Financial and Social Emergency Support Package

Tanmanjeet Singh Dhesi Excerpts

Wednesday 25th March 2020 Commons Chamber

[Jeremy Corbyn]

If employers are putting us all at risk by forcing people to work in a non-essential industry or company or non-essential work, they should be sanctioned, and those sanctions should include fines. They have to understand that they have a responsibility as well.

The Government should ensure the closure of any construction work that is not urgent or health and safety-related, just as Transport for London and the Scottish Government have already done—and remember, both have many major building projects going on at any one time.

[Mr Tanmanjeet Singh Dhesi (Slough) (Lab)]

Having worked in the construction industry for the past two decades, I appreciate how critical that industry is. Does my right hon. Friend agree that because of the Government’s mixed messages and the lack of support for the many workers in that industry who are self-employed, freelance, working as consultants or on zero-hours contracts, they are left in the unenviable position of having to get on the tube and go to work, because they have no other source of income? That is why the Government must step in, give a clear and concise message and support the self-employed workers in the construction industry.

[Jeremy Corbyn]

My hon. Friend anticipates the point I was about to make. We have all seen the images this morning of construction workers packed on to the London tube and other trains all around the country, going on to site because it is the only way they can earn a living, and putting themselves and all of us at risk as a result. Action has to be taken now on this.

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[Jesse Norman]

I thank the right hon. Gentleman for the question. Of course, if people are falling through the social safety net as it presently exists, we will stand ready to address that and support them. He will recall that when the Prime Minister was Mayor of London he called for an amnesty on illegal immigrants and others, so he has a wide and capacious interest in that area.

[Mr Dhesi]

I thank the Minister for allowing me to intervene. He will have heard about today’s shocking and saddening terrorist attack on a Sikh gurdwara in Afghanistan. I am sure he will join me in expressing sincere condolences to the victims’ families, many of whom live in the UK. My right hon. Friend the Member for East Ham (Stephen Timms) has mentioned those with no recourse to public funds. Does the Minister agree that it is also very important that the Home Office takes into account those minorities who are seeking asylum and that they are given adequate support during this time of crisis?

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[Zarah Sultana (Coventry South) (Lab)]

Before I begin, and since it is the last time they will speak from the Opposition Front Bench as Leader of the Opposition and shadow Chancellor, I would like to pay tribute to my right hon. Friends the Members for Islington North (Jeremy Corbyn) and for Hayes and Harlington (John McDonnell). I would like to put on record that they are among the most principled people in politics and their leadership has been no exception to that. Before he was Leader of the Opposition, my right hon. Friend the Member for Islington North was for me someone who always gave a voice to the voiceless and championed the oppressed. Few have done as much as my right hon. Friend the Member for Hayes and Harlington to champion the interests of the working class, and to build on the idea of society marked not by greed and fear, but compassion and equality. I thank them for giving me and so many other people hope for a better future. I look forward to many more years campaigning together.

[Mr Dhesi]

I thank my hon. Friend for allowing me, too, to place on record that my right hon. Friend the Leader of the Opposition is a principled, down to earth, decent individual who is committed to his cause. Like the shadow Chancellor, he has done that not just for a year or two, but for decades. It has been an honour and a privilege to serve as the Leader of the Opposition’s permanent private secretary. Does she agree that they are excellent individuals?

[Zarah Sultana]

Absolutely. I wholeheartedly agree.

Ten years ago, in response to a crisis, the then Prime Minister said that we were all in it together. A decade of public service cuts tells a different story. It tells a story of the working class paying the price for a crisis not of their making. Our services have been run into the ground and our NHS pushed to the brink. That has left us more vulnerable to this pandemic. The chairman of the British Medical Association said earlier this month that, after a decade of underfunding

“Our starting position…has been far worse than many other European nations”.

We see that with the NHS staff confronting this crisis without the resources they need. They do not have the proper protective equipment, ventilators or tests they deserve. Frankly, that is a scandal. Before I go on, I want to put on record my thanks to and admiration for the NHS staff at University Hospitals Coventry and Warwickshire and across the country. Their bravery, dedication and self-sacrifice at this time is an inspiration. If we are to learn one thing from this crisis, I hope it is that no one will ever again undervalue or underfund them and our NHS again.

This emergency has already taught us something: it has taught us who our key workers are. It is not the bankers or the city traders. It is the nurses, the doctors, the cleaners, the shop assistants, the teachers, the bus drivers, the carers, the postal workers and the delivery drivers. It is the 99%. It is the working class in all our diversity. This crisis shows that society is nothing without the labouring class. But just as the financial crisis showed us, it is the working class who risk being hit hardest by this crisis. Belatedly, the Government are appreciating the scale of the economic challenge, but they are not going far enough, fast enough. They are allowing bosses to force staff to go to work even in non-essential areas. If we are fining individuals for going out when they should not, surely it is right to fine businesses that tell their staff to come into work when it is unnecessary.

