Sheila Gilmore
Main Page: Sheila Gilmore (Labour - Edinburgh East)
Andrew Selous (South West Bedfordshire) (Con)
I think that all of us on the Government Benches absolutely recognise the increase in people’s bills, whether it is their gas bill, their electricity bill, the bill to fill up their car with petrol or diesel when they go to a garage, or their weekly food bill. We absolutely recognise the squeeze that our constituents are experiencing and the fact that wages have not gone up to compensate, and in many cases we have been extremely clear about that.
Nevertheless, because of the decisions that the Government have taken, it now costs people £7 less to fill up their cars than it would if we had gone ahead with all the price increases that Labour legislated to introduce before they left office. Also, we heard from the Secretary of State for Energy and Climate Change that our energy bills are 5% lower than they would have been, again because of the decisions we have taken. We know that Labour would have added £193 a year to our energy bills, because they would have funded the renewable heat incentive and carbon capture and storage through levies on people’s energy bills, whereas we are funding those things from general taxation.
Council tax is another area where the Government have done fantastic work to reduce the impact of the cost of living. Under the previous Government, council tax more than doubled—it went up by 109%. Thanks to the excellent stewardship of my right hon. Friend the Secretary of State for Communities and Local Government, we have managed to freeze council tax—certainly for principal authorities—for three years in a row. I remember that pensioners regularly came to see me in my surgeries, and some would complain that they were spending up to a third of their income on their council tax. I have not had pensioners coming to see me about that in the last three years, because in real terms we have cut council tax by 10%. In fact, my own council tax bill has gone down in cash terms in the last two years, thanks to the excellent stewardship of Central Bedfordshire council and Studham parish council. We are talking about a council that has taken £52 million out of its budget and improved services. We now have a better leisure centre in Houghton Regis, the gutters are sprayed three times a year rather than twice a year and more potholes are being filled, despite £52 million being taken out of the budget, which shows that it can be done.
We have an immigration Bill in the Queen’s Speech, which is absolutely necessary. I am sorry that the right hon. Member for Sheffield, Brightside and Hillsborough (Mr Blunkett) is no longer in his place, because I would have liked to remind him that the Migration Advisory Committee—an independent body from the UK Border Agency that advises the Government—has pointed out that the 2 million extra net migrants who came to this country under the previous Government decreased wages for working people and meant that fewer UK citizens went into jobs. That is something that we need to be mindful of when many of our constituents are looking for work. Only two days ago, one of my constituents wrote to tell me that on the construction site he was on in London he was virtually the only British worker; all the others were Albanian. I am not sure why they were there, given that Albania is not a member of the European Union. These are genuine issues for our constituents. The people of this country are speaking to us loud and clear, and we would do well to heed what they are saying.
I hugely welcome the national insurance contributions Bill. We are talking about a tax off jobs. Up to 2.5 million employers will benefit and 450,000 of our smallest businesses will no longer pay national insurance contributions. That means that every business could take on one extra employee on a salary of up to £22,400 or four more on the minimum wage without paying any more national insurance contributions. That is just the thing that we should be doing.
Sheila Gilmore (Edinburgh East) (Lab)
How many businesses benefited from the Government’s previous attempt to use national insurance to stimulate the economy? My understanding is that very few did so. Why does the hon. Gentleman think that the current proposal will be any more successful? He is talking about the future, but what about the past three years?
Sheila Gilmore (Edinburgh East) (Lab)
I should like to address housing, which hon. Members on both sides of the House must start to take seriously. In 2012, the Institute for Public Policy Research showed that, in the current spending review, nearly £95 billion will be spent on housing benefit compared with just £4.5 billion on building affordable housing. That means that for every £1 spent on affordable housing, £19 will be spent on housing benefit. We should therefore not be surprised that the housing benefit bill has been rising. We accept that, but the problem is that the Government have not analysed the reasons for it, and have decided to address housing benefit spending by trimming bits of money off recipients of housing benefit here and there. For those individuals, those bits of money are not insubstantial. For somebody on £71.70 a week, losing £12 a week because they have to pay it towards their rent is extremely significant in their cost of living. The policy does not make sense for the country or for those individuals.
