Fairness and Inequality

Pete Wishart Excerpts

Tuesday 11th February 2014 Commons Chamber

[Mr MacNeil]

We voted against its abolition. It would not have gone—we would have the 50p tax rate right now—if the hon. Lady and many others had joined us in the Lobby. The question is: why did she and her colleagues not go through the Lobby to vote against the cut? Where were Labour Members that night? There was no sign of them. Would anybody from the Labour party care to tell me why they did not vote against the cut to the 50p tax rate? I would be very pleased to hear why not. Will one of the about 20 Members on the Labour Benches please stand and explain why Labour did not oppose the cut to the 50p tax rate? Going once, going twice, gone: Labour has refused to explain.

[Pete Wishart (Perth and North Perthshire) (SNP)]

I remember that evening very well. To call Labour Members headless chickens would be an affront to headless chickenry, given the way they were running around. Does my hon. Friend agree that perhaps it was a principled abstention that the Labour party pursued that evening on the 50p tax rate?

[Mr MacNeil]

Well, a principled abstention by the Labour party is news to me, but I take on board what my hon. Friend says.

I was talking about hunter-gathering. I was not so much hunting Labour Members as asking why they did not go through the Lobby on the 50p tax rate. I was discussing why people have certain outlooks in life. I think that when people view the fruits of their success as being the result of a hunt that involved a great deal of good fortune and support, they might have a tendency to be slightly more left wing, whereas those who think the fruits are the result of their own individual hard graft might have a tendency to be more right wing and view their gains as a gather. I will make no further judgment on that idea—I just want to put it out there and let people chew it over—but I think there is something deep-seated in our own personal biases as to why we arrive at certain points of view.

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[Mr MacNeil]

My hon. Friend is absolutely correct. We can see that again in the philosophy behind the bedroom tax, which is not one that I subscribe to in any way. Last night, I stumbled across a Channel 4 programme on Walsall and Glasgow housing authorities. It talked about having to demolish houses in Walsall, due to their being left empty: people cannot stay in them because of their cost and what people have lost in welfare. Glasgow housing authority has demand for 1,500 more one-bedroom properties—people want them so that they will not be penalised—but it does not have them. It is, inefficiently, trying to build them so that people can avoid the bedroom tax, but the costs are colossal.

[Pete Wishart]

I am loth to interrupt my hon. Friend’s fantastic speech, but perhaps I can help him a little. We know a bit about what the Labour party proposes to do with the Scottish budget because of the cuts commission. It intends to do away with universal benefits and it does not like free bus passes and free prescriptions. That is what it would do if it gets control of the levers of power in the Scottish Parliament. We know exactly where it is going with its cuts commission.

[Mr MacNeil]

My hon. Friend is absolutely correct. Johann Lamont has a cuts commission. [Interruption.] I hear from the Labour Front Bench that she does not have a cuts commission, which is another example of how Labour Scottish Members say one thing while Labour in Scotland says another. If Labour Front Benchers want to tell us what Johann Lamont is doing—if she has told them—they are more than welcome to intervene.

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[Mr Brown]

I am saying that a rosy picture is being painted. Some will say, “It is happening in London and the south-east”, but the Minister represents a Welsh constituency, which is rural, just as mine is. People in rural constituencies and in some urban constituencies are finding things really difficult indeed. The situation is still pretty tough and they do not recognise this rosy picture that is often painted.

Also in the other place yesterday, Lord Lawson stated that

“it is far more important to focus on making the poor richer than on making the rich poorer”.

I have to agree with that, but the Minister replied:

“we want to make sure that everybody makes a fair contribution to society and that all those in work get a fair wage for their labour. Obviously, there comes a point when taking too much tax from those right at the top becomes counterproductive.”—[Official Report, House of Lords, 10 February 2014; Vol. 752, c. 408-09.]

I would have to argue with that; those comments by the Minister tell us an awful lot about what those on the Government Benches are thinking.

Where we disagree with the text of the motion is on the words

“successive governments of all political hues have presided over an underlying trend of rising income inequality since the early 1980s”.

