The Economy
Patricia Gibson Excerpts(7 months ago)
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Bim Afolami
My hon. Friend makes an important point about those on the Labour Benches. I must admit that I disagree with him on one key point: the idea that they might inherit this. We are not complete yet. We know that the economy still needs to continue to turn and that inflation needs to come down. We hope that that will lead to falling interest rates in due course, and that the measures we have put in place will come to fruition over the next Parliament.
Patricia Gibson (North Ayrshire and Arran) (SNP)
The UK economy is smaller now, and living standards are lower now, than at the start of this Parliament—the first time this has ever happened. Does the Minister agree that it is a sign of the Tories’ increasing desperation that they consider it a cause for celebration that the UK economy has stopped shrinking? Growth is still lower than in Europe, Asia, the Americas and Australia, and we continue to pay the price of Brexit and Tory incompetence.
Bim Afolami
I am afraid I disagree with the hon. Lady on points of fact. I have already set out so many statistics that show that things are significantly improving in the economy, and at a faster rate than that experienced by most of our competitors in Europe. I completely disagree with her assessment.
Oral Answers to Questions
Patricia Gibson Excerpts(7 months, 2 weeks ago)
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Marion Fellows (Motherwell and Wishaw) (SNP)
Patricia Gibson (North Ayrshire and Arran) (SNP)
The Chief Secretary to the Treasury (Laura Trott)
The Office for Budget Responsibility expects UK living standards to grow in all years of the forecast period.
Laura Trott
It is good news that energy prices are set to fall. The hon. Lady will know that the Chancellor abolished the surcharge in one of his first Budgets.
Patricia Gibson
The UK is set to have the highest level of inflation in the G7 and the lowest rate of growth in the entire OECD in 2025. Bizarrely, the Chancellor claimed ludicrously that the Tories are winning the war on inflation. With GDP per capita continuing to fall as part of the longest unbroken decline since records began, who does the Minister think in the real world really believes that this plan is working, and that the cost of living crisis is easing?
Laura Trott
It is important to note that inflation has more than halved since the Prime Minister took office, and is now at 3.2%. That will have a material impact on the cost of living pressures on households. In addition, support this year includes cutting national insurance rates across the UK and raising the local housing allowance. Benefits are up by 6.7%, the national living wage is up by 9.8%, and pensions are up by 8.5%. We are on the side of the British people.
Oral Answers to Questions
Patricia Gibson Excerpts(10 months, 2 weeks ago)
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Rachel Hopkins (Luton South) (Lab)
Patricia Gibson (North Ayrshire and Arran) (SNP)
The Chief Secretary to the Treasury (Laura Trott)
The Government stand by households, with one of Europe’s largest support packages, worth on average £3,700 per UK household, but we all know that the key to reducing cost of living pressures is to bring down inflation, which we have more than halved, delivering on the Prime Minister’s promise.
Laura Trott
Fourteen years of the Conservatives has halved unemployment and increased employment by 4 million. Crucially, poverty is down: we have 1.7 million fewer people in poverty now than in 2010, including 400,000 children and 200,000 pensioners. That is a legacy to be proud of.
Patricia Gibson
The Joseph Rowntree Foundation’s report on poverty in the UK in 2024 reiterates that, consistently, the demographic with the highest poverty rates is children. Although 29% of the children in my constituency live in poverty, the Scottish Government are doing what they can with their limited powers via the Scottish child payment. Will the Chancellor and his team use their powers to make a concerted and determined effort to tackle the scourge of poverty, which is so damaging to our children?
Laura Trott
I reiterate: we have 400,000 fewer children in poverty now than in 2010. In addition, the national insurance contributions cut that we have introduced has been shown to cut child poverty dramatically. Crucially, the leading indicator of whether a child is in poverty is whether their parents are in work, and that is what we have delivered over this Parliament—[Interruption.] Yes it is—it absolutely is. Getting more people into work will help to solve child poverty.
Living Standards
Patricia Gibson Excerpts(10 months, 3 weeks ago)
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Patricia Gibson (North Ayrshire and Arran) (SNP)
I am delighted to sum up for the SNP. I congratulate my hon. Friend the Member for Glasgow South (Stewart Malcolm McDonald) on securing the debate and opening it so comprehensively.
No issue is more pressing for our constituents at the moment than the cost of living crisis and its impact on living standards. The UK Government point to a range of factors to explain why, in the two years to March 2024, we have had the biggest fall in living standards since records began, as the Office for Budget Responsibility highlighted. Even as wages rise and inflation falls, there is yet more pain to come. Consumers with less to spend act as a drag on the economy. In addition, confidence in UK economic growth fell by 19% between June and July, according to the Hargreaves Lansdown investor confidence index.
The UK Government blame the covid pandemic and the war in Ukraine—to be honest, they would blame the bogeyman if they could—but they are strangely reluctant to even mention the word “Brexit”, although we all know the impact it has had on our productivity and our living standards. The Resolution Foundation says that the UK is falling behind our European counterparts on living standards due to low growth and high inequality, and our prosperity gap has been widening since 2009.
Everybody knows that there is a global element to the current difficulties, but let us not forget—as so many Ministers have done already, it seems—the disastrous Budget of the previous Prime Minister, which sent inflation soaring, interest rates rocketing and the pensions system to the very verge of collapse. That is what true economic incompetence looks like, and the Tories have never recovered fully from that particular disaster.
My constituents and people across the UK are truly suffering and the Government must accept responsibility for their own incompetence. About 2.65 million people have reported being unable to afford a healthy amount of food. The expense of groceries remains the most significant stream of household finances, as 96% reported a rise in food expenses over the past month. Young adults aged 25 to 34 years are almost three and a half times more likely to experience vulnerability compared with those aged 75 years and above.
The cost of essential household expenditure for homeowners has soared by more than £9,000 a year on average over the past two years, with higher mortgage rates the biggest contributing factor. There have been 14 mortgage rate rises over the past two years, with inflation peaking at 11.1% in October 2022. Food and energy prices have risen markedly since 2022, gas prices in particular, with the cost of energy doubling since 2021. The pain goes on and on. Many households use less fuel, such as gas or electricity, simply because they cannot afford to maintain the same level of usage, with about one in five adults reporting that they were occasionally, hardly ever or never able to keep comfortably warm in their home.
Nearly two thirds, or 64%, of those of working age who live in poverty live in working households. More than 5 million people live in homes with energy debt, with more than 3 million people disconnected from their energy last year because they simply could not afford to top up their meter. There seems to be no end to this because, alongside all that, food-bank reliance is at record levels, with many of the food banks in our communities simply unable to keep up with demand. At this juncture, I pay tribute to the work of the Ardrossan food bank in my constituency, which does excellent work.
