Wednesday 7 July 2021
[Esther McVey in the Chair]
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We are about to begin. The Minister has now arrived, so I will not ask whether we need to have a short delay, if that is what the Member introducing the debate would have liked to do.
I beg to move,
That this House has considered the future of regional airports.
It is a pleasure to serve under your chairmanship, Ms McVey, and a great honour to open the debate on a matter that I feel passionately about. I know many colleagues feel the same, owing to the number of Members who have applied to speak.
I am speaking as chair of the all-party parliamentary group on general aviation and as the MP representing Cornwall airport Newquay. I draw the House’s attention to the fact that my wife, Anne, was recently elected a Cornwall councillor and is now chairman of the Newquay Airport consultative forum.
I am sure we are all aware of the unprecedented impact that the covid-19 pandemic has had on the UK aviation sector. Collapsed demand drove passenger levels at UK airports last summer to their lowest since 1975. In the first quarter of 2021, they were down 94% compared with 2019, and economic output for the air transport sector reduced by 89% between February and March 2020. As a result, many regional airports are losing many millions of pounds in revenue while incurring significant additional debt, leaving them in a perilous financial situation.
Although our national recovery has begun, many challenges remain for the sector. Our airlines and airports face a far longer road to recovery than many other sectors. Even with a successful global vaccine roll-out, 2025 is the earliest date by which the UK is predicted to return to 2019 passenger levels. Furthermore, that recovery is unlikely to be even, with regions outside London and the south-east set to recover far more slowly.
It is crucial that we recognise the role that the aviation sector and, in particular, regional air connectivity will play in our future economy. Pre-pandemic, the sector had an estimated value of more than £28 billion to the UK, and every year almost 80% of inbound visitors reached the UK by air. We enjoy one of the largest aviation networks in Europe and the third biggest globally, with more than 230,000 people working across more than 40 commercial airports.
Regional airports also play a vital role in supporting our national hub airports. Airports such as Heathrow, Gatwick and Manchester rely on routes offering good connectivity to the regions of the UK to provide the passengers for their long-haul flights. In particular, regional airports are vital to the Government’s levelling-up agenda, as they are crucial for economic development across our regions. They give regional communities the connectivity and accessibility they need to be part of the national economic and social fabric, and they allow people from all corners of the country to benefit from economic growth and prosperity.
The UK’s regional airports are a vital catalyst for the economic growth of other sectors, as they facilitate inward investment in the services, products and tourism that support communities to thrive. Newquay airport, in my constituency, is vital to the prosperity of Cornwall and the wider south-west, and it contributed £50 million to the economy in 2015. We witnessed the importance of Newquay airport during the recent G7 leaders’ summit in Cornwall. Given the distances involved and the aircraft that needed to be accommodated, there is a strong case that without Newquay airport it would not have been possible successfully to host the G7 in Cornwall. The collaboration between the Government, Cornwall Council and Newquay airport to fund and deliver the infrastructure required to host the summit in record time is an example of what can be achieved through effective collaboration between Government and regional airports to deliver short-term and long-term value across the UK.
It is therefore right that the Government have intervened with £7 billion of support for the aviation sector during the pandemic, through loans, grants for business rates and the job retention scheme. However, with many of our regional airports in a fight for survival as they bear the brunt of the global pandemic, the Government need to look at providing sufficient ongoing support to keep our regional airports open and planes flying. Many of our smaller regional airports have been hardest hit, will take the longest to recover, and are the least well-resourced to do so. Therefore, we need additional assistance if the economies they serve are to be prevented from falling even further behind during the recovery.
Unfortunately, experience tells us that, once a regional airport closes, all too often it never returns. With developers reallocating the land, large airports such as Heathrow and Gatwick will pull through the crisis—they really are too big to fail—but that is not true of our smaller regional airports. We must therefore protect regional airports now. If we allow them to close, it is likely that the connections they provide and the economic contributions they make to the regions they serve will be lost forever.
I am particularly pleased to welcome the news of a review on cutting air passenger duty on domestic flights, which I and many other colleagues have been advocating for some time. Domestic UK operators bear a disproportionate burden owing to that tax because the charge is levied on the outbound and return journeys. Unfortunately, there has been a loss of connectivity since APD was introduced in 2006, with the tally of UK domestic routes falling by 27%.