There can be no doubt that over the past 30 years or so there have been some particularly difficult and distressing times for many families, but during the early years after the change of government in 1997 rapid improvements were made right across the country. [Interruption.] I am not about to rewrite history; I am about to tell the Chamber what actually happened, because we tend to forget. This relates to a point made by the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards), because he said that if Labour were to win the next election we would be carrying out the current Government’s spending plans. When Labour came to power in 1997 we held by the tight budgetary constraints, but as a party coming from opposition to government we decided that we would spend the money in a wholly different manner. What did we do with the chance that came our way? We created employment opportunities for young unemployed and long-term unemployed people, the disabled and lone parents through the new deal, and those very chances that were given to so many people brought about a marked change when coupled with the introduction of the national minimum wage and working tax credits. It was not the answer to every woe that people had suffered under the previous Government, but it was a major step forward. For many individuals, especially women, it meant that they no longer had to try to hold down two or three jobs to make ends meet.

The motion makes reference to inequality between men and women, but fails to recognise the gains made by women under the Labour Government from 1997 to 2010. I am talking about not just the minimum wage and tax credits but extensions to child care, which allowed more women to participate in the labour market, and extensions to maternity leave, which meant that women no longer had to choose between work and family life soon after having a child.

Let me now mention one or two things that have been raised this afternoon, including the issue of food banks. Over the past 12 months, there has been a 170% increase in the number of people using food banks. Between 2010 and 2011—some two years ago—61,468 people were using food banks, compared with more than 346,000 now. Those are only the Trussell Trust figures. There are other ad hoc, less regulated, food bank systems.

The Minister mentioned welfare reform. Let me tell him, in case it has slipped his mind, that the previous Labour Government introduced three welfare reform Bills, and we maintained that those who could work should work and should be given help and support into work.

[Pete Wishart]

Where does the hon. Gentleman stand on the great “more powers” debate in the Labour party? Is he one of the boycotters, or is he an enthusiast of more powers? Would he give welfare powers to the Scottish Parliament, so that it is under Scottish people’s democratic control, or does he want to keep it with the Westminster Tories?

[Mr Brown]

I will come to that in just a moment. It is not that I need time to think. [Interruption.] Let me tell the hon. Gentleman that I am a solid believer in devolution.

We put three welfare reform Bills through the House. They were designed to ensure that those with the greatest need received benefits not just to exist but to live. We were able to recover that money by getting others into work. We were making progress on that when the banking crisis hit and turned the world upside down.

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[Mr Weir]

I cannot believe what I am hearing from the hon. Lady. What I said is that the Scottish Government have taken action on and invested money in those matters. We have not claimed that we have solved every problem under the sun—we cannot possibly do that—but what we have said is that we have done all we can with the powers we have and that with the powers of independence we will be able to do so much more.

[Pete Wishart]

My hon. Friend is making a very powerful speech. Does he share my great concerns about the cuts commission? Labour has said that everything is on the table and has set out a whole list of things, including tuition fees, free bus passes, prescription charges and free personal care. Is my hon. Friend as worried as I am that if Labour gets its hands on the levers of power, those things will be under threat?

[Mr Weir]

I do indeed have great fears about what will happen to our country if we do not get a yes vote in September, because either this lot will continue in power with the cuts already promised by the Chancellor, or we will have the Labour cuts commission and heaven knows what it might come up with.

We have a different vision for our country. We will be able to do many things with independence that we cannot do under devolution. The problem of child care, for example, is not just about improving the early education of our children and helping families, important as those things are; it is also an important economic policy. If we can raise female participation in the labour market to the levels achieved in, for example, Sweden, we will not only boost general economic performance, but raise an extra £700 million a year in tax revenue.

Under devolution, the Scottish Parliament has been able to increase the amount of child care available and it has recently announced a further extension, but with independence we could go beyond that and deliver our ambitious plan for the provision of free universal child care for all children aged one to five—a policy that, when fully implemented, would save families up to £4,600 per child per year.

Why do we need independence to deliver that? Because at the moment, as I have said, Scotland receives a fixed budget from Westminster. We would not receive the increased tax revenues resulting from having more women in the workforce unless Westminster decided that we should, so under devolution the costs of providing increased child care would have to be met from within a fixed budget, which would inevitably mean cuts in other services. Those who are making that argument need to tell us where they want to see the cuts. That social and economic transformation can be achieved only when we have access to all of Scotland’s resources, and that is why we need independence delivered to the full.