The Joseph Rowntree Foundation report, “UK Poverty 2024”, was clear that six successive UK Prime Ministers have overseen deepening poverty over the past 20 years. It also noted that the Scottish child payment is making a difference in Scotland. We know that the current UK Government will not implement a similar measure in England, but we also know that no incoming Labour Government will implement it, either. However, it is heartening to know that those parties are committed to ensuring no cap on bankers bonuses, but that there will be one on child benefit. That suggests that those parties are completely relaxed about increasing inequality in our society, with an apparent acceptance of the inevitability of poverty.
The reality is that amid all that pain, with the limited powers that the Scottish Government have—their powers are very limited—they are doing all they can to support people during this unprecedented decline in living standards, with a focus on a more progressive and equal society—the Scottish child payment; the baby box; the rent freeze; free school meals being rolled out for all primary 1 to primary 5 pupils, and to be extended to all primary school pupils on a universal basis; free bus travel for under-22s; five family payments from April 2024, which dwarf the payments made in England; the winter heating payment; the council tax reduction scheme, worth £800 per year for over 450,000 households; and the carer’s allowance supplement, delivering £255 million to over 148,000 Scottish carers. But, if I may quote George Foulkes, we are “doing it deliberately”.
The SNP will always use its powers to support households through the damage inflicted by the mismanagement of this UK Government, with its £318 million a day spent on paying debt interest, after burning £4.2 million-worth of personal protective equipment and wasting £66,000 million on High Speed 2, which is just a rail link from London to Birmingham, for which all UK taxpayers will pay. The UK Government are not doing this deliberately; they are just dogged by their own inability to govern, and govern well.
An incoming UK Labour Government seems pretty likely at the moment, but as Labour U-turns on all that it was ever supposed to stand for, we know that it will remain committed to austerity, which it introduced in its previous term in office, leaving bankers’ bonuses uncapped as millions struggled to make ends meet. We all remember the admission from the current shadow Chancellor, the right hon. Member for Leeds West (Rachel Reeves), that Labour is
“not the party of people on benefits”—
a sorry story indeed.
We look to the example of small, independent European nations, which show what can be done with a more equal, prosperous country with wellbeing at its heart. Scotland is rich in natural resources and we can build a nation, freed from the shackles, the dead hand, of Westminster, which is governed by a consensus from both the main parties that poverty and inequality are acceptable and inevitable. They are not.
With all the powers of an independent nation, Scotland can make meaningful improvements, by making different choices and having different priorities. That is the way that we will tackle the scandal of the record decline in living standards that is decimating our communities.
Michael Shanks (Rutherglen and Hamilton West) (Lab)
It is a pleasure to participate in this debate under your chairmanship, Mr Mundell, and to speak in a debate brought by my neighbour, the hon. Member for Glasgow South (Stewart Malcolm McDonald). I congratulate him on securing it. He and I endured many electoral scrapes before we got to this place, but this is the first opportunity we have had to participate in a debate at the same time. It is a pleasure.
This is a timely debate because, as we have already heard, over the past few weeks the Government seem to be trying to give the impression that everything is okay —that there is “nothing to see here” and we are back to normal; the cost of living crisis does not exist, and everybody, all across the country, is getting on just fine.
The hon. Member for Glasgow South made the important point that the cost of living crisis affects individuals, but also the very fabric of our society. I will come back to that point later on. From my own constituency casework and from meetings with community groups and others—I know it will be the same for all of us —I know that the cost of living crisis is far from over. In fact, people are struggling now more than ever. It is important that we keep talking about living standards and that we push the Government, in the weeks that they have left in office, to do more. This Parliament is on record as being the first in modern history during which living standards in the country will contract. Household income growth is down by more than 3% in this Parliament. Britain is worse off.
The hon. Member for Dover (Mrs Elphicke) made some reflections on history, which was an interesting perspective to bring. At one point, I thought the praising of Bevan might have led to another faction in the Conservative party—the Bevanites—but it was an important point. I will take away particularly the idea of a unified Department to look at these issues. She made the point very well. Just a few weeks ago, I raised the issue of prepayment meters in the main Chamber. It is a classic example of a straightforward issue, but the various bodies that deal with it are divided and sit at different parts of the system. Bringing them together would be very helpful.
I mentioned before the cumulative impact of the cost of living. That is important, because we see levels of poverty and destitution reaching horrifying levels. People who were teetering on the brink of poverty have been plunged into it, and into destitution. Inflation may be coming down, but the aftershocks are still being felt. Wages have not kept pace with costs. Debt is rising across many households. The ability to make the pay packet stretch just a little further every month is becoming more and more difficult, if not impossible.
We saw this week that even the hon. Member for Mid Norfolk (George Freeman) has had to confront mortgage challenges. A salary of £118,000, some four times the average salary of a worker in my constituency, still did not allow him to continue in his ministerial job, although I suspect there will not be a huge outpouring of grief in that case.
More than 1 million households are expected this year to come to the end of cheaper mortgage deals, leading to an average increase in annual housing costs of about £1,800, according to the Resolution Foundation. Yesterday the leader of the Labour party, my right hon. and learned Friend the Member for Holborn and St Pancras (Keir Starmer), raised the case of an Iceland worker and was met with derision from many Members on the Government Benches. Dozens of similar cases have been raised with me over the past few months. Constituents who were stretched to afford their mortgage in the first place now find themselves in greater debt, with income no longer matching the mortgage payments that they could only just afford before.
Citizens Advice has done some research and found that, previously, mortgage holders on average had about £61 left after paying for essentials, but now, after the mortgage changes, they find themselves more than £100 at least in debt every month—there is a cumulative impact—and in some cases it is four, five or six times that amount.
Of course, part of the problem is the still rising cost of food. Although inflation overall may have come down, food inflation continues to be a huge problem for families. The overall price of food rose last year by 26%, which is a staggering figure. Of course, we also have the slightly more subtle version of inflation through companies simply reducing the product that they are selling, which puts even more pressure on families.
Energy bills have soared, with people struggling to heat their homes. As we have heard from other Members, a quarter of adults last year said that they were occasionally, hardly ever or never able to keep themselves comfortably warm, which is a basic that any of us should be able to expect. It was the case that 34% of adults said that they cut back on their heating, and 16% of adults said that they were worried that their food would run out and they could not afford more. That is a staggering statistic.
