Tag: 2021

Drew Hendry – 2021 Speech on Employment Rights

The speech made by Drew Hendry, the SNP MP for Inverness, Nairn, Badenoch and Strathspey, in the House of Commons on 25 January 2021.

Madam Deputy Speaker, a very happy Burns night to you, the staff and everyone else. Could I also welcome the Secretary of State to his place this evening?

Workers deserve our thanks, our respect and our appreciation. Scotland should not have to protect hard-fought workers’ rights from the Tories and their Brexit chaos. By reneging on their promise to protect EU-derived workers’ rights, the UK Government would again prove that it is impossible to trust anything the Tories say, especially on Brexit. The SNP is clear that it rejects any regression of workers’ protections. However, the Scottish Government’s ability to tackle unfair working practices and to fully protect workers’ rights remains limited. As employment law is reserved to Westminster, the UK Government must take action.

Madam Deputy Speaker,

“using threats of firing and rehiring is unacceptable as a negotiating tactic”.—[Official Report, 13 January 2021; Vol. 687, c. 293.]

These are not my words, but the words of the Prime Minister earlier this month, so why is nothing being done to stop this? While the SNP would support any legislation seeking to ban fire and rehire practices, the Bill of my hon. Friend the Member for Paisley and Renfrewshire North (Gavin Newlands)—the Employment (Dismissal and Re-employment) Bill—is available now to do just that, and the Tories and Labour could help us change the law within weeks by backing his Bill.

When my hon. Friend introduced his Bill in June 2020 to ban fire and rehire practices, he wrote to the current leader of the Labour party and the then Tory Business Secretary—incidentally, with nearly 100 MPs co-signing the letter—urging them both to back his Bill. Given that the Labour leader called on the UK Government to

“Introduce legislation to end fire and re-hire”—

adding:

“If you do that, you will have our full support”—

surely now Labour must get behind the Bill introduced by my hon. Friend. To quote Burns,

“A mind that is conscious of its integrity scorns to say more than it means to perform.”

To my hon. Friend’s great credit, he has in fact submitted two Bills to Parliament over recent months seeking to outlaw the practice, which have been backed by all major trade unions, including Unite, the British Airline Pilots Association and GMB Scotland. The current Bill extends workers’ rights currently under the Employment Rights Act 1996 to prevent employers from forcing workers to sign up to wage cuts and inferior conditions under threat of dismissal. The simple amendment he proposes to existing employment legislation would benefit millions of people overnight, supporting responsible employers, while making it clear to those with less scruples that these sorts of actions are not permitted in any country across the UK.

The SNP has called time and again for the UK Government either to get behind my hon. Friend’s employment Bill or to bring in their own legislation to give millions of workers at Centrica and elsewhere the same protections enjoyed across Europe. We should all be willing to put party differences aside and work together in the interests of workers. The UK Government have a duty to act swiftly and decisively to ban fire and rehire practices. Until this happens, more employers will be encouraged to follow suit. Companies such as British Airways, Tesco and Centrica are the tip of the iceberg, and workers across these isles face unprecedented attacks on their wages and conditions via despicable tactics such as fire and rehire.

As I have said, my hon. Friend has led the charge to ban fire and rehire tactics and ensure that workers are not the victims of bosses looking to cut costs. We will of course listen to the warm words today, but the fact is that the Tories and Labour could help us change the law within weeks by backing the Bill. Let them now commit to action to support that Bill.

Turning to other matters, I think we have all been shocked by the details of the UK Government’s shabby and heartless treatment of their own Driver and Vehicle Licensing Agency workforce that have emerged over the weekend. That sets a worrying precedent for the coming months and years in relation to workers’ rights.

We have heard from the Secretary of State tonight that he will not be following up the package of deregulatory measures following the UK’s exit from the EU. He said that he would not be ending the 48-hour week, and that he would not be tweaking the rules around rest breaks at work, overtime pay or other changes. But, of course, we have heard Tory Ministers make countless empty promises to protect EU-derived workers’ protections, and now that we have left the EU there are few who do not believe that they are going to renege on that promise.

Even if we believed that the Tories were intent on protecting workers’ rights—admittedly, that is a big ask—surely they would simply maintain those that were already enshrined in EU law, rather than ploughing ahead with a review and selecting what they want to discover. Despite initially dismissing the reports of watering down rights, the Tory Business Secretary confirmed last week that

“we wanted to look at a whole range of issues relating to our EU membership and examine what we wanted to keep.”

Of course, we can easily read that as the Government keeping the bare minimum that they can get away with.

With each day that passes, the damage being inflicted by the Tories’ Brexit deal on businesses and jobs becomes clearer; they have earned zero trust. As with fishing, they have shown that they will break any promise and sell out any group of workers, no matter the cost. As the STUC general secretary Roz Foyer said:

“We are alarmed, if unsurprised, by reports of early attempts to downgrade workers’ rights through amending the commitment to the EU Working Time Directive. We will vigorously oppose any attempt to dilute existing rights and are pleased that the Scottish Government, in line with its commitment to Fair Work, supports us in this.”

The SNP and the Scottish Government will continue to work in partnership with trade unions to challenge the UK Government to avoid a race to the bottom when it comes to pay and conditions. As I have said, people in Scotland can see that the Scottish Government’s ability to tackle unfair working practices and fully protect workers’ rights remains limited while employment law is reserved to Westminster, even though they are doing all they can to embed fair work practices across Scotland. In July 2020, Scotland’s Cabinet Secretary for Economy, Fair Work and Culture issued a refreshed joint statement with the STUC, the Convention of Scottish Local Authorities, the Scottish Council for Voluntary Organisations, the Institute of Directors and the Scottish Council for Development and Industry, outlining the sheer commitment to fair work practices in Scotland across the public, private and third sectors.

The Scottish Government also published their fair work action plan last year to drive forward the ambition for fair work to be the norm in workplaces across Scotland. Through their flagship fair work first policy, they are rewarding and encouraging employers to adopt fair work practices by attaching fair work criteria to grants and other funding, as well as to the contracts awarded by and across the public sector. This includes: asking employers to commit to paying the real living wage, not the pretendy one that we hear about in the Commons so often; no inappropriate use of zero-hours contracts; and the provision of channels for an effective voice, such as trade union recognition.

