I beg to move,
That this House has considered the matter of Statutory Sick Pay and protection available for all workers.
This is an international crisis, where countries need to learn from each other about what is working and what additional steps need to be taken. We also need to come together as a country to support each other as the severity of the crisis is becoming clearer. A Public Health England document estimates that the coronavirus epidemic in the UK will last until this time next year and could lead to almost 8 million people being hospitalised. The impact will be felt not just by those who become ill or have to self-isolate; this public health crisis has exposed the fault lines in an economy in which insecure, low-paid work is so prevalent.
In the Budget last week, and again yesterday, the Chancellor announced measures to support business, but there was a glaring omission when it came to workers on low income and those who are unable to work. PHE warns:
“It is estimated that at least 10% of people in the UK will have a cough at any one time during the months of peak Covid-19 activity.”
The revised health advice is that anyone with a cough should self-isolate for at least seven days, and for 14 days if they live with other people. It is right that people should not go on working when they are not well, but the Government’s measures so far still leave many people facing a cruel choice between their health and financial hardship, and it is a choice that has an impact on the health of the people with whom they come into contact.
In response to the questions from the Leader of the Opposition, the Prime Minister said that he would bring forward a package of measures relating to statutory sick pay. We really do need the details on that as a matter of urgency.
In order to claim statutory sick pay, workers need to prove that they are earning a minimum of £118 per week. So does my hon. Friend agree that rather than just regurgitating vacuous soundbites such as “whatever it takes”, the Government need to bring the statutory sick pay levels up from the current paltry £94.25 a week, which is not enough to even feed one’s family, to European levels and to extend it to all workers?
My hon. Friend makes a couple of important points about the levels of pay and the people who are able to access it, and I will be coming on to deal with those things in my speech.
Some 7 million people are not eligible for statutory sick pay: just under 2 million workers on low income do not qualify because they earn less than the £118 on average; and 5 million self-employed people do not qualify. Those on low pay are some of those who will be hit hardest by the crisis. Many of them work in retail, hospitality and leisure, and we are also hearing of people being laid off in these sectors. Others will be concerned that their jobs may be at risk, and these anxieties could also make them more likely to carry on working, even if they are unwell. Nearly 1 million people are on zero-hours contracts. Analysis by the TUC found that the earnings of about a third of them do not meet the threshold for SSP, compared with a figure of 6% for permanent employees, and women figure highly in the number of people on zero-hours contracts. Overall, about 70% of workers who would benefit from the removal of the threshold are women. A Government consultation published last year highlighted that workers who do not earn enough to qualify for SSP may be “working when unwell”. It said that the Government believed that there was a case to extend eligibility for SSP to people earning less than the threshold. So will they now extend SSP to all workers, including those on low pay.
Along with the just under 2 million people whose earnings are too low to qualify, others on low income in the gig economy are not eligible because they are classified as self-employed. They include careworkers, cleaners and delivery drivers, the very people on whom we will be depending to an even greater degree than usual in the coming weeks and months as people have to self-isolate in greater numbers. My hon. Friend the Member for Dulwich and West Norwood (Helen Hayes) has rightly highlighted, in a letter to the Government signed by 100 colleagues, that although NHS England has issued guidance advising trusts to give full sick pay to staff who have to self-isolate because of the disease, careworkers on zero-hours contracts will not be protected. They make up a quarter of the social care workforce. Will the Government ensure that they also qualify for full sick pay? In the case of delivery drivers, the GMB has worked with Hermes to agree on a fund to protect the income of drivers who fall sick or who have to self-isolate, but there are other examples of companies offering derisory payments or even requiring drivers to continue to meet the costs of renting vans even while they receive sick pay. We should not need to emphasise how important it is that people in occupations where they are going from one house to another should not go on working when unwell. We depend on people such as carers and drivers, and the Government have a responsibility to protect them if they are unable to work because of the outbreak.
There is also a case to extend statutory sick pay to the self-employed more generally, as the Irish Government have done. Many people who are disabled and who have been ill, for example, choose self-employment because of the flexibility that it can give them to choose hours that are manageable. However, they also may be now more vulnerable to the virus.
The level of statutory sick pay is far too low at only £94.25 a week, so even those who do qualify for it are likely to struggle to keep on top of even basic household bills. Average weekly earnings are currently £512, meaning that the average worker who has to self-isolate for 14 days will see their income fall by more than £850 during that time.
Is the hon. Member aware that research undertaken by the Institute for the Future of Work absolutely backs up everything she is saying about putting the statutory floor in place so that people can economically contribute when it is right for them to do so? There is much more resilience in the general population and they have more ability to work when they are fit to do so when such measures are in place.
The hon. Lady makes a really excellent point, and I thank her for it. Many workers on low pay are unlikely to have savings to fall back on either. In a recent YouGov survey, 48% of workers said that they would not be able to cover their rent or mortgage and other living expenses if they had to take two weeks off work at the current statutory sick pay rates. The European Committee of Social Rights found in January 2018 that statutory sick pay and social protections for the unemployed, sick and self-employed people in the UK were “manifestly inadequate”.
A worker in the UK on the national minimum wage who has to self-isolate will receive less than a third of what they would in Germany and less than half of what they would in Sweden or the Netherlands. The level of statutory sick pay is also set lower than the national living wage, which the Government said in the Budget that they want to increase. Will the Government therefore raise statutory sick pay to at least the level of the real living wage so that people are not pushed into poverty by doing the right thing?
The Government’s approach has been to say that people on low income who are not eligible for statutory sick pay can claim universal credit or new-style ESA. That is not the answer. Universal credit acts as a vehicle for cuts and the level of support is simply too low.
The four-year benefits freeze will only come to an end in April, and, as a result, families living in poverty have been left £560 a year worse off on average, so will the Government raise the level of social security payments in order to build resilience in people facing the virus? The five-week wait for the payment of universal credit means that there will remain a risk that people will go on working when unwell. The Government say that people can request an advance, but advances are loans that have to be paid back, often on top of other debts built up during that period, so will the Government commit to ending the five-week wait, and will they change their loan into a non-repayable advance?
The truth is that people often have to rely on food banks to survive as well as on advances during the first five weeks, and often after that, as deductions are made from the universal credit when it finally does arrive. However, there are reports that panic buying by the public is leading to food banks running short. People using food banks cannot afford to stock up and so are disadvantaged still further.
The Government should be taking measures to protect people in poverty in the current situation. Will the Government immediately suspend deductions from social security for anyone who becomes ill or is forced to self-isolate, and consider suspending them for all other claimants? Will the Government suspend work search requirements for anyone directly affected by the virus, and will the Government suspend all sanctions?
In the Budget, the Chancellor also suggested that some people who become ill but do not qualify for statutory sick pay could claim new-style ESA. That is £73.10 a week, even lower than statutory sick pay. Someone who is ill as a result of the coronavirus or for any other reason should not also be pushed into poverty and left worrying about how they will cope financially, so will the Government raise the level of new-style ESA payments? Even to get that, someone has to have built a contribution record over the past two years, which people in insecure work in particular may find difficult to do.
The Government announced that they were temporarily suspending face-to-face assessments for sickness and disability benefits. That is welcome as far as it goes, and Opposition Members have been highlighting the major problems with how assessments are carried out for a long time, but the Government have said that this approach would be replaced by telephone or paper-based assessments. That could risk increasing pressure on GPs at a time when they are already overrun, so can the Government tell us clearly how assessments will be carried out during the outbreak?
Media reporting of the virus highlighted that the most at risk had underlying health conditions, so what is the Government’s response to Mind’s call for all reassessments to be suspended to give people security of income at this time? What action will the Secretary of State take to protect people who care for a loved one who was already ill or disabled before the crisis began? Neither person may be directly affected by the virus, but attending a jobcentre could leave the carer at greater risk of contracting the virus.
The truth is that social security changes aimed solely at people who are self-isolating or ill will not be enough. Other people will be affected by the crisis. The Government have said that they will suspend the minimum income floor in universal credit for self-employed people directly affected. Will they also suspend the minimum income floor for all workers, given that many will be affected as a result of the crisis and the impact on the economy?
The demands on the DWP will be considerable, and its own staff may be forced to self-isolate or take time off because of illness as a result of the outbreak. What will the Government do to ensure that the service can continue? We are calling on them to do all that they can to introduce a form of robust, generous and comprehensive income protection for those whose hours may be cut or who may be asked to take unpaid leave because of the impact of the crisis. In some cases that will be because of a fall in the number of customers, but if schools have to close at some point, there will also be parents who are not ill and do not have to self-isolate, but who are unable to go on working, at least full-time. The Danish Government have just announced a scheme that would involve their paying 75% of people’s wages in those circumstances, and businesses paying the remaining 25%. A similar scheme successfully limited redundancies in Germany during the financial crisis.
My hon. Friend is making some excellent comments. I understand that a major international fast food chain has told its employees that if a branch has to close because of infection, business being quiet or Government action, the employees will receive only statutory sick pay, and those on zero-hours contracts will get nothing. Does my hon. Friend agree that that will make it harder for employees to do the right thing, and that it constitutes exploitative behaviour on the part of the employers which must be condemned and stopped?
My hon. Friend is making a powerful speech. May I echo the point that she made about Denmark? I understand that both the French and the Italian Governments are seeking to introduce exactly the same system to support workers who would otherwise be laid off. The money is being paid directly to companies to ensure that they can retain those employees and the business can be kept alive as well.
That too is a very important point. The Labour party is working with the TUC and others on a package of measures, and looking at the Danish model in particular.
We want people to be reassured that they will not lose their jobs and their income, so they can go on spending. That would prevent a sharp fall in demand, and would also ease business confidence, as firms would see the Government take on part of their wage bill. It is an approach that involves employers, trade unions and the Government working together to preserve jobs and protect people from poverty. We are calling on the Government to explore these options, and we are prepared to work in partnership to make that happen.
There is a real danger that people who have already been pushed to the margins of our society will be worst affected by this crisis, and those who are struggling on low incomes, are disabled or are unable to work will be affected particularly badly. As I have said, we are working with the TUC and others on a range of measures to extend and raise statutory sick pay, abolish the five-week wait and sanctions, and provide income and wage support along the lines of the Danish model. We also wish to join in discussions with the Prime Minister about emergency universal basic income. We need leadership from the Government to ensure that all are protected if they fall ill, are forced to self-isolate, see their jobs at risk, or face unemployment. More than ever, we need leadership and policies that reflect the responsibility we all have for one another.
We are in extraordinary times. The coronavirus pandemic is the most serious public health emergency that our nation has faced for a generation, but the Government will do whatever it takes to get our nation through it. We all need to pull together. We can, must and will get through this.
Before I proceed to the main part of my speech, I want to pay tribute to all our fantastic staff, particularly those on the front line who are doing their level best, where they can, to enable some of the most vulnerable people in society to continue to receive benefits, and to enable those who now need to gain access to those benefits to do so. The spirit of this debate shows Parliament at its best—we are all seeking to work in partnership.
These are uncharted times, and there are new things coming forward. I have talked to lots of stakeholders in the past few days as we have made announcements about our Department. In normal times, we could spend 18 months developing policies—testing them, carrying out engagement up and down the country, and talking to people with real-life experiences to make sure there are no unintended consequences—but we are on a daily basis having to review things. It is a credit to the Opposition that this debate is being conducted in a spirit of partnership, so that we can look at and feed in things that need to be considered to provide further support—I know that more support will come forward on a daily basis.
Our policy is to protect lives and fight this virus with everything we have. Everyone should follow Government guidance to control the spread of the disease. Those who have a high temperature or a new contagious cough, and those who share a home with people presenting these symptoms, should stay at home in self-isolation for 14 days. Everyone should avoid unnecessary travel and social contact with others, and people who can do so should work from home. That will help to protect the NHS and safeguard the most vulnerable.
