Government's Management of the Economy

Olivia Blake Excerpts

Tuesday 23rd February 2021 Commons Chamber

[Olivia Blake (Sheffield, Hallam) (Lab)]

The aftermath of the 2008 crisis saw not only weak levels of growth, but a fundamental shift in the character of our labour market. As the economy contracted and people lost their jobs, we saw low-pay zero-hour contracts in sectors where workers had far weaker trade union representation. Labour borrowing or spending did not cause the international crisis and the economic crash. No, the only organisations that could achieve that were the big banks that took huge risks in an unregulated global banking market, They did not think about the impact that such risks would have on our communities; they just thought about their profits and bonuses.

This false rhetoric about what happened has damaged towns, cities and many communities, leaving councillors with impossible decisions on what services to cut. I find it a bit insulting when I hear Members say, as some have done today, that those in the public sector have been protected from job losses. After 10 years of harsh service cuts, huge workloads and many vacancies—in nursing, for example, there are 40,000 current vacancies —a huge strain has been imposed on the hard-working public sector who do deserve a pay rise. It is no surprise that the gap between the super-rich and the poorest continues to grow.

Things are certainly not all rosy in the private sector. In 2008, 143,000 people were on zero-hour contracts. By 2016, that figure had reached nearly 1 million, and it has stayed at about that level ever since. Not only did the 2008 crisis force down wages, the insecure working conditions that it created made it harder to negotiate higher pay. Now, 13 years after the last economic crisis, total pay, adjusted for inflation, has finally returned to 2008 levels.

Today, some of the people most likely not to have been furloughed are those on low pay, or on zero-hour contracts. I was shocked to read in the latest Office for National Statistics labour market report that the net impact on recent job losses could see an increase in average pay of 1.5%. That is purely because the people on the lowest wages are the ones most likely to lose their jobs. When they do not lose their jobs, many are afraid to go off sick for fear that they will not have their hours renewed, or because statutory sick pay simply will not cover their rent and bills, or because they will not be entitled to statutory sick pay. Low pay and insecurity in our economy has created a perfect storm for transmitting the virus and the Government are failing to learn the lessons. There is a real human price to their ideology—whether it be children in poverty, food bank queues or homelessness.