Fair work first criteria will be incorporated into the policies and practices of the Scottish National Investment Bank, and are embedded across the enterprise and skills agencies, including the new South of Scotland Enterprise agency. If an anti-worker ideology continues at Westminster, it is vital that powers over employment are devolved to Scotland to allow our Parliament to get on with the crucial job of supporting employment and helping businesses to thrive.

By breaking the promise to protect EU-derived workers’ rights, the UK Government will again be proving that it is impossible to trust anything that the Tories say, especially on Brexit. We in the SNP are clear that we reject any regression of workers’ protections. The Scottish Government now need the powers to tackle unfair working practices and to protect workers’ rights. Employment law should no longer be reserved to Westminster. In the meantime, fire and rehire is an abomination. The UK Government and Members of all parties must now support my hon. Friend’s simple but effective Bill to outlaw it.

Scotland has not voted for a Tory Government since 1955. Unlike other parties, the SNP wants to put workers’ rights, and all other powers to create a fairer Scotland, in Scotland’s hands—not in the hands of Tory Governments we never vote for. Twenty opinion polls in a row have shown that the people of Scotland back that proposition. They must, and will, have their democratic right to choose a better future with independence.

January 27, 2021
Kwasi Kwarteng – 2021 Speech on Employment Rights

The speech made by Kwasi Kwarteng, the Secretary of State for Business, Energy and Industrial Strategy, in the House of Commons on 25 January 2021.

I just want to make something very clear and unequivocal at the outset: we will not reduce workers’ rights. There is no Government plan to reduce workers’ rights. As the new Secretary of State, I have been extremely clear that I do not want to diminish workers’ rights, and on my watch there will be no reduction in workers’ rights. I do not want there to be any doubt about my or the Government’s intentions in this area. The hon. Member for Middlesbrough (Andy McDonald) and the right hon. Member for Doncaster North (Edward Miliband) were kind enough to send me a letter in my first week in the job asking for reassurances on this matter. I am happy to report that I have provided those reassurances, and I am very willing to provide them every time.

We will not row back on the 48-hour weekly working limit derived from the working time directive. We will not reduce the UK annual leave entitlement, which is already much more generous than the EU minimum standard. We will not row back on legal rights to breaks at work. I will say it again: there is no Government plan to reduce workers’ rights.

The Government have managed to have a record that is unimpeachable on this subject. Our manifesto promised, among other things, to get Brexit done and to maintain the existing level of protections for workers provided by our laws and regulations. We have delivered Brexit, and we will not use this new-found freedom to reduce workers’ rights. In any case, as the hon. Member for Middlesbrough said, our higher standards were never dependent on our membership of the EU. The UK has one of the best employment rights records in the world. It is well known that in many areas the UK goes further than the EU on workers’ protections. We have one of the highest minimum wages in the world, and the Government are increasing this again for workers on 1 April, but in the EU there is no requirement to offer a minimum wage or sick pay. In the UK, people get over five weeks of annual leave, minimum; the EU requires only four weeks. In the UK, people get a year of maternity leave; the EU minimum is just 14 weeks. The EU has only just agreed rights to flexible working, over 15 years behind the UK. The Opposition are simply wrong to hold the EU up as the gold standard. Our equalities legislation, and our maternity and paternity entitlements, are already considerably better than the EU’s. Now we have left the EU, our Government and Parliament are able to decide what rules should apply and make improvements where we believe there is a need to do so.

Stephen Doughty

Will the Secretary of State give way?

Kwasi Kwarteng

I have to make progress because lots of people want to speak in this debate.

We have already set out plans to make workplaces fairer. Our manifesto contains commitments to create a new single enforcement body for labour market abuses to give greater protections for workers, as well as plans to encourage greater flexible working. It is totally disingenuous for Labour to claim that we do not stand on the side of workers when our manifesto clearly says the direct opposite.

We will not take lectures on employment rights from Labour, because, as I said, our track record speaks for itself. It was a Conservative-led Government who introduced shared parental leave and pay in 2014, giving parents flexibility in who takes time away from work in the first year of their child’s life. It was a Conservative Government who introduced the national living wage in 2016, giving the lowest-paid workers the security of a higher wage to provide for themselves and their families. Ten years of progressive Conservative reforms pushed unemployment to a 45-year low. Before coronavirus hit, our employment rate was at a record high, with over 33 million people in work. By March last year, workers across the UK had enjoyed 26 consecutive months of real pay increases, and women and workers from black, Asian and minority ethnic backgrounds made up a larger proportion of the workforce than ever before.

Stephen Doughty

On fire and rehire specifically, will the Secretary of State give way?

Kwasi Kwarteng

I have to make progress.

I know at first hand through my work as Energy Minister the importance of making sure that we have a high-wage, high-protection, high-skilled labour market to ensure that we can deliver the net zero transition and seize the opportunities of the green industrial revolution. The times have moved on. We have a new net zero focus, and clearly high wages and high skills are really at the centre of what we are trying to do as a Government.

That will be more crucial than ever as we rebuild our economy from the devastating impact of coronavirus. From the outset, the Government have acted decisively to provide an unprecedented package of support to protect our workers’ and our people’s livelihoods. The coronavirus job retention scheme, the first intervention of its kind in UK history, delivers countrywide support to protect millions of British workers. The scheme has helped 1.2 million employers across the UK to furlough 9.9 million jobs and has now been extended until April 2021.

Enforcement bodies are continuing to protect vulnerable workers and to work with businesses to promote compliance throughout the epidemic. We are concerned about reports suggesting that threats about firing and rehiring are being used as a negotiating tactic. We have been clear—

Stephen Doughty

The Secretary of State is speaking about fire and rehire, and his colleague the Chief Secretary to the Treasury told me that those tactics were completely unacceptable. Does the Secretary of State agree with those comments and does he share my concern? In September of last year, I met the chief executive of British Gas about that specific dispute and he tried to suggest that they were not using those tactics, despite having written to members in July to do just that. Does the Secretary of State agree that that is completely unacceptable in our labour market?