We could also take action to ensure that most people are treated fairly and that work is genuinely a route out of poverty. We should not accept this as a given, but the fact is that many women work in low-paid jobs, so what we do with the minimum wage really matters to the living standards of women and their children. With independence, we will able to guarantee that the minimum wage will rise at least in line with inflation every year and not leave it to the whim of the Government of the day.

It is interesting to note that, if the minimum wage had increased in line with inflation over the past five years, the lowest paid would be £600 a year better off than they are now. That has been the cost to the lowest paid of not being able to take such decisions ourselves and of not being able to make the impact we want on the inequality that stalks our nation.

With independence, we and not Westminster will be responsible for implementing the Equal Pay Act 1970, closing the scandalous 32% gap that still exists between the pay of men and women. Why is it that 44 years after that Act was passed there is still such a huge gap between their pay?

Decisions being made down here about the retirement age are also a problem. Just a few years ago, women could expect to retire at 60. By 2020 the retirement age for women will be 66—an increase of six years in just a decade. As things stand, young women entering the work force today will probably have to work until they are about 70. Of course, we all have to accept that people are living longer and that things cannot stand absolutely still—we accepted the first rise in the retirement age—but the rapid increases being imposed by Westminster are not right for Scotland, because we have different demographics. We have serious problems in some of our communities and we are working hard to deal with them. The fact is that life expectancy is often much lower in some of those communities than in the general population. It is, therefore, surely better that decisions about the retirement age are taken in Scotland, where such distinctive circumstances will be properly taken into account.

I have often spoken in the House on energy, and it will be no surprise that I want to say a few words about it. In its recent campaign, Energy Bill Revolution made the point that fuel poverty has increased across the UK by 13%, but one gain from devolution is that that is not the case in Scotland. Under the latest Scottish house condition survey, which was revealed at the end of last year, the number of those in fuel poverty in Scotland has decreased by 3.4% at a time when energy prices are rocketing. That is a tremendous achievement by successive Scottish Administrations, who have made real efforts to tackle fuel poverty. However, there is so much more we could do.

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[Stephen Crabb]

With the leave of the House, I start by thanking the hon. Member for Banff and Buchan (Dr Whiteford) for summarising the debate in her usual intelligent way, and all right hon. and hon. Members who have participated in this wide-ranging and interesting debate on subjects of huge importance to Members on both sides of the House—fairness and inequality.

I will meet head on some of the criticism that has been levelled at the Government by saying that no Government Member is painting a rosy picture about the challenges that many households and families still face. None of us is complacent about the issues that we have been debating. As the country is still recovering from the economic trauma that it was subjected to between 2008 and 2010, much progress remains to be made in seeing wages increase, seeing the emerging economic recovery spread to all parts of the country, and ensuring that people from all walks of life in all parts of the UK can share in that emerging economic recovery.

We are not painting a rosy picture about that recovery, but neither do we subscribe to the view that has been put consistently today by Opposition Members that the growth is somehow not real; that it is somehow patchy and fuelled by London and the south-east and what is happening in the housing market. If they take time to look at what the statistics tell them, they will see that the emerging recovery is broadly balanced across all the sectors of the economy—manufacturing, construction, tourism, services and exports. Progress must still be made to ensure that the recovery reaches all parts of the UK, but just as three years ago they were deficit deniers, as we come to the end of this Parliament they have become growth deniers. They deny that the growth and the recovery are taking place.

This evening I will be urging hon. Members to reject the motion, because at its heart is the biggest risk of all to the emerging economic recovery, which is a return to the failed economics of more spending, more borrowing and more debt. Just as so many Government Members this afternoon have asked where the equity is in saddling our children and grandchildren with yet more debt, the fair, compassionate, progressive thing to do is to meet that challenge head on and see the deficit come down.

In the minutes that remain I will refer to a number of the speeches made by hon. Members. I pay tribute to the opening speech by my hon. Friend the Member for Carmarthen East and Dinefwr (Jonathan Edwards), who spoke with typical passion and made a plea for fairness. However I take issue with his description of Wales as a colonial economy. I absolutely reject that term. Wales is not a colonial economy. The economy of Wales is highly integrated with the rest of the United Kingdom. One reason why support for separatism is so low in the Principality is that real people out there understand how integrated the Welsh economy is with the rest of the United Kingdom. They reject the separatism of Plaid Cymru and the Opposition.