I reassure the House that the Government will provide a safety net and support for individuals during this testing time. Everybody will be supported to do the right thing, and the Government will help employers to support their employees to do the right thing.
The Minister is very dutiful in doing his job, for which I thank him, but I have had contact today from a mother who is isolating because of her child. Is she eligible for sick pay from the Government, or does she have to take unpaid dependants’ leave, which would be very unfair? Just how can that work?
When people in work are isolating due to Government guidance, which seems to be the case in the circumstances that the hon. Gentleman describes, they would be eligible for statutory sick pay through their employers. In addition, it is always worth their looking on gov.uk to see whether they can get additional support through the welfare system, whether universal credit or new-style ESA.
Like the Minister and other hon. Members, I am looking to be collaborative, as I generally try to be, particularly in this type of circumstance, but the issue raised by the hon. Member for Strangford (Jim Shannon) typifies the confusion surrounding the guidance and support for people, which was why my right hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford) recommended at Prime Minister’s questions some form of minimum income guarantee that would cover all these issues and mean that people could just do what is right at the right time without having to worry about the financial consequences. Is the Department looking at that?
I thank the hon. Gentleman. I have said many times at the Dispatch Box that I admire the way that he contributes and offers support in trying to help some of the most vulnerable people in society. There were two aspects to his question, the first of which was about general communication. These are fast-moving events, and all constituency MPs are getting a lot of correspondence that asks very reasonable questions. We are trying to give answers that are as good as possible, but we really have to keep pushing people towards the gov.uk website, on which there is consistent communication. On the second point about a minimum net, that is where the welfare system comes into play, because statutory sick pay—it is important, and I will go over that—applies in only some cases, whereas the welfare safety net applies to all who need it.
I believe the Minister will know that cross-party working is in my DNA, and I really do want to do everything I can to make sure we get this right. This is a personal but pertinent point: my son Stuart is self-employed; he has a wife who has had dialysis since she was 14, and a 10-year-old son, Liam. They are all self-isolating; Stuart does not have an income. They live in rented accommodation and utilities are essential to keep the dialysis going. I have a very frightened family and very many frightened constituents. We would be most grateful for any clarification on what we can do.
I have worked very closely with the hon. Lady on a number of issues, and I know that she is held in huge respect across both sides of the House.
Prior to being an MP, I ran my own business, so I understand the concerns of self-employed people who have suddenly overnight seen dramatic changes to their cash flow and ability to trade as a business. I absolutely understand the worries that people will have, which is why we are allowing access to statutory sick pay or, depending on people’s personal circumstances, looking at whether they can turn to new-style ESA—the contributory benefit—which is probably the case for the self-employed, or the wider support offer through universal credit and the welfare net. People would need to look at their circumstances and talk to the jobcentres. We are all trying to do our best to provide as much certainty as possible, as quickly as possible, through the daily updates.
The Minister will know that many people are really worried about the financial impact of self-isolation, whether they are sick or not. He has mentioned sick pay a few times and the alternatives of universal credit and ESA, but those sums simply will not pay the rent or the bills, or put food on the table. The Minister also mentioned the speed at which action is needed and how much faster his Department is having to react then normal. If it takes till next week to put in place legislation, many more people will have not taken action to protect themselves and everybody else. Action is needed now and people need the money now. Will he please respond on that point?
I absolutely understand the point that the hon. Member makes. These are extraordinary times, and collectively we are all trying to identify the right levels of support as quickly as possible. In pure cash terms, the fiscal support that we have already provided at this stage of the curve is almost the highest around the world, but this is not complete. As events progress, we have to do more and we can expect more announcements. I understand that in an ideal world we could announce everything straight away, but we have to make sure that it is right, we have to react as things come forward, and we have to communicate as quickly and clearly as possible. We do understand that.
Let me make a little progress, because I think I am about to cover some of the things being asked about. I promise that I will take more interventions.
Extraordinary times call for extraordinary measures, which is why we have extended statutory sick pay to those who are self-isolating in line with the latest Government health guidance. The guidance is available online on gov.uk and ensures that eligible individuals, whether they are sick or self-isolating, will be entitled to statutory sick pay if they are unable to work because they are following Government advice.
The upcoming emergency Bill will mean that for people affected by coronavirus, statutory sick pay will be payable from day one, instead of day four, and currently it will be backdated to 13 March. We removed those waiting days to get support to people as quickly as possible. These are crucial measures to ensure that employees do not attend work when they should stay at home to help to keep themselves and others safe. The circumstances are exceptional and we urge employers to do the right thing, use their discretion and respect the medical need to self-isolate.
Statutory sick pay is a legal minimum, and employers can offer more. Where possible, employers should support their employees to work from home to help to slow the spread of the virus. If employers do feel the need to require evidence, people who are advised to self-isolate for coronavirus will soon be able to obtain an alternative to the fit note by contacting NHS 111 rather than visiting a doctor. We are all aware of the need to protect GP surgeries so that they can concentrate on key areas of work.
Accordingly, the Government will ensure that businesses are supported to deal with the temporary economic impact of the outbreak of coronavirus. Small and medium-sized enterprises are at the heart of our economy, symbolising the hard work and enterprising spirit of our nation. To support such employers with the increased costs of sick pay, the emergency Bill will provide that employers with fewer than 250 employees can reclaim up to two weeks’ statutory sick pay for sickness absences related to coronavirus. That includes those who are required to self-isolate in line with Government guidance. The measure could provide more than £2 billion of support for up to 2 million businesses, and will be crucial to ensure that our economy keeps running.
The measure on statutory sick pay is in addition to others to support businesses that were outlined by the Chancellor yesterday: £330 billion of Government-backed and guaranteed loans; additional cash grants of up to £25,000 for businesses in the retail, hospitality and leisure sectors with a rateable value of less than £51,000; and cash grants of £10,000 to 700,000 of our smaller businesses. The Government will do whatever it takes to support our economy.
Of course, not everyone is eligible for statutory sick pay, which is paid by employers. Gig workers and those on zero-hours contracts may be entitled to sick pay, and should check with their employer, but millions of hard-working people who are self-employed or in the gig economy will need our help, too. That is why we are making it easier to access benefits during this period.
The shadow Secretary of State talked about disability benefits and the announcement that we made earlier this week. The first decision was to remove face-to-face assessments, because we recognise that a significant proportion of those who could be claiming disability benefits are vulnerable. We want to avoid them needing to travel unnecessarily and to sit in busy waiting rooms, so we decided to stop face-to-face assessments. However, we do not want to stop new people gaining access to the support that they are entitled to, so we are seeking to continue to do paper-based and telephone reviews, but prioritising those who are new claimants, and looking at the workforce on a daily basis.
I very much agree with the policy that the Minister is setting out. Will he clarify the intention for reassessments? He will know that Mind and one or two others have suggested that reassessments ought not to go ahead at the moment, partly because it is very difficult for people to get medical evidence in support of their reassessment claim at a time when doctors are very busy with something else.
I absolutely understand that point, and the right hon. Member and I discussed it when we first made the announcement. The absolute priority has to be new claimants who are seeking to get support through the disability benefit system, so we are looking on a daily basis at what we can do. I do not envisage that we will be able to do much beyond that, but I want to make sure that new claimants can get support. That was why, at the beginning of my speech, I paid tribute to the fantastic work of those who are working on the frontline, who—like all people—are anxious about events, but are still, when they can, coming in to make sure that the vulnerable people in society can access the support that they are entitled to.
I thank the Secretary of State for giving way. He talks about statutory sick pay as part of the safety net. As such, he recognises that, as a safety net, it is a benefit of last resort, and he talks about the way in which companies can offer more. Does he therefore recognise that in this unprecedented situation, when so many people are likely to find themselves—either by choosing to self-isolate or being obliged to—in the position of claiming statutory sick pay, the level is not appropriate to drive the right behaviours or support people? It is no longer a question of last resort, but of supporting significant proportions of our population, so sick pay needs to be at a higher level.
I am not the Secretary of State—it is very kind of the hon. Member to elevate me to such a lofty position, but that does not apply. The broader point is that the Chancellor has made it very clear that we will continue, on a daily basis, to look at what additional support there can be. The Government will do what we need to do to protect the vulnerable in society and keep our economy going. Many Members will raise very important points in the debate but, as a broad principle, the safety net is wider welfare support, looking at an individual’s personal circumstances, and tailoring the level of support to them so that we can target help to the most vulnerable in society.
Those not eligible for sick pay, including the self-employed, are able to make a claim for universal credit or contributory employment and support allowance. Last week, we laid regulations to ensure that the contributory ESA is now payable from day one, removing the seven-day waiting period for people who are self-isolating on Government guidance or who are ill with coronavirus. Claims can also be made over the phone without the need for people to contact their doctor for a fit note. Those in self-isolation or sick with coronavirus who make a claim for universal credit can receive up to a month’s advance up front without physically attending a jobcentre. Everything can be done by phone or online, and that is a welcome position.
We anticipate unprecedented demand, which is part of the reason why we have looked at the work that we no longer need to do during this period—for example, there was the announcement on ending face-to-face assessments for disability benefits—so that we can move health professionals on to the telephone systems to make sure that we can cope with demand and remove the need for people to unnecessarily visit jobcentres. We are keeping a very close eye on that on a day-to-day basis.
We are also removing the minimum income floor for self-employed universal credit claimants who have to self-isolate or who become ill as a result of coronavirus during this period. We are taking those measures to ensure that people are supported throughout this difficult period. We have increased access to sick pay, made it easier to access benefits and provided support for businesses to protect people’s jobs. This is a comprehensive package of support for some of the most vulnerable in society, but we are continuing to look at it by the day. The Chancellor has made it clear that there will be further announcements.
Two of my constituents who were both self-employed have had all their contracts brought to an end. They have a mortgage and two young children. Not surprisingly, as in many cases that hon. Members have raised, they are worried for the future. What support should I tell them the Government will make available to help their specific situation?
We are all hearing similar queries as constituency MPs. The key is for people to keep looking at gov.uk as announcements are made each day so that they have clarity about what they can and cannot get. The hon. Member talked about his constituents having a mortgage; obviously, we have already made the announcement about support for a mortgage holiday to protect people.
Part of the next step of our plan is to focus on providing support for people’s income and jobs. There will be further announcements, which will be shaped by all of us. As we flag up the issues being brought to our inboxes, that will help to shape the response. This is Parliament at its best, through partnership working. I hope that all hon. Members will give their full support to all the work that we and all our fantastic frontline staff are doing.
I thank the Labour party for devoting some of its Opposition time to allow us all to discuss this serious, pertinent, timely and important issue, given the uncertainty facing many of our constituents across the UK.
With your forbearance, Madam Deputy Speaker, I stress at the outset for anybody watching that people should follow the advice of their local health authorities, such as NHS Scotland or Public Health England. Regular updates are coming from the Governments across the isles. I recommend that, as best as possible, employees and employers follow the available guidance.
I commend everyone leading the response to the situation, including NHS staff, other emergency services, local authorities, the voluntary sector and Governments across the isles, who have been working together as best as possible to ensure that the best advice, based on science, and the best support is available at the right time. I particularly praise Professor Jason Leitch, a former dux of Airdrie Academy in my constituency and the Scottish Government’s national clinical director. Alongside the Scottish Health Secretary Jeane Freeman and the First Minister Nicola Sturgeon, he has been the model of calm, erudite leadership.