Many of us may have visited the Trussell Trust’s event in Parliament yesterday. I spoke to a number of people who raised examples of families who were in work, in well paid, permanent jobs, but were still struggling to make ends meet. We know that more and more people in the economy are not in such work and so they are in an even worse position. Working-age adults are far more likely to turn to food banks, and almost half of households experiencing food insecurity are dealing with disability—an issue to which I want to return. This is a picture of a country with so many people teetering on the brink of poverty and now living such a precarious life that even work is not lifting them out of poverty.
A number of Members have raised the intergenerational nature of poverty—the challenge of a generation growing up now without any of the expectations that a previous generation had. Before I was elected to this place, I was a high school teacher and saw many of those young adults. They were very well qualified, intelligent and capable, but they were leaving school and going off to university or work with none of the expectations about being able to get a permanent job and afford a home. That just does not exist for many of them now. The fact that so many of them have resigned themselves to that fact is in itself depressing.
In the midst of all this, we have a Government—I am hoping that the Minister will correct me—who seem to suggest that everything is fine and there is nothing to see here. The fact is that the economy is not working for working people across this country. We have now had 14 years of a Conservative Government, and people are certainly no better off than they were before. People have higher taxes and higher mortgage payments, and prices are still rising at the shops. There have been 25 tax rises in this Parliament alone, with households paying on average £4,000 more in tax each year. The Conservatives have become the party of high tax because they are the party of low growth.
The same is true in Scotland: we see tax rises in Scotland to cover for fiscal mismanagement and a £1.5 billion black hole, but also for a lack of growth, which I attribute to both Scotland’s Governments. We need to get some basic economic competence back so that we can boost wages, bring down bills and make working people in all parts of our country better off.
Michael Shanks
The leader of the Scottish Labour party—my good friend, Anas Sarwar—is always right. Of course, we opposed lifting the cap at the time. Since then, we have outlined that this is not the moment to bring it back, but we have very clearly said that bankers should be on notice that, if we see the behaviour that led to the cap in the first place, it would be very easy to implement it again.
Patricia Gibson
Does the hon. Member accept the independent evidence of the OBR that shows that—I have the evidence and can share it with the hon. Member, if he wishes—the majority of people in Scotland pay less tax, including council tax, than they would if they lived in England? His remarks about tax make me wonder whether he no longer supports what was on his leaflets during the by-election: that council tax should be frozen.
Michael Shanks
I am grateful to the hon. Member for North Ayrshire and Arran for her dedication in checking my leaflets and retaining that information; I think that is what we call “cut-through” in the political world. I accept the interesting point that she makes. She has questioned the Government on that point on a number of occasions. I think that there is an issue when somebody on £28,500 is paying more tax—those are not wealthy people. In the midst of what we have all been talking about in this debate, that is an increase in the cost of living.
On the subject of the council tax—I feel like I am relitigating a by-election that I thought was behind me for now—I opposed the proposal of a 25% increase, which was in the consultation carried out by the Scottish Government. There is a world of difference between opposing a 25% increase and announcing a council tax freeze, which will hammer communities all across Scotland. Of course, the hon. Member may be very aware of my leaflets, but I am not sure that any of her party were aware that the First Minister was going to announce that policy before he announced it, which shows just how little thought went into it.
I will get back to Labour’s new deal for working people, which is what I thought the interventions were going to be about. We have made it very clear that, in the first 100 days of a Labour Government, we want to introduce the strongest commitment to improving the lives of workers in a generation: raising wages, improving working conditions, bringing stability back to employment and enshrining workers’ rights from day one. That would undo the damage of much of the anti-worker legislation we have seen over the past 14 years.
We have also set out how we will bring down energy bills by building cheaper and cleaner power across the country, through the creation of GB Energy, a publicly owned clean energy generation company headquartered in Scotland—something that I am sure my colleagues from Scotland will warmly welcome. We will also look to reform things like work capability processes—I have raised that on a number of occasions in this Parliament—so that people entitled to benefits are not locked out of them by bureaucracy that simply does not work.
I return to the comments that the hon. Members for Glasgow South, for North Ayrshire and Arran and for Dover made about the intergenerational question, which is incredibly important. I spoke about being a teacher. Before that, I worked for a charity that worked with young people involved in gangs and offending. The route out of that involvement was often through giving people something to aspire to: a sense of hope that their future would be better than the poverty and destitution that they found themselves in. It seems to me that we are increasingly turning our backs on a generation of young people who have done nothing to cause any of the crises that they face, but who are going to pay the price of them for a long time to come.
I will briefly address the issue of disability. I draw attention to my entry in the Register of Members’ Financial Interests, as I am a trustee of two disability charities. Disabled people face higher costs of living across the board. Scope found that disability-related costs represent the equivalent of 63% of a disabled person’s income. Just by having a disability, you are already at a financial disadvantage, and the cost of living crisis has exacerbated that hugely.
I want to mention a woman who I met just before Christmas. She was forced out of her home because she could not afford to heat it any more. She had spent the past three months in the living room. She had a hospital bed where she ate her meals, had her personal care and spent most of the day because it was the only room in her home that she could heat properly. The downside was that the rest of her house became damp and infected with mould because she could not turn the heating on. She had been failed by the benefits system, cuts to her care package and rising energy and food bills. She also lost the opportunity to continue in her employment programme, which was what gave her opportunities in life.
There are countless such examples. I am sure that every one of us could recount an example from our constituents. We should be ashamed that in 2024, in a country as rich as ours, people have such a standard of living.
I want to close by saying what the hon. Member for Glasgow South started by saying: the fall in living standards is a huge crisis facing our country. It affects mental and physical health, education, family wellbeing, housing, employment—a whole range of issues. It is not going away. It has not declined. It is not getting better. It will stalk families for years to come, possibly for a generation. Debt is piling up to eye-watering levels and with it comes the impact on families. The Government have failed in basic economic tests, and working people, as always, pay the price.
I thank the hon. Member for Glasgow South for securing this important debate. I look forward to hearing what the Minister will do in the few weeks that the Government have left to change the situation for families across the country.
Oral Answers to Questions
Patricia Gibson Excerpts(1 year, 6 months ago)
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Ian Byrne (Liverpool, West Derby) (Lab)
Patricia Gibson (North Ayrshire and Arran) (SNP)
Jeremy Hunt
I totally respect the hon. Gentleman for raising the concerns of his constituents in the way that he has done. I do not believe that capping prices is the right long-term solution, but we are doing a lot, including payments of £900 per household for people on means-tested benefits, £150 for households with someone disabled living in them and £300 for households with pensioners living in them, precisely because we want to help the people that the hon. Gentleman is talking about. I will be meeting the regulators next week to talk further about what needs to be done with respect to supermarkets.