The job retentions scheme offers support for businesses, but it gives no guarantees that workers will be able to retain their jobs. It does not cover the 5 million self-employed, from actors to taxi drivers. The Chancellor has promised further measures, but they should never have been excluded in the first place or left with the fear of their incomes disappearing overnight. I urge the Government to extend the scheme to the self-employed before they are pushed into poverty. Poverty is what it would be, because at £94 a week universal credit is simply not enough to live on. The Secretary of State for Health and Social Care has himself admitted that.

It is the whole system that is broken. We see that at the moment, with reports that online queues for universal credit are 150,000 people long. It is taking days to move forward just a few thousand places. That is what happens when we gut the social security system. It is about time that this broken system was fixed and funded properly. Again, I urge the Government, before more people are driven into totally unnecessary poverty, to end the five-week wait, suspend all sanctions and raise the universal credit rate to a liveable rate. Our social security system must be extended to people currently excluded from it. Before this crisis, “no recourse to public funds” was an injustice. During this pandemic, it is a public health calamity. Migrants must be given access to healthcare, vital public services and financial support. The Government must end “no recourse to public funds”.

The final point I wish to touch on is the position for renters. Last week, we called on the Chancellor to suspend rents and ban evictions. Ministers promised that our concerns would be swiftly met, but we are still waiting. The Government’s announcement on evictions was inadequate to start with and has only disappointed on closer inspection. It is not a ban on evictions; it only extends eviction notices to three months. Evictions are going ahead right now, as the charity Shelter has warned. People cannot stay at home if they are being kicked out of their home. So, again, I urge Conservative Members to live up to their promise and ban evictions throughout this crisis. But banning evictions alone is not enough. If rents are not suspended, debts will pile up and renters will be at the mercy of landlords when this outbreak subsides. The Government have “asked” landlords to “show compassion”, but if there is one thing I have learnt after years of renting it is that we cannot rely on the compassion of landlords. So I tell the Government: suspend rents before it is too late.

I will finish on one final point. Yesterday, it was reported that banks are exploiting this crisis, putting up the cost of personal loans, quadrupling interest rates on overdrafts to nearly 40% and failing to pass on Bank of England’s interest rate cuts. We bailed them out when they crashed the economy, and we paid the price. We cannot let that happen again. So I urge the Government: this time, let us bail out the people. Let us protect the incomes of the self-employed; raise statutory sick pay for all workers; increase universal credit, end “no recourse to public funds”; suspend rents and ban evictions; and make sure that working people are not hit the hardest ever again.

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[Stephen Timms]

I am grateful to my hon. Friend. We took evidence this morning on that very point—the need to improve universal credit and change some of the problems. Unfortunately we were told that, because of the IT systems, there is very little that can be done in the short term.

For example, one thing the Government have agreed to do is reduce the maximum deduction from people’s standard payment of universal credit. There are deductions for people to pay back the advance they receive up front and for other reasons. There is a case for suspending those deductions for the time being, but that is not the Government’s intention at the moment. They have agreed that the maximum deduction will be reduced from 30% of the standard amount to 25%, but they tell us that they cannot do that until October 2021 because of the problems with the IT system.

I am grateful to my hon. Friend the Member for Newcastle upon Tyne Central (Chi Onwurah) for reminding the House that, years ago, we were all told that this was going to be done in agile, precisely in order that changes could be made quickly. I am afraid that those promises have not been fulfilled. We were assured time after time that all the problems of the old DWP systems would be solved by adopting the agile approach. Sadly, that does not seem to be the case. Despite that, I am going to press this afternoon, as I and the Committee did this morning, for changes to universal credit. A way has to be found to overcome some of the problems and to get these things done much more quickly than is suggested will be the case.

I very much welcome the fact that the headline rate of universal credit and working tax credit has been increased, although only for a year. Given the long freeze in the rates of benefits, there is a case for making that increase permanent rather than temporary. That is something we will no doubt come back to in the months ahead.

When it comes to universal credit providing much needed support to the self-employed, people who come off zero-hours contracts and freelancers, there are some serious problems with the way it works at the moment. The Trussell Trust has found that people on universal credit are two and a half times more likely to need a food bank than people on legacy benefits, such as jobseeker’s allowance.

There is a remarkable article in this month’s issue of The Lancet Public Health about universal credit, which finds that

“an additional 63674…unemployed people will have experienced levels of psychological distress that are clinically significant due to the introduction of Universal Credit”.