Our departure from the EU provides us with a timely opportunity to cut the tax, which would be a critical move to support connectivity across the country and a welcome step to provide some vital relief to the airline industry. When will the Government make a decision on cutting domestic APD? I gently suggest to the Minister that that should be done as a matter of urgency, as one way to support our regional airports.
I am also pleased that, last year, the Government announced the regional air connectivity review as part of their commitment to levelling up the UK. I look forward to any update that the Minister can provide on the review, and he will know it is keenly anticipated by the sector.
I stress the important role that public service obligation routes can play in supporting our regional airports. PSOs could be a vital lifeline for many regions across the UK as we recover from the pandemic, and it is disappointing that the UK has only three PSO routes, all linking to London. That is far fewer than other European countries; for instance, France has around 40. Therefore, I would welcome the expansion of PSO routes to key non-London routes, which would boost the confidence of prospective operators to take on new routes and help with our regional connectivity.
Adding to the importance of our regional airports is their contribution to our transition to net zero—to a cleaner, greener and more sustainable future. Before we can reach the goal of net zero long-haul transatlantic flights, our regional airports will play a critical role in offering short-haul electric flights that are entirely carbon free. For example, I am delighted that the first hybrid electric aircraft will fly between Exeter and Newquay airports later this summer. I am also pleased that easyJet is committing itself to covering short-haul flights with a new electric fleet by 2030 and that Airbus is in the early stages of developing the world’s first zero-emission aircraft.
My view is that, within the next 20 years, as we introduce clean methods of flight, flying will be the environmental transport choice. We are not too far from the opportunity for all domestic flights to be zero emission, which means that one of the biggest barriers to flying—the environmental impact—will be removed. When we reach that point, flying will become the mode of transport of choice for many travellers, but that will not be achieved if we do not have a network of regional airports to serve the whole of our country. With that in mind, our regional airports must be protected to allow us to realise the full potential of the new technology.
It is clear that aviation is still in the midst of the most challenging crisis it has ever faced, which leaves many of our regional airports in a fight for survival. The importance of the industry is evident: better connectivity, greener aviation and a more robust economy. I am pleased that the Government have intervened with billions of pounds to support the sector, but we must recognise the importance of our regional airports and provide them with the support they need to survive the pandemic and to thrive. Greater financial support, reduced APD and more PSO routes are some of the available options that I believe the Government should consider. I urge them to look at such options to ensure that the UK domestic aviation sector can thrive in the years to come and play a critical part in levelling up all regions of the UK.
It is a pleasure to serve under your chairmanship, McVey, and I congratulate my constituency neighbour, my hon. Friend the Member for St Austell and Newquay (Steve Double), on securing the debate. Like him, I wish to support Cornwall airport Newquay because it serves the whole of Cornwall, including my Truro and Falmouth constituency. I will echo what my hon. Friend has said, but hope not to repeat too much of it.
Cornwall airport Newquay is a vital part of Cornwall’s transport and economic infrastructure as it provides national and international connectivity to and from Cornwall and the whole south-west. Given the geographical location of Cornwall, which has water on three of its sides, the airport provides a fast and cheap alternative for longer-distance travel, and speed and choice for businesses, residents and visitors. The airport supports a growing and resilient modern transport system for Cornwall. Before the pandemic, our airport was one of the county’s largest employers, employing over 600 people in different roles, including aircraft engineers, air traffic controllers, pilots, firefighters, instructors and so forth.
Aviation is a fundamental driver of international trade, and the connectivity it provides is a key component in delivering national competitiveness and enabling exports. Aviation and aerospace directly support over 250,000 UK jobs. They have been beacons of British engineering prowess for a hundred years, and, as we have heard, they still are. As my hon. Friend described, the aviation sector has unsurprisingly been hugely affected by the pandemic. We have seen countries across the globe shutting their borders and imposing multiple restrictions and regulations, which has meant that the movement of individuals and freight has been curbed. The pandemic is having an enormous impact on the aviation industry and our regional airports. Consequently, there are knock-on effects for the local economy.
