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House of Commons Hansard
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Covid-19: Economic Support
07 July 2020
Volume 678
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What steps he is taking to support the economy during the covid-19 outbreak. [904351]

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What steps he is taking to support the economy during the covid-19 outbreak. [904402]

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The Government have taken unprecedented steps to keep as many people as possible in their existing jobs, support viable businesses to stay afloat and protect the incomes of the most vulnerable. We are now carefully and safely reopening our economy.

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I have previously raised the issue of the 3 million taxpayers being excluded from Government support with the Prime Minister, the First Secretary of State and the Leader of the House, all of whom have repeated details of the Government support provided to other groups. To be clear, it is understood that 2.6 million self-employed people were supported and 9 million people were furloughed. What remains an issue, though, is the 10% of the workforce who have received no meaningful support to help navigate covid. Specifically on the 3 million excluded, will the Chancellor provide an eleventh-hour lifeline such as that provided for the arts, or is he planning to cut 3 million workers adrift? It is one or the other, and it is now or never.

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I have said previously that, although we have not been able to help everyone in exactly the way that they would have liked, I am confident that the breadth and scale of the interventions we have provided ensures that everyone is able to access some support. We have also strengthened our security net, with welfare through universal credit, among other things, and our self-employment scheme remains one of the most comprehensive and generous anywhere in the world.

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The economic impact of coronavirus has not been distributed evenly across the UK economy, yet the Scottish Government have extremely limited borrowing powers to stimulate demand and aid recovery in key sectors. A one-size-fits-all approach should no longer be the norm. Will the Chancellor bring forward the review of the fiscal framework, lift the caps on borrowing and give the Scottish Government the tools that they need to invest in Scotland’s future?

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My right hon. Friend the Chief Secretary to the Treasury is in constant dialogue with his counterpart, the Finance Minister in Scotland, on these issues, but the people of Scotland are able to benefit from the strong measures that we put in place for the entire United Kingdom. Whether it be our loan schemes or, indeed, our furlough scheme, everyone in every part of this country is able to benefit.

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I call the Chairman of the Select Committee, Mel Stride.

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Guidance has recently appeared on Her Majesty’s Revenue and Customs website that suggests that those who take covid-19 tests, as provided by their employer, will have to treat the cost of those tests as a taxable benefit in kind, which is very unfortunate, particularly in respect of those frontline workers who may be involved. Will the Chancellor look into this matter, please, as a matter of urgency?

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I am delighted that my right hon. Friend has raised this issue with me, and of course we will look into it very quickly.

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To follow up on the question asked by my hon. Friend the Member for Angus (Dave Doogan), the ExcludedUK all-party group launched this morning with more than 150 Members of this House signing up as members, cheered on by the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone). Will the Chancellor tell me why he has decided that 3 million people are not worthy of support, and why will he not put something in place to protect their incomes?

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Everyone in this country has benefited one way or another from what we have been able to do. Although people have not been able to be helped in exactly the way they would have liked, we have been able to put in place measures unprecedented in scale and speed, and that meant we did have to make some difficult decisions to implement those policies. None the less, I do believe that, because of the measures that we have taken to strengthen our safety net, for example, everyone, no matter where they are, has access to more support than they did before this crisis began.

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If the Chancellor listened to the evidence from groups such as ExcludedUK, he would know that that is simply not the case. To turn to some of the rhetoric of the past few days, the Government seem to be trying to imitate the rhetoric of President Duterte of the Philippines and President Roosevelt on the new deal, but the measures do not meet the scale of either of those gentlemen’s ambitions. Does he agree with the SNP that we need a stimulus package of at least £80 billion, including a 2% cut to employers’ national insurance contributions and a reduction in VAT for the hospitality sector, as demanded by the Scottish Government? If he does not believe that those steps should be taken, will he allow the Scottish Government to have the full suite of financial powers that they require to meet that challenge?

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The hon. Lady talks about scale of ambition. I am proud of what this Government have put in place and the speed at which we have done so. The jobs of 9 million people have been protected through our furlough scheme; 2.7 million self-employed people have had their income supported; and millions of companies have received access to loans, grants, tax deferrals. In sum, this represents £130 billion of support—one of the most comprehensive and generous support packages available of any country anywhere in the world.

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The Chancellor knows that different sectors of our economy face very different challenges in the months ahead, so will he listen to the businesses right across our country that have called again and again for the job retention scheme to have the flexibility to meet those different challenges?

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On the job retention scheme, our policy is clear. We have extended the scheme all the way through to the autumn, at which point it winds down gradually and in a way that asks for very modest contributions from employers. None the less, I do recognise that different sectors have faced a different circumstances during this crisis, particularly those in the hospitality, leisure and retail sector, which is why we cut business rates for the entire year for those sectors and, indeed, provided cash grants of £10,000 or £25,000 to almost 1 million businesses up and down the country.