Patricia Gibson
Over the weekend, the former Governor of the Bank of England, Mark Carney, spoke about how before the Brexit referendum, the Bank of England had set out that the likely consequences of Brexit were
“a weaker pound, higher inflation and weaker growth”.
Does the Chancellor think it is fair that the UK Government’s decision to ignore the stark warnings from the Bank of England are now being paid for by the households who can least afford it?
Jeremy Hunt
I am afraid that I do not buy this Brexit narrative from the SNP. Food price inflation has been around 20% in Germany, Sweden, Portugal and Poland in recent times, so this is not a UK-specific issue. We are all dealing with the consequences of Putin’s invasion of Ukraine and the aftermath of the pandemic, and we are all tackling it with one central focus, which is to bring down inflation as our overriding priority.
Mortgage Market
Patricia Gibson Excerpts(1 year, 6 months ago)
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Andrew Griffith
Once again, we have a contribution from the hon. Lady that completely ignores the fact of the global pandemic, the £400 billion of support we have provided and, although I believe she is highly literate in these matters, the fact that interest rates are rising across the western world.
Patricia Gibson (North Ayrshire and Arran) (SNP)
In the first three months of this year, repossessions increased by 27% on the same period last year, and the latest estimates show that 2.5 million customers will need to renegotiate their mortgages over the next two years, with their payments increasing by £9 billion. Is the Minister really telling us that he is satisfied and that he has no reservations about the way that his Government have mismanaged the economy, with the consequent economic turbulence and soaring interest rates that are literally pricing people out of their homes?
Cost of Living
Patricia Gibson Excerpts(1 year, 7 months ago)
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Dave Doogan
As much as it pains me, I credit the hon. Member with a little more wit than that. If he thinks that 300 years of this Union and its effect on the people of Scotland—particularly the poorest—can be eradicated in a decade, he is more naive than I thought. He likes rhetoric, but he is not so keen on facts. My colleagues in the Scottish Government are sighted on the challenges of closing the attainment gap and are doing the right thing by our young people, but real life is much harder than that.
What Governments can do—particularly constrained Governments such as that of my colleagues, who exist under the profoundly suboptimal circumstances of devolution—is pull on the levers of investment in education. The hon. Member for Moray (Douglas Ross) might like to know that the Scottish Government invests £1,758 per child in Scotland, compared with England’s £1,439. In Scotland, his constituents in Moray will enjoy a far higher teacher-pupil ratio than elsewhere in the United Kingdom. In Scotland, there are 7,573 teachers per 100,000, versus England’s 5,734 per 100,000. That is a substantial difference. He might be keen to know that, when a teacher qualifies in Scotland, they will attract a remuneration of £33,729, whereas their colleagues in England will be on £28,000.
Patricia Gibson (North Ayrshire and Arran) (SNP)
My hon. Friend is telling the House about the Scottish Government’s positive work on Scottish education. Does he agree that the Scottish Government are doing all that good work with one hand tied behind their back, because the attainment gap is fed most by poverty, and the levers to deal with it lie in Westminster?
Dave Doogan
I know better than to disagree with my hon. Friend. She is absolutely right. We heard from the Minister when he spoke to his amendment—and perhaps the hon. Member for Moray, I am not sure—about how the Scottish Government have tax-raising powers and do not use them. Having some tax-raising powers is like having a set of spoons and being told to set the table. It is not going to work. They need the whole suite of fiscal levers to make a difference to the economy. My hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) is right. We have one hand tied behind our back. We have domestic policy but we do not have the full suite of fiscal policy, and we will never dig into the root causes of the crises faced by communities and businesses in Scotland until we get independence.
The UK is a poor country. The Unionists in the House like to talk up GDP, which is an increasingly meaningless measure of wealth. It has its role, but GDP is largely irrelevant to the ordinary men and women in my constituency. The United Kingdom is so unequal that ordinary people working hard every day of every week of every year still cannot afford to feed their kids or pay their rent at the end of the month. That is not a meaningful economy working in the interests of ordinary people up and down these islands. It would be very different with a Scottish Government and an independent Scotland.
We have heard all about how this is entirely down to the illegal war in Ukraine and the covid pandemic. Interestingly, neither Labour nor the Tories want to lay any blame at the feet of the world’s worst unforced error and self-injury—Brexit. “Brexit has not done anything; it has been nothing but positive for the economy” according to those two delusional movements. In reality, compared with the pre-pandemic level, UK GDP in Q1 of 2023 was 0.5% lower. That contrasts with GDP in the eurozone being 2.5% higher than its pre-pandemic level. In the United States it is 5.3% higher and in Canada 3.5% higher. Among their chums in the G7, the United Kingdom is something of an outlier. I wonder what distinguishes the United Kingdom from those other countries: they did not take the most profoundly daft manoeuvre ever and exit the biggest trading bloc in the world.
Cash Acceptance
Patricia Gibson Excerpts(1 year, 9 months ago)
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Martyn Day
I agree entirely with my hon. Friend’s good points. It appears to be something that concerns very many people. Research from Which? has shown that 82% of Scottish consumers are likely to keep cash in case electronic payments are down.
Patricia Gibson (North Ayrshire and Arran) (SNP)
My hon. Friend is making a powerful case about the importance of having the choice to use cash. Does he agree that access to cash is fundamental to this debate? In order for people to have the choice to use cash, access to it is at the basis of all that we are seeking to do.
Martyn Day
Absolutely, and I will come to that later in my speech. I hope the Minister takes cognisance of that well-made point.
There are also those who have valid privacy concerns about electronic payments. In an age of technology, algorithms, digital footprints and cyber-crimes, it is understandable that some—perhaps many—of our constituents would prefer the financial privacy offered by cash transactions. Some constituents wrote to me in recent weeks to make that point. Many stated that they regard barriers to using cash as a violation of their right to privacy. Cash clearly remains an important and valued part of our transactional landscape. As such, the ability to access and use cash must be protected.
In their response to both petitions, the Government state:
“The Government does not intend to mandate cash acceptance.”
They say that they will instead make provisions through the Financial Services and Markets Bill to ensure reasonable access to infrastructure such as withdrawal and deposit facilities. Of course, the availability of such infrastructure is clearly a concern for consumers and businesses. In Scotland, 53% of bank branches have closed since 2015, and since 2018 some 20% of Scotland’s free-to-use ATMs have closed. In many communities, banks have withdrawn completely, often leaving the post offices as the last place in town to do basic banking.
