Cost of Living

Stephen Doughty Excerpts

Wednesday 27th November 2013 Commons Chamber

[Chris Leslie]

There are only another 18 months during which there will be more Conservative Members than Labour ones in this Chamber. I hope that the hon. Member for Bournemouth East (Mr Ellwood) is watching the clock, because they are running out of time.

The Prime Minister has broken not only that list of promises, but more records than most Prime Ministers over the decades, and not in a good way. How has he been a record breaker? Since entering No. 10 Downing street, he has delivered a record-breaking cost of living crisis, with wages failing to keep pace with prices for an unprecedented 40 out of his 41 months in office. That is the longest period of diminishing real wage values since records began.

A record-breaking number of people now rely on food banks just to get by—it has tripled in the past year alone—with more than 350,000 families requiring food parcels in the past six months.

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

On the cost of living crisis that is driving people to food banks, does my hon. Friend share my shock at the hon. Member for Vale of Glamorgan (Alun Cairns) saying that people use food banks because they are drug addicts and cannot manage their money, rather than because of the cost of living crisis?

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[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I do not know whether what was said is true or false, but the hon. Gentleman has put the facts on the record. I am sure that that point can be sorted out later, no doubt over a cup of tea.

[Stephen Doughty]

rose—

[Chris Leslie]

I will happily give way to my hon. Friend in a moment, so that he can relay the quote that he has to the House. Perhaps a journalist wrote it down incorrectly, but I am sure that there is an explanation.

The point about food banks is that the crisis is so bad that the Red Cross has launched an emergency food appeal right here in the United Kingdom, something that has not happened since the second world war.

The Prime Minister’s broken records include real-term wage levels plunging to a new low and average weekly earnings at their lowest level since the Office for National Statistics started to record the figures in 2001. Not only has he hit record lows on incomes, but he has delivered record fuel bills and average household energy costs—

[Stephen Doughty]

On a point of order, Mr Deputy Speaker. I am sorry to raise another point of order, but the hon. Member for Vale of Glamorgan suggested that I may have misled the House—

[Mr Deputy Speaker]

Order. Let me reassure both hon. Gentlemen that I am not going to decide who is right. You have each claimed that you are right and that the other is wrong. It is on the record, and people can make up their minds tomorrow. I want to continue with this debate.

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[Sajid Javid]

My hon. Friend is right to make that point. I think every MP in this illustrious House could share similar numbers. Indeed, in the shadow Chief Secretary to the Treasury’s constituency, 4,000 people have been taken out of income tax altogether and more than 38,000 have had an income tax cut.

Our changes to the personal allowance mean that someone working full time on the minimum wage has seen their income tax bill more than halved under this Government. It also means that for any income on which people would pay Labour’s 10p tax rate, which it previously abolished, they pay a 0% tax rate under this Government.

[Stephen Doughty]

Is the Minister still a member of the Free Enterprise Group of Conservative MPs and does he agree with that group and the hon. Member for Spelthorne (Kwasi Kwarteng) that VAT could be increased to 15% on food and children’s clothes, which are currently zero-rated? How would that help with the cost of living crisis for my constituents?

[Sajid Javid]

I am pleased that the hon. Gentleman is so interested in tax, because he will be sure to welcome the news that 38,000 people in his constituency have had an income tax cut and 4,500 have been taken out of income tax altogether.

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[Stephen Doughty]

What do the polls say about the attitude of the hon. Gentleman’s constituents to his proposals to put VAT at 15% on children’s clothes and food?

[Kwasi Kwarteng]

I have mentioned my specific proposal and not the Mickey Mouse, cartoon version offered by the Daily Mirror. [Interruption.] I am not sure which rag it was, but I will not return to that point.

The cost of living debate cannot be conducted without reference to the actual economic conditions or the economic legacy of the previous Government. It is a sleight of hand—I admire Labour’s political skill in that regard—and dishonest not to recognise that the cost of living debate cannot be conducted without reference to the economy. It is also not very open handed or reasonable to suggest that the previous Government’s legacy and appalling record have nothing to do with the difficulties that families up and down this country face.

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[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

I am grateful for the opportunity to speak in this important debate. Over the past few months, we have seen the spectre of the Chancellor and the Prime Minister on repeated occasions suggesting that everything is rosy and that hundreds of thousands of jobs are sloshing around. It is the old attitude of, “Crisis, what crisis?” Unfortunately, such a view is completely out of touch with the daily, lived experience of many of my constituents and thousands of others across Wales, who have seen one of the greatest falls in real average earnings—a staggering drop of £1,669, or 8%, since the general election, when this Government came to power. They see this Government as out of touch, patronising and complacent; they see a Government on the side of the rich, of millionaires and of banking and energy bosses, as we heard aptly demonstrated by the hon. Member for Redcar (Ian Swales). It is Labour Members who are on the side of the British people, with solutions such as capping the cost of credit and payday loans, and freezing energy prices. These real measures would help the real lives that many on the Treasury Bench seem to have little understanding of.

[Sheila Gilmore]

Does my hon. Friend share my incredulity that the price rises that the energy companies started to announce are being blamed on us because we announced our policy on an energy freeze?

[Stephen Doughty]

My hon. Friend is right to point out that the energy price scandal has been going on for some time, and that the Government have done nothing to deal with it.

I welcome any growth and any new jobs in the economy, and I hope that any positive movement in the economy will help people in my area address the massive drop in earnings since this Government came to power. However, I caution that illusions are simply not good enough. The Government repeatedly fail to answer questions about how many new jobs are part-time and, of those, how many are on zero-hours contracts. They also do not say in what sectors those jobs are being created. The truth is that half the new jobs are in low-paid sectors, and that the minimum wage is not always being enforced.