Kwasi Kwarteng

I think it is unacceptable. I will go further—as a constituency MP, I have a large number of constituents in Spelthorne who work for British Airways and I spoke directly to the old CEO, Alex Cruz, who has since left the company, and made exactly the points that the hon. Gentleman has just made to me. It is not acceptable.

Andy McDonald

I am grateful to the Secretary of State for his unequivocal indication that he condemns this practice. If that is so, will he legislate to outlaw it once and for all? We will support him if he does.

Kwasi Kwarteng

As I was saying, we have been very clear that this practice is unacceptable and the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Sutton and Cheam (Paul Scully), who is the Minister responsible for labour markets, has condemned the practice in the strongest terms on many occasions in this House. We have engaged ACAS to investigate the issue and it is already talking to business and employee representatives to gather evidence of how fire and rehire has been used. ACAS officials are expected to share their findings with my Department next month and we will fully consider the evidence that they supply.

The House should be left in no doubt that the Government will always continue to stand behind workers and stamp out unscrupulous practices where they occur. The Government have worked constructively with businesses and unions throughout the pandemic to ensure that our workers remain safe and we will continue to do so as the UK looks towards economic recovery. I am proud of the constructive relationship I had with trade unions in my former role as Minister of State for energy and I fully intend to continue in this vein as the newly appointed Business Secretary. I have already reached out to the union leaders and I spoke to the TUC general secretary, Frances O’Grady, only last week.

I want to conclude by reassuring employees across the country that we in Government continue to acknowledge the immense efforts our workers—our workforce, our people—have contributed to the effort against coronavirus. These are unprecedented times, and we fully understand the pressures that we are all labouring under. We will use the opportunities created by leaving the EU to build back better and maintain a world-leading position on employment rights. The House should be in no doubt that we are the party on the side of the hard-working people of this country.

Justin Madders

In his rather selective recollection of what the Government have done on workers’ rights over the past 10 years, the Secretary of State forgot to mention the reduction of consultation periods, the increase of qualifying periods for unfair dismissal and the introduction of employment tribunal fees. Will he mention those things, because they were certainly detrimental to working people in this country?

Kwasi Kwarteng

What I will mention is the introduction of the national living wage—[Interruption.] I will also mention the fact that we have doubled the personal allowance, which was at £6,450 when we came to office in 2010 and is now hitting £12,000. We take no lessons or lectures from the Labour party on helping the most vulnerable people in our society. This Government have a proud history of protecting and enhancing workers’ rights, and we are committed to making the UK absolutely the best place in the world to work.

Before I open the Floor to other Members for their contributions, I can confirm to you, Madam Deputy Speaker, that the amendment in the name of the Prime Minister will not be moved this evening.

January 27, 2021
Andy McDonald – 2021 Speech on Employment Rights

The speech made by Andy McDonald, the Labour MP for Middlesbrough, in the House of Commons on 25 January 2021.

I beg to move,

That this House believes that all existing employment rights and protections must be maintained, including the 48-hour working week, rest breaks at work and inclusion of overtime pay when calculating some holiday pay entitlements, and calls on the Government to set out to Parliament by the end of January 2021 a timetable to introduce legislation to end fire and re-hire tactics.

May I start by welcoming the Secretary of State to his place and wishing him every success in his new role? I am sure that I speak for the whole House in paying a heartfelt tribute to the workers of our country—the women and men who have battled so hard throughout this pandemic, persevering in the most difficult environment that any of us, who have not suffered the horrors of war, have ever known. I am talking about those keyworkers: our nurses, our doctors, health and care workers, shop workers, cleaners, transport workers and, indeed, everybody who has worked so selflessly and bravely battled to maintain services throughout our country. Many of them have had to go to work with real concerns about their own safety and that of their families. Sadly, too many have worked in unsafe conditions because of the Government’s failure to enforce workplace health and safety standards or to provide the financial support needed for people to self-isolate. Tragically, so many workers have lost their lives, including a member of our own House of Commons family, namely Godfrey Cameron, and we grieve with, and for, all who love them. Workers are facing enormous stresses and pressures, and many are having to deal with major mental health challenges. It is with all those workers in mind that Her Majesty’s Opposition bring forward this motion today.

This pandemic has exposed the many deficiencies in workers’ rights and protections, and now there is a real yearning that, when we emerge from this crisis, a better deal for working people is not only possible, but essential. Yes, the economic position is tough, but people came back from a devastating war in 1945 determined to forge a better society for their families to prosper in. Such a moment, as President Biden said, of renewal and resolve is right now. At no time in living memory has it been clearer that the safety and security of working people is inextricably linked with public health and the economy.

Mark Tami (Alyn and Deeside) (Lab)

Does my hon. Friend agree that some employers, such as British Airways and British Gas, have used the covid situation to exploit workers and to try to change their terms and conditions in this very difficult environment?

Andy McDonald

I agree wholeheartedly with my hon. Friend in that respect and I will come on to deal with many of those issues later on in my speech.

Against this backdrop, it is shocking that the Government would even consider embarking on a review to rip up the hard-won rights of working people. As revealed in the Financial Times, the Government have drawn up plans to end the 48-hour working week, weaken rules around rest breaks and exclude overtime when calculating holiday and pay entitlement. If the Government have their way, these changes would have a devastating impact on working people. Quite simply, it will mean longer hours, lower wages and less safe work.

The 48-hour working week limit is a vital protection of work-life balance. It is also a crucial health and safety protection, without which the physical and mental wellbeing of workers and the general public is at risk. But let us not beat around the bush: working longer hours leads to more deaths and more serious injuries. Nobody wants their loved ones cared for by our fantastic, but exhausted and overworked, nurses or ambulance staff, or for buses and trains to be operated by tired-out drivers. After the sacrifices of the past year, it is unconscionable for the Government to plot changes that would endanger workers and the public.