Patricia Gibson (North Ayrshire and Arran) (SNP)
Let me begin by thanking my hon. Friend the Member for Linlithgow and East Falkirk (Martyn Day) for his excellent exposition of the challenges that we face. This e-petition debate calling for the legal right to use cash payments in shops and requiring all businesses and public services to accept cash payments is very important. Since I was first elected, repeated concerns have been expressed about the decline of our cash infrastructure and the need to preserve it. I have spoken in every single debate on this matter, along with the hon. Member for Blackpool North and Cleveleys (Paul Maynard), yet here we are again. It feels like we are banging our heads against a wall as we face, with increasing urgency, the existential crisis facing our cash infrastructure.
The arguments are well rehearsed, and have been again today. There is no denying that, as a result of changes wrought by the covid pandemic, the future of cash is even more uncertain. Many of us in this Chamber and beyond fear that its demise has been accelerated. Ultimately, this is a debate about inclusion—financial inclusion—and consumer choice. The situation becomes ever more urgent with every debate that we have on this issue and with each passing day. I wish to pay tribute to and commend the Scottish Affairs Committee for its report, which is a most informative and constructive contribution to the wider debate.
From the outset, it is important to underline the fact that the right to use cash, as the hon. Member for Blackpool North and Cleveleys said, cannot be separated from free access to cash. There is no point in legally ensuring the right to use cash if there is no reasonable access to cash. It is important to remember that, in Scotland, this debate takes place in the context of bank closures. This matters, because without access to cash it is simply not possible to use cash. That cannot be said too often. Fifty three per cent of Scotland’s bank branches have closed. In my constituency, the situation is nothing less than appalling. Kilbirnie has no bank. Beith has no bank. Dalry has no bank. West Kilbride has no bank. Kilwinning has no bank. Stevenston has no bank. Ardrossan has no bank. Indeed, in the whole of my constituency only Saltcoats, Largs and Isle of Arran have a bank branch. If we are to protect the cash infrastructure, we need a two-pronged approach: protecting access to cash and protecting the legal right to use cash.
Overall, Scotland has suffered the highest percentage loss of bank branches among all the nations in the UK. It is against that backdrop that any debate about access to cash and the use of cash must take place. Alongside this, we see our post offices under threat, as postmasters struggle to make even the minimum wage. In all the towns in my constituency, the post offices—those towns have no banks—play a vital role in supporting our cash infrastructure, because the banks have washed their hands of the matter. Yet, as an example, the town centre in Kilwinning has now lost its post office. Although Post Office Ltd is working hard to find a sub-postmaster to take on the franchise, it is proving very challenging because it is so hard to turn a profit or even make minimum wage for the franchisee. Of course, it is true to say that the last Labour Government closed down a whole slew of post offices, including many in my constituency, and stripped others of the services that they were able to deliver. All this has been exacerbated by the winding down of the energy support on which post offices currently rely.
Of course, it would help if the banks paid postmasters properly for the work they do on the banks’ behalf as they abandon our towns. Banks must value postmasters, who are picking up the pieces left behind by doing the banks’ work for them and for insufficient remuneration. The situation is simply unacceptable and has placed an unsustainable burden on postmasters, and I look forward to hearing the Minister’s thoughts on that specific matter.
As if all this was not enough, we see a worrying decline in cash machines, especially free-to-use cash machines, in communities across Scotland. This is especially so in rural areas, as we have heard. The Centre for Social Justice recently found that 38% of people on low incomes report having faced cash machine charges, compared with 17% of all consumers. That is what you call a poverty premium: the exploitative practice of placing a disproportionate number of pay-to-use cash machines in our most socioeconomically challenged communities.
Access to cash is vital if we are to demand, as we should and do, that there be a legal right to use cash, and there must be a requirement that all businesses and public services should accept cash. As we have heard, the vast majority of us use cash often and when it is convenient to do so. Indeed, for many rural dwellers, there may be little choice due to digital challenges, which may be exacerbated by the weather, as we have seen in recent weeks, as well as by technical glitches, which can strike without warning at any time. For the most vulnerable customers, there must be the option to access and use cash if that is what they require and is most convenient for them.
The Financial Conduct Authority has found that over 1 million adults in the UK do not have a bank account. There are also many who struggle to manage budgets electronically, and others who simply prefer to manage their daily transactions in cash, such as older people and those on a budget. They would face financial exclusion if our cash infrastructure is allowed to deteriorate further. We know that many consumers were unable to buy what they needed during covid, and that 38% were turned away when trying to buy food from shops using cash. What happens to those who have no alternative to cash payments? Are they to be abandoned? What happened to the customer being king?
Anyone who has ever faced any level of financial difficulty knows that, when this is the case, banks cancel credit cards and advice centres giving debt advice advise clients to cut their cards in half. They do that to help people control their spending and manage their budget better, because we know that using plastic can often lead to losing track and overspending.
Margaret Ferrier
Research has shown that carrying cash can help people with gambling issues to budget, avoid debt and better control their habits. By contrast, it is harder for people to retain control and keep track of their spending while using debit cards. Does the hon. Lady agree that the UK Government must ensure that cash remains a viable payment method to safeguard against the risks of gambling harm?
Patricia Gibson
Yes, and we expect gambling companies to step up and take greater responsibility for the harm that gambling outlets can cause. Of course, we know that there are more ways to gamble on high streets in socioeconomically deprived communities than in better-off communities, which is another scandal that we really should debate another day.
People actually handling cash and seeing in real time what money they are spending is critical to helping them budget—even more so when budgets are under so much pressure and are so much more precarious during this cost of living crisis, when everything costs more each time we go to the supermarket.
There is, of course, another side to this. Electronic payments incur a cost for firms, especially those making many small transactions. The UK Government should seek to address that to help to support our overall cash infrastructure. It is not right that businesses should have to pay those fees. While the provisions of the Financial Services and Markets Bill, which grants new powers to the Financial Conduct Authority over the UK’s largest banks and building societies to ensure that cash withdrawal and deposit facilities are available in communities across the country, were welcome, as many people have said in this debate, we need more detail. We need to know how that will work in practice. Again, I am hoping that the Minister will tell us more about that when he responds.
However, it is and has been clear for a long, long time—it was made even clearer as we tried to get back to normal after the pandemic—for a range of reasons that have been well rehearsed today and previously that consumers want and need the choice to pay for goods and services in cash. Consumers must not be forced down a cashless road which they do not want or are simply unable to go down. The Government should uphold that right and protect our cash infrastructure for all the sound reasons debated today. They should enshrine that right in legislation, which is becoming increasingly necessary.