In the spirit of cross-party co-operation that we have seen emerge at Holyrood, I, too, have no desire to be political or criticise where working constructively can bring about better outcomes and engender greater confidence in the response of all Governments to the crisis. When I call for further action, therefore, it is not because I think the UK Government are deliberately holding back. I believe there is a genuine desire across all Governments to do the right thing at the right time.
The concerns that remain in large sections of society regarding the UK Government’s economic response to covid-19 essentially boil down to ensuring that incomes are protected when demand falls in huge sections of the economy. Renters, the self-employed, small business owners and people who are in or out of work just want to know that they will get the financial support they need to survive.
Constituents who are self-employed, such as taxi drivers, driving instructors, childcare providers and many more, have contacted me because they are worried about making sure that they do the right thing at the right time, while providing for their families and employees. My right hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford) and the shadow Health Secretary, the hon. Member for Leicester South (Jonathan Ashworth), have led calls for statutory sick pay arrangements to be improved to help workers who contract covid-19 or who have to self-isolate.
Although we welcome the UK Government’s move to make sick pay kick in from day one, and for the cost of sick pay to be met by them for companies with fewer than 250 staff for a period of 14 days, there is still more to do to support workers and businesses. Statutory sick pay is a reserved matter, as is employment law, so those areas are required to be decided upon here.
My right hon. Friend compared statutory sick pay rates in the UK with the rates of our European neighbours. As the House will be aware, that is not currently a favourable comparison for the UK Government. The UK rate is currently £94.25 a week—the second lowest rate when compared with EU nations. Ireland doubled its rate to £266 in response to covid-19, while Germany and Austria both pay £287 a week. At £94.25 a week, the UK Government are presiding over a system of poverty pay for those who are sick. One Tory MP was asked on Twitter whether she could live on £94.25 per week, and she simply responded “Get a life”.
This is really serious. We are asking people, even if they have mild symptoms, to self-isolate for the greater good, to contain and delay the spread of covid-19. We must be sympathetic with constituents who are asking legitimate questions about the advice and support they are getting. Statutory sick pay is an issue that should have been resolved before now, frankly. In response to this situation, the UK Government must act quickly.
At the Work and Pensions Committee hearing this morning, there was consensus among the witnesses that statutory sick pay should be raised. Citizens Advice is asking for it to go up to £180 per week. Scope is asking for it to be the equivalent of the national minimum wage. Others have said that the equivalent of the real living wage would be more appropriate, and Scandinavian countries are making it 100% of wages. The UK Government must act.
Alongside the rate of statutory sick pay, there are other specific areas where we want to see action from the UK Government.
We have to reflect on the fact that, even not at times of crisis, UK statutory sick pay rate is considerably lower than that of other European nations. A permanent change is required, but a temporary measure which might go beyond that permanent increase is required to deal with covid-19, so the answer is both, if that makes sense.
The Government must extend the policy further to ensure that sick pay is set at an hourly rate and available for everyone for 52 weeks instead of 28. Current rules on statutory sick pay are not flexible enough to meet real-life needs and fall far short of meeting a dignified standard of living, even with this new change. Disability groups have been especially vocal in calling for an overhaul of the sick pay system. Their concerns must be factored into the UK Government’s response to the sick pay consultation.
The UK Government should accept the TUC’s recommendations on sick pay for all. Those include abolishing the lower earnings limit, which would extend coverage to almost 2 million additional workers; permanently removing the waiting period for sick pay; increasing the weekly level of sick pay from £94 to the equivalent of a week’s pay at the real living wage; permanently agreeing that the legal requirement on fit notes after seven days of absence be extended to 14 days, with employers accepting self-certification for anything less than that; and permanently providing funds to ensure that employers can afford to pay sick pay.
The UK Government must do all they can to support businesses, to ensure that jobs are kept for the duration of this crisis. I would like to see the UK Government provide much greater grants, rather than loans, to help all businesses stay afloat, and attach conditions about ensuring that jobs are protected. We have seen that type of initiative in Denmark, and I hope the UK will follow.
Clearly, we all hope that these issues are temporary. The UK Government must do all they can to ensure that the attachment between employer and employee is not detached. That is important for workers, employers and the wider economy. Yesterday, Robert Chote, the chair of the Office for Budget Responsibility, urged the UK Government not to be “squeamish” about spending whatever it takes to prevent mass foreclosures, bankruptcies and millions of job losses as the UK effectively goes into lockdown. He said:
“When the fire is large enough you just spray the water and worry about it later.”
I turn to measures to support people who are self-employed and other business owners. The UK Government must do more. I echo the calls from my hon. Friend the Member for Glasgow Central (Alison Thewliss) last night. We must protect the incomes of people who are self-employed and do so quickly, to give them confidence. She was also right to raise issues around maternity leave, parental leave and support for people with no recourse to public funds; they are extremely vulnerable at the best of times, but right now they must be supported. The UK Government must give information to the devolved Governments as quickly as possible, and encourage much greater information sharing to allow all Governments to act swiftly and appropriately. At Prime Minister’s questions, my right hon. Friend the Member for Ross, Skye and Lochaber raised the prospect of some form of minimum income guarantee, such as a universal basic income. The Prime Minister appeared to accept the general premise, but time is now of the essence. Can the Minister give an idea of when he expects some form of announcement on people receiving financial support?
The UK Government should consider whether they will extend the normal deadlines for people to provide the necessary information to support social security applications, while paying people much more quickly as the demand is likely to be much greater. There is clearly a need to go further on social security. Ministers have heard me discuss the various issues that there are routinely with universal credit. The changes I want to universal credit, although they would undoubtedly help in this crisis, may not be practically achievable in a useful timescale—I am talking about scrapping the five-week wait, the two-child cap and increasing work allowances.
Instead, for the duration of this crisis, the UK Government need to ensure that those who are in or out of employment, those who are employed or self-employed, are paid an amount that allows them to get through. Universal credit advances, for instance, should now come in the form of a grant, not a loan. The Government should also look at urgently suspending the tax credit income disregard for reductions in earnings, at least for the 2020-21 financial year, to ensure that, where earnings fall, household tax credits entitlement takes account of that loss.
We now know that schools in Scotland and Wales are to close at the end of this week. That puts huge pressure on families who rely on free school meals, so I urge the UK Government to look at this area, as pressures are going to be on those families for the duration of the school closures.
One of the issues that constituents have contacted me about a number of times over recent days is the finance of households that rely upon prepaid meters for their energy. These households are likely to already be financially more vulnerable. It is very likely that they have to travel some distance to get the meter top-ups that they require. As part of their thinking, could the UK Government give serious thought to compelling the energy companies not to cut people off and to take account of the fact that there will be higher needs for energy and less money to go round while this is happening?
I absolutely agree. Many calls are being made across the country today for direct payments to be made from the Government to utility companies to ensure that people in these circumstances do not miss out, but it goes back to my original premise: incomes for people, regardless of their circumstances during this period, are going to be hit, so the Government need to provide some form of minimum income guarantee to ensure that people in all circumstances are able to get through, whether that is via statutory sick pay or the social security system. If they are in work, the Government must ensure that, if people lose hours, those could be picked up again, so they continue to pay their bills and continue to live a sustainable life.
The monthly allowance for universal credit should also be increased dramatically and all other social security payment levels should be swiftly reviewed as well. Clearly now, this is not business as usual. We cannot continue to pay social security rates which impoverish in normal times, never mind now. We are going to have to accept that, to get through, the UK Government are going to need to inject a massive amount of money into the economy to make up for what is undoubtedly going to be a massive downturn across a wide range of sectors, the like of which I do not think we have ever seen before—a downturn that will result from the actions that the UK Government and other Governments are rightly taking in asking people to self-isolate and take other actions to contain the virus. We cannot tell people to stay away from work if they have symptoms, to stay away from restaurants, bars and cinemas and to work from home, and not expect an economic impact, an employment impact and an income impact. The UK Government must fill that hole to ensure that they fulfil the promises of the Prime Minister that nobody will be penalised and everyone will be protected for doing the right thing.
I wish to conclude with an encouragement to everybody who may be following this debate. Please be community-minded. We have already seen some fantastic ideas and responses to the crisis in all our communities. Watch out for your neighbours. Help if you can. Buy only what you need. If they have the means to buy more, add what you can to the food bank trolley and know that others certainly do not have the ability to stockpile. Many of my constituents are already worried about how they will access essentials because they are self-isolating, have lost their job or have other vulnerabilities. Now, like never before in so many of our lifetimes, we need the community-mindedness that got previous generations through such emergency situations.
We also need to start talking about how those of us who are fit and well—and who have contracted and come through the other side of covid-19—can help key sectors of the economy and emergency services to cope with what is to come. I suspect that, in time, with self-isolation and illness, we will need to mobilise that volunteer army. But that can only happen if we ensure that everyone has their income protected. Support for business is important, but at the end of the day it will be income protection, in whatever form that takes—a cash grant or a temporary universal basic income—that will finally give everyone the comfort to do the right thing by society. That will give the answers to the questions that we are all getting from businesses, the self-employed, renters and others.
I hope that, within hours, rather than days, the UK Government will do the right thing and guarantee incomes, as we have seen in other nations. We are willing to discuss any potential measures that the UK Government are thinking of in order to ensure that this is done properly and quickly.
The hon. Member for Airdrie and Shotts (Neil Gray) mentioned in passing that the Work and Pensions Committee met this morning. We took evidence from five organisations: the Royal National Institute of Blind People, Mind, Scope, Citizens Advice and the Zacchaeus 2000 Trust representing the Disability Benefits Consortium. The main purpose was to take evidence about disability benefit assessments, but of course we took the opportunity to raise some of the current issues that we are discussing in this debate. I thank the members and staff of the Committee, and the witnesses from all those organisations, for being willing to take part in that useful session this morning, despite the current difficult circumstances.
I welcome the announcements that the Government have made. As the Minister for Disabled People, Health and Work, the hon. Member for North Swindon (Justin Tomlinson), has recognised, there is going to be a good deal more to do to protect individuals through this very difficult time; that is underlined by the examples from other countries that we have heard today. I very much hope, with others, that those additional announcements will happen very soon because we need them very fast.
I want to raise a couple of issues about universal credit. I put the point to the Chancellor yesterday that somebody who is self-employed and who self-isolates very often will have to forgo their income as a result. The advice is to apply for benefits, but if people apply for universal credit, they do not get any help for the first five weeks other than a loan that has to be repaid. It seems to me that people in that position are not going to be willing to give up their income if all they are going to get is a loan.
In answering my question, the Chancellor correctly said that people can apply for the new contributory employment and support allowance. I welcome the fact that that is now available not only to people who are sick, but to people who are having to self-isolate because others in their household are sick. However, as the Minister will recognise, there are going to be quite a lot of people in that position who do not meet the contribution criteria for ESA because they have not paid 26 weeks’ worth of contributions, having earned above the lower earnings limit, within the last two years. The only opportunity those people will have is to apply for universal credit. However, if they only get a loan, many will feel that they have no alternative but to carry on working—even though they know that they really ought to self-isolate.
The attraction of the proposal made by the hon. Member for Airdrie and Shotts—and which has been made by Citizens Advice and others—is that these advances should be made as non-repayable grants for the duration of this crisis. That is something that the Department could readily do. I recognise that expecting the Department very quickly to make big changes to its IT systems for supporting universal credit may not be practical, but it could quickly make the advances non-repayable.
I am pleased to see both the Minister for Disabled People, Health and Work and the Under-Secretary of State for Work and Pensions, the hon. Member for Colchester (Will Quince), on the Front Bench. They are very familiar with the Select Committee’s concerns about the five-week delay in universal credit anyway. There is growing evidence—including a striking article published in The Lancet this month—that people are being pushed into clinical depression due to being on universal credit rather than on legacy benefits. The Trussell Trust has found that many more people on universal credit need to go to a food bank compared with those on the predecessor benefits. Looking at what it is about universal credit that is causing those problems, the only big structural issue is the five-week delay. As the Ministers know, the Work and Pensions Committee will shortly begin an inquiry on that particular topic. That is a broader issue but, for the duration of the crisis, there is a powerful case for making the advances non-repayable.