It is not just about making work less safe; the Government are proposing to exclude overtime from holiday pay entitlements, which would be a hammer blow to the finances of the country’s lowest paid and most insecure workers. Under current rules, regular overtime is included when calculating holiday pay entitlement, ensuring that it reflects the hours that are actually worked. Scrapping those rules would mean that the holiday pay that workers get would be lower. The average full-time care worker would lose out on £240 a year, a police officer more than £300, an HGV driver more than £400 and a worker in food and drink processing more than £500.

The losses, however, will be even more severe for those who work irregular hours, such as retail workers, who work lots of overtime. USDAW, the Union of Shop, Distributive and Allied Workers, described the case of Leon, a warehouse worker who works night shifts for a major parcel delivery company. Employed on an 8.5-hour contract, but working 36.5 hours in an average week, Leon would lose £2,149.22 per year.

All of that is at the start of the stewardship of a new Secretary of State for Business, who wrote in “Britannia Unchained” in 2012 that the British are

“among the worst idlers in the world”.

The Secretary of State is wrong: far from being lazy, British workers work some of the longest hours of workers in any mature economy, yet our economy still suffers from poor productivity.

The solution is to strengthen employment rights, not to strip them away in a bid to make working people work even longer hours. The Secretary of State excused his comments as being made a long time ago, but in 2015 the right hon. Gentleman wrote and edited another pamphlet, called “A Time for Choosing”, in which he said:

“Over the last three decades, the burden of employment regulation has swollen six times in size”,

before singling out protections on working time, declaring that the UK

“should do whatever we can to cut the burden of employment regulation.”

Does he stand by that?

James Cartlidge (South Suffolk) (Con)

On recent writings, Labour had a manifesto in December 2019 that committed to a four-day week. Is that still its position?

Andy McDonald

There is a clear and active discussion about working time and the quality of life for working people. Since time immemorial, that discussion has taken place. I have no doubt that it will be a subject for debate and consideration between now and the next election, and way beyond. It is a perfectly proper area of debate.

The Secretary of State has spent a career calling for employment protections to be weakened, so he has a lot of ground to cover if he is to persuade the country’s 30 million-plus workers that he is on their side.

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

The hard workers my hon. Friend is talking about includes the many British Gas workers in my constituency, GMB members I met last week. I was very surprised to be told by them that the chief executive of British Gas had called personally to put pressure on them to accept new, worse terms. Bizarrely, he suggested that senior Labour figures had endorsed that. Will my hon. Friend confirm that that is absolute nonsense, that we stand in solidarity with them and that British Gas should get back around the table for serious negotiations? Of course, I draw attention to my membership of the GMB and the support that it has provided me.

Andy McDonald

I am more than happy and delighted to confirm that that is utter and complete nonsense. Is it likely? I just ask people: is that really likely? Of course it is not.

If the Secretary of State now wants to say that the 48-hour cap, holiday pay entitlements and rest breaks will be protected, and that he will scrap the planned consultation, perhaps he can say so in unequivocal terms here today and vote for our motion.

Today’s motion also calls on the Government to set a timetable to introduce legislation to end “fire and rehire” tactics. It is not a new phenomenon, but it has gained prominence because of the conduct of major employers such as British Airways, Heathrow and British Gas—some in circumstances that they claim to be justified by the covid pandemic. It is about sacking workers and hiring them back on lower wages and worse terms and conditions, including 20,000 British Gas employees who kept working through the pandemic to keep customers’ homes warm and worked with the Trussell Trust to deliver food parcels. I think of the engineer who explained that he was often the only face that people living in isolation were seeing. This is how they are repaid.

Justin Madders (Ellesmere Port and Neston) (Lab)

My hon. Friend is absolutely right that fire and rehire has been around for a long time, but does he agree that that shows just how weak the current unfair dismissal laws are and how they really need to be strengthened?

Andy McDonald

My hon. Friend is absolutely right. We have had an erosion of protections and rights over many years, and we have to deal with it and review it comprehensively.

This also includes British Airways, whose use of fire and rehire was described by the cross-party Transport Committee as

“a calculated attempt to take advantage of the pandemic to cut…jobs”

and weaken the terms and conditions of its remaining employees, and it deemed this “a national disgrace”. The Leader of the Opposition was right to call for fire and rehire tactics to be outlawed, saying:

“These tactics punish good employers, hit working people hard and harm our economy. After a decade of pay restraint—that’s the last thing working people need, and in the middle of a deep recession— it’s the last thing our economy needs.”

We have repeatedly warned that the practice would become increasingly common, triggering a race to the bottom, and I take no delight in observing that this warning has come to fruition. Research published today by the TUC reveals that fire and rehire tactics have become widespread during the pandemic. Nearly one in 10 workers has been told to reapply for their jobs on worse terms and conditions since the first lockdown in March, and the picture is even bleaker for black, Asian and minority ethnic and young workers and working-class people. Far from levelling up, the Government is levelling down, with nearly a quarter of workers having experienced a downgrading of their terms during the crisis.

Fire and rehire is a dreadful abuse and allows bad employers to exploit their power and undercut good employers by depressing wages and taking demand out of the economy. It is all the more galling when those very companies have had public funds to help them to get through the pandemic. The economic response to the 2008 financial crisis in Britain was characterised by poor productivity and low wage growth. The Government fail to understand that well-paid, secure work is good for the economy, and greater security for workers would mean a stronger recovery. If the Government had listened to the Leader of the Opposition back in September, countless workers could have been spared painful cuts to their terms and conditions, but it is not too late for the Government to act. They can act now to introduce legislation to end fire and rehire and give working people the security they need. If they do that, they will have our full support.

Finally, I turn to the Government’s amendment, in which they say that

“the UK has one of the best employment rights records in the world”

and that the UK

“provides stronger protections than the EU”.

That is simply not the case. The UK ranks as the third least generous nation for paid leave and unemployment benefits out of the US and major European economies. A UNICEF analysis of indicators of national family-friendly policies has the UK at 34th on one index and 28th on another, lagging behind Romania, Malta and Slovakia and just edging ahead of Cyprus.

