CANTERBURY MP Rosie Duffield has resigned from the Labour Party, criticising Labour leader Sir Keir Starmer – now labelled Free Gear Keir – for accepting thousands of pounds worth of personal items while at the same time removing Winter Fuel Payments from thousands of struggling pensioners.
Ms Duffield will now sit as an Independent MP.
Her scathingly critical letter is below:
The UK’s long experiment with a low-rights, low-wage economy is drawing to an end, and employers need to recognise now is not the time for foot-dragging (writes TUC’s TIM SHARP).
Rupert Soames, president of business lobby group the Confederation of British Industry (CBI), was this week driven to acknowledge that improved workers’ rights is “really good for people who are employed”.
This matters because bolstering workers’ rights is central to the Labour Party’s New Deal for working people.
This pledges sweeping but necessary changes including stamping out the exploitative use of zero hours contracts, ending the ability of employers to fire and rehire workers on lower wages, and scrapping the current wait for up to two years for basic workplace protections.
Such reform is desperately needed.
Rise in insecure work
TUC analysis of official figures shows that by the end of 2022 there were around 3.9 million people in insecure employment, a rise of 23 per cent since the coalition took office – almost double the rise of 12 per cent in overall employment growth.
As Soames, having recently spent eight years as chief executive of outsourcing giant Serco, will be well aware: insecure work disproportionately affects groups of workers who are already discriminated against in the workplace, such as Black and minority ethnic (BME) workers.
Over half of those living in poverty are in working households – and this rises to three quarters of children living in poverty.
Even the current government promised 20 times to introduce an employment bill. But the pledge remains unfilled.
Faltering economy
Meanwhile, the flawed idea that weak workers’ rights means a stronger economy and higher productivity has been tested to destruction.
As the Resolution Foundation has pointed out: “Labour productivity grew by just 0.4 per cent a year in the UK in the 12 years following the financial crisis, half the rate of the 25 richest OECD countries (0.9 per cent).”
Moreover, things are getting worse not better. Economic growth is flatlining with the country teetering on the brink of recession.
The relentless undermining of wages and incomes has repercussions on spending in the economy, with household consumption failing.
This is why Richard Walker, boss of grocery chain Iceland, switched support to Labour citing concern about the impact of the rising cost of living on their customers.
Higher pay and greater security are clearly in the interests of both workers and businesses, for they mean more spending and more revenues for business.
Watering down
Soames warned that “European model” of stronger worker rights, while benefiting those in work, is “really bad for people who are unemployed because companies are terrified to take them on”.
This suggests some in business are oblivious to the events of the past decade or so.
The Marmot review, for example, recognised that insecure and poor quality employment is associated with an increased risk of physical and mental health worsening. That in turn leads to absence due to illness, and worklessness.
No wonder businesses continue to complain of staff shortages.
Indeed his language is reminiscent of the apocalyptic and entirely inaccurate warnings that a national minimum wage would lead to two million more unemployed.
The incoming Labour government in 1997 was right to disregard claims from the Right that the minimum wage would cost millions of jobs. Now there is a wealth of evidence, over 25 years of the minimum wage, that it has protected the lowest paid with no employment effects at all.
It should take unevidenced claims about the New Deal in the same spirit.
Behind the times
While some in the business lobby are dragging their heels, previous advocates of unconstrained free markets now advocate reform.
The OECD’s 2018 Jobs Strategy finally put to bed its long standing celebration of flexibility and market fundamentalism.
“Countries with policies and institutions that promote job quality, job quantity and greater inclusiveness perform better than countries where the focus of policy is predominantly on enhancing (or preserving) market flexibility,” it said.
In the UK, the Institute for Fiscal Studies warned that: “Higher earnings inequality, with low real earnings growth, and a very different labour market from 40 years ago have placed the world of work in a much more unequal and divisive place. To halt or reverse this trend requires significant attention be devoted to ways to restore and reinvigorate real earnings growth and to generate decent jobs with good career opportunities in an inclusive way”.
Conclusions
A radical and effective programme is long overdue both for workers – whether currently in employment, looking for work or will be joining the jobs market in future – and for the wider economy.
As TUC general secretary Paul Nowak told the CBI conference last year: “Decent employers will recognise the promise of Labour’s economic reset and work with unions to boost productivity, skills and security at work.”
Now is not the time for foot-dragging. The economy needs a major reboot and the opponents of change need to get out of the way.
New analysis published by the TUC yesterday shows that non-disabled workers earn around a sixth (14.6%) more than disabled workers
The analysis reveals that the pay gap for disabled workers across the board is £1.90 an hour, or £66.50 per week – over what the average household spends on their weekly food shop (£62.20).
That makes for a pay difference of £3,460 a year for someone working a 35-hour week – and means that disabled people effectively work for free for the last 47 days of the year and stop getting paid today, on the day the TUC has branded Disability Pay Gap Day.
“Zero progress” on disability pay gap
The pay gap has fallen since last year, when the overall pay gap was £2.05 (17.2%) an hour.
The new analysis shows that the disability pay gap is now higher than it was a decade ago (13.2% in 2013/14) when the first comparable pay data was recorded.
And the gap is only slightly lower than when the TUC first launched Disability Pay Gap Day using 2016/17 data (when it was 15.0%).
Disability pay gap by gender and age
The new TUC analysis reveals that disabled women face the biggest pay gap. Non-disabled men are paid on average 30% (£3.73 an hour, £130.55 a week, or £6,780 a year) more than disabled women.
The research also shows that the disability pay gap persists for workers for most of their careers. At age 25 the pay gap is £1.73 an hour hitting a high of £3.18 an hour, or £111.30 a week, for disabled workers aged 40 to 44.
National, regional and industrial disability pay gaps
The analysis looked at pay data from across the country and found disability pay gaps in every region and nation of the UK.
The highest pay gaps are in Wales (21.6% or £2.53 an hour), followed by the South East (19.8% or £2.78 an hour) and the East of England (17.7% or £2.30 an hour).
The research found that disability pay gaps also vary by industry. The biggest pay gap is in financial and industrial services, where the pay gap stands at a huge 33.2% (£5.60 an hour).
Unemployment
Not only are disabled workers paid less than non-disabled workers, they are also more likely to be excluded from the job market.
Disabled workers are twice as likely as non-disabled workers to be unemployed (6.7% compared to 3.3%).
And the analysis shows disabled BME workers face a much tougher labour market – one in 10 (10.4%) BME disabled workers are unemployed compared to nearly one in 40 (2.6%) white non-disabled workers.
Zero-hours contracts
The analysis shows that disabled workers are more likely than non-disabled workers to be on zero-hours contracts (4.5% to 3.4%).
And disabled BME women are nearly three times as likely as non-disabled white men (6.0% to 2.2%) to be on these insecure contracts.
The TUC says zero-hours contracts hand the employer total control over workers’ hours and earning power, meaning workers never know how much they will earn each week, and their income is subject to the whims of managers.
The union body argues that this makes it hard for workers to plan their lives, look after their children and get to medical appointments.
And it makes it harder for workers to challenge unacceptable behaviour by bosses because of concerns about whether they will be penalised by not being allocated hours in future.
New Deal for Working People
The TUC is calling for government action to end the discrimination disabled workers’ face in the jobs market.
The union body says Labour’s New Deal for Working People would be a “game changer” for workers’ rights.
Labour has pledged to deliver new rights for working people in an employment bill in its first 100 days.
Labour’s new deal would:
TUC General Secretary Paul Nowak said: “We all deserve to be paid fairly for the work we do. But disabled people continue to be valued less in our jobs market.
“It’s shameful there has been zero progress on the disability pay gap in the last decade. Being disabled shouldn’t mean you are given a lower wage – or left out of the jobs market altogether.
“Too many disabled people are held back at work, not getting the reasonable adjustments they need to do their jobs. And we need to strengthen the benefits system for those who are unable to work or are out of work, so they are not left in poverty.
“It’s time for a step change. Labour’s New Deal for Working People would be an absolute game changer for disabled workers. It would introduce mandatory disability pay gap reporting to shine a light on inequality at work.
“Without this legislation, millions of disabled workers will be consigned to many more years of lower pay and in-work poverty.”
The North Sea Transition Authority has today granted development and production consent for the Rosebank field, north-west of Shetland.
The consent has been given by the oil and gas regulator to owners Equinor and Ithaca Energy, following the acceptance of the Environmental Statement.
An NSTA spokesperson said: “We have today approved the Rosebank Field Development Plan which allows the owners to proceed with their project.
“The FDP is awarded in accordance with our published guidance and taking net zero considerations into account throughout the project’s lifecycle.”
GREEN MP Caroline Lucas described the announcement as “the greatest act of environmental vandalism in my lifetime, causing emissions equal to 28 lowest income countries, busting #climate targets & doing nothing for energy security since vast majority is for export” #climatecriminals
Labour’s Environment spokesperson, Shadow Climate and Net Zero Secretary Ed Miliband said: “Here’s what it means. Rosebank: £3.75bn of taxpayer subsidy which could have been invested in renewables. 80% of oil exported, not a penny off bills, equivalent to half all UK emissions for a year.
“Colossal waste of taxpayer money and climate vandalism.” However Ed’s boss Sir Keir Starmer has already said that a future Labour government will NOT reverse the decision.
More responses from environmental organisations to follow
OUR Scottish Future is to stage a major rally next month to make the case for a plan that makes Britain work for Scotland.
Welsh First Minister Mark Drakeford and Andy Burnham, the Mayor of Greater Manchester are confirmed as speakers at the event to be held on June 1st in Edinburgh.
They will be joined by former Prime Minister Gordon Brown, Scottish Labour leader Anas Sarwar and comedian and actor Arabella Weir to set out the case for radical reform to political institutions across the UK.
Mr Brown said yesterday that the vision of a new UK can unite people in Scotland and across Britain who are looking for a better future.
Our Scottish Future was formed three years ago to make the case for Scottish devolution and for reform of the UK.
Last year, the Brown Commission published its report on the UK’s Future, proposing major reforms to Westminster, a replacement of the House of Lords, and further devolution across the UK.
The June 1st rally will aim to bring together supporters from across the UK to show the united demands for change both in Scotland and outside it.
Gordon Brown said: “There are many things we are divided about as a country, whether it’s over culture, the constitution, or on the economy. But we can all unite around a mission to change the UK and tackle the great challenges of the 21s century: poverty, inequality, climate change, and sustained economic growth.
“In our politics, people are looking for a hopeful message which shows how Scotland and the UK can work together.”
Mark Drakeford, First Minister of Wales and Leader of Welsh Labour, said: “The current union of the United Kingdom isn’t working for people in any part of this country we are proud to call home.
“We need a new, strengthened union, which guarantees that no one will find themselves unable to eat or relying on a food bank; facing old age or illness at the margins of society. A union which offers strong devolution for all parts of the UK; a union where all four nations are treated as equals.
“In Gordon’s report we have a blueprint for real and lasting change to transform our country for the better.”
The Mayor of Greater Manchester, Andy Burnham said: “Just like Scotland, Wales and Northern Ireland, the North of England has suffered from an over-concentration of political and economic power in the South East of the UK.
“This is changing with the devolution of power out of Westminster but in our experience it works best when it goes deep. Places in all parts of the UK should have the ability to build a better future from the bottom up and collaborate with neighbours.
“The creation of Mayoral Combined Authorities in England is enabling places like Greater Manchester to begin to chart our own destiny. But whilst devolution needs to spread throughout England, it’s also important that powers are devolved out of Holyrood and into local areas.
“Gordon has set out a route map for the empowerment of communities and the strengthening of the bonds between all the regions and nations of the United Kingdom.”
The event will take place at Central Hall in Edinburgh, at 730pm on June 1st.
Attendees must register their intention to come and can do so here:
Making Britain Work For Scotland, Thu 1 Jun 2023 at 19:30 | Eventbrite
The Chancellor today announced Barnett-based funding for the Scottish Government of £41 billion per year – delivering the largest annual funding settlement, in real terms, since devolution over 20 years ago. This includes a £4.6 billion per year spending boost – as part of a Budget and Spending Review that delivers a stronger economy for the whole of the UK.
Rishi Sunak set out a plan to deliver the priorities of the British people by investing in stronger public services, levelling up opportunity, driving business growth and helping working families with the cost of living.
As part of the significant spending plans, Scotland will receive an average of £41 billion per year in Barnett-based funding representing a 2.4% rise in the Scottish Government’s budget each year. The Scottish Government will now receive around £126 per person for every £100 per person of equivalent UK Government spending in England.