I appreciate that this will not be the case everywhere, but it is the case in constituencies like mine. There are many working families who have leave to remain in the UK but do not yet have indefinite leave to remain. They are on what is called the 10-year pathway to securing indefinite leave, which means that every two and a half years they have to apply again for leave to remain. If they are working, they obtain leave to remain, but—I do not know whether this is universal, but it is certainly the case for a lot of my constituents—the card they receive making it clear they have leave to remain and are permitted to work in the UK also says they have no recourse to public funds. They are not allowed to claim any benefits at all, which in the current circumstance puts them in an extraordinarily difficult position. They are not allowed to claim ESA or universal credit at all. If they are in a position where they should self-isolate in accordance with the Government’s guidance, they will find that they suddenly have no income at all if they self-isolate.
There is a related issue with the habitual residence test, which is often applied, perfectly properly, to make sure people are habitually resident in the UK and are therefore entitled to benefits. I wonder whether there is a case for suspending the test, at least in some circumstances, because we want those who are working to be able to self-isolate when it is important that they do so. If they do not have access to public funds for one of those two reasons, they will find it practically impossible to self-isolate. I hope the Ministers and their Home Office colleagues will look at that.
Citizens Advice has argued that there should be a temporary repayment pause for claimants, which is a strong point in the current crisis. People currently have to repay their universal credit advances, or perhaps their past tax credit overpayments, through their universal credit, so there is a case for suspending those repayments.
The Minister for Disabled People, Health and Work said in his opening speech that “Everybody will be supported to do the right thing.” He is right to underline the importance of that but, as things stand, those who do not have recourse to public funds, because they do not meet the requirements of the habitual residence test, will not be supported to do the right thing, and it is very important that they should be.
In his Budget statement, the Chancellor said he is
“temporarily removing the minimum income floor in universal credit.”—[Official Report, 11 March 2020; Vol. 673, c. 280.]
When we came to read the Budget documents, we found that the position, as the Minister set out a few minutes ago, is that the removal applies only to those directly affected by covid-19 or by self-isolation according to Government advice. I think the Government should stick with what the Chancellor of the Exchequer actually said, which is that the minimum income floor will be suspended altogether, because a lot of self-employed people—my hon. Friend the Member for Harrow West (Gareth Thomas) gave us such an example—will see a big fall in their income because of what is happening in the wider economy, not because they are directly affected, as yet, by covid-19. Universal credit provides an opportunity to increase support where their income from self-employment falls. That could work very well, I think, if the minimum income floor was suspended altogether, as the Chancellor of Exchequer appeared to indicate would be the case in his Budget speech last week. I do hope that that will be looked at again, that the caveats that have been added to that commitment since might be taken away, and that the minimum income floor will be suspended altogether for self-employed people for the duration of this crisis.
I echo the point that was made a few moments ago by the hon. Member for Airdrie and Shotts (Neil Gray) about the tax credit disregard. As things stand at the moment, if someone’s income falls by less than £2,500, their tax credits do not increase at all. There is, in the tax credit system, a mechanism that can be used to provide people with help when their income falls, but to get the full benefit of that we would need to remove that £2,500 disregard. I appreciate that that is a matter for the Treasury, rather than for the Department for Work and Pensions, but I hope that it will be done.
Statutory sick pay is a big focus for this debate. The Government consulted last summer on extending statutory sick pay to those who are lower paid—to those who are earning below the current threshold—but the Government have not yet responded to that consultation, which was carried out several months ago. Surely now is the time to act. It was proposed then that statutory sick pay should be paid to people earning less than the lower earnings limit at 80% of their wage. That, I think, was the proposal on which the Government consulted. This is surely the time to fast-track that proposal—to bring it forward and put it in place. I appreciate that it will need legislation to do that, but it is very important that it is done, and I hope that it can be picked up in the legislation that will be published tomorrow.
On this point about statutory sick pay, there are two additional points on which the Government really do need to act. One is that this should be done in advance, up front, rather than making businesses reclaim, which is putting massive pressure on them. The other is that it is vital for the self- employed. Businesses in my Aberavon constituency are really under the cosh and they need both of these measures to be included in the rethink on statutory sick pay.
My hon. Friend makes a couple of very important points. I very much agree with him on the first, but on the second, my understanding is that self-employed people in this position can apply for this new employment and support allowance if they meet the contribution conditions, which, of course, some will not. That is where universal credit needs to be changed. One of those routes is likely to be a solution for them, rather than statutory sick pay, because that depends on there being an employer in place.
My final point is about the argument that has been made by many, and I am sure that will be made again in this debate, that the overall level of benefits should be higher, at least for the duration of this crisis, than it has been up until now. I just want to make one argument in favour of that proposition. We always say, and we have said it on both sides of this House, that work is the best route out of poverty, and the system is designed to encourage people to seek and find work but, at the moment, there are lots of people—and it will be a growing number over the coming weeks—whom we do not want to work. We do not want to force people into jobs. For many, the position will continue to be the same in the next few weeks as it has been in the past, but there is this large and very important group whom we really do not want to be working, and we want them to be at home. That, in particular, makes the case for Ministers who are looking temporarily at raising the levels of benefits—statutory sick pay and universal credit and the others.
I welcome what the Minister said about the suspension of face-to-face assessments
for disability benefits. I think he suggested that, in practice, his Department will not conduct reassessments for disability benefits either. If that is the practical reality, it would be helpful if he stated that explicitly. I think that would be reassuring to a lot of people who are in receipt of disability benefits at the moment and expect to have to be reassessed in the next few months. That is always quite an anxious time for people in that position. If the reality is that they will not be reassessed for several months because everybody is busy with everything else, it would be helpful for that to be made explicit so that reassurance can be provided.
Of course, if it turns out that there are ways of doing the new assessments that do not require face-to-face meetings, and if that works well for new applications, hopefully lessons can be learned for the system in the longer term. However, if it was possible to make it clear that there will not be any disability benefit reassessments in the next few months, I think that would be widely welcomed.
It is an honour to follow my right hon. Friend the Member for East Ham (Stephen Timms), who made a powerful speech, particularly about refugees and asylum seekers. Their plight, and the specific issues they face, have not been discussed nearly enough in the past few days and weeks.
At times of national and, as in this case, global crisis, only Governments have the resources to protect our society and our health, to protect the most vulnerable, to protect businesses and production, and to protect workers. Markets cannot do that; only the Government can. That is why the Government must step up to ensure that we protect all our citizens, to direct our national economy, to help and support the people who most need it, and to ensure that resources get to where they are most needed.
I will talk primarily about issues with statutory sick pay, but let me first say something about the reports in the newspapers today that some Harley Street clinics are offering coronavirus tests for £395. That means someone can get the test if they have the money, but someone who works in a GP surgery cannot get it. That is utterly unacceptable. The role of the Government is to intervene to ensure that resources go where they are most needed—not to the rich and powerful, but to the people delivering our frontline services, who need protection. I urge Ministers to do that.
The measures taken by the Chancellor yesterday were necessary and worth while to protect our economic infrastructure and to support the most severely hit sectors of our economy. They were also necessary to support businesses, which are not responsible for the collapse in demand they are experiencing. The same is true of workers—they are not responsible for the predicament they find themselves in—yet support for them was missing from the Chancellor’s statement yesterday. The Minister has said today—the Prime Minister has said it too—that everybody will be supported to do the right thing. We all want that, but I am afraid at the moment that is not the case. People are not being supported to do the right thing. For many people, the right thing is not to go to work—not to spread this virus, but to stay at home.
If we really want people to do the right thing, we need to support them to make that decision, so let me turn to statutory sick pay. This point has been well rehearsed in debate both today and yesterday, but it obviously needs to be made time and again, because so far the necessary measures have not been taken. Statutory sick pay is not enough for people to be able to support themselves and their family. The level of statutory sick pay is insufficient.
The ineligibility is also a huge problem. If people are self-employed or earn below the lower earnings limit, they are not able to get statutory sick pay. Some of the people who most need it are denied the support that the Government say is necessary. Other people may not be sick, but also need support. If they are self-isolating, they might not have symptoms or be sick, but the right thing to do is to stay at home. If we want people to stay at home, they need support.
Similarly, we will have a statement from the Secretary of State for Education later and if, as now seems inevitable, many parents will have to take time off work to look after their children, they will need support to do the right thing, although they will not be sick. Of course, many people also face redundancy because their businesses cannot employ them anymore. Or if they are self-employed, the work is just not coming in. At the moment, those people are not able to claim statutory sick pay, and they will have to wait in the queue for universal credit or ESA if they have the contributions. That is not supporting people to do the right thing.
Does the hon. Lady agree that as workers have had their shifts cancelled, or have been told that their hours will be reduced—many of them are on zero-hour contracts—they, too, need the support that she is rightly saying should be given to workers?
The hon. Gentleman is right. For many people, if they have a temporary reduction in their work, they can draw on their savings, but many of the people I represent—and many of his constituents as well—do not have savings to draw on. The Resolution Foundation published evidence last week before the Budget—to try to influence the Budget—that showed that 60% of people on low and middle incomes have less than £100 of savings. They do not have the resources to draw on even temporarily for a short time to pay the rent or the mortgage, or to put food on the table.
We must offer more support. That is what other countries are doing. In Norway, full pay is given to those laid off for 20 days. The self-employed get 80% of their average income over the last three years. In Sweden, laid-off workers are guaranteed 90% of their income: the Government will pick up half of that and employers are expected to pick up the other half. In Denmark, the Danish state will pay 75% of the salaries of laid-off workers. That is the same in many other countries. If it is good enough in Denmark, Sweden, Norway and other countries in the European Union and elsewhere, it is frankly good enough for workers in this country too.
It is now urgent that the Government come to the House and tell us that support is not just available for business—although that is very welcome—but is available to workers as well. Unless that happens, people will not be able to self-isolate and stop the virus spreading. The health crisis will become an economic crisis and many people will pay the price for the virus. It does not need to be that way. Let us look at income replacement, and quickly, to ensure that help is available.
As important as helping people now is, if we put in place income replacement so that people are not laid off or made redundant, it will also support the economic recovery. The pandemic will pass—we must believe that and we know it is the case—but when it does, and people want to go out again and to start spending in shops, restaurants, bars, theatres and cafes and to travel on aeroplanes, we need to ensure that the economic fabric of our country is still intact. The best way to do that is to ensure that workers remain attached to the firms that have been employing then. Income replacement can help people now, but it can also ensure that our economy gets back on a sound footing when the crisis has passed. To build the economy we need to see after this, I urge the Government to introduce urgently a system of income replacement.
The issue of renters has also been mentioned by Front Benchers and others. There was support yesterday for people with mortgages, and that is very welcome, but many people, especially those in precarious work or on low pay, do not have mortgages—they rent privately or in the social sector. In my constituency, fewer than a third of homes are owner-occupied; the others are either in the private rented sector or the social rented sector, and we need to do much more to support those people as well, because if they are on statutory sick pay now, or have seen a fall in their incomes or are expecting to be made redundant, frankly they are not going to be able to pay their rent in the days and weeks ahead. It was welcome that the Prime Minister said there will be support for renters, but we need to see the detail of that, and we need to see that support coming directly to landlords and renters to ensure that nobody is penalised because they do not have the money to pay their rents right now. That requires support for local authorities, who are big letting agents, and big providers of social housing; the support needs to go to the housing associations too and also large landlords, and we should be working with local government to ensure that we are reaching and talking to the biggest letting agencies and estate agents to make sure that support is getting to the people on the ground.