The Government’s amendment also “welcomes the opportunity” to strengthen protections for workers, but what are the Government doing with the opportunity that they so welcome? What have they been doing on fire and rehire? All we have had is sympathy and hand-wringing, when action was and still is required. Where were they on Rolls-Royce at Barnoldswick? It was Unite the union and the courage and determination of those brave workers that fought to secure their jobs, not this Government. What works best for the UK is what works best for its working people, and undermining their rights and protections does not cut it. Accordingly, Labour will not be supporting the Government’s amendment.

Why did the Secretary of State’s Department embark on this review, and how can it be that his Department has sought responses from companies without the consultation being published? Can he confirm that it is now dead in the water, or does he intend to bring it back at a later date? We were promised an employment Bill that would make Britain

“the best place in the world to work”.

The Opposition would very much welcome a Bill that did exactly that, but given his track record, we have major doubts. Perhaps he can tell the House when we will see that Bill introduced.

From this point on, it is about how we rebuild our country and secure our economy. That objective has to have working people—their interests and their health and wellbeing—right at the forefront. As a bare minimum, that has to include maintaining the basic protections that employees have had up to now and then building on them. Sadly, workers will find no hard evidence of this Government enhancing their rights and protections, but it is what they were promised, and it is what they are expecting, so we will be holding the Government to it.

January 27, 2021
Paula Barker – 2021 Speech on Council Tax Increases

The speech made by Paula Barker, the Labour MP for Liverpool Wavertree, in the House of Commons on 25 January 2021.

Before entering Parliament, I spent my entire working life in local government. Local government as an institution is one of the great pillars of our democracy. It is in every sense the frontline, providing the bread-and-butter services our communities and our people rely on day in, day out. I cannot be more earnest in delivering this message from the frontline: morale has never been more crushed or in such short supply within local government than it has for this last decade. Half a billion pounds has been slashed from my own council in Liverpool in the past 10 years and more than £10 billion from local government overall, with a postcode lottery where the Tory shires are cushioned from the devastation inflicted on councils across the north of England.

The disturbing irony of it all is that the Conservatives claim to be no big believer in the central state, yet trash the very institutions that have the expertise and know-how to put local people in charge of their communities’ own destiny. They talk a good game on devolution, but we know in the north that the reality is quite the opposite. Meagre powers with little resource do not deliver real change, nor do they come anywhere close to levelling up. The Conservative party talks an even mightier game on tax and spend, but there is nothing to justify such assertions if the modus operandi is to shift the tax burden from progressive taxation to the most regressive of taxes, council tax. The most sinister swindle of them all is when local people receive their council tax bill. The top does not read “Ministry of Housing, Communities and Local Government” but “Liverpool City Council”, “Salford City Council” or “Leeds City Council”. I dare say that if the opposite were true and blame was directed where it truly belongs, to Whitehall, the Government would think twice about backing councils into a corner like this.

Social care is a case in point. If this Government in all their delusions honestly believe the way to put adult social care on a truly sustainable financial footing is to pillage the pockets of local taxpayers with huge council tax hikes that let the wealthiest off the hook and allow the poorest to shoulder the greatest burden, they are in for a shock. Squeezing the tax base in areas of high deprivation to subsidise an inadequate adult social care business will never ever provide the solutions our people need as our population grows older and therefore more dependent on such services.

This Government have abjectly failed to live up to their own mantra of “whatever it takes” when it comes to local government. Our councils are delivering despite the most difficult circumstances. Instead of forcing more of them into the humiliation of section 114 notices, let us restore essential government grants, cancel the council tax hike and keep the money in the pocket of working-class people.

January 26, 2021
Liam Byrne – 2021 Speech on Council Tax Increases

The speech made by Liam Byrne, the Labour MP for Birmingham Hodge Hill, in the House of Commons on 25 January 2021.

Let me just start with a point that I think many of us will share: in these debates about numbers, statistics and finances, we must remember the lives that are at stake.

Most of us will never forget the stories of love and loss that we have heard this year, stories such as those I heard from the family of Sarah Scully. Their mum, Sarah, went into hospital and said goodbye to her family at the hospital door. Sarah was pregnant. She had to be given a caesarean section, but was so ill she had to be put into an induced coma. Tragically, she died before she was ever able to hold her newborn baby in her arms. Or stories such as Monica’s. She had been married to her husband since she was a teenager. They both got covid, but went into different hospitals. She got the news from her husband that she had feared by text message: “Told just 24 to 48 hours to live.” Or stories such as Bishop Windsor’s, who buried so many people in his congregation that he did not know how that congregation would ever recover from their agony of loss. Now, after all that agony and pain, and after all the anxiety of the job losses, in Britain’s second city we are being handed a bill—a bill to make good on the underfunding of this Government.

Last May, we wrote a cross-party letter to the Minister to warn that the costs of covid in our city would total some £282 million. That included the £92 million extra for social care, to cover the costs of PPE that never arrived or to ensure that there was a safe social care system after the protective ring around care homes failed, and £95 million in lost income, as well as business rates going down and council tax support going up. It is true that the Secretary of State provided some grants to make good on that, but as of last year, we were still £100 million short because our council, led by Councillor Ian Ward, decided to step up and help protect the people of our city where there were shortcomings from the Government. Now, what was the result of that? A 4.99% increase in council tax—£72 a year for a band D home.

How on earth can it be right that council tax payers in places such as Surrey are being cushioned, when council tax payers in Birmingham and the west midlands are being punished? We took the Secretary of State at his word when he told us that he would ensure that there were the resources we needed to do the job. He has reneged on that. It is people—people who are going through hell on earth—who are now being asked to pick up a bill for Government underfunding. That is simply not right, and I, along with my colleagues, urge the Government to think again.

January 26, 2021
Steve Double – 2021 Speech on Council Tax Increases

The speech made by Steve Double, the Conservative MP for St. Austell and Newquay, in the House of Commons on 25 January 2021.

I was not informed that the time limit had been cut, but I will try to keep to three minutes.

As a former councillor and cabinet member of Cornwall Council, I know at first hand the important role that local authorities play in the lives of our constituents. There can be no doubt of the important role played by Cornwall Council, and councils up and down the country, in supporting local communities as we have faced this pandemic. In particular, I place on record my thanks to town and parish councils for the incredible work they have put in to support their local communities.

