John McDonnell MP
I want to speak briefly in support of amendments 2 and 3 and new clauses 7 and 14. Unfortunately, at this stage of a Bill we are not able to move amendments that significantly increase the benefits, but because we are within a week of a Budget, we can send a message from this debate to the Chancellor. The message is to acknowledge the background to this legislation, which is fuel poverty rising in the past year from 4.5 million households to 6.7 million—a 50% increase. We welcome the legislation today, but in that context, and as others have said, it clearly does not go far enough, and my worry is that if the energy price cap is lifted to £3,000, fuel poverty will rise to 8.4 million.
My hint to the Chancellor—all Chancellors like to pull a rabbit out of their hat on that last day—is not to raise the cap to £3,000. In fact, a reduction could be in order and an increase in the level of benefits support could be provided fairly rapidly, too. In that way, we would have, alongside this legislation, some real impact on fuel poverty. The Chancellor, because of the reduction in energy fuel prices, and also because of the increase in income tax receipts he has received recently, is in a beneficial position to enable that to happen. Alongside this legislation, action in a week’s time from the Chancellor could have an immediate impact on lifting people out of poverty.
My second point is in support of amendment 2. Many of us have constituents who have been penalised, and this Bill will double-penalise them. It is almost like they are now placed in a form of double jeopardy. As others have said, sometimes those penalties have been for trivial reasons—often for understandable incidents that have occurred with people not being able to fulfil all their responsibilities for claiming the benefit. A bit of flexibility is definitely needed.
Moving to new clause 14, I claim philistine status on this; I am not a member of the all-party parliamentary group on opera or the all-party parliamentary group for theatre—I will join immediately—but I am a member of the performers’ alliance all-party parliamentary group. Like the hon. Member for Bromley and Chislehurst (Sir Robert Neill), I was also briefed by Equity and the Musicians Union about what is happening, particularly in the arts sector, for those people in and out of work and employment, because that is part of life in that sector, particularly for youngsters. The new clause simply asks the Government to stand back and look at how they are treating the self-employed, particularly this group of people.
In that briefing from Equity, I was shocked by the recent impact. I did not realise that 40% of that group have not received any support throughout the pandemic. They never qualified for any of the support mechanisms, which surprised me. I looked at the impact that was having on Equity’s members. It did its survey, and these are some of the results, which demand a response from the Government. Some 60% of respondents anticipate difficulty in meeting essential costs—we are talking about housing, rent, food, childcare and utility bills. Some 33% have seen their level of personal debt increase in the past year, 41% feel negative about their prospects for work in the entertainment industry over the next 12 months, and, as the hon. Member said, 19% are considering having to leave the entertainment industry. That is an immense loss of talent.
As the hon. Member said, the minimum income floor largely affects young people, but it also impacts on different parts of society. Black and ethnic minority communities are impacted in particular. The Government need to stand back and undertake a short, sharp exercise on the implications of the minimum income floor on the self-employed, particularly in this sector. I am sure we can come to a reasonable response that can be agreed on a cross-party basis.
I come to my third point. I support new clause 7 because we desperately need to stand back and see where we are, after the panoply of legislation that we have introduced. We need to assess whether any of it is working and having the impact that it should. On Second Reading, we went through some of the issues facing our constituents. That debate impressed on me, and I think many others, exactly why the new clause is important. Now is the time to review the implications of poverty in our society.
Mention was made of unemployment benefits. We have discussed this before; all of us believe that if a person can get into work, that should help them to lift themselves out of poverty. The problem is that for some people, it is difficult getting into work, so they are dependent on benefits. Unemployment benefit is at its lowest in real terms since 1990-91. As my right hon. Friend the Member for East Ham (Sir Stephen Timms) mentioned, as a proportion of average earnings, it is 14% of what it was in the 1970s. People cannot survive on an unemployment benefit at that level, so it is no wonder that the relative poverty rate among working-age adults has risen from 8% in 1961 to 20% now. No wonder there has been a 135% increase in food bank usage between 2016 and 2020.
When we discussed this earlier, what shocked us all was what has happened with regard to poverty and children. There are 4 million children in poverty; that means that they live in households with less than 60% of median household income. That is up from 3.6 million in 2010-11. According to Action for Children, there are 400,000 more children in deep poverty than in 2010-11; 2.7 million children—20%—are in deep poverty and 1.4 million children are in very deep poverty. That is 10% of children in the United Kingdom. We see many of those children in our constituencies, when their parents come to try to get advice and assistance; we are usually the place of last resort for that help.
That is why it is absolutely critical that the Government take up the challenge of new clause 7. It is a simple request. A review, in addition to the impact assessments that the Government have published, would enable us to stand back and look at where we are. What has been the cumulative impact of numerous pieces of legislation? What has worked, what has not, and what could work? Could we perhaps agree across the House on a new strategy for tackling poverty? It is clear from this legislation, and the legislation that preceded it, that the strategy is not working. The increases in poverty have been staggering. It is a disgrace to the country that we have these levels of poverty.
I want to speak up for one more group. I congratulated the Government on introducing the triple lock on pensions, but nevertheless 20% of single pensioners live in poverty; 1.7 million pensioners live in relative poverty. The Joseph Rowntree Foundation has advised the House that pensioner poverty is forecast to rise again. I supported the triple-lock legislation, but it has not had maximum impact. That is why new clause 7 is important. It would enable us to stand back, see where we are, recognise the problems, and recognise that we have significantly failed, and need to move forward with a new strategy, on a new basis.