Again, I cannot stress enough how important this is; this action is needed urgently. The representative of the hospitality sector said last night that we are staring at hundreds of thousands of redundancies in that sector alone, so income replacement and support for people in the rented sector is crucially important.
The support for mortgages is a three-month holiday, and I say again that I am not sure that that is the right approach in the private rented sector, because a three-month holiday on a person’s mortgage which can then be added to their mortgage debt is one thing, but if in three or four months’ time someone has four months’ worth of rent to pay, that is not going to be much good if they have found their incomes have not recovered by then. We therefore need to be sensitive about ensuring that the support is there for the period of time that it is needed for.
Finally, I want to say something about gas and electricity and broadband and television licences. These are all essential services for people, and they will be more essential in the weeks and days and months ahead as more people are having to stay at home. Broadband is now absolutely an essential service, because the only way that many people can get food delivered is by ordering online. Again I urge Ministers to say to the providers of those essential services that nobody should be cut off from those essential services as long as the pandemic lasts, because otherwise people will find themselves without the basic infrastructure to be able to stay in their homes.
This global pandemic has thrown into sharp relief some of the problems in our labour market and in our social security system, so when this is all over we cannot go back to business as usual. If people cannot survive on £94.25 statutory sick pay when there is a global pandemic, they cannot survive on £94.25 at any other time, so we need to look at the waiting time for universal credit and the level of statutory sick pay, and who is eligible for it, and also, frankly, how our labour market works. We have 1 million people on zero-hour contracts and we have almost 5 million people who are self-employed—some choose to be, but many have no choice—so we need to look at how our economy works and who it works for, because whether we are in the midst of a global pandemic or not, there are too many people in our country that our economy, our labour market and, frankly, our society do not work for.
It is a pleasure to follow my hon. Friend the Member for Leeds West (Rachel Reeves) and my right hon. Friend the Member for East Ham (Stephen Timms), the Chair of the Select Committee, and I want to build on some of the points they made both about the practical challenges people face in the midst of this pandemic and about some of the fundamental questions posed to each of us as members of a society that has left far too many people far too dangerously exposed, not just in the face of this pandemic but in everyday life—a plight that has gone unanswered for far too long.
I want to begin by paying tribute particularly to the workers in the NHS who are putting themselves in harm’s way as they treat people in the midst of this pandemic, and I absolutely echo what my hon. Friend the Member for Leeds West said: it is crucial that NHS workers have access to the right kit to do the job and that, where there is any concern about the diagnosis of those NHS workers or their family members, they are considered priority cases for testing. Frankly, the Government’s claim to be among the best in the world at testing tells us only that the rest of the world has much more to do, because we are hearing of far too many cases where people who need to be tested are not receiving that test.
The crisis we face is not just a public health crisis; it threatens to be an economic one. The supply and demand-side shocks it will pose will be both simultaneous and severe, so it requires co-ordinated action on the part of Government and industry on a scale that we have not seen since the second world war. A wartime mobilisation is going to be required for this peacetime crisis. Many families, as they gather around the kitchen table this afternoon and this evening to consider what a loss of earnings or perhaps a loss of employment would mean for them and their families, are staring at the hard reality of a social insecurity system that has left far too many people grappling with poverty and insecurity, and ongoing crises as a result, for far too long. No one can or should be expected to live on SSP of £94.25 a week. No one should be expected to live on universal credit, which in some cases can be even less generous—if that is the right word—than SSP. So I echo the calls this afternoon for increases to SSP and UC to ensure that our social security system provides just that—social security, not just in the worst of times, but in the best of times for our country.
Ministers should ask, but so should people in our communities, how the political choices of successive Governments and the political demands of sections of the electorate ever allowed a position in which we allow people who have fallen on hard times to fall into harder times still because of the social insecurity system, which pushes people further into poverty, mental ill health and family crises, which make it harder, not easier, to escape from this. I suspect I am one of a minority of people in this House who know what it is like to grow up in a household that is reliant on the social security system; what it is like when there are more days left to the end of the month than there is money; what it is like when people have to beg, borrow and steal to put food in the fridge; what it is like when the electricity meter has run out and so has the emergency; and what it is like to feel a victim of the state, rather than supported by the state. We should resolve, in the midst of this crisis, that once it is over, never again are we going to allow our social security system to fail people in the way that it did before this crisis and that it threatens to do within this crisis.
Yesterday, the Chancellor set out a series of measures to help businesses and to try to get the economy through this. I welcome those measures, but we have to learn from past mistakes. It is not enough to bail out businesses, although that is important; we also have to bail out people. As we build the economic recovery, we have to ensure that the quantitative easing that helps provide liquidity to our economy to help things keep going as best they can in difficult times is also a quantitative easing for the people. By all means, let us call for an increase in SSP, UC and disability benefits, to make sure that people can live with dignity and have a good quality of life if they are unable to work. All those things are important, but instead of quibbling about piecemeal measures, with a bit of mortgage relief here and a bit of rental support there, why do we not just provide every household in this country with the security to know that the Government will provide protection for people’s incomes, so that they can continue to make sensible choices for their families, so that they know that when the end of the month comes and the mortgage or the rent is due they can pay it, and so that they know that when the bills are due and when they have to do their shop, they will be able to pay for this?
I have always been a sceptic about the principle of universal basic income, because I fundamentally believe in an economy and a social security system that redistributes wealth from those who have it to those who need it most. I am also cynical about it because although there are many principled and decent-minded champions of universal basic income on the left of politics, the left should regard the principle with suspicion when some of its leading champions have been right-wing economists, such as the father of free market economics, Adam Smith. There is a right-wing vision of universal basic income that is about dismantling the state and that says, “If we provide everyone with the income, we don’t need to provide the services centrally because people can pay for them.” That is one reason, I suspect, why the Trump Administration have not needed much persuasion to provide a form of basic income.
But although we should regard the principle with suspicion as an ongoing solution to how we provide social security for people, there is now a strong case for a form of basic income to see us through this crisis. It could be a universal payment made available to everyone, where the tax system is used to recoup the money from those who genuinely do not need it. It could be a form of basic income, where those who need it simply apply for it and then receive it. It could be a form of income protection, as my hon. Friend the Member for Leeds West described, which is already working well in Scandinavia. But one way or another, we have to make sure that families have incomes to see themselves through this crisis, because as we have already heard, the majority of people in this country tonight are one lost payday away from being in a real crisis, and the crisis for them will be a crisis for all of us if demand is further sucked out of the economy. I hope that Ministers will take that message back to the Treasury.
Finally, it is not just the social insecurity system that has left people exposed in this crisis. We have to make sure that this is a turning point. It could be that our political choices further entrench inequality in our society—just as, frankly, the coalition and Conservative Governments did after the last financial crisis, when too many of the political decisions and so-called tough choices meant balancing the books on the backs of the poorest.
The hon. Gentleman is making a very good speech, and I agree with much, if not all, of what he has said. He is coming to the very important point about what happens after all this. There has been a massive fiscal stimulus over the last week, and we expect more to come. What none of us would expect is austerity mark 2 to see us out the other side.
I wholeheartedly agree.
Let me conclude on this point. In the aftermath of the last financial crisis, the Labour Government—and, in fact, the reputation of the Labour party—were utterly trashed because Gordon Brown’s Government took the courageous steps that were needed to prevent a financial crisis in America, which became a global financial crisis, from becoming a depression, which would have meant people being unable to take money out of the banks. The Government were right then not to be squeamish about borrowing to make sure that our country got through it, and this Government should not be squeamish now.
I suspect that by the end of this the Government will own such a large stake of the British economy that it will make Labour’s last manifesto look positively conservative in its ambitions by comparison. If that is what it takes to see us through this crisis, that is what the Government will have to do that. We are going to need a wartime response to get us through this crisis, so let us think now about the peace that will follow. Just as our generation looks back with pride at the decisions that the 1945 Attlee Government took and the legacy that they left, let us think now about the legacy that we will leave for our country. Let us make the choices now that lessen inequality in our country and provide genuine social security in the best of times, not just the worst of times.
Let us ask how it was that political choices left our social care system at breaking point and the people languishing in it more exposed to this pandemic than they would otherwise have been. Let us repair our broken social care system by making brave political choices. Let us care more about how we fund the living to lead a good life than about how we tax the dead. Let us make sure that, when people get to old age, they are not just looking back on a life well lived, but able to live life to the full until the end. Let us make sure that, when people get to old age, they are not just looking back on a life well lived, but able to live life to the full until the end.
Let us see this as a wake-up call. If a pandemic can seriously disrupt the labour market, and we have to provide serious income protection to see it through, let us think about what a technological revolution will do as it displaces, relocates and significantly changes the shape of the labour market. Let us make sure that we have the social protections needed now to face the next revolution, not just the current crisis. Let us not let the global pandemic distract us from the urgency of the climate emergency. Let us make sure that our recovery is a green recovery.
Finally, let us no longer listen to the siren calls of the populists and the nativists who believe that countries can go it alone, and that we have to build a world where we are all in it for ourselves. Let us recognise that global problems require global solutions and global leadership through global institutions. As the Attlee Government rebuilt the fabric of the country through a new welfare state and built international institutions, let us to resolve to do the same.
We have heard some powerful speeches from hon. Members of three parties. I commend my right hon. and hon. Friends for what they have said.
It is a challenge to follow my hon. Friend the Member for Ilford North (Wes Streeting), because he spoke so powerfully. He started with his experience of growing up in the grip of the completely inadequate welfare system that we had then. The point he made that touched me was how dangerous it will be if we do not respond to the crisis by putting in place the necessary economic measures right now, because we run the risk of subjecting millions of our fellow citizens to long-term hardship. That is why the situation is so urgent and requires so much action from the Government. As my hon. Friend the Member for Leeds West (Rachel Reeves) said, only the Government can take that action.
We in this country face a situation where the number of fatalities had doubled in two days to 69 when I looked yesterday. If that is the growth rate of the number of fatalities, we will be where Italy is today by next Friday. That is the reality of what is happening, if those figures are right. That brings home to me, and I am sure to everybody, the need for the fastest possible action on health and on the economy.
My hon. Friend the Member for Ilford North mentioned the need to support health workers. That applies across the public sector. The No. 1 priority is to get them protection so that they can do their jobs and to make sure that the testing regime is there as quickly as possible. It will not wait any longer.
That priority is very closely followed by the economic response that is needed. If we are to reassure people across the country to take the actions recommended by the Government, and rightly spelled out by the Minister, we must also give them the financial assurance that they can do so. That has to happen straightaway. The SNP spokesman was right in saying that it should happen in the next few hours. Yesterday’s measures were only a start. I accept that the Chancellor rightly acknowledged that they were only part of a number of steps. As a result of this debate, Ministers are hearing further reinforcement of why it is important to get action for individuals today—not next week.
I will give some case studies. The bus driver in London who believes that he has coronavirus symptoms is still going to work, because sick pay would not be enough money to put food on the table, let alone cover the £1,200 in rent that he pays every month. He cannot afford not to work. The reflexologist who works in a care home now cannot go to work because she is a visitor. The dog kennel owner is not going to get any dogs to look after. Their income is gone. The tutor has lost all of her income.
My hon. Friend the Member for Leeds West talked about renters. They are often also the most at risk from income loss, because of the nature of the work they are involved in. The Government need to support landlords as well as tenants in the private rented sector, as well as supporting social housing landlords at the same time. We have heard reports about rough sleepers being on the tube in London and on public transport elsewhere. They are clearly in great distress. The support for people outside the system is essential straight away. At this stage, as far as I can see, it is not in place.