Chancellor of the Exchequer, Rishi Sunak said: “This is a budget for the whole of the UK. We’re focused on what matters most to the British people – the health of their loved ones, access to world-class public services, jobs for the future and tackling climate change.
“By providing record funding, the Scottish Government can tackle backlogs in the NHS and ensure people in Scotland get the support they need as we recover from the pandemic.
“The UK Government continues to level up opportunities across all parts of the UK, with investments in green jobs and high-speed internet access for thousands more homes in Scotland through Project Gigabit.
Scottish Secretary, Alister Jack said: “The Budget delivers for people in Scotland, and right across the UK.
“The Scottish Government’s block grant, boosted by an additional £4.6 billion a year due to spending in England, means that the funding for the Scottish Government is the highest it has ever been.
“It demonstrates our commitment to level up right across the UK. The Budget ushers in an era of real devolution, ensuring money is spent on projects that matter most to people in Scotland.
“The UK Government made a clear commitment to maintain Scotland’s level of funding following the vote to leave the EU, and we have delivered on that promise. We are taking decisions in the UK rather than in Brussels and dealing directly with local authorities who know their communities best.
“From the Knoydart community pub, to Dumbarton town centre and the Granton Gasworks – all these projects will bring real, visible improvements for local communities. Special funding for Glasgow’s iconic Burrell Collection and Extreme E will help drive economic growth and jobs on the back of culture and tourism.
“The continuation of the freeze on spirit duty will be a boost to Scotland’s thriving whisky industry.
“Over the past 18 months the UK Government has been focused on protecting people’s livelihoods, their incomes, and their jobs. We now need to look to the future, to build a stronger economy for people in all parts of the UK.”
Targeted funding in Scotland
On top of the record funding for the Scottish Government, Scotland will benefit from the UK Government’s commitment to invest in people, jobs, communities and businesses. Targeted projects in Scotland include:
Over £200 million to be invested in Scotland to boost the post-pandemic recovery and enhance the Scottish economy, including:
UK-Wide Support
As a result of our strong United Kingdom, Scotland will benefit from:
Rachel Reeves MP, Labour’s Shadow Chancellor, responding to the Budget, said: Families struggling with the cost of living crisis, businesses hit by a supply chain crisis, those who rely on our schools and our hospitals and our police – they won’t recognise the world that the Chancellor is describing. They will think that he is living in a parallel universe.
The Chancellor in this budget, has decided to cut taxes for banks. So, Madame Deputy Speaker, at least the bankers on short haul flights sipping champagne will be cheering this budget today.
And the arrogance, after taking £6 billion out of the pockets of some of the poorest people in this country, expecting them to cheer today for £2 billion given to compensate.
In the long story of this Parliament, never has a Chancellor asked the British people to pay so much for so little.
Time and again today, the Chancellor compared the investments that he is making to the last decade. But who was in charge in this lost decade? They were.
So, let’s just reflect on the choices the Chancellor has made today – the highest sustained tax burden in peacetime.
And who is going to pay for it?
It’s not international giants like Amazon – the Chancellor has found a tax deduction for them. It’s not property speculators – they’ve already pocketed a stamp duty cut. And it’s clearly not the banks – even though bankers’ bonuses are set to hit a record high this year.
Instead, the Chancellor is loading the burden on working people. A National Insurance Tax rise – on working people. A Council Tax hike – on working people. And no support today for working people with VAT on their gas and electricity bills.
And what are working people getting in return? A record NHS waiting list, with no plan to clear it, no way to see a GP and still having to sell their home to pay for social care.
Community policing nowhere to be seen, a court backlog leaving victims without justice and almost every rape going unprosecuted.
A growing gap in results and opportunities between children at private and state schools. Soaring number of pupils in supersize classes and no serious plan to catch up on learning stolen by the virus. £2 million announced today – a pale imitation of the £15 billion catch up fund that the Prime Minister’s own education tsar said was needed. No wonder, Madame Deputy Speaker, that he resigned.
Now the Chancellor talks about world class public services. Tell that to a pensioner waiting for a hip operation. Tell that to a young woman waiting to go to court to get justice. Tell that to a mum and dad, waiting for their child the mental health support they need.
And the Chancellor says today that he has realised what a difference early years spending makes. I would just say to the Chancellor, has he ever heard of the Sure Start programme that this Tory government has cut?
And why are we in this position? Why are British businesses being stifled by debt while Amazon gets tax deductions?
Why are working people being asked to pay more tax and put up with worse services?
Why are billions of pounds in taxpayer money being funnelled to friends and donors of the Conservative party while millions of families are having £20 a week taken off them?
Madame Deputy Speaker, why can’t Britain do better than this?
The Government will always blame others. It’s business’ fault, it’s the EU’s fault, it’s the public’s fault.
The global problems, the same old excuses. But the blunt reality is this – working people are being asked to pay more for less for three simple reasons:
Each of these problems is down to 11 years of Conservative failure and they shake their heads but the cuts to our public services have cut them to the bone. And while the Chancellor and the Prime Minister like to pretend they are different, the Budget they’ve delivered today will only make things worse.
The solution starts with growth. The Government is caught in a bind of its own making. Low growth inexorably leads to less money for public services, unless taxes rise.
Under the Conservatives, Britain has become a low growth economy. Let’s look at the last decade – the Tories have grown the economy at just 1.8 percent a year.
If we had grown at the same rate as other advanced economies, we could have spent over £30bn to invest in public services without needing to raise taxes.
Let’s compare this to the last Labour Government. Even taking into account the global financial crisis, Labour grew the economy much faster – 2.3 percent a year.
If the Tories matched our record, we would have spent £30bn more on public services without needing to raise taxes.
It could not be clearer. The Conservatives are now the party of high taxation, because the Conservatives are the party of low growth.
The Office for Budget Responsibility confirmed this today – that we will be back to anaemic growth. The OBR said that by the end of this Parliament, the UK economy will be growing by just 1.3%. Which is hardly the plan for growth that the Chancellor boasted about today, hardly a ringing endorsement of his announcements.
Under the Tory decade we have had ow growth and there’s not much growth to look forward to.
The economy has been weakened by the pandemic but also by the Government’s mishandling of it.
Responding to the virus has been a huge challenge. Governments around the world have taken on debt, but our situation is worse than other countries.
Worse, because our economy was already fragile going into the crisis. Too much inequality, too much insecure work, too little resilience in our public services.
And worse, because the Prime Minister dithered and delayed, against scientific advice – egged on by the Chancellor – we ended up facing harsher and longer restrictions than other countries.
So, as well as having the highest death toll in Europe, Britain suffered the worst economic hit of any major economy.
The Chancellor now boasts that we are growing faster than others, but that’s because we fell the furthest.
And whilst the US and others have already bounced back to pre-pandemic levels, the UK hasn’t. Our economy is set to be permanently weaker.
On top of all of that, the Government is now lurching from crisis to crisis. People avoiding journeys because they can’t fill up their petrol tank is not good for the economy. People spending less because the cost of the weekly shop has exploded is not good for the economy. And British exporters facing more barriers than their European competitors because of the deal that this government did is not good for the economy.
If this were a plan, it would be economic sabotage. When the Prime Minister isn’t blagging that this chaos is part of his cunning plan, he says he’s “not worried about inflation.”
Tell that to families struggling with rising gas and electricity bills, with rising prices of petrol at the pump and with rising food prices. He’s out of touch, he’s out of ideas and he’s left working people out of pocket.
Madame Deputy Speaker, Conservative mismanagement has made the fiscal situation tight. And when times are tight it’s even more important to ensure that taxes are fair, that taxpayers get value for money. But the Government fails on both fronts.
We have a grossly unfair tax system with the burden heaped on working people.
Successive budgets have raised council tax, income tax and now National Insurance. But taxes on those with the broadest shoulders, those who earn their income from stocks, shares, and property portfolios have been left largely untouched.
Businesses based on the high street are the lifeblood of our communities and often the first venture for entrepreneurs.
But despite what the Chancellor has said today, businesses will still be held back by punitive and unfair business rates. The Government has failed to tax online giants and watered-down global efforts to create a level playing field.
And just when we need every penny of public money to make a difference, we have a government that is the by-word for waste, cronyism and vanity projects.
We’ve had £37 billion for a test and trace system that the spending watchdog says, ‘treats taxpayers like an ATM cash machine’. A yacht for ministers, a fancy paint job for the Prime Minister’s plane and a TV studio for Conservative Party broadcasts, which seems to have morphed into the world’s most expensive home cinema.
£3.5bn of Government contracts awarded to friends and donors of the Conservative Party, a £190 million loan to a company employing the PMs former Chief of Staff, £30 million to the former Health Secretary’s pub landlord. And every single one of those cheques signed by the Chancellor.
And now he comes to ordinary working people and asks them to pay more. More than they have ever been asked to pay before and at the same time, to put up with worse public services. All because of his economic mismanagement, his unfair tax system and his wasteful spending.
There are of course some welcome measures in this budget today, as there are in any budget.
Labour welcomes the increase in the National Minimum Wage, though the Government needs to go further and faster. If they had backed Labour’s position of an immediate rise to at least £10 an hour then a full-time worker on the minimum wage would be in line for an extra £1,000 a year.
Ending the punitive public sector pay freeze is welcome, but we know how much this Chancellor likes his smoke and mirrors. So, we’ll be checking the books to make sure the money is there for a real terms pay rise.
Labour also welcomes the Government’s decision to reduce the Universal Credit taper rate, as we have consistently called for. But the system has got so far out of whack that even after this reduction, working people on universal credit still face a higher marginal tax rate than the Prime Minister. And those unable to work – through no fault of their own – still face losing over £1000 a year. And for families who go out to work everyday but don’t get government benefits, on an average wage, who have to fill up their car with petrol to get to work, who do that weekly shop and who see their gas and electricity prices go up – this budget today does absolutely nothing for them.
We have a cost-of-living crisis.
The Government has no coherent plan to help families to cope with rising energy prices. Whilst we welcome the action taken today on Universal Credit, millions will struggle to pay the bills this winter.
The Government has done nothing to help people with their gas and electricity bills with that cut in VAT receipts as Labour has called for. A cut that is possible because we are outside the European Union and can be funded by the extra VAT receipts that have been experienced in the last few months.
Working people are left out in the cold while the Government hammers them with tax rises.
National Insurance is a regressive tax on working people, it is a tax on jobs.
Under the Chancellor’s plans, a landlord renting out dozens of properties won’t pay a penny more. But their tenants, in work, will face tax rises of hundreds of pounds a year. And he is failing to tackle another huge issue of the day. Adapting to climate change.
Adapting to climate change presents opportunities – more Jobs, lower bills and cleaner air. But only if we act now and at scale. According to the OBR, failure to act will mean public sector debt explodes later, to nearly 300% of GDP.
The only way to be a prudent and responsible Chancellor is to be a Green Chancellor. To invest in the transition to a zero-carbon economy and give British businesses a head-start in the industries of the future.
But with no mention of climate in his conference speech and the most passing of references today, we are burdened with a Chancellor unwilling to meet the challenges we face.
Homeowners are left to face the costs of insulation on their own, industries like steel and hydrogen are in a global race without the support they need and the Chancellor is promoting domestic flights over high speed rail int he week before COP26.
It is because of this Chancellor that in the very week we try and persuade other countries to reduce emissions, this Government can’t even confirm it will meet its 2035 climate reduction target.
Madame Deputy Speaker, everywhere working people look at the moment they see prices going up and shortages on the shelves. But this Budget did nothing to address their fears.
Household budgets are being stretched thinner than ever but this Budget did nothing to deal with the spiralling cost of living. It is a shocking missed opportunity by a government that is completely out of touch.
There is an alternative. Labour would scrap the business rates and replace it with something much better by ensuring online giants pay their fair share. That’s what being pro-business looks like.
We wouldn’t put up National Insurance for working people, we would ensure those with the broadest shoulders pay their share. That’s what being on the side of working people looks like.
We’d end the £1.7 billion subsidy the Government gives private schools and put it straight into local state schools. That’s what being on the side of working families looks like.
We’d deliver a climate investment pledge – £28bn every year for the rest of the decade. That’s Giga-factories to build batteries for electric vehicles, a thriving hydrogen industry and retrofitting, so we keep homes warm and get energy bills down. That’s what real action on climate change looks like.
This country deserves better but they’ll never get it under this Chancellor who gives with one hand but takes so much more with the other.