It goes on to estimate that more than a third of those people

“might reach the diagnostic threshold for depression.”

A little further on, the article states:

“When the policy change was introduced, the prevalence of psychological distress started to increase among those eligible for Universal Credit; however, the prevalence remained constant for people not affected by the change”.

Lastly, the article states:

“We also tested if there was an increase in the number of participants transitioning from unemployment into work in the intervention group after the introduction of Universal Credit relative to the comparison group; the reform had no effect on employment”.

There are serious problems with the way universal credit is working, and we are now forcing—understandably—hundreds of thousands of additional people on to this benefit. What is the problem? Why does it cause so much more difficulty for people than jobseeker’s allowance and other past benefits? A big part of the answer is the fact that people have to wait five weeks after applying to receive their first regular benefit payment. That is inevitably pushing people into debt with the Department for Work and Pensions. A lot of people are then choosing to say, “In that case, I’d better not pay my rent for a bit,” and they are getting into rent arrears. The National Housing Federation is reporting that people on universal credit are significantly more likely to be behind with their rent than people on jobseeker’s allowance, both in the past and currently. This is a problem that will affect very large numbers of those who are now applying for universal credit.

It seems to me that it cannot be a good idea—given the boldness and generosity and the welcome characteristics of the package for employees that was introduced last week— to force self-employed people, by contrast, on to an arrangement where they do not get a substantive payment for five weeks.

[Mr Dhesi]

Does my right hon. Friend not agree that many of the individuals on universal credit and jobseeker’s allowance are having to go to food banks, and at the very time that we need support for food banks, many food banks are unfortunately having to close because of the age demographic of the volunteers, who are normally a lot more mature? That is why, within this package, we need more support for food banks and the charitable sector.

[Stephen Timms]

My hon. Friend is absolutely right. I very much agree about the need for more support for charitable organisations. I spoke yesterday to the chief executive of the Trussell Trust, who told me that of its 1,250 food banks, two have closed so far. One of them is reopening and some other arrangement is being put in place for the other one instead. It is a remarkable tribute to exactly the people that my hon. Friend refers to, who are running those food banks, that despite the potential risks to them, they are carrying on. The whole House will be grateful to them for their extraordinary effort.

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[Bill Esterson (Sefton Central) (Lab)]

The badge on the Chancellor’s Twitter account says: “Stay At Home save lives”. I completely agree with the sentiment behind that message. A number of hon. and right hon. Members also have that badge on their Twitter accounts. However, if people cannot afford to stay at home, they simply will not do so. They will have to go out to find the money to put food on the table. That applies, as things stand, to very many self-employed people. It also applies to many people who have lost their jobs because of the financial downturn that has happened so suddenly and unexpectedly. People who do not qualify for sick pay and who have symptoms of the virus will also have to go out to find money, as will those who suffer as a result of the delays in universal credit, which have been so well described by many hon. and right hon. Members. As my right hon. Friend the Member for East Ham (Stephen Timms) said, it will also happen to those who have no recourse to public funds.

Health has to be absolutely paramount in everything that we say and do, by which I mean the health of the individual and their potential to pass on the virus to other people, especially to health workers who we need to look after the rest of us.

[Mr Dhesi]

Today, we have heard the sad and shocking news of the death of a 21-year-old lady in Buckinghamshire who had no underlying health conditions. Does my hon. Friend agree that there are many individuals and employers out there who are under the misconception that those who are younger, or who have no underlying health conditions, will not suffer from this virus? They need to take heed of this story and look after the health not just of themselves, but of those around them.

[Bill Esterson]

I am grateful to my hon. Friend for making that point. It is really, really important that everybody—no matter what their age or health condition—recognises that we are all at risk from this. But there are groups who are especially at risk, and we have an enormous responsibility to protect them as much as possible, including the health workers who we will need to look after us all.

If we want people to stay at home and to observe the 2 metres rule when they are out and about, we have to do everything in our power to make it as easy as possible for them to comply. Delivering financial security is crucial to ensuring that nobody has to go out unless they absolutely have to. I asked the Leader of the House earlier to pass on my point about the construction industry to the Prime Minister. I will make that point again now. There are too many people going on to construction sites that are not essential work. Such construction must stop, otherwise people will carry on going to work. Somebody who works away from home emailed me just this afternoon to tell me that their employer is saying, “I am only interested in the profits of my company”; they do not care about anything else. Those workers are being forced to go to work. If they do not, their pay will be cut and they will have nothing, and they will not be part of any income retention scheme if and when it is applied by that employer.