Does my hon. Friend agree that for lots of the people he is talking about—the Chancellor repeatedly talked yesterday about those who are self-employed, for example, being able to claim universal credit instead of SSP in this circumstance—this simply is not good enough? Today I have had lots of reports of people trying to do that in my constituency, and they are being told by the Department for Work and Pensions that they have to go to a face-to-face meeting and go through a series of protocols in order to do that. Let alone the dangers of a face-to-face meeting, it is simply not the case that these people can get any access to universal credit at the moment.
I thank my hon. Friend for what she says. It reinforces the point, and she made the same point in the question she asked the Chancellor yesterday evening. I just hope that Ministers are taking on board how quickly things need to change. One of my constituents made the point that he does not qualify for statutory sick pay, as he is self-employed. That is a real problem for the 5 million people who are self-employed and have lost all their work. Whether it is universal credit or ESA, it simply is not anywhere near enough money. He is staying at home, observing advice from Government and not able to earn his weekly wage. Whatever is in the package from the Government, which the Minister has already referred to, it is nowhere near enough for what they need.
Another of my constituents, a nurse, asked me to raise the situation of principal carers who live with somebody in a vulnerable group. What is the advice for her? The example she gives is her son, who cares for his wife, who has a chronic respiratory disease. She is 26, but with that disease she is clearly in one of the highest risk groups. She cannot work and does not leave the house, but what is he supposed to do? He is still going to work, but with great anxiety, because he might catch the disease and pass it on to her. They have a mortgage and they need his income. Those are real-world examples. We have all heard them from our constituents and from others around the country, and they show why action has to be immediate.
I have mentioned the self-employed and freelancers, small firms and people on zero-hours contracts. The support just is not there. If someone is employed and they qualify, the £94.25 a week they get is not enough. Universal credit is not enough. The support announced yesterday for the hospitality and retail sectors for a few weeks is encouraging, but what is really needed is the kind of cash injection that a number of my hon. and right hon. Friends have already mentioned, and that was put to the Chancellor last night in the statement.
Loans are part of the answer, but there is a massive question mark with loans from a banking system that many businesses still do not trust because of how it behaved during the financial crisis. Loans have to be repaid. That was the point I made to the Chancellor in the question I asked last night. In reality, we have to avoid storing up problems further down the line with the actions that are taken now. These were very big numbers—eye-catching, headline-grabbing numbers, such as £330 billion—but the reality is that the £10,000 on offer to small firms will not last very long as a grant.
Then there is the question of information. The Minister mentioned the gov.uk website. Not many businesses—and I work with them across the country—are aware that that is where to go to get this information. The Government need to do a lot more to get the information out there quickly on a range of issues, using social media, television and radio.
The grant system for businesses announced yesterday appears only to be starting next week. Again, that is so much later than needed. Is there any way of bringing it forward? We have heard the examples from Scandinavia, with contributions towards salaries of 75% by the Government in Denmark, 90% in Sweden and 60% in Germany, or 67% for those with parental responsibilities. The Minister said that these things take time. Why is it that other countries have been able to put these measures in place so quickly, but we are not at that stage yet? What is holding us back if they were able to do it? It seems to me that if they can do it, so can we.
Are the Government looking at what the TUC has said about a real living wage and what Members have said about a universal basic income for a limited period? I tend to agree with my hon. Friend the Member for Ilford North on that period. We need to redefine what we mean by sick pay. It is not just whether someone is sick; it is whether they are in danger of becoming sick and infecting other people. It is about giving financial reassurance and making up for the lost jobs, the livelihoods that are at risk and the contracts that have gone in whatever sector of the economy, for as long as it takes.
Only the Government can intervene, and if we do not get this right, it will be so much worse for the health of us all and for the economy. The Government say that they will do whatever it takes—that is the three-word slogan of the moment. “Whatever it takes” means giving every single person in this country the financial security they need right now to ensure that they can protect themselves, their families and the rest of us.
I am grateful to you for allowing me to speak, Madam Deputy Speaker, and I apologise to the hon. Member for Wirral West (Margaret Greenwood) that I was not in the Chamber for the first part of her speech. I wanted to listen and make a contribution, and I appreciate the opportunity to do so.
I thank the Opposition for holding this debate, which covers two of the things that are on most people’s minds: reducing the likelihood that I, anyone in my family or anyone I work with will get sick, and providing protection for me if that does happen; and trying to protect my job over the next few weeks and as we recover. The debate has raised a number of issues. I am not going to pick out any particular ones, but I want to make some observations.
The first is what a difference a week has made. It is seven days since the Budget, and these are very different circumstances. We should give credit for all the efforts made in this House and for the measures that the Government have taken to respond as quickly as they can on such a wide range of issues. None of us in this room has the power of the Almighty, and we should understand that we work within human frailties. I will come back to the frailties of the systems that we work within.
Secondly, I would like to add to some of the examples given by the hon. Member for Airdrie and Shotts (Neil Gray) about the public’s response. This week, I have met churches that are working on good neighbourhood schemes. I spoke today with a playwright in the village of Arlesey who is setting up a group to bring skills together in the community, to assist people. We are seeing the best of people, but as some Members have said, we are also seeing the worst of people. In a free society, we can see the best, but we can frequently see the worst. Harley Street doctors are reselling tests at a high price that will not be available to everyone. That is a disgraceful thing for anyone with a professional qualification to do. We have seen pictures of hoarders in shops, meaning that elderly and vulnerable constituents of mine—and, I am sure, of all Members—are not able to access the foodstuffs and other products they need. We have seen the reaction of the bosses of some of the largest companies.
On that point, I have been contacted by a constituent who has informed me that their employer is insisting that they cannot work from home because it is waiting for stronger guidance from the Government. Can the Government give clear guidance right now to my constituent’s employer and many others across the country that, if people can work from home, they must?
I appreciate the hon. Lady’s intervention. I am not speaking for the Government—I am sure the Minister will seek to address that—but I have to say that it sounds to me as though her constituent’s employer is just making an excuse, because the Government have been absolutely clear that it is the right thing to do socially for everyone in this country, if they have a concern, to be able to isolate themselves from others and to work from home. What more does that person need to understand what they should do? I hope they will get that message very clearly from the Front Bench.
On the point of leaders not doing the right thing, the experience of Virgin airlines has been raised. The owner or partial owner of Virgin airlines has suggested that employees should take eight weeks of unpaid leave, and I decided to look at how much that would cost. Eight weeks at the £94.25 rate of statutory sick pay would cost £754 per employee. There are 8,571 employees of Virgin airlines, so if all of them took eight weeks of unpaid leave, that would be a cost of £6.4 million. Sir Richard Branson’s net worth is $3.8 billion. If he is able to get 2% interest on that money for eight weeks, he will earn the equivalent of £9.9 million. So I say: Sir Richard Branson, give up the interest on your wealth for eight weeks, and pay your employees yourself their unpaid leave.
Big or small—a leader of a church in a small village or a leader of the large business—when it comes to looking at the protection of their workers, the time is now, and we will judge them all by their actions. It will be the same for the Government’s actions.
As I say, are we choosing the right policies? We have heard a lot about that today. I congratulate the Government on the staging of the announcements. There is so much pressure—all MPs are under pressure, with loads of questions: small or micro ones, and very large ones covering many issues—but I think the staging of announcements is a good approach, because we need this to bed in with people each day. If we put everything into an announcement on a single day, I would worry that, although we would feel we were communicating, we would find that it was not being received and understood as clearly as it should be.
I commend the hon. Member’s speech thus far. To some extent I agree that, for preparedness in working through particular policies or interventions, there has to be some preparation and that does take time. However, in terms of people’s livelihoods, people are losing their jobs now and businesses are making decisions about their future viability now, so would he encourage the Government, as I have, to make an announcement about the financial impetus that could be given to protect individuals and jobs in hours, not days, so that this response can be adequate?
Yes, yes, yes, yes and yes. Those yeses are for each of the businesses in my constituency that I have spoken to in the last 24 hours that have asked for precisely that. We often think: how can a business suddenly be short of money to pay its own workers within a short period of time? But the truth is that, in some sectors, cash flow is of a nature that those issues do come up. More importantly, I say to those on my Front Bench that every single responsible private sector business right now will be thinking, first and foremost, “How can I protect cash flow for the long-term survival of my business?” One of the nearest short-term costs that can be reduced is their employee cost, so there is the sense that this is needed, as the hon. Member rightly says, in hours rather than days. To be fair, I think the Chancellor was very aware of that in his statement yesterday.
To that end, may I encourage hon. Members on both sides—there are slightly more on the Opposition Benches than on the Government Benches for certain reasons—to think more about using what is already in place, such as the systems that connect what the Government can do to those institutions and people that need it, rather than trying to broaden it out into a big and different debate about whether we should have this or that. There is of course a time for debating universal income, and there is time for us to think about ways in which we might look at a better overall system in the future.
Right now, I say to my right hon and hon. Friends on the Front Bench that we should be looking at proposals using the existing arteries of the financial system, of the benefits system and of the pay-as-you-earn and tax system that can reach people, either to amplify payments that are already made or to reverse flows from into the Government to back out to those who need them, and I ask them not to get too distracted by items along the way.
We should also recognise that in this period there will be a test for the labour market structure in the United Kingdom. The UK does have some not quite unique but nuanced features, particularly its reliance on flexible working and on self-employment. The changes that Governments have put in over the past 15 years to create a flexible market—there are benefits to that—will also be tested during this pause in the economy. After we have gone through this crisis, I would encourage the Government to see what lessons can be learnt from that.
This is also a test in terms of the enlightenment we have in our social insurance system. I was moved by the contributions from the hon. Member for Leeds West (Rachel Reeves), the Chair of the Business, Energy and Industrial Strategy Committee, and the hon. Member for Ilford North (Wes Streeting). It is absolutely right that this is an opportunity for us to look at those things and to reflect. We may have different perspectives on it, and we will definitely have different politics, but only a fool would say that we should not look at this and learn lessons. This is no time for fools.
My core message for the Government is this: the staging of announcements is absolutely right, so that they can bed in with people; use the systems we have to get money into the hands of the people and businesses who need it; and follow the advice from both sides of the House, which is that we would welcome the Government’s moving with speed between the announcement and the time that the money is available in the bank manager’s office in Arlesey, Bolnhurst or anywhere else in the country, or in that person’s pay packet, their bank account, or their benefits slip.
I thank the hon. Member for North East Bedfordshire (Richard Fuller), who has been uniquely brave in speaking from the Back Benches on his side of the House. I think that there was much that we on the Opposition Benches could agree with him about.
The scale of the coronavirus crisis means that we need to take action in many forms, and ensuring that people have economic security is second only to our response in safeguarding people’s health. The point will come at which we have mass isolation—I feel that that point is probably coming very soon—and that will happen whether people are symptomatic or not. This unprecedented challenge needs an unprecedented response, and we must work together to bring forward the right response, which safeguards people and brings future confidence, not just immediate wellbeing. A measure that will do just that is an emergency universal basic income, which will give everyone the basic financial support they need to provide the necessities of everyday life through this crisis.
My hon. Friend the Member for Ilford North (Wes Streeting), who has just left the Chamber, made some very good points. In normal circumstances, this might be a debate in which we would ask questions, explore different aspects of the situation and, particularly on the Opposition Benches, talk about the benefits of universal basic income versus universal basic services. I suggest to the Government that if we had universal basic services in areas such as childcare and social care, we would be in a much better place to weather this crisis than we are with just a single universal basic service, the national health service, taking the brunt of the crisis.