The Government have shown their recognition of the role that councils play with the support we have provided to local councils throughout this pandemic, amounting to billions of pounds. Cornwall Council alone has received more than £555 million to support the people of Cornwall. I am therefore pleased that this motion today gives us the opportunity to highlight the important work that councils do.

I am not surprised, however, that the Labour party’s motion misses a number of important points. First, it misses the Labour party’s own record on council tax. I remember when the Labour party was in government, when council tax doubled. Even now, Labour-run councils cost the taxpayer £84 a year more and Liberal Democrat-run councils a staggering £132 a year more than the average Conservative-run council. If we want to know what a Labour Government would do with council tax, we only have to look to Wales.

Secondly, the motion misses the point by saying that the Government should provide funding, but without saying where it should come from. It is all taxpayers’ money; whether raised centrally or locally, someone has to pay.

Are the Opposition suggesting that tax rises should be put in place to fund local authorities across the country? That would mean taxpayers in Cornwall paying so that Sadiq Khan can subsidise travel for Londoners. I do not believe that would be right. Or are they saying that we should take money away from other essential public services to fund the council tax from other Government budgets? If so, they need to say where the money would come from.

I am sure that the Liberal Democrats and independent councillors who run Cornwall Council would love to hide away their spending from local taxpayers, but the whole point of council tax is that councils are answerable to local taxpayers for the decisions that they make. In Cornwall, we have many examples of the Lib Dem-independent administration wasting money, such as funding an office in Brussels, even though we have now left the European Union—wanting to continue it at a cost of tens of thousands of pounds a year—or a £2 million failed IT system that hardly anyone has used.

I believe it is right that local council tax is raised by local councillors who have to answer to their electorate for the decisions that they make.

January 26, 2021
Gill Furniss – 2021 Speech on Council Tax Increases

The speech made by Gill Furniss, the Labour MP for Sheffield Brightside and Hillsborough, in the House of Commons on 25 January 2021.

As a former councillor, I am glad that we are able to hold this debate today. Before entering this place, I was a councillor for 17 years and saw at first hand the impact that austerity has had on our city and its families. I also saw the challenges we faced in trying to prioritise budgets in the face of wave after wave of cuts. Since 2010, many local authorities across the country have had to grapple with devastating cuts. My council in Sheffield has lost almost 50% of its budget, with cuts amounting to £475 million. Throughout this period, the Labour council has made difficult decisions and been forced to adapt many services, but it always sought to protect the most vulnerable in our city.

The Government’s proposals to allow councils to raise tax by up to 5% is absurd. It would not come close to addressing the funding crisis that many are experiencing. Next year’s costs for adult social care alone in Sheffield will be £31 million. A 3% increase would contribute only £6.6 million to that cost. The further 2% would contribute only £4.4 million. That does not come close enough to addressing the covid funding gap of £61 million that Sheffield City Council faces next year after the £92 million cost of responding to the pandemic.

This policy flies in the face of the Government’s levelling-up agenda by benefiting wealthier areas. While a 5% increase in Sheffield would raise £9 million, Surrey County Council would raise £38 million with the same increase. Councils across the country will, of course, be reluctant to raise council tax by 5%, but the Government have given them no choice. They have done what they do best: they have shifted any responsibility away from themselves. No council faced with significant funding gaps would refuse even the slightest boost to funding during these challenging times. It is shameful to hold councils to ransom in this way.

My constituency of Sheffield, Brightside and Hillsborough ranks as the 12th most deprived constituency in England. Over a third of children are eligible for free school meals. Very many of my constituents face tremendous hardships to make ends meet. Claims for universal credit have risen by 95% since March, with almost 14,000 families now receiving the payments—around half of these are in work. While the Government consider removing the uplift, they are also moving forward with this plan, which would add further strains to household budgets.

Families in Brightside and Hillsborough have particularly felt the cost of covid-19. Funding this increase will be more difficult for many families in our community than in more prosperous areas. I am deeply concerned that pushing forward with this plan would only further the hardships that many of them face. Hundreds of thousands of families across the country are feeling similar pressures. The Prime Minister said he would do “whatever it takes”. It appears that this meant abandoning councils and pushing the burden of support for their strained finances on to local taxpayers.

The Government are adept at performing U-turns, so I hope that they will do another and scrap this policy. The Chancellor must prioritise introducing a comprehensive funding settlement for local government to redress the budget imbalance that a decade of cuts and the covid-19 pandemic have caused.

January 26, 2021
Simon Clarke – 2021 Speech on Council Tax Increases

The speech made by Simon Clarke, the Conservative MP for Middlesbrough South and East Cleveland, in the House of Commons on 25 January 2021.

It was my great privilege to serve as the Local Government Minister for the first six months of our response to covid-19, and am I am grateful to have this opportunity to commend the whole sector for its response. I witnessed three things in my time at the Department that are particularly relevant to today’s debate. First, I witnessed the absolute sincerity of my right hon. Friend the Secretary of State, and all in the Department, in respect of the Government’s commitment to provide all the support that the sector needs throughout the pandemic.

As we heard my right hon. Friend say in his speech, the gap between what many leaders say and what the sector then self-reports to the Department is often profound. Throughout the spring, we faced real concerns about the number of councils that might need to issue section 114 notices to declare themselves effectively bankrupt; as we have seen, that has not transpired. It has not transpired for a reason: namely, the effective and highly tailored support schemes that have been put in place alongside direct grant support. We should not underestimate the complexity of the local government landscape and the need to respond to the different challenges that face different types of council in different parts of the country. That response has been accomplished, and councils have worked admirably and been able to get on with delivering their important work.

Secondly, I saw the exceptional knowledge and dedication of the local government finance team in the Department. The team’s staff live and breathe the work and the recommendations of Ministers reflect the hard work that they put in in direct conversation with council finance officers. We have struck a fair balance, apportioning the costs of our response to covid-19 between central and local government. Most reasonable people would accept that that is the only realistic route through the current situation.