The truth is this – what you get with these two is a classic con game. It’s like one of those pickpocketing operations you see in crowded places. The Prime Minister is the front man – distracting people with his wild promises. All the while, his Chancellor dips his hand in their pocket. It all seems like fun and games until you walk away and realise your purse has been lifted.
But people are getting wise to them. Every month they feel the pinch. They are tired of the smoke and mirrors, of the bluster, of the false dawns, of the promises of jam tomorrow.
Labour would put working people first. We’d use the power of government and the skill of business to ensure that the next generation of quality jobs are created right here, in Britain.
We’d tax fairly, spend wisely and after a decade of faltering growth, we’d get Britain’s economy firing on all cylinders.
That is what a Labour budget would have done today.
Edinburgh Pentlands SNP MSP Gordon MacDonald said that the Tory UK Government’s budget makes it clear that “independence is the only way to give Edinburgh a fair recovery from the pandemic.”
Gordon MacDonald said that the budget, described by the head of the Institute for Fiscal Studies as “actually awful” for living standards, is failing the people of Scotland by failing to tackle the cost of living crisis, the Brexit crisis and the climate crisis whilst the Tory Government prioritise cuts to the cost of champagne and giving tax breaks to bankers.
The Edinburgh Pentlands MSP said: “What the Tory UK Government has outlined today does not meet the ambition needed to build a fair and sustainable recovery and to tackle the cost of living crisis.
“It’s painfully clear that there will be no fair recovery from the pandemic under Westminster control.
“This Tory budget fails Scotland as a whole and doesn’t go anywhere near supporting people in Edinburgh, who are being hit by an energy crisis, a Brexit crisis, labour shortages and an inflation crisis under Westminster control.
“The UK Government budget is leaving families in Edinburgh hundreds of pounds worse off next year due to Tory cuts, tax hikes and the soaring cost of Brexit.
“It’s little wonder that, in May’s election, the people of Scotland voted overwhelmingly for a different future when they gave the SNP the highest share of the vote since the dawn of devolution and a clear mandate for an independence referendum – Independence is the only way to keep Scotland safe from Tory cuts.”
Commenting on today’s budget and spending review (Wednesday), TUC General Secretary Frances O’Grady said: “The chancellor has gone from pay freeze to pay squeeze.
“The chancellor admitted that we will have zero pay growth across the economy next year. And he has no plan to get real wages rising for everyone after an eleven year pay squeeze, with average real pay growth over the next four years predicted to be just 0.3 per cent.
“He should have announced fair pay deals for whole industries, negotiated with unions, designed to get pay and productivity rising in every sector.
“Families face a triple whammy of a £1,000 universal credit cut, tax hikes and fast-rising energy and food bills. All the while wages across the economy stand still.”
On the universal credit taper cut, she added:
“Workers on universal credit should always have been able to keep more of their wages. This change does not make up for the £1,000 per year cut to universal credit, and does not help those on universal credit who cannot work.”
Centre for Cities’ Chief Executive Andrew Carter said: “Raising the National Living Wage is a quick win for the levelling up agenda and will have the biggest impact in the places that are crucial to the Prime Minister winning the next election. Four of the five places where the most people will benefit are in the North.
“While a pay increase is good news for people struggling with the cost of living crisis, it does not address the reasons why they live on low pay in the first place: a lack of well-paid jobs in their local area.
“We’ve seen today the beginnings of a plan focused on skills, innovation and infrastructure to address this, but turning it from rhetoric to reality will depend on ministers’ willingness to work with metro mayors and councils on delivering it.
“I am now looking to the delayed Levelling Up White Paper to set out how this will happen.”
Katie Schmuecker, Deputy Director of Policy & Partnerships at JRF said: “This is a tale of two Budgets for families on low incomes.
“For those in work, the change to the taper rate and work allowance, alongside the National Living Wage increase, are very positive steps, allowing low-paid workers to keep more of what they earn. Together these measures improve our social security system for working families and demonstrate a serious intent to turn the tide on the pre-pandemic trend of rising in-work poverty.
“But the reality is that millions of people who are unable to work or looking for work will not benefit from these changes. The Chancellor’s decision to ignore them today as the cost of living rises risks deepening poverty among this group, who now have the lowest main rate of out-of-work support in real terms since around 1990.
“Among the people in our society who cannot work are cancer patients, people with disabilities and those caring for young children or elderly parents.
“Their energy bills and weekly shop are going up like everyone else’s and they face immediate hardship, hunger and debt in the months ahead. The Chancellor had an opportunity to support families on the lowest incomes to weather the storm ahead, and he did not take it.”
New analysis by the independent Joseph Rowntree Foundation reveals that the rising cost of living wipes out much of the financial gain some families will receive from the Universal Credit changes announced today.
| Weekly incomes and Costs for 2022/23 | Family 1: single adult, no children, not working | Family 2: single parent, with one young child (assume age 5), part-time 16 hours per week | Family 3: couple with two young children (assume 7 and 5). One FT worker | Family 4: single parent, with one young child (assume age 5), full-time 35 hours per week | Family 5: Couple with two young children (assume 7 and 5). 1 FT worker (35 hours), 1 PT worker (16 hours) |
| Weekly income before new announcements | £77 | £278 | £433 | £333 | £489 |
| Weekly gain from taper rate and work allowance | £0 | £8 | £19 | £19 | £31 |
| Total loss from higher cost of living due to… | -£13 | -£16 | -£23 | -£18 | -£24 |
| 1) increase in energy prices | -£7 | -£7 | -£7 | -£7 | -£7 |
| 2) overall cost of living increase | -£6 | -£8 | -£13 | -£8 | -£13 |
| 3) increase in National Insurance and impact of inflation on earnings | £0 | -£1 | -£3 | -£3 | -£4 |
| Overall weekly gain or loss after measures and cost of living | -£13 | -£8 | -£4 | £1 | £7 |
Note all five families lost £20-a-week in October 2021, due to the cut in the Universal Credit Standard Allowance, so all are worse-off than they would have been in September 2021. All workers are assumed to be paid at the National Living Wage rate, so benefit from its increase.
Peter Kelly,Director of the Poverty Alliance, said: “It is a shameful, unjust decision that makes the Chancellor’s rhetoric about ‘levelling up’ seem as empty as the pockets of the hundreds of thousands of people swept into poverty as a result.”
Madam Deputy Speaker, A year ago, in my first Budget, I announced our initial response to coronavirus.
What was originally thought to be a temporary disruption to our way of life has fundamentally altered it.
People are still being told to stay in their homes; businesses have been ordered to close; thousands of people are in hospital.
Much has changed.
But one thing has stayed the same. I said I would do whatever it takes; I have done; and I will do so.
We have announced over £280 billion of support, protecting jobs, keeping businesses afloat, helping families get by.
Despite this unprecedented response, the damage coronavirus has done to our economy has been acute. Since March, over 700,000 people have lost their jobs.
Our economy has shrunk by 10% – the largest fall in over 300 years.
Our borrowing is the highest it has been outside of wartime.
It’s going to take this country – and the whole world – a long time to recover from this extraordinary economic situation.
But we will recover.
This Budget meets the moment with a three-part plan to protect the jobs and livelihoods of the British people.
First, we will continue doing whatever it takes to support the British people and businesses through this moment of crisis.
Second, once we are on the way to recovery, we will need to begin fixing the public finances – and I want to be honest today about our plans to do that.
And, third, in today’s Budget we begin the work of building our future economy.
Madam Deputy Speaker, Today’s forecasts show that our response to coronavirus is working.
The Prime Minister last week set out our cautious but irreversible roadmap to ease restrictions whilst protecting the British people.
The NHS, deserving of immense praise, has had extraordinary success in vaccinating more than 20 million people across the United Kingdom.
And combined with our economic response, one of the most comprehensive and generous in the world, this means the Office for Budget Responsibility are now forecasting, in their words:
“A swifter and more sustained recovery” than they expected in November.
The OBR now expect the economy to return to its pre-covid level by the middle of next year – six months earlier than previously thought.
That means growth is faster, unemployment lower, wages higher, investment higher, household incomes higher.
But while our prospects are now stronger, coronavirus has done and is still doing profound damage.
And today’s forecasts make clear repairing the long-term damage will take time.
The OBR still expect that in five years’ time, because of coronavirus, our economy will be 3% smaller than it would have been.
Before I share the detail of the OBR’s forecasts, let me thank Richard Hughes and his team for their work.
The OBR forecast that our economy will grow this year by 4%, by 7.3% in 2022, then 1.7%, 1.6% and 1.7% in the last three years of the forecast.
And the OBR have said that our interventions to support jobs have worked.
In July last year, they expected unemployment to peak at 11.9%. Today, because of our interventions, they forecast a much lower peak: 6.5%.
That means 1.8 million fewer people are expected to be out of work than previously thought.
But every job lost is a tragedy, which is why protecting, creating and supporting jobs remains my highest priority.
So, Madam Deputy Speaker, Let me turn straight away to the first part of this Budget’s plan: to protect the jobs and livelihoods of the British people through the remaining phase of this crisis.
First, the furlough scheme will be extended until the end of September.
For employees, there will be no change to the terms – they will continue to receive 80% of their salary, for hours not worked, until the scheme ends.
As businesses reopen, we’ll ask them to contribute alongside the taxpayer to the cost of paying their employees.
Nothing will change until July, when we will ask for a small contribution of just 10% and 20% in August and September.
The Government is proud of the furlough – one of the most generous schemes in the world, effectively protecting millions of people’s jobs and incomes.
Second, support for the self-employed will also continue until September with a fourth grant covering the period February to April, and a fifth and final grant from May onwards.
The fourth grant will provide three months of support at 80% of average trading profits.
For the fifth grant, people will continue to receive grants worth three months of average profits, with the system open for claims from late July.
But as the economy reopens over the summer, it is fair to target our support towards those most affected by the pandemic.
So people whose turnover has fallen by 30% or more will continue to receive the full 80% grant.
People whose turnover has fallen by less than 30% will therefore have less need of taxpayer support and will receive a 30% grant.
And I can also announce a major improvement in access to the self-employed scheme.
When the scheme was launched, the newly self-employed couldn’t qualify because they hadn’t all filed the 2019-20 tax return.
But as the tax return deadline has now passed, I can announce today that, provided they filed a tax return by midnight last night, over 600,000 more people, many of whom became self-employed last year can now claim the fourth and fifth grants.
Over the course of this crisis, we will have spent £33 billion supporting the self-employed; one of the most generous programmes for self-employed people anywhere in the world.
Third, we’re also extending our support for the lowest paid and most vulnerable.
To support low-income households, the Universal Credit uplift of £20 a week will continue for a further six months, well beyond the end of this national lockdown.
We’ll provide Working Tax Credit claimants with equivalent support for the next six months.
And Because of the way that system works operationally, we will need to do so with a one-off payment of £500.
And over the course of this year, as the economy begins to recover, we are shifting our resources and focus towards getting people into decent, well-paid jobs.
We reaffirm our commitment to end low pay, increasing the National Living Wage to £8.91 from April – an annual pay rise of almost £350 for someone working full time on the National Living Wage.
And My Right Honourable Friends the Education Secretary and the Work and Pensions Secretary, are taking action to give people the skills they need to get jobs or get better jobs:
The Restart programme – supporting over a million long term unemployed people.
The number of work coaches – doubled.
The Kickstart scheme – funding high quality jobs for over a quarter of a million young people.
The Prime Minister’s Lifetime Skills Guarantee – giving every adult the opportunity for a fully-funded Level 3 qualification.
And we want businesses to hire new apprentices so we’re paying them more to do it.
Today, I am doubling the incentive payments we give businesses to £3,000 – that’s for all new apprentice hires, of any age.
Alongside investing £126 million of new money to triple the number of traineeships we’re taking what works to get people into jobs and making it better.
Madam Deputy Speaker, One of the hidden tragedies of lockdown has been the increase in domestic abuse.
So I’m announcing today an extra £19 million – on top of the £125 million we announced at the Spending Review – for domestic violence programmes to reduce the risk of reoffending, and to pilot a network of ‘Respite Rooms’ to provide specialist support for vulnerable homeless women.
To recognise the sacrifices made by so many women and men in the Armed Forces community, I’m providing an additional £10 million to support veterans with mental health needs.
And, on current plans, the funding to support survivors of the Thalidomide scandal runs out in 2023.
They deserve better than to have constant uncertainty about the future costs of their care.
So not only will I extend this funding with an initial down payment of around £40 million; I am today announcing a lifetime commitment, guaranteeing funding forever.