Putting that aside, and thinking about where we are and the phase of the coronavirus crisis that we are about to enter, we need to take this step. We just need to think about how our economy has changed fundamentally since 2008, with the number of self-employed people having risen over the past 15 years from 3.25 million people to more than 5 million people. They can only properly be protected through a universal basic income, as can those who will sadly lose their employment through redundancy, temporary lack of work or the failure and closure of businesses because of the crisis.
Let us think about the app-based driver, the zero-hours warehouse worker, the children’s entertainer and the agency-supplied care worker. None of them has an employer. The Government can incentivise by keeping them in work. A universal basic income would be more holistic and more effective than subsidising a company payroll, which currently seems to be the Government’s main tool in dealing with the crisis.
Finally, let me, just for a moment, look across the Atlantic to the United States of America. Normally, on this side of the House, we do not look to the United States of America, but just yesterday the US Treasury Secretary, Steve Mnuchin, said that cash infusions could happen swiftly:
“We're looking at sending checks to Americans immediately.”
That sounds very much like a temporary universal basic income to me. Well before this crisis, Andrew Yang, the former Democratic contender for the presidency, said that a universal basic income of $1,000 a month should be introduced. He is now speaking directly to the White House. Donald Trump himself has said:
“I think we’re going to do something that gets money to them as quickly as possible.”
This is a measure that will get money straight to people and give them that basic economic security. Let me say to Ministers that if Yang and Trump can work together, surely so can Sunak and McDonnell.
It is a pleasure to speak in this important debate. Let me start by thanking my hon. Friend the Member for Leeds North West (Alex Sobel) and many other speakers, including the hon. Member for North East Bedfordshire (Richard Fuller), who spoke very eloquently, and my hon. Friend the Member for Ilford North (Wes Streeting),, who made some thoughtful and far-sighted points.
I want to address not just the policy responses that we need, but the underlying scale of the problem. We have heard today that as many as 5.5 million people in this country are self-employed. I want to describe my experience of that as a constituency MP, but also to set it in the context of the wider crisis that we face.
We face an unprecedented situation, and I fully acknowledge the action that the Government have taken. Measures to reduce the spread of the outbreak are vital, and I am pleased that Ministers have announced robust measures this week, including the measures to support businesses that they announced yesterday. However, I want that action to go much further and to be much more resolute, because of the scale and need of people who work for themselves, and those who are on low incomes or in the gig economy.
I support the range of measures outlined earlier by my hon. Friend the Member for Wirral West (Margaret Greenwood). Let me draw the Minister’s attention in particular to the approach taken in Scandinavia, and also by a number of other European Governments: we have heard mention of the Irish Government today. The UK Government now need rapidly to develop a comprehensive approach and provide a safety net for all workers, and, indeed, all renters, who are uniquely vulnerable in the current crisis. Let me explain what that means to local people in Reading and Woodley, the area that I represent. Self-employed people are the absolute bedrock of our local economy, carrying out a range of activities in the knowledge economy, public services and other forms of service, retail and distribution.
Let me begin by highlighting the role and the importance to our local economy of IT subcontractors. Some of the largest IT businesses in the world are based in our part of the Thames valley. Those large businesses subcontract to many, many smaller businesses, most of them one-woman or one-man bands who are very dependent on a relatively unstable economic situation. As a growing and rapidly expanding area close to London and the midlands, we have a large amount of construction taking place. We have many small builders and other tradespeople who are dependent on jobs and work which is relatively short-term, and who may see only a few weeks ahead economically. We also have a vibrant transport sector, with a large number of people employed in the aviation industry at Heathrow, many taxi drivers, and many people who work on the railways. All are part of a transport sector that looks set to be severely constrained because of the crisis.
Reading is the main shopping town for the Thames valley and the related parts of the south midlands, and we also have a vibrant gig economy, with a number of distribution centres and warehouses nearby. Many people in this group are also renters, so we have a double hit in our local economy. We have many people who are vulnerable because they have only one month’s guaranteed income ahead, whether they are professional people, people with trades, or people who have other skills, and in the same group of people we also have many young families living in rented accommodation, which is very high cost in an area that is similar in cost to outer London or the centre of major cities around Britain.
I draw the Minister’s attention to this local example, which reflects the situation in many towns and cities throughout the country. There is this collision and reinforcement: people have insecure incomes, are vulnerable and have not yet had their situation addressed by the Government’s measures—however helpful those measures are for larger businesses—and they are also renters in a high-cost local rental economy, where rental income can be as much as £1,000 a month for basic accommodation.
We need to take action and to take it urgently. Will the Minister reconsider the Government’s approach, focus on the needs of these groups of workers and renters, and think about the world from their perspective? Their income is not guaranteed and is vulnerable, and they are the bedrock of the local economy in so many parts of our country and, indeed, in the country as a whole. They deserve our support and respect. We need to come up with a realistic and workable plan, using whatever policy measures are necessary to protect them and their family income and to ensure their safety and security.
Has the Minister seen proposals from the Communication Workers Union, which yesterday called for Royal Mail to act in effect as a fourth emergency service? Royal Mail is the only organisation in the country that puts workers on every single street, six days a week, and postal workers are trusted in every community. Whether it is through the delivery of prescriptions or food bank parcels, or by checking on elderly people who might need support—particularly if care services cannot be provided to them—Royal Mail could play an important role, if appropriate precautions are taken.
Will the Minister join me in paying tribute to the Communication Workers Union? Does he agree that this idea should be explored as a matter of urgency? Will he commit to speak to the union and Royal Mail to discuss it?
It is difficult to follow such powerful speeches and such great orators, who have made their points so eloquently, so I shall be brief. But I make no apology for reiterating the points on which we need the Government to act now.
Statutory sick pay will now be available for eligible individuals diagnosed with covid-19 or those who are unable to work because they are self-isolating in line with Government advice. It is right to commend the Government for making SSP available on day one, instead of day four, for affected individuals. However, at this time of intense worry and strife, it is also right to highlight where the Government must act to help those who need it.
Statutory sick pay is £94.25 a week, as we have already heard. The equivalent weekly payment on the national minimum wage is £307.88. How can the UK Government justify forcing potentially millions of people to live on less than a third of their usual weekly income? The Chancellor himself stumbled when asked whether he could afford to live on that sum, and I implore colleagues from all parties to ask themselves the same question—could they?
The UK Government’s covid-19 advice on statutory sick pay on the gov.uk website is a total of only 13 lines, but universal credit is mentioned three times. It is important that the Government seek to ensure that those who are not eligible for SSP, or those who are self-employed, are aware that they can claim for universal credit. That is fine, but my colleagues and I have spoken numerous times in this place about the difficulties inherent in the universal credit system. I refer to the fact that applications must be made online and claimants wait a period of five weeks for their first payment.
Will the Minister tell me what steps the Government are taking to assist those who are not able to leave their homes, and who are also unable to access the web, so that they may apply for the benefit? Furthermore, what steps are the Government taking to ensure that new universal credit claimants who are self-isolating, some for periods of up to 16 weeks, do not have to wait five weeks for their first payment? Alternatively, will the Government consider extending the period over which advance payments must be repaid?
The UK Government will refund SSP for small employers who employ fewer than 250 people. This refund, however, will cover only up to two weeks SSP per eligible employee who has been off work because of covid-19. How can the Government reconcile that with their current advice that some employees will have to self-isolate for up to 16 weeks? With thousands of local and independent businesses already scared for their continued existence, will the Government reconsider their policy and offer SSP refunds for the total period of time that employers are required to claim during this crisis?
I do appreciate that these are unknown and challenging times, but I urge the Government to consider people who are falling through the SSP safety net and to act quickly and compassionately now.
We conclude this debate on statutory sick pay and protection for workers at a time of immense uncertainty, as we are witnessing an implosion in our labour markets and people’s lives being turned upside down. As we have long feared, those in the most insecure work have little resilience to weather this storm. As we speak, thousands of people are being laid off, falling into hardship and fearful for their future. We cannot let the story of coronavirus also be the one about avoidable poverty, so, today, Labour is highlighting how Government must take a far more robust approach to create the safety net that we all need.
The Government have said that no one should be penalised for doing the right thing, yet without stronger underpinning of statutory sick pay and employment and wage protection, many will be plunged into serious debt, unable to pay their rent, their bills and even for their food, as my hon. Friend the Member for Reading East (Matt Rodda) set out.
I will, if I may, start with workers’ protection. We need all workers to be kept safe and to be protected from contracting coronavirus in the first place. Employers must maintain their duty of care. Too few workers still have access to appropriate PPE, as my hon. Friend the Member for Ilford North (Wes Streeting) set out while paying tribute to NHS staff, and I endorse what he said.
Yesterday, community pharmacists in my constituency highlighted to me how they have now become the frontline of healthcare, and yet they only had a tiny stock of plastic pinnies, gloves and masks. Tradeswomen and men such as plumbers will need to carry out urgent home repairs so will also need protection. Care staff need to be provided with PPE and not expected to pay for it themselves.
Workers must never feel that they have to choose between health—their own and that of others—and hardship. Even after yesterday’s announcement, they were offered little comfort. I have three asks on SSP, isolation leave pay and families’ and carers’ leave. First, no worker should be excluded from statutory pay protection for sickness or isolation no matter their employment status—employee, worker, self-employed, office holder or limb (b) workers. This should also apply no matter what a person earns, which is why the lower earnings limit must go, and no matter whether a person has already taken 28 weeks SSP. All who work should have statutory pay protection for sickness and isolation from day one.
If people are required to stay away from work, or are staying away to protect their health due to existing underlying health conditions, they should not be penalised and neither should their family members be penalised, as my hon. Friend the Member for Sefton Central (Bill Esterson) set out. Life must come first. We also need these measures to reach beyond the narrow application of coronavirus. People will be isolating because they have signs of the virus, but not the virus itself. Vulnerable people are at risk from all communicable diseases and so the application of the measures needs to apply to all sickness and isolation absences. While many companies are establishing full pay for those sick and in isolation, others are not. This inequality must be addressed. Universal credit is no substitute, as my right hon. Friend the Member for East Ham (Stephen Timms) and my hon. Friend the Member for Newport West (Ruth Jones) highlighted with their experience, and, as we have heard in the debate, it pays even less than SSP and takes five weeks to process. I am grateful to my right hon. Friend, who set out the plight of those who have no recourse to public funds; that must be resolved.
Simple changes to section 16 of the Health and Safety at Work etc. Act 1974 and section 64 of the Employment Rights Act 1996 would ensure that all workers were fairly remunerated and did not experience hardship; with the underpinning of statutory sick pay UK workers would be protected to levels we are seeing elsewhere.
Secondly, as life must come first, to reduce a worker to poverty levels of statutory sick pay at just 18.4% of the average wage will not be sufficient for those forced to make a choice between health and hardship. We cannot afford for anyone to go out to work if the determination is that they should isolate or are sick, but if they are battling to keep their head above water financially, they may lessen the severity of their sickness to justify just to themselves that they are not really a risk.
At a time when other countries are significantly raising their statutory sick pay, the UK, which pays the lowest rate of statutory sick pay compared with the EU27 countries, must now ensure that statutory sick pay provides vital protection. The TUC has highlighted how the real living wage is the right benchmark when full pay is not paid. Many in today’s debate across the House, including my hon. Friends the Members for Leeds North West (Alex Sobel) and for Ilford North, have highlighted the opportunities a universal basic income would provide. The Prime Minister earlier said that he is willing to look at that, and he must.
