Secretary of State for Work and Pensions, SSP is available for those who are eligible for it from day one. Regulations are being laid to that effect, and employment and support allowance will also be available from day one, rather than day eight.

Tax Avoidance and Evasion

Nick Smith Excerpts

Tuesday 25th February 2020 Commons Chamber

[Matt Western]

Yes, there has. As I have said, the former Chancellor showed the wrong sort of leadership when he basically said about taxes, “It is almost entirely down to you whether you choose to pay it or not.” Tax really is the responsibility of us all: it is a corporate responsibility and it is a personal responsibility.

Decades ago, when I was working in the corporate world, I remember the introduction of a thing called corporate social responsibility. It was a real buzz term, and we started making donations to charities, volunteering and so on. Of course, that is important and it is wonderful that big business does that, but we are seeing this almost replace tax responsibility. Rather than paying their way and supporting education, infrastructure and healthcare for society, we are seeing organisations perhaps decorate a community centre or go out on litter picks and the like.

Turning to personal tax avoidance, I have mentioned the former Chancellor, and there are schemes such as the film production scheme. Businesses have increasingly paid out dividends, substituting them for actual salary, because of course there is lower tax to be paid on dividends and it is advantageous to employees or directors to get a much larger proportion of their income through dividends. All we need to do is go to some of the ports around Europe, and see that the yachts in the berths there are all flying flags of convenience—and they are all UK flags or those of UK overseas territories and Crown dependencies. There are no German flags, dare I say it, or Dutch flags or French flags. Either we are renowned for our sailing, or a lot of Germans or those of other nationalities like flying the British flag because— I do not know—they sail better or something like that. The same could be said about personal jets and where they are domiciled.

Let me just say that tax is good: it is a contribution to a better society, and we must think about what that society looks like. We should look at the words of Elizabeth Warren. Let me just paraphrase her; I will not do her justice. She basically said, “Why is it that people should simply want to avoid paying tax and then be able to afford to buy a Ferrari? There is no point in owning a Ferrari, if they have not got a good road to drive it on.” People should pay their tax and get a Jaguar Land Rover or Aston Martin—obviously, because they are much better products anyway—and drive on a beautiful smooth road that has been paid for out of their taxes. That is the sort of society we should be looking for, not people avoiding tax, living behind gated communities, owning Lamborghinis, Ferraris or it whatever may be, and having roads full of potholes.

The Government need to turn up on this issue: they need to go Davos and places like that, and make the case for why international intervention and regulation need to be introduced. I agree with what the hon. Member for Amber Valley (Nigel Mills) said earlier about full disclosure. We need to see that across the entire business sector, whether for small businesses or large businesses. When we talk about consumers being given an informed choice, I think the consumer should know whether Caffè Nero is not paying any tax at all, or whether Costa or one of the others is paying tax, and they can then make an informed decision. They can choose, saying, “Well, maybe I want to buy my coffee from that place”, or whatever the product or service may be.

I want to close on the issue of the tech titans. I say this to them: Amazon, you have your warehouses, and your warehouses need security. They need protection from fire; who is going to show up? Warwickshire fire and rescue service has had significant cuts, and it needs the money out of taxation to pay and provide for the fire and rescue services.

[Nick Smith (Blaenau Gwent) (Lab)]

It is estimated that five of the big tech companies paid an effective UK tax rate of just 2.9% in 2018. They avoided paying £1.3 billion in taxes. Does my hon. Friend agree that the Government need to get that money back?

[Matt Western]

Indeed they do, and I was just about to say in respect of companies such as Facebook that services impact on mental health. We need those services; they need to be paid for for our young people. I say to Apple and Google: your product upgrade and replacement cycles lead to huge waste in recycling. You have to pay your taxes; it is a responsibility that we deserve from you, to pay for our society.

Oral Answers to Questions

Nick Smith Excerpts

Tuesday 11th February 2020 Commons Chamber

[Sajid Javid]

My hon. Friend is right. Local transport is the backbone of our community, which is why hopefully a welcome announcement will be made today on buses and cycling—a new £5 billion package on local transport. There is also the £150 million fund for smaller projects to deal with congestion hotspots. I would be pleased to consider the Chickenhall Lane link road in the next available competition.

[Nick Smith (Blaenau Gwent) (Lab)]

Blaenau Gwent needs investment in the Ebbw Vale to Cardiff train line for extra services. The shared prosperity fund could be a crucial route to providing that. When will the fund be ready to support infrastructure projects in our eastern valleys?

[Sajid Javid]

The hon. Gentleman will know that, as we transition from EU structural funds to the shared prosperity fund, it will be important that we set out exactly how that will work. With reference to his question, it means that the Welsh Government will have to work closely with us to see how we can use that for infrastructure projects in Wales.

The Economy

Nick Smith Excerpts

Thursday 24th October 2019 Commons Chamber

[John McDonnell (Hayes and Harlington) (Lab)]

I beg to move amendment (g), at end add

‘but respectfully regret that the Gracious Speech fails to rebuild the UK economy, tackle the housing crisis, further pushes public services into crisis and contains no vision to bring this divided country back together; call on the Government to bring forward a plan to rebuild the economy so that it works in the interest of the many, not just handing out rewards to those at the top; and further call on the Government to address the climate emergency by bringing forward a green industrial revolution to decarbonise the economy and boost economic growth.’

Mr Speaker, may I just say this? This is the last time that you will be chairing a day of the Queen’s Speech debate, and I may not get the opportunity in other tribute debates to say this. It has been a privilege to serve in this House while you have been Speaker. Thank you.