And let me thank the Thalidomide Trust and the Honourable Member for North Dorset for their leadership on this important issue.
As well as supporting people’s jobs, incomes, the lowest paid and most vulnerable, this Budget also protects businesses.
We’ve been providing businesses with direct cash grants through the recent restrictions. These grants come to an end in March.
I can announce today that we will provide a new Restart Grant in April, to help businesses reopen and get going again.
Non-essential retail businesses will open first, so they’ll receive grants of up to £6,000 per premises.
Hospitality and leisure businesses, including personal care and gyms, will open later, or be more impacted by restrictions when they do, so we’ll give them grants of up to £18,000.
That’s £5 billion of new grants; on top of the £20 billion we’ve already provided; taking our direct total cash support to business to £25 billion.
And I pay tribute to My Right Honourable Friend the Member for Romsey and Southampton North for highlighting the particular needs of the personal care sector.
And, with My Right Honourable Friend the Culture Secretary, we’re making available £700 million to support our incredible arts, culture and sporting institutions as they reopen;
Backing the United Kingdom and Ireland’s joint 2030 World Cup bid, launching a new approach to apprenticeships in the creative industries, and extending our £500 million film and TV production restart scheme.
Even with the new Restart Grants, some businesses will also need loans to see them through.
As the Bounce Back Loan and CBIL programmes come to an end, we’re introducing a new Recovery Loan Scheme to take their place.
Businesses of any size can apply for loans from £25,000 up to £10 million, through to the end of this year. And the government will provide a guarantee to lenders of 80%.
Last year, we provided an unprecedented 100% business rates holiday, in England, for all eligible businesses in the retail, hospitality and leisure sectors – a tax cut worth £10 billion.
This year, we’ll continue with the 100% business rates holiday for the first three months of the year, in other words, through to the end of June.
For the remaining nine months of the year, business rates will still be discounted by two thirds, up to a value of £2 million for closed businesses, with a lower cap for those who have been able to stay open.
A £6 billion tax cut for business.
One of the hardest hit sectors has been hospitality and tourism: 150,000 businesses that employ over 2.4 million people need our support.
To protect those jobs, I can confirm that the 5% reduced rate of VAT will be extended for six months to 30th September.
And even then, we won’t go straight back to the 20% rate.
We’ll have an interim rate of 12.5% for another six months; not returning to the standard rate until April of next year.
In total, we’re cutting VAT next year by almost £5 billion.
Madam Deputy Speaker, The housing sector supports over half a million jobs.
The cut in stamp duty I announced last summer has helped hundreds of thousands of people buy a home and supported the economy at a critical time.
But due to the sheer volume of transactions we’re seeing, many new purchases won’t complete in time for the end of March.
So I can announce today the £500,000 nil rate band will not end on the 31st of March, it will end on the 30th of June.
Then, to smooth the transition back to normal, the nil rate band will be £250,000, double its standard level, until the end of September – and we will only return to the usual level of £125,000 from October 1st.
Even with the stamp duty cut, there is still a significant barrier to people getting on the housing ladder – the cost of a deposit.
So I’m announcing today a new policy to stand behind homebuyers: a mortgage guarantee.
Lenders who provide mortgages to home buyers who can only afford a five percent deposit, will benefit from a government guarantee on those mortgages.
And I’m pleased to say that several of the country’s largest lenders including Lloyds, NatWest, Santander, Barclays and HSBC will be offering these 95% mortgages from next month, and I know more, including Virgin Money will follow shortly after.
A policy that gives people who can’t afford a big deposit the chance to buy their own home.
As the Prime Minister has said, we want to turn Generation Rent into Generation Buy.
So, Madam Deputy Speaker:
The furlough – extended to September.
Self-employed grants – extended to September.
Universal Credit uplift – extended to September.
More money to tackle domestic violence.
Bigger incentives to hire apprentices.
Higher grants to struggling businesses.
Extra funds for culture, arts and sport.
New loan schemes to finance businesses.
Kickstart, Restart, a Lifetime Skills Guarantee.
Business rates – cut.
VAT – cut.
Stamp duty – cut.
And a new mortgage guarantee.
The first part of a Budget that protects the jobs and livelihoods of the British people.
And, Madam Deputy Speaker, As you can see, we’re going long, extending our support well beyond the end of the Roadmap…
… to accommodate even the most cautious view about the time it might take to exit the restrictions.
Let me summarise for the House the scale of our total fiscal response to coronavirus.
At this Budget we are announcing an additional £65 billion of measures over this year and next to support the economy in response to coronavirus.
Taking into account the significant support announced at the Spending Review 20, this means our total COVID support package, this year and next, is £352 billion.
Once you include the measures announced at Spring Budget last year, including the step change in capital investment, total fiscal support from this Government over this year and next amounts to £407 billion.
Coronavirus has caused one of the largest, most comprehensive and sustained economic shocks this country has ever faced.
And, by any objective analysis, this Government has delivered one of the largest, most comprehensive and sustained responses this country has ever seen.
So, Madam Deputy Speaker, We’re using the full measure of our fiscal firepower to protect the jobs and livelihoods of the British people.
But the damage done by coronavirus, combined with a level of support unimaginable only twelve months ago, has created huge challenges for our public finances.
The OBR’s fiscal forecasts show that this year, we have borrowed a record amount: £355 billion.
That’s 17% of our national income, the highest level of borrowing since World War Two.
Next year, as we continue our unprecedented response to this crisis, borrowing is forecast to be £234 billion, 10.3% of GDP – an amount so large it has only one rival in recent history; this year.
Without corrective action, borrowing would continue at very high levels, leaving underlying debt rising indefinitely.
Instead, because of the steps I am taking today, borrowing falls to 4.5% of GDP in 22-23, 3.5% in 23-24, then 2.9% and 2.8% in the following two years.
And while underlying debt rises from 88.8% of GDP this year to 93.8% next year, it then peaks at 97.1% in 2023-24, before stabilising and falling slightly to 97% and 96.8% in the final two years of the forecast.
Let me explain why this matters.
The amount we’ve borrowed is comparable only with the amount we borrowed during the two world wars.
It is going to be the work of many governments, over many decades, to pay it back.
Just as it would be irresponsible to withdraw support too soon, it would also be irresponsible to allow our future borrowing and debt to rise unchecked.
When crises come, we need to be able to act.
And we need the fiscal freedom to act.
A freedom that you only have if you start with public finances in a good and strong place.
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When the next crisis comes, we need to be able to act again.
And while our borrowing costs are affordable right now, interest rates and inflation may not stay low for ever; and just a 1% increase in both would cost us over £25 billion.
And as we have seen in the markets over the last few weeks, sovereign bond yields can rise sharply.
This Budget is not the time to set detailed fiscal rules, with precise targets and dates to achieve them by – I don’t believe that would be sensible.
But I do want to be honest about what I mean by sustainable public finances, and how I plan to achieve them. Our fiscal decisions are guided by three principles.
First, while it is right to help people and businesses through an acute crisis like this one, in normal times the state should not be borrowing to pay for everyday public spending.
Second, over the medium term, we cannot allow our debt to keep rising, and, given how high our debt now is, we need to pay close attention to its affordability.
And third, it is sensible to take advantage of lower interest rates to invest in capital projects that can drive our future growth.
So the question is how we achieve that; how we balance the extraordinary support we are providing to the economy right now, with the need to begin the work of fixing our public finances.
I have and always will be honest with the country about the challenges we face.
So I’m announcing today two measures to begin that work.
Let me take each in turn.
Madam Deputy Speaker,
Our response to coronavirus has been fair, with the poorest households benefiting the most from our interventions.
And our approach to fixing the public finances will be fair too, asking more of those people and businesses who can afford to contribute and protecting those who cannot.
So this government is not going to raise the rates of income tax, national insurance, or VAT.
Instead, our first step is to freeze personal tax thresholds.
We’ve nearly doubled the income tax personal allowance over the last decade, making it the most generous of any G20 country.
We will of course deliver our promise to increase it again next year to £12,570, but we will then keep it at this more generous level until April 2026.
The Higher Rate threshold will similarly be increased next year, to £50,270, and will then also remain at that level for the same period.
Nobody’s take home pay will be less than it is now, as a result of this policy.
But I want to be clear with all Members that this policy does remove the incremental benefit created had thresholds continued to increase with inflation.
We are not hiding it, I am here, explaining it to the House and it is in the Budget document in black and white. It is a tax policy that is progressive and fair.
And, I will also maintain, at their current levels, until April 2026:
The inheritance tax thresholds.
The pensions lifetime allowance.
The annual exempt amount in capital gains tax.
And, for two years from April 2022, the VAT registration threshold which, at £85,000, will remain more than twice as generous as the EU and OECD averages.
We’ll also tackle fraud in our covid schemes, with £100m to set up a new HMRC taskforce of around 1,000 investigators as well as new measures, and new investment in HMRC, to clamp down on tax avoidance and evasion.
The full details are set out in the Red Book.
Madam Deputy Speaker, The government is providing businesses with over £100 billion of support to get through this pandemic, so it is fair and necessary to ask them to contribute to our recovery.
So the second step I am taking today is that in 2023, the rate of corporation tax, paid on company profits, will increase to 25%.
Even after this change the United Kingdom will still have the lowest corporation tax rate in the G7 – lower than the United States, Canada, Italy, Japan, Germany and France.
We’re also introducing some crucial protections.
First, this new higher rate won’t take effect until April 2023, well after the point when the OBR expect the economy to have recovered.
And even then, because corporation tax is only charged on company profits, any struggling businesses will, by definition, be unaffected.
Second, I’m protecting small businesses with profits of £50,000 or less, by creating a Small Profits Rate, maintained at the current rate of 19%.
This means around 70% of companies – 1.4 million businesses – will be completely unaffected.
And third, we will introduce a taper above £50,000, so that only businesses with profits of a quarter of a million or greater will be taxed at the full 25% rate.
That means only 10% of all companies will pay the full higher rate.
So yes, it’s a tax rise on company profits. But only on the larger, more profitable companies. And only in two years’ time.
And I wanted to announce this now because I think for business, certainty matters.
For the next two years, I’m also making the tax treatment of losses significantly more generous by allowing businesses to carry back losses of up to £2 million for three years providing a significant cash flow benefit. This means companies can now claim additional tax refunds of up to £760,000.
And because of the current 8% bank surcharge, the implied overall tax rate for banks would be too high. So we will review the surcharge, to make sure the combined rate of tax on the United Kingdom banking sector doesn’t increase significantly from its current level and to make sure this important industry remains internationally competitive.
Madam Deputy Speaker,
These are significant decisions to have taken.
Decisions no Chancellor wants to make.
I recognise they might not be popular.
But they are honest.
And let’s consider the alternatives.
The first is to do nothing.
To leave our deficit problem untreated.
Our debt problem for someone else in future to deal with.
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And Nor do I believe it can be the way of a responsible Chancellor.
Another alternative would be to try to find all the savings we need from public spending.
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The only other alternative would be to increase the rates of tax on working people – but I don’t believe that would be right either.
So I believe our approach, while bold, is compatible with our duty as a fiscally responsible and business friendly government.
This is the right choice and I’m confident it will command public assent.
I have one final announcement on business tax.
With the lowest corporation tax in the G7, and a new, small profits rate, the United Kingdom will have a pro-business tax regime.
But we need to do even more to encourage businesses to invest right now.
Business investment creates jobs, lifts growth, spurs innovation and drives productivity.
For decades we’ve lagged behind our international peers.
Right now, while many businesses are struggling, others have been able to build up significant cash reserves.
We need to unlock that investment; we need an investment-led recovery.
So today I can announce the ‘Super Deduction’.
For the next two years, when companies invest, they can reduce their taxable profits* not just by a proportion of the cost of that investment, as they do now or even by 100% of their cost, the so-called full expensing some have called for, with the Super Deduction they can now reduce their taxable profits by 130% of the cost.
Let me give the House an example.
Under the existing rules, a construction firm buying £10 million of new equipment could reduce their taxable income, in the year they invest, by just £2.6 million.
With the Super Deduction, they can now reduce it by £13 million.
We’ve never tried this before in our country.
The OBR have said it will boost business investment by 10%; around £20 billion more per year.
It makes our tax regime for business investment truly world-leading, lifting us from 30th in the OECD, to 1st. And, worth £25 billion during the two-years it is in place this will be the biggest business tax cut in modern British history.
Bold, unprecedented action.
To get companies investing.
Creating jobs.
And driving our economic recovery.