In the 1970s, 80% of housing expenditure was for building houses—very little was spent on rent subsidy. As a result, many working people, including people in relatively low-waged jobs, had affordable housing in which to live. They therefore did not need to claim benefits. No wonder people say, “Too much goes on benefits.” The money is going in at the wrong end.
The previous Labour Government did not address the problem in the way that I, as a councillor active in housing, would have liked. Many Labour Members have said that for some time. I was pleased that the shadow Secretary of State for Work and Pensions said recently in an article in the Evening Standard that one principle of the next Labour Government would be to redress that.
Geraint Davies
My hon. Friend will know that the cost of housing benefit has doubled in the past 10 years to about £20 billion, but is she aware that 70% of the increase is because of private sector rent increases? Does that not make her case for building more affordable housing, not just crushing the poor?
Sheila Gilmore
As recently as February 2009, about 1 million private rented tenants claimed housing benefit. By October 2012, that number had risen to 1.7 million. Far more people in the sector need to claim housing benefit, largely because they are on lower wages or have lost working hours because they are on poor contracts.
Damian Collins (Folkestone and Hythe) (Con)
Does the hon. Lady believe that mass immigration has contributed to the massive increase in demand for social rents and housing benefit?
Sheila Gilmore
No, I do not believe that. In fact, the number of recent immigrants who are housed by councils and housing associations is very small. The problem is the lack of building of affordable housing.
Government policy is about to stoke that problem further. They have decided to say that affordable housing is housing built at 80% of market value. They can therefore say, “We have replaced housing. We have built affordable housing.” However, that will stoke the problem further, because more people in that form of housing will have to claim benefit to afford it. The policy does not make sense. In 10 years’ time or even five years’ time, if that continues—hopefully it will not continue, because there will be a change of Government—people will turn around and say, “Why did the Government do that? Why did they yet again put all the onus on revenue and give us an even bigger benefit bill?”
As it turns out, the problem is happening not just in England. There is also a cut in the amount going for affordable housing in Scotland. We are building far more mid-rent housing, as it is called in Scotland. It is about 80% of market value. That is the only way in which housing is being built. I do not see any reason for not having some mid-market rented housing as a supplement to what is there already, but when it becomes a substitute for truly affordable housing, we are storing up problems with the balance of what we are spending.
Much has been made by this Government and the previous Government about the importance of making work pay. The cost of housing is one of the essential determinants of whether work pays or not. People get trapped by the lack of cheap, affordable housing. As my city is so short of housing, we introduced a scheme which solved the crisis for some people. I recently met a constituent who had separated from her husband two years ago. She had two children and no home to go to, so she applied to the council as homeless. She was in a crisis—the relationship had been violent—so she accepted a property under a private sector leasing scheme, in which the council leases properties from the private sector. It was a relief to her at the time, because she had a safe home for herself and her daughters. She was not working at the time; her life was in such a crisis that she had had to give up her job as well as her home, so she was receiving housing benefit to pay the very high rent.
Two years on, my constituent is ready and anxious to get on with her life. She wants to get a job, but she is stuck with a rent that is more than double the rent of a council or housing association house. She has been advised that if she got a job she would still get some housing benefit to help pay the rent, but she would still have to pay as much rent—from a fairly average wage—as she would have to pay on a council property. Everybody would lose out. My constituent would lose out, because it might not be worth her while to get a job, and taxpayers would lose out because they would still have to pay half the rent for her to live in a property that she does not now particularly need or want to live in.
We have to solve this problem and we have to do so quickly. The best way is to start investing directly in the building of affordable housing. If we do not do that, we will never be able to tackle the housing benefit bill. If that had been in the Queen’s Speech, we could have made some real progress for many people. My constituent is not alone, she is just a recent example of how people can get stuck. In fact, that is her word—she is stuck and she would have welcomed some progress from the Government in the Queen’s Speech.