Thirdly, we need to recognise that local authorities clearly have important responsibilities, too. Some authorities have been hit hard over the past year by factors that are legitimately outside their control. Some, such as Bath and North East Somerset Council, have been affected by factors relating to covid; others have been affected by issues such as cyber-attacks—I know that Ministers are working hard to resolve the situation at my local authority, Redcar and Cleveland, at pace. Such authorities must, and will, be supported.

However, other authorities have made seriously poor decisions for which they simply cannot attempt to blame central Government. The Secretary of State has already referred to the situation in Croydon and the reverse Robin Hood scenario that has played out in Nottingham. The sheer brass neck of the shadow Secretary of State in tabling today’s motion is genuinely astonishing, given that it is overwhelmingly Labour councils that have failed. I could go on: Bristol, Southampton and Brent, and the situation presided over by the Mayor of London, that master of evasion, which deserves to be punished by the electorate in May. It is of course the Labour group on the Local Government Association that is so keen to abolish the referendum lock, which is the only thing that in practice stands between ratepayers and exorbitant tax rises, so for the Opposition to initiate today’s debate is, I am afraid, pretty rich.

The Government have put in place an unprecedented package of support. What councils do beyond that is, rightly, a matter for them. This Government and Conservative-led councils will focus on getting the basics right: prudent financial management, driving down costs and waste, delivering high collection rates and supporting the truly vulnerable. I would note in this regard the extra £670 million next year that the Government have allocated to address the council tax hardship, which follows the £500 million for the same purpose this year. We have local democracy in place for a good reason. Councils control important aspects of our lives and should be accountable for that. Central and local government together have to meet the costs of responding to the pandemic, and for that reason, the quality of local decision making matters enormously.

January 26, 2021
Peter Dowd – 2021 Speech on Council Tax Increases

The speech made by Peter Dowd, the Labour MP for Bootle, in the House of Commons on 25 January 2021.

Listening to the Secretary of State, it seems that everything is fine in local government, and local authorities have all the money and resources they need. Well, the Local Government Association does not say that, the Institute for Fiscal Studies does not say that, council leaders do not say that and Tory MPs—the ones who have a spine, anyway—do not say it. The Secretary of State consulted local government given the dire circumstances, and local government gave a view about council tax; it is entitled to do that.

The year 2021 marks 40 years since I was elected as a Merseyside county councillor, and now we have the city regions. Those councils were abolished by Mrs Thatcher—mainly because they stood up to her—and the beginnings of the first stage of austerity began. It seems that nothing much changes in 40 years. I continue to see local government bear the brunt of cuts and policies of retrenchment in the light of the Government’s inability to see beyond the confines of Westminster and Whitehall. Not content with making a hash of virtually every policy decision and initiative in relation to covid—I use the words “policy” and “initiative” with a certain amount of caution—they continue to dump on local government.

When I was the leader of Sefton Council, I often referred to the overall balance experienced and witnessed among local councils across the country. As early as 2010, my council had in-year cuts to funding—for example, for neighbourhood renewal funds— and things simply got worse that after that stage. As time went by, my authority had cut after cut after cut. When I first came to the House in 2015, five years into austerity, I heard one Conservative Member express surprise at and bemoan the fact that his local police authority was supposed to find savings that year—it was as though he was some sort of Rip Van Winkle who had just woken up. The shadow Secretary of State, my hon. Friend the Member for Croydon North (Steve Reed), is a former council leader, like me, so has witnessed the impact of continued retrenchment in local council finance. That is the responsibility of the Government, not local government.

Meanwhile, as the unprecedented crisis in local government goes into even deeper and darker places and councils struggle to provide the most basic of services, the Secretary of State should be concentrating on the wellbeing of the living, not on the wellbeing of inanimate objects and issues such as the removal of statues in various areas. It is a diversionary tactic; I am sure the Secretary of State could have come up with something a tad more imaginative than that.

Allowing and expecting councils to increase council tax by 5% will mean very different things for households in different parts of the country. Although the percentage increase is uniform throughout the country, the starting point in absolute terms is very different. It is important to take that into account. If we follow the Chancellor’s assumption that councils increase tax by the maximum allowed, for band D householders in the Sefton Council area, the tax will go up in April by £99 for 2021, compared with £54 in Westminster and £55 in Wandsworth. Is that fair? No, it is not.

I have a number of questions for the Secretary of State. With the UK having experienced the worst recession of any major economy, does he really think that now is the time to raise council tax? Does he recognise that most councils will simply have no choice but to raise council tax to preserve crucial services such as adult social care and children’s social care? What assessment has he made of the impact on the economic recovery of taking £90 out of the pockets of families? Frankly, is it not about time that, instead of bowing down to the Chancellor, the Secretary of State stood up for local government and said, “Enough is enough”?

January 26, 2021
Steve Reed – 2021 Speech on Council Tax Increases

The speech made by Steve Reed, the Labour MP for Croydon North, in the House of Commons on 25 January 2021.

I beg to move,

That this House calls on the Prime Minister to drop the Government’s plans to force local councils to increase council tax in the middle of a pandemic by providing councils with funding to meet the Government’s promise to do whatever is necessary to support councils in the fight against covid-19.

Right at the heart of the local government funding settlement, there lurks a rather nasty little surprise. What the Chancellor and the Secretary of State for Housing, Communities and Local Government trumpeted as an increase in funding for councils was nothing of the sort. Instead of the promised “end to austerity”, we got a Conservative council tax bombshell.

The Government made a choice to clobber hard-pressed families with a 5% council tax rise, after the Government’s mistakes led our country into the worst recession of any major economy. There are two big problems with that: it is economically illiterate to push up taxes while the economy is in crisis; and it is dishonest to trumpet the end of austerity when most councils will still be forced to cut services even after they impose the Conservative tax hike, because the rising costs of social care outstrip any increase in revenue, and the Government have done nothing about that crisis.

Felicity Buchan (Kensington) (Con)

Will the hon. Gentleman please explain, if he does not think that councils should be increasing taxes, why the Mayor of London is proposing to increase his precept by 10%?