I listened to the Prime Minister introducing the Queen’s Speech. What I always find most startling about the Prime Minister is his ability to create his own truth and, when confronted with any reality that contradicts his truth, to bluster his way through. I believe he believes that, with a combination of bluster and the occasional pretentious use of Latin, he can always avoid confronting reality or answering for it. So, if we can achieve anything in today’s debate, let us at least try to confront the reality of what some of our people face and assess whether the announcements in the Queen’s Speech in any way meet those challenges.

On the economy, the Prime Minister referred in his speech to “economic success” and “free market success”. He also said:

“in important respects this country is the greatest place to live and to be—the greatest place on earth.”—[Official Report, 14 October 2019; Vol. 666, c. 19.]

I think many of us feel that way, but I just wish it was the same for everyone. For so many of our people, tragically, it is not at the moment. There is a multitude of statistics evidencing just how far the Prime Minister is out of touch and how he appears to have no understanding of what our people have gone through over nearly a decade. Let me start with three stark examples of what the austerity the Conservative party has inflicted on our people has meant and continues to mean, and which I deeply regret were not addressed in the Queen’s Speech.

First, on infant mortality and child poverty, earlier this month, the British Medical Journal published a research project into infant mortality. Declines in infant mortality have been reversed for the first time in 100 years. The research found that, between 2014 and 2017, there were 570 excess infant deaths. The research concluded that 172 of those infant deaths were associated with the increase in child poverty. Out there, there are nearly 200 families who are grieving as a result of the Government’s austerity policies. There is nothing in the Queen’s Speech—nothing—that will tackle the poverty affecting 14 million of our people, and nothing that will tackle the poverty that 4.5 million of our children are being brought up in, or help the 125,000 children who are forced to live in temporary accommodation. There is nothing to address the £3 billion funding gap local councils face in trying to provide the services needed to support those very families. I will not forget, and many Labour Members will not forget, that this is a Government who have closed over 500 Sure Start centres, the very institutions we founded to support those families and to prevent infant mortality and morbidity on the scale we have seen.

Let me take the second example of what the Tories have done to our people. Earlier this month, the Office for National Statistics reported a record number of deaths of homeless people in England and Wales in 2018. Last year, 726 homeless people died. That represents the highest year-to-year increase since data was first collected. The Government have cut £1 billion from support to the homeless since 2010, so it is hardly surprising that rough sleeping has risen by almost 165%. In London, rough sleeping has more than tripled since 2010. Again, there is nothing—nothing—in the Queen’s Speech to tackle the scourge of homelessness.

My third example is the distance between what the Government claim and what employment and wages are like in this country. The Prime Minister claimed that

“we have unemployment at its lowest level since 1974”.—[Official Report, 14 October 2019; Vol. 666, c. 22.]

The reality is this: more than 3 million people are missing from the unemployment rate because they report themselves as “economically inactive,” we have over 2.5 million people counted as employed even though they work fewer than 15 hours a week and there are 3.7 million people in insecure work.

[Nick Smith (Blaenau Gwent) (Lab)]

The Government have received over £4 billion from the mineworkers’ pension scheme, despite not having paid a penny in. With retired miners getting by on a pension of, on average, £84 a week, does my right hon. Friend agree that it is time for the Government to listen? This Queen’s Speech should announce a review of the scheme so that miners and their widows get a fair deal.

[John McDonnell]

Madam Deputy Speaker, I know that large numbers of Members are seeking to make speeches—I will take a number of interventions, but I will protect the time as best I can for others to speak.

Let me give my hon. Friend this assurance on that critical point: in our last Labour party manifesto, we promised that we would review the mineworkers’ pensions scheme—it is dear to my heart, because I was one of the administrators of the scheme soon after I left university, when I worked for the RMT—and we will review it because we want to lift miners and many miners’ widows out of the poverty that they now live in. We give that commitment.

I mentioned insecure work. There are now about 900,000 people on zero-hour contracts—up by 100,000 from a year ago—and real wages are still below pre-crisis levels. The Government like to talk about wage rises and wages rising at their fastest rate in a decade. It is a bizarre claim, because the Government have been in charge of the economy for the last decade, suppressing wages all through that period. According to the Financial Times, the UK was the only major economy where growth returned but wages fell. According to TUC calculations, since 2010, average pay has also fallen for 7.7 million low to middle-income earners, and 11.5 million middle to high-income earners. It is extraordinary that that was not even acknowledged in the Queen’s Speech—that we now have a low-pay, insecure-job economy that this Government have created over the last decade.

Oral Answers to Questions

Nick Smith Excerpts

Tuesday 1st October 2019 Commons Chamber

[Mr Speaker]

I think that we are about to hear the prodigious knowledge of the hon. Member for Blaenau Gwent (Nick Smith) on the Moray growth deal. Wonders never cease.

[Nick Smith (Blaenau Gwent) (Lab)]

21. Thank you, Mr Speaker. Local growth deals like Moray’s would greatly help regional development. The shared prosperity fund would greatly help with improvements to the Ebbw Vale to Cardiff train line, so will the Minister please meet me to consider that possibility?

[Mr Clarke]

That was a truly ingenious question. Of course, the UK shared prosperity fund is really important. We continue to make good progress on its design. Ministry of Housing, Communities and Local Government officials have so far held 26 engagement events across the UK with over 500 representatives from a breadth of sectors. This is something that, obviously, has massive implications for Wales, and we are very happy to ensure that we engage everyone in that process.