Fundamental to all this is protecting free access to cash in all our communities. Financial inclusion matters, and the Government have a moral duty to uphold that in principle as well as in practice.
Andrew Griffith
The hon. Member makes a good point. He talked a lot about his rural constituency, which is a little larger than mine but also very rural, and brought that to life by talking about the Grantown-on-Spey annual show. He is quite right, but if he will bear with me, I will talk about the solution to precisely the problem he raises. This is not just an issue of access to cash, or the use of cash, but, as my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) said, about how we can ensure that businesses and retailers have access to facilities to deposit cash. I will come on to discuss the legislative action that I assure the House we are taking on precisely that point.
I have followed this debate extremely closely so, to be clear, let me say for the Government that there is no plan, no drive and no conspiracy to eliminate cash. This Government continue to support the ability of citizens to use cash as an alternative to digital payments, and I am proud that the Government are taking legislative steps to support the use of cash well into the foreseeable future. It is this Government, for the first time, who are taking those legislative steps.
A number of Members have talked about the fact that the way people make payments is changing. We have seen that over time. Analogies have been drawn with the transition from analogue to digital television and with decimalisation—I do not remember that, but the Father of the House was not shy about his recall of going through that transition. Digital payments play an important role in people’s lives. We see that from our own experience in the Tea Room of this House and also from the data. The industry body UK Finance found that in 2021 non-cash transactions accounted for 85% of UK payments, up from 45% a decade earlier and 60% in 2016. That is a really fast rate of change. I do not say that to unsettle anybody in respect of the continued attachment to cash, but it does mean that we in this place have to contemplate very rapid changes in society and technology.
Cash remains important for millions of people across the UK. We are an ageing society, and many Members have talked about the vulnerable groups—my hon. Friend the Member for North Norfolk (Duncan Baker) thought it was about 10 million people—who make up a significant part of society. We should rightly have great recourse to work out how we can protect them, whether that is through support with the convenience of managing their finances or with other vulnerabilities. Members made some great points about the importance of managing finances through the use of cash.
This is about striking a balance in society, which we have sought to do through the Financial Services and Markets Bill. I want to offer reassurance and protection for those who seek it. I am conscious that not everyone will be as familiar with the clause-by-clause detail of the Bill as the hon. Member for Hampstead and Kilburn and I am. That Bill, which has made its passage through the House, will mean that for the first time, not just since the hon. Member for Tiverton and Honiton (Richard Foord) scrabbled for coins himself but since ancient Celts first manufactured coins on this great isle of ours, there will be statutory protection of access to cash and the ability to deposit cash. It is important that we get that Bill on the statute book in this time of rapid change. It will cover access to deposit facilities on a similar basis as access to cash withdrawal.
My hon. Friend the Member for North Norfolk reminded us that this is the domain not just of the banks and ATMs, but also the extensive post office network. I know that postmasters—notwithstanding the loss to the profession of my hon. Friend—do a fantastic job in our rural communities. We should support them, and we do want to see that support. The provision of cash and banking services can be one way in which we underwrite their continued service to the community.
Patricia Gibson
Will the Minister explain what my constituents in Kilwinning will do when the town centre has lost its bank? It will be a population of 16,000 with no bank and no post office. What advice would he give to the businesses and residents of Kilwinning?
Andrew Griffith
I advise the hon. Lady to explore with Link the provision of potential alternative cash machines and to explore with the Access to Cash Action Group the potential for a banking hub. A number of Members have procured banking hubs for their constituencies. The hon. Member for Tiverton and Honiton has a banking hub and has spoken up about that issue.
Andrew Griffith
I will happily entertain treatises from the hon. Gentleman if he would like me to follow that up. There are 70 cash hubs on their way. Members throughout the House, including a number of his colleagues in Devon, have procured them. It sometimes takes a little while for them to appear because of planning issues or the need to get the right power arrangements and safe access in place for constituents. If the hon. Gentleman will bear with the banking hubs and work with them, he will find that there are solutions out there.
My hon. Friend the Member for Blackpool North and Cleveleys talked about the no-purchase cashback facility, which turns every single convenience store and retailer in the country into a potential cash-dispensing hub.
Andrew Griffith
I will give way one final time before the hon. Lady combusts.
Patricia Gibson
I gently say to the Minister that local corner shops do not want to be cash dispensers. There are all sorts of security issues relating to no-purchase cashback.
Andrew Griffith
The hon. Lady makes an important point, although perhaps not the one she intended, about some of the challenges of cash in a rural location.
Sunscreen Products: VAT
Patricia Gibson Excerpts(1 year, 10 months ago)
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Patricia Gibson (North Ayrshire and Arran) (SNP)
It is a pleasure to serve under your chairmanship, Mr Sharma. I am delighted to participate in the debate and I pay tribute to my esteemed colleague, my hon. Friend the Member for East Dunbartonshire (Amy Callaghan), for her pursuit of this important matter and for her excellent, comprehensive and very powerful opening speech.
My hon. Friend, along with the hon. Member for Erewash (Maggie Throup), came to Westminster Hall today to speak as a survivor. That gives what they say power and authenticity. When survivors speak, it is incumbent on us all to listen to the lessons they are trying to teach us. Whether we are in government or not, what they say matters and must be listened to in that way.
It seems odd to most people that suncream is not already classified as an essential healthcare item in the UK and, as such, is not exempt from VAT. After all, we know and have heard today in some detail that suncream plays a vital role in preventing serious health conditions such as skin cancer. In all honesty, I am not aware of anybody who wears suncream for cosmetic purposes; they wear it because the consequences of exposing themselves to the sun without sunscreen are extremely serious and potentially fatal. That is because it provides protection against harmful ultraviolet radiation. Importantly, it is strictly regulated to ensure that it provides sufficient ultraviolet protection for consumers, so there is no sense or logic in classifying it as a cosmetic product.
As we have heard, that is recognised in the US, where sunscreen is regulated by the Food and Drug Administration, and in Canada, where it is classified as a non-prescription drug, so there is international precedent for reclassifying the product as a healthcare item. The hon. Member for Strangford reminded us of those international examples and precedents for the change that everybody in the Chamber seeks.
The debate matters, and it is even more important when we consider that skin cancer is now much more common across the UK, where around 16,000 new cases of melanoma are diagnosed each year. Of the 16,000 people who are diagnosed, about 2,300 will die. Cancer Research UK concludes that being sunburnt just once every two years can triple the risk of melanoma, and statistics show that more than one in four skin cancer cases are diagnosed in people under 50. When we consider the cost of treating the growing numbers of people diagnosed with skin cancer, removing VAT from suncream should be considered as important preventive spend. I suspect that the Minister will tell us about the pressure on the public finances and the significant contribution that VAT makes to the public finances, but, like others in the debate, I find it unbelievable that simply removing VAT from sunscreen—that one act on its own—would create insurmountable fiscal challenges for the Treasury. It would make sunscreen more affordable, and that can only be positive when we think about the quest to reduce skin cancer cases and pressure on our NHS.