We had a long and interesting speech from the hon. Member for Na h-Eileanan an Iar (Mr MacNeil). He started by introducing the philosophical challenge of what to do with a box of chocolates among children. I disagreed with a lot of his economic analysis, but I strongly agreed with him when he said that behind all the economic statistics that we are talking about are real lives. Members on both sides of the House should not lose sight of the fact that when we talk about record numbers of people returning to work and unemployment falling in our constituencies, those are real lives. People are making their way back into the jobs market, upping their skills and getting new confidence, which will make a powerful difference in our communities.

The hon. Gentleman also made an important point about the decline of social mobility. I put on record that both his nation of Scotland and mine of Wales at one time were beacons of social mobility. There was a time in Wales and Scotland when increasingly it did not matter who one’s mum and dad were, what street one grew up in or what jobs one’s parents did. There was a progressive trend of social mobility. We have gone into reverse on that, and that is one of the great tragedies of what has happened in the economy in recent decades.

My hon. Friend the Member for Aberconwy (Guto Bebb) made what I think was the speech of the day. He spoke with expertise and experience about small businesses being the engines of job creation, not only in Wales but across the UK. Members on both sides of the House should pay tribute to him for the work he has done, particularly on interest rate swaps and on challenging the banks on the way in which they have treated small businesses in recent years. He spoke powerfully and passionately about the ethical and moral underpinning of our welfare reforms and what we are trying to achieve. It is not just about deficit reduction, and it is not about attacking the poor or anything so absurd; it is about seeing lives changed and communities that were blighted by worklessness unlock their potential so that they can increasingly share in the emerging economic growth.

The hon. Member for Angus (Mr Weir) drew on his expertise on fuel poverty and energy markets. I promise to write to him, or to ensure that one of my ministerial colleagues does, on the specific point he raised. He mentioned pensioner poverty, as did other Members, so let us remind ourselves of the figures. In 2011-12, 1.6 million pensioners were in relative poverty, which is close to the lowest rate recorded. Pensioners are less likely to be in relative low income than the population as a whole. The Government want all pensioners to have a decent and secure income in retirement.

The hon. Member for Dumfries and Galloway (Mr Brown) seemed a little confused and uncertain about what is happening to income inequality, so let us put on the record what the statistics show: income inequality is falling under this Government, having reached record levels under the previous Labour Government. I very much agree with his comment that young people are not only our future—they are more important than that—but our today. That is why we are making efforts to see youth unemployment fall, just as unemployment is falling right across the country. We take seriously the opportunities facing our young people and are in no way complacent about the challenges that today’s generation of young people will face. However, let me remind Opposition Members that if we are serious about the kind of future young people will face, we absolutely must reject the terms of the motion, which calls for a return to more borrowing, more spending, more deficit and more debt.

My hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) made a characteristically entertaining speech in which he made some extremely important points about business being the generator of growth and the creator of jobs in the economy. He used the analogy of a rising tide carrying all boats, but it is business and private sector growth that makes that tide rise. We absolutely agree.

The hon. Member for Oldham East and Saddleworth (Debbie Abrahams) drew on her expertise in health inequality and made a characteristically well-judged speech. I just remind her that in the nations of Wales and Scotland, which we have focused on today, many of the policy levers that relate to health inequality—housing, health and education, for example—lie with the devolved Governments. I encourage her to look at what is happening in Wales. If she studies that in detail, she might have some serious and difficult questions for her Labour colleagues in Cardiff.

My hon. Friend the Member for Bedford (Richard Fuller) made an excellent speech reinforcing the point that if we are serious about fairness, we must take seriously the issue of what kind of future our young people and their children will face. That is why we remain absolutely committed to reducing the deficit and restoring stability, discipline and order to our national finances.

The hon. Member for Llanelli (Nia Griffith) spoke about zero-hours contracts, which she clearly regards as a negative thing. The number of zero-hours contracts in the economy was the same in 2013 as it was in 2000, so the idea that there has been some kind of explosion in the number is just not correct. If she really regards them as such a bad thing, she should speak to her colleagues running Carmarthenshire—

[Pete Wishart]

claimed to move the closure (Standing Order No. 36).

Question put forthwith, That the Question be now put.

Question agreed to.

Main Question accordingly put.