Madam Deputy Speaker,
Let me now turn to duties.
This is a tough time for hospitality.
So I can confirm that the planned increases in duties for:
Spirits like scotch whisky.
Wine.
Cider.
And beer, will all be cancelled.
All alcohol duties frozen for the second year in a row – only the third time in two decades.
And right now, to keep the cost of living low, I’m not prepared to increase the cost of a tank of fuel. So the planned increase in fuel duty is also cancelled.
Madam Deputy Speaker,
This Budget protects the jobs and livelihoods of the British people.
This Budget is honest about the challenges facing our public finances, and how we will begin to fix them. And this Budget does one other thing:
It lays the foundations of our future economy – the third part of our plan.
If we want a better future economy, we have to make it happen.
We have to do things that have never been done before.
The world is not going to be any less competitive after coronavirus.
So it’s not enough to have some general desire to grow the economy.
We need a real commitment to green growth.
It’s not enough to have a general desire to increase productivity.
We need a real commitment to give every business, large or small, the opportunity to grow, innovate and succeed. It’s not enough to have a general desire to create jobs.
We need a real commitment to create jobs where people are and change the economic geography of this country.
And we can’t strengthen our domestic economy without remaining a global, outward-looking nation.
This future economy won’t be created in any one Budget, but today we lay the foundations.
Madam Deputy Speaker,
Our future economy needs investment in green industries across the United Kingdom. So I can announce today the first ever UK Infrastructure Bank.
Located in Leeds, the Bank will invest across the United Kingdom in public and private projects to finance the green industrial revolution.
Beginning this spring, it will have an initial capitalisation of £12 billion and we expect it to support at least £40 billion of total investment in infrastructure.
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Offshore wind is an innovative industry where the United Kingdom already has a global competitive advantage. So we’re funding new port infrastructure to build the next generation of offshore wind projects in Teesside and Humberside.
And in November I announced we would launch a world-leading Sovereign Green Bond.
Today we’re going further, announcing a new, retail savings product to give all United Kingdom savers the chance to support green projects…
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We’ve also asked Dame Clara Furse to establish a new group to position the City as the global leader for voluntary, high quality carbon offset markets.
And underpinning all of this will be an updated monetary policy remit for the Bank of England. It reaffirms their 2% target.
But now, it will also reflect the importance of environmental sustainability and the transition to net zero.
Madam Deputy Speaker,
Our future economy will also address our productivity problem and support small businesses.
Too often smaller firms don’t have the time or resources to acquire the extra skills and training they need to be more efficient, more digital, and more productive.
Thanks to Be the Business, we have made a good start at supporting these firms.
Today, the Business Secretary and I are going further with a new set of UK-wide schemes: Help to Grow.
First, Help to Grow: Management will help tens of thousands of small and medium sized businesses get world-class management training.
Dozens of business schools across the United Kingdom will offer a new executive development programme with mentoring and peer learning, and government will contribute 90% of the cost.
A real commitment to learn more, make more and earn more.
Second, Help to Grow: Digital.
With the pandemic, many businesses have moved online. This has been a challenge. But we want to turn it into an opportunity.
We’re going to help small businesses develop digital skills by giving them free expert training and a 50% discount on new productivity-enhancing software, worth up to £5,000 each.
Both programmes will commence by the autumn; and I’d urge interested businesses to register today on Gov.UK/HelpToGrow.
A real commitment to help over a hundred thousand businesses become more innovative, more competitive and more profitable.
Madam Deputy Speaker,
A future economy requires us to be at the forefront of the next scientific and technological revolutions.
Becoming a scientific superpower is something we can be; I don’t think that’s hubristic or unrealistic.
Our incredible vaccination programme has shown the world what this country is capable of.
So I’m providing an extra £1.6 billion today to continue the rollout and improve our future preparedness.
And I want to make the United Kingdom the best place in the world for high growth, innovative companies.
So I’m launching two wide-ranging consultations today: to make sure our research and development tax reliefs – and our Enterprise Management Incentives – are internationally competitive.
And, My Right Honourable Friend the Home Secretary knows that a scientific superpower needs scientific superstars so together we’re announcing ambitious, visa reforms aimed at highly skilled migrants, including:
A new unsponsored points-based visa to attract the best and most promising international talent in science, research and tech.
New, improved visa processes for scale-ups and entrepreneurs.
And radically simplified bureaucracy for high skilled visa applications.
Now as well as support for innovation and access to talent, high growth firms need access to capital.
To do that, we’re taking steps to give the pensions industry more flexibility to unlock billions of pounds from pension funds into innovative new ventures launching a new Future Fund Breakthrough, to help fill the scale-up funding gapand changing the rules to encourage more companies to list here.
Let me thank Lord Hill for leading this landmark review, the FCA will be consulting on his proposals very shortly.
Madam Deputy Speaker,
Our future economy depends on remaining a United Kingdom.
Millions of families and businesses in Scotland, Wales and Northern Ireland have contributed to and benefitted from our coronavirus response.
And central to that has been a Treasury that acts for the whole United Kingdom.
That’s not a political point, it’s an undeniable truth.
The majority of today’s Budget measures will apply directly to people in all four nations of the United Kingdom. And I’m taking further specific steps, with:
Three accelerated Scottish City and Growth Deals in Ayrshire, Argyll and Bute, and Falkirk;
Three more in North Wales, Mid Wales, and Swansea Bay;
And funding for the Holyhead hydrogen hub.
The Global Centre of Rail Excellence in Neath Port Talbot.
The Aberdeen Energy Transition Zone.
As well as the Global Underwater Hub and the North Sea transition deal.
Along with the first allocations of the £400m New Deal for Northern Ireland.
And through the Barnett formula, the decisions I’m taking in this Budget also increase the funding for the devolved administrations, by:
£1.2 billion in Scotland;
£740 million in Wales;
And £410 million for the Northern Ireland executive.
And Madam Deputy Speaker,
Our future economy demands a different economic geography.
If we are serious about wanting to level up, that starts with the institutions of economic power.
Few institutions are more powerful than the one I am enormously privileged to lead – the Treasury.
Along with the other critical economic departments, including BEIS, DIT, and MHCLG, we will establish a new economic campus in Darlington.
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Redrawing our economic map means rebalancing our economic investment.
I have already revised the Treasury’s Green Book; and set out the highest sustained levels of public investment across the United Kingdom since the 1970s.
But we can go further.
I’m announcing today over a billion for 45 new Towns Deals.
From Castleford to Clay Cross; Rochdale to Rowley Regis; and Whitby to Wolverhampton.
And let me pay tribute to local leaders like the brilliant Mayor for the West Midlands, Andy Street, who are making the case for investment in their area.
We’re also creating a £150 million fund, to help communities across the United Kingdom take ownership of pubs, theatres, shops, or local sports clubs at risk of loss – putting more power in the hands of local people.
And I am launching the first round of the Levelling Up Fund today, inviting applications from local areas across the United Kingdom.
And I’m grateful to My Right Honourable Friends the Transport Secretary and the Communities Secretary for their support on this crucial initiative.
Madam Deputy Speaker,
I have one final announcement that exemplifies the future economy.
A policy on a scale we’ve never done before;
A policy to bring investment, trade, and, most importantly, jobs, right across this country.
To replace the industries of the past with green, innovative, fast growing new businesses.
To encourage free trade and reinforce our position as an outward-looking, trading nation, open to the world. A policy we can only pursue now we’re outside the European Union:
Freeports.
Freeports are special economic zones with different rules to make it easier and cheaper to do business. They’re well-established internationally, but we’re taking a unique approach.
Our Freeports will have:
Simpler planning – to allow businesses to build;
Infrastructure funding – to improve transport links;
Cheaper customs – with favourable tariffs, VAT or duties;
And lower taxes – with tax breaks to encourage construction, private investment and job creation. An unprecedented economic boost across the United Kingdom.
Freeports will be a truly UK-wide policy – and we’ll work constructively with the Scottish, Welsh and Northern Irish administrations.
Today, I can announce the eight freeport locations in England:
East Midlands Airport.
Felixstowe and Harwich.
Humber.
Liverpool City Region.
Plymouth.
Solent.
Thames.
And Teesside.
Eight new Freeports in eight English regions unlocking billions of pounds of private sector investment, generating trade and jobs up and down the country.
I commend Members from across the House for their campaigning…
[POLITICAL CONTENT REMOVED]
Madam Deputy Speaker,
Let’s take just one of those places – Teesside.
In the past, it was known for its success in industries like steel.
Now, when I look to the future of Teesside I see old industrial sites being used to capture and store carbon. Vaccines being manufactured.
Offshore wind turbines creating clean energy for the rest of the country.
All located within a Freeport with the Treasury just down the road and the UK Infrastructure Bank only an hour away.
I see innovative, fast-growing businesses hiring local people into decent, well-paid, green jobs.
I see people designing, manufacturing and exporting incredible new products and services.
I see people putting down roots in places they are proud to call home.
I see a people optimistic and ambitious for their future.
That, Madam Deputy Speaker, is the future economy of this country.
And so, whilst this last year has been a test unlike any other, that which we are, we are.
The fundamentals of our character as a people have not changed.
Still determined. Still generous. Still fair.
That’s what got us through the last year; it’s what will guide us through the next decade and beyond.
This time last year we set out to deliver on the promises we made to the British people.
But the most important promise was implicit and, in truth, is made by every government, irrespective of their politics.
And that is to do what must be done, when the danger is imminent, and when no one else can.
Today we set out a plan to protect the jobs and livelihoods of the British people, but the promises that underpin that plan, remain unchanged from those we pledged ourselves to twelve long months ago.
To unite and lead.
To level up.
To create a world class education system.
To keep our streets safe.
To keep our NHS strong.
To support the most vulnerable.
To reform and improve public services.
To grow the economy.
To spread prosperity.
To extend the awesome power of opportunity to all corners of the United Kingdom.
And, yes to be honest and fair in all that we do.
Madam Deputy Speaker.
An important moment is upon us.
A moment of challenge and of change.
Of difficulties, yes, but of possibilities too.
This is a Budget that meets that moment.
And I commend it to the House.
Keir Starmer MP, Leader of the Labour Party, responding to the Budget, said:
Thank you Madam Deputy Speaker. After 11 months in this job it’s nice finally to be standing opposite the person actually making decisions in this Government.
The trouble is, the trouble is, it’s those decisions that have left us with the mess we find today. The worst economic crisis of any major economy in the last 12 months, unemployment at five per cent and as the Chancellor said, forecast to rise to 6.5 per cent, debt at over £2 trillion.
I’m sure this Budget will look better on Instagram.
In fact, this week’s PR video cost the taxpayer so much, I was half expecting to see a line in the OBR forecast for it.
But even the Chancellor’s film crew will struggle to put a positive spin on this. After the decisions of the last year and the decade of neglect, we needed a Budget to fix the foundations of our economy, to reward our key workers, to protect the NHS and to build a more secure and prosperous economy for the future.
Instead, what we got was a Budget that papered over the cracks, rather than rebuilding the foundations. A Budget that shows the Government doesn’t understand what went wrong in the last decade or what’s needed in the next.
The Chancellor may think that this is the time for a victory lap but I’m afraid this Budget won’t feel so good for the millions of key workers who are having their pay frozen, for the businesses swamped by debt and the families paying more in council tax and the millions of people who are out of work or worried about losing their job.
And although the Chancellor spoke for almost an hour, we heard nothing about a long-term plan to fix social care.
The Chancellor might have forgotten about it, but the Labour Party never will.
The British people will rightly ask: why has Britain suffered a worse economic crisis than any major economy? The answer is staring us in the face.
First, the Chancellor’s decisions in the last year.
This is the Chancellor who blocked a circuit break in September, ignoring the science he told the British people to “live with coronavirus and live without fear.”
A few weeks later, we were forced into an even longer and more painful lockdown. Whatever spin the Chancellor tries to put on the figures today, as a result of his decisions, we’ve suffered deeper economic damage and much worse outcomes.
And Madam Deputy Speaker, that is nothing compared with a decade of political choices that meant Britain went into this crisis with an economy built on insecurity and inequality.
The Chancellor referred to the last 10 years, we’ve got an economy as a result of those 10 years with 3.6 million people in insecure work; where wages stagnated for a decade; over four million children living in poverty and, critically, we went into this crisis with 100,000 unfilled posts in the NHS and where social care was ignored and underfunded for a decade. Members Opposite voted for all of that. Today’s Budget doesn’t even recognise that – let alone rectify it.