When I hear the Chancellor crowing about recovery, I am always tempted to ask, whose recovery and what sort of recovery. Is it a recovery benefiting my constituents who are struggling to find well-paid jobs, to pay those soaring energy bills and to put food on the table for their children? Is it helping those who are struggling to cope with the bedroom tax? One well-known local Liberal Democrat member in Cardiff recently said in a tweet that she knew that it was difficult for some people, yet many Liberal Democrats proudly voted for the bedroom tax in this House the other night. It is not just difficult but increasingly impossible for many families across my constituency.

Let me share with the House three stories that I have come across recently. First—I hope that the hon. Member for Redcar is listening—one of my constituents came to me saying that his monthly direct debit to npower had been increased from £197 to £254 just after he had been reimbursed an overpayment. I contacted npower and found that that was on top of the price rise of 10.4%. For him, the rise is 28.9%, which is extraordinary. That is the sort of issue that is affecting people in the country. How will that man make ends meet over the next few months? [Interruption.] The hon. Member for Redcar is chuntering from a sedentary position. As he does not seem to be interested, perhaps he would like to intervene and respond to that sort of example.

[Ian Swales]

Does the hon. Gentleman think that the likelihood of a price freeze in 20 months’ time will make prices go down or up between now and then?

[Stephen Doughty]

The hon. Gentleman will know that we called for a price freeze now, but it was the Government who voted against it. He should look at what is happening on his own Benches before making such comments. How is the recovery helping constituents who are being slammed by energy prices?

Let me give another example. A single father in the east of Cardiff with a 12-year-old daughter who lives with him full-time has just been sanctioned for two weeks for not providing enough evidence of his job search. He has actually provided a lot of evidence. He has been applying for multiple jobs, even in the bar and restaurant industry, despite having a history of alcohol abuse and being advised not to work in that sector. He has always worked and has never claimed social security before. He is not computer literate and has only been given limited assistance with his job search and he is not allowed to submit handwritten evidence of his job search. He is not in receipt of any other social security benefits, so the only money that is coming in is child benefit and tax credits. He has been struggling to manage over the past few weeks. After paying all of his bills, he was left with £3 to feed himself and his daughter. The real tragedy is that his daughter is trying to help the family by bringing home her school lunch because she is worried that she will not get fed at home. He is absolutely distressed and mortified to be in that position. Where is the recovery for him and his daughter?

My last example is of a gentleman who came to see me at my surgery the other week. He was being sanctioned for being unwilling to travel far away from home. He does not have a car and it was extortionately expensive to travel to the area to which he was asked to go and it would have left him out of pocket. As a result, he did not take that job, but he is willing to take any other job that he is offered. None the less, he was sanctioned and his money was put down to just £40 a week. I am fighting on his behalf with the jobcentre. The reality is that he has very little on which to live. He told me that he was not able to put on the heating and electricity. He said that it was not that cold, despite the fact that the weather outside was freezing. He was putting on extra jumpers just to try to cope and to get by—he was in an absolutely awful position. He has worked all his life and now he is not putting on the heating or the electric, so where is the recovery for him?

Those are the real stories of people living under this Government. They simply do not recognise the rosy picture that the Prime Minister, the Chancellor and other Ministers have been telling us about over the past few days. The story across Wales as a whole is equally concerning. More people are hit by the bedroom tax in Wales than in any other area in the UK. Even the hon. Member for Monmouth (David T. C. Davies), despite some of his more outrageous comments the other day, has admitted, as Chair of the Select Committee on Welsh Affairs, that significant challenges are caused by its impact in Wales.

We have some of the highest energy prices in the country and 1 million households would benefit from Labour’s price freeze. Wales has the biggest increase in those in energy debt compared with anywhere in the UK, up by 24% in the past two years. People are now consistently falling into arrears with the energy companies as a result of those price rises. We have seen one of the biggest falls in real wages across the UK and one of the largest increases in under-employment—that is, people who want to work more hours but are unable to do so because of the types of jobs that are available. They do not recognise the fantasy of the 1 million or so jobs that the Government keep citing.

I have described some heart-rending cases, but we also heard earlier about food banks. The use of food banks in Wales has trebled in recent times and in every part of my constituency, from Penarth to Splott to Llanrumney, I am seeing increasing numbers of people accessing those food banks. That is why I was so disappointed to hear the remarks of the hon. Member for Vale of Glamorgan (Alun Cairns), who is no longer in his seat. He attempted to suggest earlier that I had somehow misled the House on his views about food banks. Let me put on the record the reasons for people using food banks that he gave to his local paper, the Barry & District News, on 5 September. He said, and I quote directly, that the reasons were

“inability to manage money and to budget, addiction to alcohol or substance misuse, bullying at home, neglect by the benefit recipient and a range of other reasons.”

He did not recognise or comment on the real reasons people are going to food banks: energy prices, low wages, the social security changes or delays that the Trussell Trust says are the biggest reason for people going to food banks, the low incomes that the trust also points to as another such reason, and the debt that many people are getting into with payday lenders, loan sharks and others. I believe that it was right for him to be criticised by local Labour councillors for a local Labour council that is doing an immense amount to help people in very difficult times, including working with Cardiff on a collective energy buying scheme to help reduce the pressure from the energy companies, which are ripping off consumers across the country.

The figures for the whole of Wales tell an even greater story. Some 400,000 people have been hit by the Government’s squeeze on tax credits and social security overall; that can be compared with the 4,000 richest in the country, who got a handout from the Government with the tax cut for millionaires.

My constituents and people across Wales are asking again and again: whose side are the Government on, who is benefiting from this so-called recovery and who will stand up for them? Time and again, they are left wanting by Tory and Lib Dem Members. They will get a much better deal if they vote for Labour at the next general election.