In light of the possible scale and duration of isolation and sickness expected to be taken, the £1 billion package announced by the Chancellor is totally insufficient. Will the Secretary of State return to the House this week and confirm that she will, through a poverty prevention measure, ensure that statutory sick pay is paid to take away the additional fear of financial hardship, so people will be able to pay their rent bills and fuel and food? Without this significant shift, people will be dependent on other sources of income support, perhaps food banks and other charitable support. However, we know that these are areas in themselves experiencing major challenges at this time. The infrastructure to underpin this completely avoidable poverty is so fragile, so statutory pay must rise.
Thirdly, parents and carers are also facing new challenges as they are having to significantly change their lives. No one should be denied the right to meet family and carer needs at such a time as this, so will the Secretary of State ensure that taking leave for family emergencies and for care provision becomes a right—not a right to ask, but a right to get—and that people remain fully remunerated while doing so? While most employers will be accommodating, this is a critical time, and we need to ensure all parents and carers are supported in this national effort.
I further want to raise the issue of pace. While welcoming the Chancellor’s announcement that he will work with trade unions and businesses to provide wage protection, this needs resolving now—this week. If Denmark and other countries have brought forward a scheme of wage protection, there is no need to reinvent the wheel; we can deliver a scheme through the emergency legislation being laid tomorrow. As my hon. Friend the Member for Leeds West (Rachel Reeves) said, if it is good enough for workers in other countries, it is good enough here.
Denmark’s first coronavirus case was on 27 February and New Zealand’s first case was on 28 February, and they have developed and delivered support already. The UK’s first case was on 31 January, and we still have nothing to protect people’s incomes. People are losing their jobs now, and it could be avoided; it must be avoided. Employers need confidence that the Government will deliver a package of wage substitution; workers need confidence that they will not face poverty. We need interventions now so that jobs can be saved.
Many workers, where there is a cessation of work through this crisis, may step up in the national effort to provide vital services elsewhere in the economy, for instance in health and care. They will be doing the right thing, so can the Secretary of State ensure their position in their substantive jobs is protected when they return so that like someone returning from maternity leave, they will be able to return to the job they left?
I endorse my hon. Friend the Member for Stockport (Navendu Mishra) in highlighting the extended role that others such as postal workers can play. I urge the Government to meet the CWU and to explore that terrain further.
The last few days have exposed the weaknesses in zero-hours contracts—workers who are reduced to zero hours, yet must still be available to work. Those workers are desperate. Some 1.87 million of them will not qualify for statutory sick pay, and 70% of those people are women. I ask the Secretary of State to end this insecurity in work. All workers need security, not least at a time such as this. Will she move to ensure that all employment become substantive, and that workers are placed on proper contracts underpinned by the same securities afforded to all employees?
Workers and employers are being called upon to take extraordinary steps to protect our country from the worst aspects of covid-19. They need a Government who recognise all the challenges they face, and who will provide the full protection that they need. The Chancellor promised to do this, so will the Secretary of State ensure that all the holes that continue to exist in the safety net are closed, with the publication of the emergency legislation. Will she ensure that workers get the support they need to save them from hardship? All these things are political choices. Making the right call today may save us from the worst aspects of an economic crisis, and reset the dial for a fairer and more equitable country to come.
First, let me thank all Members from across the House who have taken the time to attend this important debate, and to speak about their concerns in such a constructive and collaborative way. I will try to answer as many of the numerous points raised as possible, but I stress that—as hon. Members know—my door is always open and my phone is always on. If Members have urgent cases, please reach out to me and other Ministers on the Treasury Bench; we will look to take the appropriate action, as necessary.
As my right hon. Friend the Chancellor made clear yesterday, we will do whatever it takes to support people, jobs and businesses, and to help people to protect their loved ones. This includes the measures we are taking on statutory sick pay, in order to ensure that everybody is supported to do the right thing and follow the Government advice on self-isolation. We must come together to fight this virus and protect the most vulnerable, and statutory sick pay is part of our welfare safety net and our wider Government offer to support people in times of need. That is why we are ensuring that our welfare safety net provides the right level of support in these exceptional times. We have extended statutory sick pay to those who are self-isolating, in line with the latest Government health guidance, and the upcoming emergency Bill will make statutory sick pay payable from day one instead of day four. This is the right thing to do to ensure that eligible individuals are supported to stay at home in self-isolation, protecting themselves and others.
As my right hon. Friend the Chancellor set out, the Government will stand behind businesses, both large and small. As a DWP Minister, I know that the best way to support people is through protecting their jobs. Small and medium-sized businesses are the backbone of our economy, and we will support them to implement these measures. Employers with fewer than 250 employees will be able to reclaim up to two weeks’ statutory sick pay paid for sickness absences relating to the coronavirus—a measure that could help up to 2 million businesses. These changes will help to provide certainty and security for individuals and businesses affected by coronavirus.
Statutory sick pay is just one of the Government’s offers of support and protection. The safety net also extends to those who are self-employed or who work in the gig economy. Workers on zero-hours contracts or in the gig economy may be eligible for sick pay and should check with their employers, but we are here to support those who are not eligible, and they can make a claim for universal credit or contributory employment and support allowance. Last week, we made changes so that the seven waiting days for employment and support allowance for new claimants affected by coronavirus or required to self-isolate will not apply. That means that ESA is payable from day one, without the need to provide medical evidence and without the need to attend a work capability assessment. Those required to self-isolate or who are ill with coronavirus can receive up to a month’s advance from day one, with no need to physically attend a jobcentre—that point was raised by Opposition Members. Any individuals affected by coronavirus will have their work search and work availability requirements switched off, and affected self-employed claimants will not have a minimum income floor applied during this period.
A number of specific points have been raised, and I will try to cover as many as possible. The hon. Member for Sefton Central (Bill Esterson) raised the important point about the communication of changes. Everything is on gov.uk, and Departments also use social media, such as Twitter, to highlight changes. There are also daily press conferences where updates on coronavirus are given by the Prime Minister, and he is increasingly being accompanied by another member of the Cabinet. However, I take the hon. Gentleman’s point that communications in times like this are incredibly important, and I will certainly feed back to the Cabinet Office that where improvements can be made to Government communications, particularly for businesses—that is the point he made—that should be done.
I am grateful for that answer, and I know the Minister will do his best to carry out what he just promised. Will he also make sure that that information comes to us and to local authorities in a timely fashion, as we are often in a position to get it out to a great number of people in a short space of time?
I thank the hon. Gentleman for making that case. I know from my postbag and email account that a number of businesses and individuals affected, who are concerned on health grounds or who have concerns about their employment or financial status, will contact their Member of Parliament. We are not always the first port of call—we are sometimes the last—but we are one where people expect to be able to get a response quickly, so I will look at what further guidance and advice we can give to Members of this House and through local authorities. That point about getting the message out to local authorities may well have been heard, because the relevant Minister, the Under-Secretary of State for Housing, Communities and Local Government, my hon. Friend the Member for Thornbury and Yate (Luke Hall) , is sitting on the Treasury Bench behind me.
The hon. Member for Newport West (Ruth Jones) raised the point about SSP and the rebate for employees, and whether that could be for more than two weeks. I understand the point she is making. The current Government advice is for people to self-isolate for seven days or for 14 days if in a household, so we feel that the two-week limit on rebates is a proportionate response. She also asked why SSP is not at the same rate as the living wage. The current system is designed to balance support for the individual with the costs to the employer. As the Minister for Disabled People, Health and Work mentioned at the beginning of this debate, we have put £1 billion into the welfare system to provide additional financial security for people, and people on low income can get a top-up, where applicable, through UC.
Numerous hon. Members, including the hon. Members for Sefton Central (Bill Esterson) and for Leeds West (Rachel Reeves), raised a point about the private rented sector. Today at Prime Minister’s questions, the Prime Minister did say that we will be bringing forward legislation to protect private renters from eviction, and the Ministry of Housing, Communities and Local Government is considering whether we need to go further on that point.
The right hon. Member for East Ham (Stephen Timms) and the hon. Member for Airdrie and Shotts (Neil Gray) both raised a point about the consultation on the lower earnings limit. Our immediate concern in dealing with the covid-19 outbreak is to ensure that a suitable financial safety net is in place, and the benefits system does provide that. We estimate that about 60% of people earning below the lower earnings limit are already in receipt of benefits. Our longer-term aim in that consultation was about preserving the link between the employer and the employee so that the individual receives appropriate support upon return to work. That is less relevant when most people are facing short periods away from work. I or the Minister for Disabled People, Health and Work would be happy to meet those Members at a later point to discuss that further.
Numerous hon. Members asked why the focus so far has been on businesses and has not just been about individuals. It is so important that organisations are able to carry on trading, which is why the initial focus of Her Majesty’s Treasury has been on supporting business and keeping people in work where it is sensible and appropriate, based on Government guidance, to do so. Ultimately, that protects so many individuals in our society, but of course we are also looking at other measures for workers.
The hon. Member for Newcastle upon Tyne Central (Chi Onwurah), the right hon. Member for East Ham and the hon. Member for Airdrie and Shotts all made the point about raising the level of statutory sick pay. We continue to look at other support for workers to see what best mechanisms are available. Thankfully, a period of absence is likely to be short—we believe between seven and 14 days—but we know that some may need extra support, as Members across the Chamber have said. We know that low-paid workers are likely to be receiving additional support through universal credit, for example, and the advantage of universal credit is that it will go up if income falls to the equivalent SSP level.
I thank the hon. Gentleman for giving way and for addressing the points that hon. Members have made. It is true that people will not have to take that long off to self-isolate for their recovery, but overall, there is likely to be a suppression of demand in the economy for a longer period. The idea that people may be off work for only one or two weeks is fine if that is for health reasons, but if it is because their business is closed or there is just not work available, it is likely to be a lot longer. That is the point that many Members have been trying to make.
I thank the hon. Lady for making that point. I reassure Members that the Government are doing all they can to ensure that everybody is supported to do the right thing. It is crucial that everyone follows the Government guidance on self-isolation—that has been clear throughout the debate—to protect themselves and others. The measures that we have announced and will put forward in the emergency Bill will support people to do so.
To come directly to the hon. Lady’s point, the Chancellor has announced that in the coming days the Government will go much further to support people’s financial security, working with trade unions—another point made by the hon. Member for Stockport (Navendu Mishra)—and businesses to urgently develop new forms of employment support to help to protect people’s jobs and incomes through this period. I know that the hon. Lady would like to tempt me to go further but, as I think she will understand, that is somewhat above my pay grade. It is very important, however, that debates such as this take place, because it will have been heard by Her Majesty’s Treasury and will be taken in the spirit of working collaboratively on a cross-party basis. I certainly take those ideas on board, and if Members have further ideas about how we can better support some of the most vulnerable people in our society, my door is always open, and I would welcome them coming forward with those.
The right hon. Member for East Ham, the Chair of the Select Committee, raised the point about the habitual residence test. The test has operational procedures already in place to expedite confirmation of eligibility, but I will take this point away and give it further thought—I had not given it consideration before he raised it and I would be very happy to meet him to discuss it further.
We have a safety net that helps people facing hardship if they cannot work or are seeking work. Depending on their individual circumstances, employees can claim universal credit and/or new-style ESA or JSA. As the Prime Minister set out, the Government will keep everything under review. The package that was set out at the Budget and the new measures that were recently announced should give some reassurance that support will be provided to support jobs, income and businesses. As the Chancellor said, we will do “whatever it takes”.
We are in extraordinary times. The coronavirus pandemic is the most serious public health emergency that our nation has faced for a generation. Our policy is to protect lives and fight this virus with everything we have, and the Government have been clear in their approach: we will do whatever it takes to get the nation through these testing times. We will protect people, their jobs and businesses through this period to ensure that we keep as many people as safe as possible.
Question put and agreed to.
That this House has considered the matter of Statutory Sick Pay and protection available for all workers.