It’s clear that the Chancellor is now betting on a recovery fuelled by a consumer spending blitz.
In fairness, if my next door neighbour was spending tens of thousands of pounds redecorating their flat, I’d probably do the same.
But the central problem in our economy is a deep-rooted insecurity and inequality and this Budget isn’t the answer to that. The Chancellor barely mentioned inequality – let alone tried to address it.
So rather than the big, transformative Budget we needed this Budget simply papers over the cracks. If this had been a Budget for the long-term it would have had a plan.
A plan to protect our NHS, a plan to fix social care.
But I can tell you this, a Labour Budget would have had the NHS and care homes front and centre.
But this Budget is almost silent on those questions.
If this had been a Budget to rebuild the foundations, it would have fixed our broken social security system.
Instead, the Chancellor has been dragged – kicking and screaming – to extend the £20 uplift in Universal Credit – but only for a few months.
Once again deferring the problem. As a result, insecurity and the threat of losing £1,000 a year still hang over six million families.
They ask what would we do, we would keep the uplift until a new, fairer system can be put in place.
If this Budget was serious about rebuilding our shattered economy, it would have included a credible plan to tackle unemployment.
The Chancellor said very little about the Kickstart scheme that’s no doubt because the Kickstart is only helping one in every 100 eligible young people.
In six months it supported just 2,000 young people, yet youth unemployment is set to reach one million. Like so much of this Budget – the Chancellor’s offer is nowhere near the scale of the task.
And of course the biggest challenge to this country is the climate emergency.
The Chancellor just talked up his green credentials, but his Budget stops way short of what was needed or what’s happening in other countries.
This Budget should have included a major green stimulus – bringing forward billions of pounds of investment to create new jobs and new green infrastructure.
Instead, the Government is trying to build a new coal mine which we now learn might not even work for British steel. If anything sums up this Government’s commitment to a green recovery and jobs of the future, it’s building a coal mine we can’t even use.
If the Government was serious about tackling insecurity and those most at risk from Covid, this Budget would have fixed the broken system of statutory sick pay and at the very least filled the glaring holes in isolation payments.
This isn’t difficult to fix – the Government should just make the £500 isolation payment available to everyone who needs it. That would be money well spent. And a year into the pandemic, it’s a disgrace that it’s not.
If the Government were serious about fixing the broken housing market, it would have announced plans for a new generation of genuinely affordable council houses.
Instead, 230,000 council homes have been lost since 2010.
Yet the Chancellor focused today on returning to subsiding 95 per cent mortgages.
Now, I know what you’re thinking, I’ve heard that somewhere before. I’ve heard that somewhere before. Maybe it was because the Prime Minister announced it five months ago in his conference speech.
No, I don’t think anybody heard that. I remember now, I remember now – it’s what Osborne and Cameron came up with in 2013. And what did that do? What did that do?
It fuelled a housing bubble, it pushed up prices, and made owning a home more difficult.
So much for “generation buy.”
I’ve been saying for weeks that this budget will go back.
I didn’t expect the Chancellor to lift a failed policy from eight years ago. This Budget fell far short of the transformative change we needed to turbocharge our recovery for the decades to come.
There was no credible plan to ease the burden of debt hanging over so many businesses. This is estimated at £70bn.
This Budget asks businesses to start paying this money back whether they’re profitable or not.
That affects millions of businesses, it will hold back growth because businesses will have to pay back money they never wanted to borrow instead of being able to invest in their futures and create jobs in their local areas.
It’s both unfair and economically illiterate.
This Budget also fell far short of what was needed to support the self-employed and freelancers, unless, of course, you’re one of the Chancellor’s photographers.
After a year of inaction, we’ll look at the details of what the Chancellor announced, but it certainly looks like, from the figure of 600,000 that he mentioned, that millions will still be left out in the cold.
The Chancellor’s one nominally long-term policy was his references to “levelling up.”
But what does this actually look like? It’s not the transformative shift in power, wealth and resources we need to rebalance our economy.
It’s not the bold, long-term plan we need to upskill our economy, to tackle educational attainment or to raise life-expectancy.
It certainly isn’t a plan to focus government’s resources on preventative services and early years. For the Chancellor “levelling up” seems to mean moving some parts of the Treasury to Darlington, creating a few freeports and re-announcing funding.
That isn’t levelling up: it’s giving up.
And instead of putting blind faith in freeports, the Chancellor would be better served making sure the Government’s Brexit deal actually works for Britain’s manufacturers, who now face more red-tape when they were promised less.
For our financial services – still waiting for the Chancellor to make good on his promises.
For the small businesses and fishing communities whose goods and produce are now left unsold in warehouses. And for our artists and performers who just want to be able to tour.
Turning to other parts of the Statement, we’ll wait for the detail about the so-called super-deduction, but it’s unlikely to make up for the last 10 years, when the levels of private investment growth have trailed so many other countries.
Of course, we welcome the creation of a National Infrastructure Bank. Something we’ve called for, for years.
Although it would have been better if the Government hadn’t sold off the Green Investment Bank in the first place.
We also welcome the introduction of green savings bonds. I have to say: What a good idea it is to introduce a new set of recovery bonds.
The trouble is that the scale of what the Chancellor announced today is nowhere near ambitious enough.
And the long-overdue commitments to extend furlough, business rate relief and the VAT cut on hospitality are welcome. But there is no excuse for holding the announcement of this support back until today – and, of course, we will look at the detail.
But Madam Deputy Speaker, there are very few silver linings in this Budget.
The IMF and the OECD have said now isn’t the time for tax rises. We’re in the middle of a once in 300-year crisis. Our economy is still shut. Our businesses are on life-support.
So it’s right that corporation tax isn’t rising this year or next.
Of course, in the long-run corporation tax should go up.
The decade long corporation tax experiment by this government has failed.
But no taxes should have been raised in the teeth of this economic crisis.
So it’s extraordinary that the Chancellor is ploughing ahead with the £2bn council tax rise – affecting households across the country.
So why is he doing that? Why is he doing that when every economist would tell him not to do it.
Perhaps we find an answer in this weekend’s Sunday Times: “Rishi’s argument was, ‘Let’s do all this now as far away from the election as possible.’”
Or the Telegraph on 27 January: “Raising taxes now means they can be reduced ahead of the next election, Sunak tells MPs.”
Or the Mail in September: “Sunak to hike taxes and lower them before the election.”
Let me be crystal clear. The proper basis for making tax decisions is the economic cycle, not the electoral cycle.
Madam Deputy Speaker, behind the spin, the videos and the photo ops, we all know the Chancellor doesn’t believe in an active and enterprising government.
We know, we know he’s itching to get back to his free market principles and to pull away support as quickly as he can.
One day these restrictions will end.
One day we’ll all be able to take our masks off – and so will the Chancellor.
And then you’ll see who he really is – and this Budget sets it up perfectly.
Because this is a Budget that didn’t even attempt to rebuild the foundations of our economy.
Or to secure the country’s long-term prosperity. Instead it did the job the Chancellor always intended: a quick fix.
Papering over the cracks.
The Party opposite spent a decade weakening the foundations of our economy. Now they pretend they can rebuild it.
But the truth is: they won’t confront what went wrong in the past and they have no plan for the future.
Commenting on today’s budget statement from chancellor Rishi Sunak, TUC General Secretary Frances O’Grady said: “The chancellor is making a dangerous bet on the economy bouncing back on its own. He is gambling with the recovery when he should have acted to create jobs.
“We are in the worst recession of our lifetimes. But while President Biden acts big, the chancellor thinks small. We saw nothing like the investment we need to stop unemployment and level-up the UK with millions of new green jobs.
“Freeports don’t create jobs – and around the world they allow freeloading employers to dodge taxes.
“And after a year of key workers going above and beyond, it’s an insult that the chancellor announced no new support for our hard-pressed NHS or public services and no guarantee of a decent pay rise for all our public sector key workers.
“The last-minute extension of furlough, while welcome, ends too soon, which will risk jobs and businesses. Cutting universal credit in October will risk family incomes. And failing to fix decent sick pay for all risks more infections and another lockdown.”
Where the budget falls short
The budget falls far short of the level of action called for in the TUC’s budget submission.
The overall level of public investment to stimulate recovery has not been increased by the budget.
The TUC budget submission called for the chancellor to:
Responding to the Chancellor’s statement in the Commons outlining the Government’s Budget, Dr Katherine Henderson, President of the Royal College of Emergency Medicine, said: “This budget is disappointing for the Health and Social Care service which urgently needs a revised funding and investment plan. There are only 10 mentions of the NHS in the published budget.
“The NHS entered the pandemic underfunded, short of staff and short of resources. Now more than ever the NHS must have an adequate recovery plan that includes funding, investment, and a strategy to fix the workforce crisis. This budget failed to build on last year’s spending review, which itself did not go far enough.
“Pressures on the NHS before the pandemic were anything but normal and the added pressure has taken a huge physical and mental toll on existing staff, who have been stretched too thinly.
“In Emergency Medicine we need an additional 2500 consultants and 4,000 nurses, in England alone. The wider NHS is hugely short of staff and fixing this will require an increase in the number of training school places, which in turn requires funding. Failing to address the workforce crisis does our staff a disservice.
“While covid is receding, we cannot drift towards being complacent about the state of our NHS. It is regrettable that this budget will do little to address the longer-term underlying problems we have.”
“Physical infrastructure and economic growth is not enough. We need new solutions for sustainable recovery”, said Sarah Gillinson, chief executive, Innovation Unit.
“The Chancellor’s Budget today was understandably focused on national economic survival in the short-term and sustainable recovery in the longer term. These are welcome non-negotiables for a country emerging from crisis.
“But for a government ostensibly focused on “levelling up” there was little evidence of deepening investment or understanding of what it will really take to improve the lives and life chances of people in places that have had a raw deal over the decades.
“Evidence gathered over many years about the success or otherwise of place-based transformation points to the need for change to be grounded in a locally-owned vision that encompasses all aspects of life – from health and education and a secure home to meaningful work and successful relationships.
“The government’s actions have been all about physical infrastructure and economic growth. It is not enough.
“This change is unbelievably hard and evolves as we learn over 10 years or more. There are scant examples of successful, long-term, place-based transformation that really works for the people who already live there – rather than the people who move in after change has happened.
“If the government is serious about “levelling up” or seriously transforming places with and for the people who live there, it should be investing in much more ambitious and holistic innovation in places, and in loud, transparent learning about what emerges. As we said in November last year, 10% of the £4.8bn levelling-up fund should be dedicated to innovation.
“We need new solutions, not partial old ones. Trains, roads and enterprise are important – but they are far from being the whole story. Emerging from Covid-19 gives us a once-in-a-generation opportunity to design forward differently. Let’s seize it, as a broad coalition that wants to learn what it really takes to transform places, rather than being stuck in the inadequate models of the past.”
Centre for Cities’ Chief Executive Andrew Carter has released this statement on yesterday’s Budget: “The extension to furlough and the UC increase will be a relief to people in places hit hard by the pandemic.
“However, the Chancellor’s vision for our economic recovery is too centralised. Governing directly from the Treasury – whether in London or Darlington – will not level up the country.
“Rather than moving civil servants out of Whitehall, the Government should be moving powers and money out and handing them over to local leaders who understand their areas and the challenges that people face.”
Reacting to the Budget statement, the leader of the country’s leading union, Unite, warned that the government’s flagship freeports policy could cause wage `sinkholes’ and demanded more action on jobs creation.
Unite general secretary Len McCluskey said: “In this time of crisis, workers and communities are desperate for action on a scale that meets this enormous moment and takes us to a fairer future.
“Instead, the chancellor plundered his back catalogue to pull out a sketchy policy, a return of freeports, a failed experiment of the last decades where the only winners are tax avoiders and bad bosses.
“Freeports are sinkholes, draining decent jobs and wages away from our communities.
“Further, we want the chancellor to answer why English freeports will sidestep employment rights, minimum wages and basic standards while Scottish workers will keep all these protections.
“These ports stand in utter contradiction to the pledge to level up, and we will oppose them.
“We need a coherent industrial strategy and real action to underpin jobs creation, not spin, gimmicks and dangerous wheezes.
“There is now also the very real worry now that we face an autumn incomes and jobs emergency, created by this Budget when it ought to be charting the course out of this economic crisis.
“Furlough support will fall away and Universal Credit will be cut by £20 a week at precisely the time when unemployment could well be rising.