Some retailers, such as Tesco, have decided to absorb the cost of VAT on sunscreen, so that at the point of sale the consumer is spared that cost. It is worth noting that when Tesco made that announcement, in May 2021, consumers were outraged to discover that sunscreen was subject to VAT. There is a lesson in that outrage for all of us and for the Government: we are working in a situation in which the public believe one thing when the reality is entirely different. Of course, the public are using logic, which we all want the Government to use. The work that Tesco and other retailers have done is to be applauded, but it is a pity that the Government will not and have not taken the lead on the issue and shown that they understand the importance of making that important health product VAT-free.
Tesco made the decision to absorb the cost of VAT on its sunscreen products because, after it did some research, it discovered that 57% of adults think sunscreen is too expensive, 29% say that they would wear it daily if it was a little bit cheaper and 31% of parents—this is important in terms of the stats for melanoma—state that they cannot always afford to apply sunscreen to the whole family. That means that this is not really a debate about sunscreen; it is a debate about public health. It is hugely disappointing that the Government are content to leave this important public health concern to the discretion of retailers, who have taken a lead on the issue. It is important that retailers have done so when the Government have not acted, because we know how financially challenged households are at this time.
I do not want to second-guess what the Minister will say, but I suspect that she will say that high factor sunscreen is available on the NHS on prescription for certain conditions, and therefore is provided VAT-free when dispensed by a pharmacist. That point has been made to me in the past. As my hon. Friend the Member for East Dunbartonshire said, that does not really help someone in Scotland; to be honest, it does not really help all the people who do not get it on prescription but who would benefit enormously from using it.
Removing VAT from sunscreen for everybody will help make the product just a little cheaper during these difficult times. More people would be able to stretch to affording it and would get the protection they need, and it would thereby help to prevent some of the 16,000 diagnoses a year of melanoma. We all urge the Minister to rethink. This is not a debate about the wider principle of VAT—we understand that VAT is levied on certain products. It is about VAT on sunscreen. When I have asked about the issue in the past, I have been told, in great detail, why VAT matters. VAT does matter, but the Treasury is well able to forgo VAT on this particular product, for the sake of public health.
The levy on this particular product has to end. As my hon. Friend the Member for East Dunbartonshire said, that would logically go alongside a public health campaign on the importance of wearing sunscreen. Such measures would ultimately take pressure off our NHS. I urge the Minister to ensure that sunscreen is no longer categorised as a cosmetic item—that is just daft; it is ludicrous. We need to call it what it is. Sunscreen is an important weapon in our armoury for tackling melanoma.
Victoria Atkins
I will develop my argument, and then I will give way to the hon. Lady.
I know that hon. Members have said they suspect they know what I am going to say, but I cannot change the fact that VAT is one of the main forms of revenue for the UK Government. In the year 2022-23, VAT is predicted to raise some £157 billion. To put that into context, that it almost the entire cost of our NHS. That is how important it is as a revenue raiser for the Government so that we can fund the services we care so much about.
Against that VAT backdrop, we look at items that we want to zero-rate or exempt. The hon. Member for East Dunbartonshire mentioned period products; I am really proud that a Conservative Government removed VAT from period products. That is a definite benefit of our having left the EU. Starkly, evidence is emerging that such VAT cuts are not being passed on to customers by those who sell those products. I have asked for more details about that, because when Government change tax policy in order to try to help with the cost of living—
Victoria Atkins
In a moment. It is important that those changes are passed on to the consumer, as that is the purpose of the policy. Our raw concern is that if relief is provided, not just with VAT but on other taxable items, it may not be passed on to the customer.
Colleagues across the House have rightly commended Tesco for choosing to absorb the VAT on sunscreen products within its profit margins. I stand with those Members and encourage other retailers to do the same, if this is a matter they care deeply about. While I am delighted to hear that Morrisons will promise to pass on the cut to customers if this VAT policy is changed, I gently point out that we would expect it to do that anyway; perhaps Morrisons should be encouraged to follow the lead of its market competitor Tesco. I know not, and I had better not get involved in competition between supermarkets. However, I would very much hope that retailers—I am sure they take a close interest in their customers’ ability to pay—will follow Tesco’s lead.
Victoria Atkins
There were a number of points there. First, the hon. Lady asked about independent retailers, and I fully accept what she said. I do not pretend that this is an easy decision or an easy policy area. My duty as a Minister is to weigh up the trade-offs implicit in deciding tax policy. We have to ensure that when we make changes to the VAT system, we do so fully understanding the potential consequences for other aspects of that system.
The hon. Member for North Ayrshire and Arran said that this change would represent a very small sum. The truth is, since the 2016 referendum, the Treasury has been encouraged to make changes to the VAT system totalling some £50 billion. Many of those changes will be commendable, and we will have a great deal of sympathy with why a Member feels compelled to make that case on behalf of their constituents. However, we have to make these difficult decisions as to which items are VAT-exempted or VAT-free and which are not, and that is why those products are so small in number.
Patricia Gibson
The Minister is making a powerful case as to why VAT is an important source of revenue for the UK Government, and I do not think anybody would dispute that. But if she was to do as Members in the Chamber ask and remove VAT on sunscreen, can she tell us how much that one single measure would cost the Treasury?
Victoria Atkins
It is very difficult to calculate. Because of the way multinational companies such as Tesco conduct their VAT returns, it is difficult to break it down. Our concern is, as I say, a practical one about the impact. Each and every time I get asked to exempt a product from VAT—this is a regular occurrence, I promise, and I completely understand why Members of Parliament would wish for such matters to be exempted—I have to conduct this trade-off. It is incredibly difficult. I very much understand the intentions behind the campaign, but this is the thinking behind why we have thus far had to say no. Of course, we keep it under review.
Covid-19: Economic Impact of Lockdowns
Patricia Gibson Excerpts(2 years ago)
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Esther McVey
I welcome my hon. Friend to this debate today. He might be one of those who voted for continuous lockdowns, but it is important that we are all together in a sense of open debate and conversation. The point he raised is correct. If subsequently, after the Government had intervened to close things down, there were effects on otherwise viable businesses, the Government had to step in and support them. Indeed, the Government have given unprecedented support, but I wish we could have had discussions beforehand so that when people voted for lockdown, they knew what would befall them. At the time, too many colleagues did not want to do that.