Steve Reed

It was actually the Secretary of State for Transport who told the Mayor of London that he had to increase council tax. [Interruption.] Oh yes, it was. The reason there is a funding gap in London is that Londoners have done the right thing and followed the Government advice to keep covid-safe by keeping off public transport as much as they can. Transport for London’s revenues have therefore collapsed, but the Government have refused to provide the financial support to cover that problem. I imagine the Government thought they were punishing the Mayor of London ahead of the London mayoral elections; what they have actually done is punish Londoners, and that is wrong.

The Government’s message to council tax payers is: “Pay more but get less under the Conservatives.” Last March, as the country went into lockdown, the Secretary of State made a commitment to fund councils to do what was necessary to get communities through the crisis. He was right to say that—I give him credit for doing so—but just two months later, he broke that promise.

The Conservative-led Local Government Association estimates that councils face a £2.5 billion funding gap as a result of the lost income and additional costs of supporting communities through these unprecedented circumstances over the past year. The Government’s planned council tax increase will raise just under £2 billion next year. If the Government had not broken their promise on funding, councils would already have that amount available to them. Of course, the Government threw away £10 billion on crony contracts for companies with links to senior Conservative politicians. Just a proportion of that money would have plugged councils’ funding gap entirely.

The Government’s failure over the past year has left Britain with the worst recession of any major economy and one of the highest death rates in the world. Now, with their inflation-busting tax hikes, the Government are making hard-working families pay the price for Conservative failure, and the timing really could not be worse. The Tory tax hike will land on people’s door mats in the same month that over 2 million people come off the furlough scheme. Many of those people are worried sick about their future job security. Millions more are worried about their income falling. This is no time to clobber them with a tax hike.

Gary Sambrook (Birmingham, Northfield) (Con)

The hon. Gentleman mentions recessions and bad timing for increasing council tax. When he was leader of Lambeth Council, he increased council tax in 2007 and 2008, during the economic recession. Why did he think it was okay to do so then?

Steve Reed

I am glad the hon. Gentleman raises that, because when I won control of Lambeth Council for the Labour party in 2006, we took over from an administration, jointly run by the Conservatives, that had raised council tax by 33% over four years, and yet service performance was on the floor. I froze council tax, with no increase at all for two years, and despite doing so, we raised the performance of standards that were left on the floor by Conservatives and achieved an outstanding rating in every single category of children’s services. We did that because Labour Members understand value for money, while Conservative Members simply do not.

The proof of that is in what the Government are trying to do with the council tax rise this year. Families who are worried about paying their heating bills or putting food on the table simply cannot afford it. It will put them under even greater financial strain and it will hit high streets that, right now, are struggling to survive. Many local businesses are on their last legs financially after years of restrictions. These tax rises threaten to choke off spending, just as we need the economy to start opening up and motoring after the pandemic.

With the Government now in full retreat on the devolution agenda, there is still one thing they are very interested in devolving, and that is the blame for cuts and council tax hikes made in Downing Street. The Secretary of State tried to justify the tax hike by claiming he is giving councils a choice—I am sure he will repeat that at the Dispatch Box today—but the truth is he is not. The Government’s funding plans, published in December, include the expectation—an assumption, not an option—that council tax will go up.

Councils’ biggest long-term financial headache is how to pay for social care. As more people, thankfully, live longer, councils need more funding to offer frail older people the care they need to make the most of their lives, but the Government have cut funding over the past decade, forcing councils to restrict care, so it is available only to those in the most severe categories of need. On his very first day in office, standing on the steps of No. 10 Downing Street, the Prime Minister told the country he had a plan to fix the social care crisis. No one has seen a dot or comma of that plan since, so councils have been forced to keep cutting, because the Prime Minister’s plan does not seem to exist—unless the Secretary of State can tell us differently when he speaks at the Dispatch Box.

Let us not forget that because a council tax increase raises less money in poorer areas, the Government are deepening the postcode lottery for social care, instead of ensuring that every single older and disabled person anywhere in our country gets the care they need, regardless of where they live. This Government are not levelling the country up; they are pulling the country apart.

James Cartlidge (South Suffolk) (Con)

If we do not raise this money in council tax, it still has to come from somewhere. How would the hon. Gentleman raise it?

Steve Reed

The Secretary of State has already given the hon. Gentleman the answer, and I am very pleased to repeat what the Secretary of State and the Chancellor said last March: they would fully compensate councils for the cost of getting the country through the crisis. A £2.5 billion funding gap is what they have left, according to James Jamieson, the Conservative leader of the Local Government Association. That is more than the amount that will be raised in council tax, and the hon. Gentleman can do the maths as well as I can. That would not be necessary if the Secretary of State kept his promises.

The costs of social care this year will rise faster than any additional income that is being made available to pay for it, so the only choice the Government are giving all our town halls is to put up council tax while families are still suffering the effects of the recession, or to cut social care during an unprecedented global health pandemic. That is no choice at all, and it is why the Government have got this so badly wrong.

Older people have suffered enough, thanks to this Government’s failures. Over a third of all covid deaths in the UK have been in care homes because the Government were too slow on distributing personal protective equipment, too slow on rolling out testing and too slow to act on hospital discharges that seeded the disease in those very care homes.

Councils need funding to pay for the care older people deserve, and not just during this pandemic. Hard-working families need support to cope with the hit that their incomes have suffered over the past year. Struggling high street businesses need the Government to encourage spending, not choke it off. Councils of all political colours will be forced to put up council tax this year, not because they want to, but because the Government have left them with no real choice. The costs of covid will have to be paid for, but not by raising taxes on people who cannot afford it at a time when their incomes are under so much strain and the pandemic is still raging.

Make no mistake: this is a Conservative tax hike made in Downing street and imposed on hard-working families after the Government’s mistakes left our country facing the deepest recession of any major economy. We will not secure our economy by choking off spending, we will not protect the NHS by denying older people the care they need and we will not rebuild our country by killing off our high streets. I urge the Government, even at this late stage, to think again and scrap their plans to force town halls to increase council tax at a time like this.

January 26, 2021