“The comfortably off will be pleased by the extension of the stamp duty relaxation for those with expensive properties, but where is the proper assistance for those at the sharpest end of the economy in desperate need of help on sick pay, wages and rent debt?
“Frontline workers kept this country safe and supported during this crisis, putting their own health on the line. Where this Budget should have recognised their heroic contribution with an end to a decade of wage cuts and the justified pay rise that the public wants to see, it failed them.
“The Budget was about choices. The danger is that this government has chosen to be timid in its actions for our people and our economic renewal but ambitious in advancing the Conservative party.”
It is with deep sadness that we pay tribute to the passing of John (Ian) Miller, former employee, Director and East Regional Committee member. John passed away suddenly, aged 72.
Known as John to his friends and colleagues at Scotmid, he served the Society both as an employee and as a democratically elected member. He was Manager at our Penicuik non-food branch for 15 years before starting his own carpet business and went on to serve on the democratic side of the Society, representing Members in our East Region for 17 years and then the Board for 9 years.
It is very sad that John passed away so soon after retiring from our Board and East Regional Committee at the Society’s AGM in September.
John was widely known and respected within the co-operative movement and in his local community. It is difficult to quantify the contribution which he made both to Scotmid and the cooperative movement over many years.
He represented the Society on a wide range of Boards and Committees over the years and was a fouder member of Fairtrade Midlothian. He was a true gentlemen with a firm belief in co-operation and the benefits of the co-operative movement and would champion these at every occasion.
John will be sorely missed by all at Scotmid and our thoughts are with John’s family and friends at this very sad time.
Prime Minister Boris Johnson made a statement on coronavirus this morning:
Good morning,
In the two weeks since I last addressed you from this podium, I am pleased to report that we have continued to make steady progress in our collective effort to beat the coronavirus.
For 3 weeks now, the number of new cases identified through testing each day has been below 1,000.
The latest SAGE advice is that, across the UK, the R rate remains between 0.7 and 0.9.
SAGE also assess that the number of infections is shrinking by between 5 and 1 per cent every day.
The latest ONS data shows prevalence and new infections to be stable and low.
The number of patients newly admitted to hospital with coronavirus each day, and the number of coronavirus patients in mechanical ventilation beds, have both fallen by more than 90% from their peak in early April.
And while we mourn every death, the average daily death rate continues, steadily, to fall.
This progress is testament to the phenomenal efforts of our NHS and social care staff working tirelessly on the frontline.
And it has only been possible thanks to the character and fortitude with which you, the British people, have made fundamental changes to the way you all live and work.
When we set out our plan to rebuild on 11 May, we said our goal was to return life to as close to normal as possible, for as many people as possible, as fast and as fairly as possible, in a way that is safe and continues to protect our NHS.
That goal remains the same – but the tools we use to achieve it are changing.
At the start of the pandemic, when we knew far less about the nature and spread of the virus, we had to take blanket, national measures.
National lockdown was undoubtedly the right thing to do and has saved many thousands of lives.
Now however, we know more about the virus – we understand the epidemiology better and our intelligence on where it is spreading is vastly improved. That means we can control it through targeted, local action instead.
In England, this work is led by NHS Test and Trace and within it the Joint Biosecurity Centre. My sincere thanks go to Dido Harding who oversees this work and who joins me today.
This approach is already working.
In Weston-super-Mare and Kirklees, we took swift and successful action to contain outbreaks at specific premises.
In Bradford and Blackburn with Darwen, we identified troubling trends in the data and worked closely with the respective local authorities to increase testing and take targeted action. That work continues.
And in Leicester, we instituted a local lockdown in order to bear down on stubborn rates of infection. As the Health Secretary announced last night, we will begin to relax the restrictions there next week. We can do so because the data is improving – with the percentage of people testing positive falling from a weekly rate of 12.2% on 29 June to 4.8% yesterday.
The approach varies in different parts of the UK, but all parts of the UK benefit from the support of our armed forces, additional testing facilities, and billions of pounds of support provided by this Government.
Today we are publishing our framework for containing and controlling future outbreaks in England, which will enable national and local government to work closely together.
From tomorrow, local authorities will have new powers in their areas. They will be able to close specific premises, shut public outdoor spaces, and cancel events. These powers will enable local authorities to act more quickly in response to outbreaks, where speed is paramount.
Action by local councils will not always be sufficient. So next week we will publish draft regulations which clearly set out how central government can intervene more effectively at a local level.
Where justified by the evidence, ministers will be able to close whole sectors or types of premises in an area, introduce local “stay at home” orders, prevent people entering or leaving defined areas, reduce the maximum size of gatherings beyond national rules, or restrict transport systems serving local areas.
I know that it will be hard going for people affected by these local measures. It isn’t easy, and for some it may seem unjust that people just a short distance away can live their lives closer to normal.
But it has to be right that we take local action in response to local outbreaks – there is no point shutting down a city in one part of the country to contain an outbreak in another part of the country.
Now of course, this local approach relies on having an effective testing regime in place.
And here we have made substantial progress.
Antigen test capacity – that’s the test which tells you if you currently have the virus – has increased 100-fold since the start of March, from fewer than 2,000 tests a day to more than 200,000 tests a day now.
Publicly available data suggests we are now carrying out our tests more than anywhere else in Europe in total, and more tests than Germany, France, Italy and Spain per capita.
We have set up testing sites around the UK and now have 200 mobile units which can be rapidly deployed wherever they are needed.
It is now the case, and has been for some time, that anyone, anywhere in the UK with symptoms can get a test without delay. We are also testing increasing numbers of people who don’t have symptoms but who are at higher risk.
As we approach winter, we will need to go further – not least as many more people will show Covid-like symptoms as a result of seasonal illnesses, and therefore require a test.
So we will further increase testing capacity to at least half a million antigen tests a day – 3.5 million antigen tests a week – by the end of October.
Demand for testing is not the only challenge that winter will bring.
It is possible that the virus will be more virulent in the winter months – and it is certain that the NHS will face the usual, annual winter pressures.
We have taken a number of steps therefore to get the NHS ready for winter.
We have massively increased the number of ventilators available to patients across the UK – up from 9,000 before the pandemic to nearly 30,000 now.
We have substantially increased the pipeline of personal protective equipment for the NHS and social care -constituting over 30 billion items of PPE over the course of the pandemic.
We will be rolling out the biggest ever flu vaccination programme in the history of the U.K.
And we will also of course give the NHS the resources it needs.
And today, I can confirm that we are providing an additional £3 billion of funding to the NHS in England to get ready for winter. Scotland, Wales and Northern Ireland will also receive additional funds.
This will allow the NHS to continue to use the extra hospital capacity acquired from the independent sector and also to maintain the Nightingale hospitals until the end of March.
This new funding comes on top of the additional £30 billion of funding for health and social care that we have already announced this year.
So we are making sure we are ready for winter, and planning for the worst.
But even as we plan for the worst, I strongly believe we should also hope for the best.
That means looking ahead with optimism – now extending our plan to lift the remaining national measures which have restricted our lives since March so we can get back to something closer to normal life.
Now I must stress, the timetable I am about to set out is conditional. It is contingent on every one of us staying alert and acting responsibly. It relies on our continued success in controlling the virus. And we will not proceed if doing so risks a second peak that would overwhelm the NHS.
Nonetheless, it is important to give people hope and to give business confidence.
So in England, from today we are making clear that anybody may use public transport, while of course encouraging people to consider alternative means of transport where they are available.
From 25 July, we have already committed to reopening the indoor gyms, pools and other sports facilities.
From 1 August, we will update our advice on going to work. Instead of government telling people to work from home, we are going to give employers more discretion, and ask them to make decisions about how their staff can work safely.
That could mean of course continuing to work from home, which is one way of working safely and which has worked for many employers and employees.
Or it could mean making workplaces safe by following Covid Secure guidelines. Whatever employers decide, they should consult closely with their employees, and only ask people to return to their place of work if it is safe.
As we reopen our society and economy, it’s right that we give employers more discretion while continuing to ensure employees are kept safe.
Also from 1 August, we will reopen most remaining leisure settings, namely bowling, skating rinks and casinos, and we will enable all close contact services such as beauticians to resume.
Nightclubs and soft play areas will sadly need to remain closed for now – although this will be kept under review.
We will restart indoor performances to a live audience, subject to the success of pilots, and we will also pilot larger gatherings in venues like sports stadia, with a view to wider reopening in the Autumn.
We will also allow wedding receptions for up to 30 people.
All of these measures for 1 August should be done in a Covid Secure way.
In September, schools, nurseries and colleges will be open for all children and young people on a full-time basis, as planned.
And universities are also working to reopen as fully as possible.
From October, we intend to bring back audiences in stadia and to allow conferences and other business events to recommence – again, these changes must be done in a Covid Secure way, subject to the successful outcome of pilots.
Throughout this period, we will look to allow more close contact between friends and family when we can.
It is my strong and sincere hope that we will be able to review the outstanding restrictions and allow a more significant return to normality from November at the earliest – possibly in time for Christmas.
At all times, we will continue to work with the devolved administrations in Scotland, Wales and Northern Ireland to support and care for those at risk, wherever they live in the UK.
We have said that the shielding programme for those most at risk in England, the clinically extremely vulnerable, will be paused at the end of this month. We will stay constantly vigilant and be sure to restart shielding at any point if required.
Now I know some will say this plan is too optimistic, that the risks are too great and that we won’t overcome the virus in time.
And of course, if they are right in saying that, and we cannot exclude that they are, let me reassure them, and reassure you: that we will not hesitate at any stage to put on the brakes.
From May 11 onwards, this plan has been conditional, and it remains conditional.
But if we continue to pull together as we have done so far, I know we can beat this virus.
Hoping for the best, but planning for the worst – and it’s in that spirit that we must carry on waging this long, hard fight against Coronavirus.
Keir Starmer, Leader of the Labour Party, speaking in response to the Prime Minister’s press conference today, said: “We all want society to reopen, we all want our economy to start growing again. So we’ll look at the details of this plan.
“But the key now is confidence. Do the public have confidence in the measures the Government have put in place? Do businesses have confidence in the advice that’s been given? And can we have confidence that the Government’s scientific advisers support these measures? This can’t be done on a wing and a prayer. It requires a credible plan, and national leadership.”
On local lockdowns:
“Labour has long been arguing that we need local control of lockdown. We need data to our local representatives, our local authorities. They need the powers to take the necessary measures. This is what will drive confidence, and this work with local authorities should have be done a long time ago.
“Mayors across the country, local authority leaders across the country, are saying what we need is the data so we know precisely what’s going on, on a day-to-day basis, on a street-by-street basis, or we need the power to take action, rapidly. That’s what they want most of all.”
On NHS winter funding:
“What I didn’t hear from the Prime Minister this morning was any extra money and funding for social care. And what we can’t do again is to leave social care out of the priorities as we go into the autumn and the winter. So where was the money for social care?”
Responding to Boris Johnson’s announcement today, allowing employers to start bringing home-working staff back to the workplace from next month, TUC General Secretary Frances O’Grady said: “We all want to get the economy up and running as quickly as possible. Returns to workplaces must happen in a phased and safe way.
“The government is passing the buck on this big decision to employers. Getting back to work safely requires a functioning NHS Test and Trace system. Yet progress on test and trace is still patchy, and the government is still refusing to support workers who have to self-isolate by raising statutory sick pay from just £95pw to a rate people can live on.
“A safe return to workplaces also requires much greater investment in public transport if people are to be able to commute to workplaces.
“Before reopening any workplace, every employer must complete a risk assessment, and make plans to reduce the risk to workers through enabling social distancing. They must consult their staff trade unions, and larger employers should publish the risk assessment on their website.
“Not everyone will be able to return to workplaces full-time or immediately. People who have been advised to shield and those without enough childcare may need to work fully from home for the foreseeable future.
“Many businesses have seen the benefits of flexible approaches to working during this pandemic. This progress must not be lost. All staff should have the right to work flexibly from their first day in the job.”
The TUC is calling on employers to do the following before asking staff to return to the workplace:
Boris Johnson set out his much-anticipated ‘road map’ in an address to the nation last night. While Johnson is Prime Minister of the United Kingdom, as he pointed out himself, much of his speech applies to England only:
It is now almost two months since the people of this country began to put up with restrictions on their freedom – your freedom – of a kind that we have never seen before in peace or war.
And you have shown the good sense to support those rules overwhelmingly.
You have put up with all the hardships of that programme of social distancing.
Because you understand that as things stand, and as the experience of every other country has shown, it’s the only way to defeat the coronavirus – the most vicious threat this country has faced in my lifetime.