Patricia Gibson (North Ayrshire and Arran) (SNP)
May I ask the hon. Lady a question about a comment she made a few moments ago? She talked about populism and said that was a factor in deciding to implement lockdowns. I am confused by that because lockdowns were, at best, tolerated; they could never be described as appealing to populism.
Esther McVey
I was quoting Lord Sumption, the former Supreme Court judge, who was talking about the way governments were led at that time—those were his words. What we need to take from them is the question of why those decisions were not questioned or challenged by Members of Parliament. Why were those decisions not challenged? If we look at the record of the House, the decision appears popular because MPs voted for it pretty much unanimously, when there should have been greater debate.
Patricia Gibson (North Ayrshire and Arran) (SNP)
I am pleased to participate in this debate, and I thank the right hon. Member for Tatton (Esther McVey) for bringing it forward. We have heard much today about the economic consequences of lockdown and the magnitude of the recession it caused, which was unprecedented in modern times. GDP declined by 9.7% in 2020—the steepest drop since consistent records began in 1948 and equal to the decline in 1921, according to unofficial estimates. The Scottish economy contracted by 19.4% between April and June 2020; that is the biggest fall in quarterly GDP on record.
We understood—how could we not?—that lockdown would of course bring significant economic cost. How could anybody not have anticipated that consequence? I have heard some Members talk about following the science; I am about as far from being a scientist as it is possible to be, but studies have shown that about 20,000 lives could have been saved if the first lockdown had been implemented a week earlier, according to research published by Imperial College London. I do not have the scientific expertise to challenge that, but when experts speak it is incumbent on us to listen. The research, incidentally, was published in the Science Translational Medicine journal, and also found that national lockdown was the only effective measure that consistently brought down the R number.
We must remember that we are speaking from the comfort of having emerged from covid, for the most part, despite the damage that it has caused on a number of levels. A Government’s first duty must be to ensure the safety of those they seek to serve. Surely we cannot forget the uncertainty during those dark days, and the need to do all we could to reduce our social contact, save lives and restrict the potential for infection. Of course there was a cost to that—nobody would pretend otherwise. How could we imagine that there would not be?
Patricia Gibson
In a moment.
These were difficult decisions that were not made lightly. I thank the lord every day that I did not have to take the responsibility to make those decisions, which were so far reaching in their consequences. They had to be made at pace and err on the side of caution, because public safety had to come first. It is easy now to sit, with some distance behind us from those days, and commentate and look at things that could have been done better. Of course mistakes would have been made, and of course things may have been done differently, but in that context and acting at speed, we—I say “we” in a societal sense—had to put public safety first.
Consider for a moment the leaders across the UK who were responsible for making those decisions, relying on public health experts as they were. As the hon. Member for Blackley and Broughton (Graham Stringer) said, politicians are not often particularly scientific or trained in scientific methods. The leaders were relying on public health experts and understanding the weight of their responsibility—that, when it comes to public health, the buck stops with them. We can make criticisms about the decisions that were taken, and talk about possible wrong turns and the damage done; all those things are true, but the reality is that the priority had to be to keep the infection rate down and save lives.
I agree with elements of what the right hon. Member for East Antrim (Sammy Wilson) said. Every single day that I was required to be in Parliament—Monday to Thursday, which is the norm—I came down here during lockdown. The reason I came was not because I felt invulnerable to infection. I came down here—it is quite a long journey, as Members can imagine—because postal workers, nurses and cleaners in my constituency had to go to their jobs. In that context, I felt unable and unwilling not to go and do my job. That is really important.
I also speak as someone whose mother-in-law was in a home with dementia. Again, I am not a scientist or doctor, but it is pretty clear that although dementia was cited as the cause of death on her death certificate, lockdown reduced her to a catatonic state because of the lack of stimulation. That does not mean that I think lockdown should not have happened, because the reality is that we cannot look at individual relatives or individual circumstances. We have to look at society in the round and make the best public health decisions, based on the scientific advice given across the UK and Europe, in order to protect the people we seek to represent.
Chris Green
The hon. Lady is making a powerful argument. One of the points that has been raised, which is part of the broader debate, is that we saw what was happening in China and Italy. People in Britain were already voluntarily choosing to restrict their activities and restrict going into work—
Mrs Sheryll Murray (in the Chair)
Order. I gently remind both speakers that we are talking about the economic impact of covid lockdowns. I also remind the hon. Lady that the shadow Minister and Minister have yet to speak, and I would like to allow at least a couple of minutes for the right hon. Member for Tatton (Esther McVey) to sum up. Please bear that in mind.
Patricia Gibson
Thank you, Mrs Murray; I will curtail my comments. The hon. Member for Bolton West (Chris Green) has made his point, but we need to move on in the light of the comments from the Chair.
I do not think the hon. Gentleman used the name of the country, but Sweden took a different approach to lockdown. However, the House of Commons Library has done some work on the issue and has pointed out that, although there was reduced economic activity as a result of lockdown, as we would all expect, it is likely that had lockdown not been implemented—a number of Members have been critical of lockdown—people would probably have reduced their social contacts voluntarily anyway, as they did in Sweden.
We will never to what extent that may or may not have happened, and we cannot know how the virus would have evolved had we not had lockdown. We could have found ourselves in a different situation all together. People can say, “At the time, I knew this and I knew that,” but the reality is that we do not know what the outcome would have been if the Governments across the UK had taken an entirely different approach. The impact could have been even greater than that which we suffered.
Everybody understands the effect of lockdown on education, on social contact and—it has not been mentioned—on mental health, but we were faced with an unprecedented situation in which we had to act at speed and try to take the pressure off the NHS. The right hon. Member for East Antrim said that people who supported lockdown want to forget it and act like it did not happen, but we cannot forget the context in which we were living. It was a time of great uncertainty, great fear and lots of unknowables, and we had to respond. I know that a number of Members are attacking the Government, and it is not often that I defend them, but this is not about the Government. This is about public safety and public health.
Businesses have struggled through lockdown, which was considered necessary at the time, and many have managed to survive and cling on to their livelihoods. They are now going through another wave of unprecedented difficulties. If the Government do not offer additional long-term support to businesses on energy costs, the initial money they invested to keep businesses afloat will have been wasted, because the very idea of that investment was to save businesses and jobs—that is what the investment was for. If the energy support is not sufficient, those jobs will disappear anyway, so the initial funding during covid will have been to no purpose. I want the Minister to think about that and comment on it when summing up.