And though the death toll has been tragic, and the suffering immense.
And though we grieve for all those we have lost.
It is a fact that by adopting those measures we prevented this country from being engulfed by what could have been a catastrophe in which the reasonable worst case scenario was half a million fatalities.
And it is thanks to your effort and sacrifice in stopping the spread of this disease that the death rate is coming down and hospital admissions are coming down.
And thanks to you we have protected our NHS and saved many thousands of lives.
And so I know – you know – that it would be madness now to throw away that achievement by allowing a second spike.
We must stay alert.
We must continue to control the virus and save lives.
And yet we must also recognise that this campaign against the virus has come at colossal cost to our way of life.
We can see it all around us in the shuttered shops and abandoned businesses and darkened pubs and restaurants.
And there are millions of people who are both fearful of this terrible disease, and at the same time also fearful of what this long period of enforced inactivity will do to their livelihoods and their mental and physical wellbeing.
To their futures and the futures of their children.
So I want to provide tonight – for you – the shape of a plan to address both fears. Both to beat the virus and provide the first sketch of a road map for reopening society.
A sense of the way ahead, and when and how and on what basis we will take the decisions to proceed.
I will be setting out more details in Parliament tomorrow and taking questions from the public in the evening.
I have consulted across the political spectrum, across all four nations of the UK.
And though different parts of the country are experiencing the pandemic at different rates.
And though it is right to be flexible in our response.
I believe that as Prime Minister of the United Kingdom – Scotland, England, Wales, Northern Ireland, there is a strong resolve to defeat this together.
And today a general consensus on what we could do.
And I stress could. Because although we have a plan, it is a conditional plan.
And since our priority is to protect the public and save lives, we cannot move forward unless we satisfy the five tests.
We must protect our NHS.
We must see sustained falls in the death rate.
We must see sustained and considerable falls in the rate of infection.
We must sort out our challenges in getting enough PPE to the people who need it, and yes, it is a global problem but we must fix it.
And last, we must make sure that any measures we take do not force the reproduction rate of the disease – the R – back up over one, so that we have the kind of exponential growth we were facing a few weeks ago.
And to chart our progress and to avoid going back to square one, we are establishing a new Covid Alert System run by a new Joint Biosecurity Centre.
And that Covid Alert Level will be determined primarily by R and the number of coronavirus cases.
And in turn that Covid Alert Level will tell us how tough we have to be in our social distancing measures – the lower the level the fewer the measures.
The higher the level, the tougher and stricter we will have to be.
There will be five alert levels.
Level One means the disease is no longer present in the UK and Level Five is the most critical – the kind of situation we could have had if the NHS had been overwhelmed.
Over the period of the lockdown we have been in Level Four, and it is thanks to your sacrifice we are now in a position to begin to move in steps to Level Three.
And as we go everyone will have a role to play in keeping the R down.
By staying alert and following the rules.
And to keep pushing the number of infections down there are two more things we must do.
We must reverse rapidly the awful epidemics in care homes and in the NHS, and though the numbers are coming down sharply now, there is plainly much more to be done.
And if we are to control this virus, then we must have a world-beating system for testing potential victims, and for tracing their contacts.
So that – all told – we are testing literally hundreds of thousands of people every day. (? – Ed.)
We have made fast progress on testing – but there is so much more to do now, and we can.
When this began, we hadn’t seen this disease before, and we didn’t fully understand its effects.
With every day we are getting more and more data.
We are shining the light of science on this invisible killer, and we will pick it up where it strikes.
Because our new system will be able in time to detect local flare-ups – in your area – as well as giving us a national picture.
And yet when I look at where we are tonight, we have the R below one, between 0.5 and 0.9 – but potentially only just below one.
And though we have made progress in satisfying at least some of the conditions I have given.
We have by no means fulfilled all of them.
And so no, this is not the time simply to end the lockdown this week. Instead we are taking the first careful steps to modify our measures.
And the first step is a change of emphasis that we hope that people will act on this week.
We said that you should work from home if you can, and only go to work if you must.
We now need to stress that anyone who can’t work from home, for instance those in construction or manufacturing, should be actively encouraged to go to work. (NB: England only – Ed.)
And we want it to be safe for you to get to work. So you should avoid public transport if at all possible – because we must and will maintain social distancing, and capacity will therefore be limited.
So work from home if you can, but you should go to work if you can’t work from home.
And to ensure you are safe at work we have been working to establish new guidance for employers to make workplaces COVID-secure.
And when you do go to work, if possible do so by car or even better by walking or bicycle. But just as with workplaces, public transport operators will also be following COVID-secure standards.
And from this Wednesday, we want to encourage people to take more and even unlimited amounts of outdoor exercise.
You can sit in the sun in your local park, you can drive to other destinations, you can even play sports but only with members of your own household. (NB this only applies in England – Ed.)
You must obey the rules on social distancing and to enforce those rules we will increase the fines for the small minority who break them.
And so every day, with ever increasing data, we will be monitoring the R and the number of new infections, and the progress we are making, and if we as a nation begin to fulfil the conditions I have set out, then in the next few weeks and months we may be able to go further.
In step two – at the earliest by June 1 – after half term – we believe we may be in a position to begin the phased reopening of shops and to get primary pupils back into schools, in stages, beginning with reception, Year 1 and Year 6 (NB: England only – Ed.)
Our ambition is that secondary pupils facing exams next year will get at least some time with their teachers before the holidays. And we will shortly be setting out detailed guidance on how to make it work in schools and shops and on transport.
And step three – at the earliest by July – and subject to all these conditions and further scientific advice; if and only if the numbers support it, we will hope to re-open at least some of the hospitality industry and other public places, provided they are safe and enforce social distancing.
Throughout this period of the next two months we will be driven not by mere hope or economic necessity. We are going to be driven by the science, the data and public health.
And I must stress again that all of this is conditional, it all depends on a series of big Ifs. It depends on all of us – the entire country – to follow the advice, to observe social distancing, and to keep that R down.
And to prevent re-infection from abroad, I am serving notice that it will soon be the time – with transmission significantly lower – to impose quarantine on people coming into this country by air.
And it is because of your efforts to get the R down and the number of infections down here, that this measure will now be effective.
And of course we will be monitoring our progress locally, regionally, and nationally and if there are outbreaks, if there are problems, we will not hesitate to put on the brakes.
We have been through the initial peak – but it is coming down the mountain that is often more dangerous.
We have a route, and we have a plan, and everyone in government has the all-consuming pressure and challenge to save lives, restore livelihoods and gradually restore the freedoms that we need.
But in the end this is a plan that everyone must make work.
And when I look at what you have done already.
The patience and common sense you have shown.
The fortitude of the elderly whose isolation we all want to end as fast as we can.
The incredible bravery and hard work of our NHS staff, our care workers.
The devotion and self-sacrifice of all those in every walk of life who are helping us to beat this disease.
Police, bus drivers, train drivers, pharmacists, supermarket workers, road hauliers, bin collectors, cleaners, security guards, postal workers, our teachers and a thousand more.
The scientists who are working round the clock to find a vaccine.
When I think of the millions of everyday acts of kindness and thoughtfulness that are being performed across this country.
And that have helped to get us through this first phase.
I know that we can use this plan to get us through the next.
And if we can’t do it by those dates, and if the alert level won’t allow it, we will simply wait and go on until we have got it right.
We will come back from this devilish illness.
We will come back to health, and robust health.
And though the UK will be changed by this experience, I believe we can be stronger and better than ever before. More resilient, more innovative, more economically dynamic, but also more generous and more sharing.
But for now we must stay alert, control the virus and save lives.
Thank you very much.
Keir Starmer, Leader of the Labour Party, responding to the Prime Minister’s statement, said: “This statement raises more questions than it answers, and we see the prospect of England, Scotland, Wales and Northern Ireland pulling in different directions.
“The Prime Minister appears to be effectively telling millions of people to go back to work without a clear plan for safety or clear guidance as to how to get there without using public transport.
“What the country wanted tonight was clarity and consensus, but we haven’t got either of those.”
Dame Carolyn Fairbairn, CBI Director General, said: “Today marks the first glimmer of light for our faltering economy. A phased and careful return to work is the only way to protect jobs and pay for future public services. The Prime Minister has set out the first steps for how this can happen.
“Businesses are keen to open and get our economy back on its feet. But they also know putting health first is the only sustainable route to economic recovery. The message of continued vigilance is right.
“This announcement marks the start of a long process. While stopping work was necessarily fast and immediate, restarting will be slower and more complex. It must go hand-in-hand with plans for schools, transport, testing and access to PPE. Firms will want to see a roadmap, with dates they can plan for.
“Success will rest on flexibility within a framework: clear guidance which firms can adapt for their particular circumstances. Financial support will also need to evolve for sectors moving at different speeds – some remaining in hibernation, while others get ready to open safely.
“The coming weeks should see business, government and employee representatives working together as part of a national effort built on openness and trust. This is the only way to revive the UK economy and protect both lives and livelihoods.”
Responding to the statement by the prime minister, the leader of the Unite union has called for “clarity and caution” as the country continues to combat the coronavirus which has left the UK with one of the worst death tolls in Europe.
Len McCluskey, Unite general secretary, said: “The decisions taken by the UK government in the coming days will shape the health and wealth of this country, not just in the immediate term but for generations to come.
“It is absolutely vital then that the UK government proceeds with total clarity and maximum caution as it works to pull the country out of lockdown – and that it gets the sequencing of the return to work right.
“People cannot get to work safely unless there is safe transport for them to use. Yet there is now a real risk that in a few hours’ time, workers will be cramming onto public transport, putting at risk their lives and those of others. This has not been thought through and the failure to do so places working people in danger.
“Similarly, issuing safety guidance to employers instead of definite, mandatory instructions is not acceptable. This runs a huge risk that some employers will follow the advice while others do not, and we urgently need to hear more from government about how it will install the inspection and enforcement systems necessary to support safe working.
“Unions like Unite have a wealth of health and safety expertise and we are already working with responsible employers to ensure that working people can be confident that they can be safe both at work and on the way to work.
“There is a standing army of tens of thousands of trades union safety representatives that could be deployed in a national effort to unlock the economy in a safe, responsible way. To fail to enlist this pool of people expert in keeping people safe at work is simply bewildering.
“We are very concerned that at the very point we need to build clarity and confidence, doing everything possible to avert a second spike, that this next phase is unfolding in a jumbled, confusing manner.
“Of course, we want to get the economy back on its feet as soon as possible but with such enormous sacrifices given by so many already, we have to honour those who have lost their lives along with those who are caring for us through this crisis by keeping people safe and by building a future of which this country can be proud.
STUC General Secretary Designate Roz Foyer said: “The Prime Minister’s management of this crisis has been so woeful that few will have any confidence in what he has laid out this evening.
“This is a three-month road map in the hands of a government that doesn’t even seem to know what it is doing from one day to the next.
“Boris Johnson has apparently announced the return to work of hundreds of thousands of non-essential workers in areas such as construction and manufacturing. In so doing he in endangering people’s lives. The Government hasn’t even published guidance on how workers will be kept safe.
“His statement that all workers who cannot work from home should go to work will cause incredible confusion and massive concern. We urgently need clarity on how workers who cannot work from home and cannot safely attend their workplace will be treated.
“And at no point did he make it clear that he was talking about England only, rather than the whole of the UK. The strain on the delivery of a four-nation approach now seems intolerable.
“Our five red lines for relaxing lockdown remain the same and apply just as much for the Scottish Government as they do Westminster.
“We need to be far further ahead in testing, have a proper contact tracing system in place, have ready supplies of PPE for any workplaces that is to re-open, and have enforcement measures in place. Each work sector must be treated according to its distinct characteristics and governed by guidelines agreed with unions. And there must be no implied threat of loss of income for workers not able to return to work. The job retention scheme must stay in place with no further reductions in levels of pay support.
“As we have made clear, we believe the Scottish Government’s more safety-first approach is broadly the right one, particularly as doubts about the R value in Scotland persist.
“We have also welcomed their willingness to negotiate the sector by sector guidance with unions. However as ongoing failures on PPE, testing and guidance for care homes show, there is not an ounce of room for complacency.
“Unions will test the strategy of the Scottish Government every step of the way and fight to ensure that the safety of workers and of the wider public remains that number one concern.”
The Prime Minister will reveal more detail when he addresses parliament today and a guidance document will be produced this afternoon.
Boris Johnson will also take questions from the public when he leads the daily press briefing at 5.30pm.