In Cornwall, the knock-on effect on tourism, which relies heavily on aviation, is extremely significant. Building public confidence to kickstart aviation in order to aid the economy through tourism, while aiming to stem further job losses in aviation and aerospace, must be a priority. That will be important not only for our continued economic recovery, but for our hugely significant promise to level up the country. Cornwall must be part of that, as it is one of the most socioeconomically challenged counties of the UK. Put simply, Cornwall must not be left isolated, and its airport is key to that.
However, the industry must become environmentally sustainable. Climate change is a clear and pressing issue for us, our businesses and Governments across the world, and we know aviation emissions will increase if decisive action is not taken. I am pleased that UK aviation is committed to achieving net zero by 2050 through taking an international approach by working with Governments around the world, and through the UN. Current circumstances present an opportunity to drive decarbonisation through such an agenda, and the UK is well positioned to become a leader on green technologies, as we have heard, through sustainable aviation fuels and the electric flight that is taking place later this year. That will also create new and exciting well-paid careers for people in Cornwall and in all our regions.
Amid the growing consensus that the global community must act now to avoid the worst consequences of climate change, the UK will host COP26, which takes place in November, and I believe aviation has a full part to play in the conference and in achieving the net zero future.
The industry has taken great strides forward, and electrification and alternative fuels will greatly reduce aviation’s carbon impact. It is important that the research and development momentum and the commercialisation of those technologies from small and medium-sized enterprises are not lost. The UK must be bold. The crucial point here is that technologies continue to develop. UK companies should be encouraged to lead on that activity, and the UK should give clear support to those companies.
The Environmental Audit Committee, on which I sit, is due to launch its inquiry on net zero aviation and shipping before the summer recess. We will agree the terms of reference next week. Although I do not wish to pre-empt the work of the Committee, it is likely that we will want to examine the role, if any, that the Government can take in achieving net zero in this space. So, as they say, watch this space.
The Government must ensure that regional airports such as Cornwall airport Newquay are supported so that they can survive what is a dark period for them. They are essential to connecting people in Cornwall with the rest of country. We should not look to stop aviation travel, as I hear in some quarters, but should ensure that innovation creates a net zero industry in time.
It is a pleasure to speak under your chairmanship, Ms McVey, and I congratulate my good friend, the hon. Member for St Austell and Newquay (Steve Double), on securing the debate. He represents Cornwall at one end of the United Kingdom, and I represent Caithness at the other.
I want to speak about Wick airport. For some time, there has been a question mark over its future, which worries me and everyone who lives in the far north of the United Kingdom. It worries us all a great deal. The point about trying to regenerate the economy of Caithness once Dounreay, the UK’s first nuclear reactor, has been decommissioned is that we have to replace the employment up there. The airport is crucial not only to the present local economy, but to the future local economy of the far north of Scotland.
We all know how enthusiastic the Prime Minister is for a space launch, which I completely support. There was a proposal to have one of Britain’s first space launch sites in Sutherland, close to Wick airport. It strikes me that although we are forging ahead in a good way with a space launch, any question mark over Wick airport would take us in completely the wrong direction. In fact, if we lost Wick airport, that would be a major disaster for the north of Scotland and a big disaster for the United Kingdom, because, as the hon. Member for St Austell and Newquay has said, our chain of regional airports is crucial to the way we run our country and our economy.
For some time, we have been campaigning in the north of Scotland for a public service obligation for Wick airport. To that end, I give credit where it is due. The Scottish Government have offered a sum of money towards that, which is good, and I congratulate a former Member of the Scottish Parliament, Ms Gail Ross, on having achieved it, but that is not enough money to run this.
My erstwhile council, Highland Council, on which I had the honour to serve for a number of years, does not have the deepest pockets in the United Kingdom, but it has, very much to its credit, come up with an offer of £300,000 per annum, but we have a shortfall. So, Ms McVey, my request is simple, and you can imagine what is coming. I would be deeply grateful if Ministers agreed to meet me, and probably Mr Raymond Bremner, chairman of the airport committee, to talk about how we could establish a joint funding package for a PSO that ensured the future prosperity of Wick airport.
This is my final point. If we can increase the flow of passengers through Wick airport, that is good for the economy of the country and it is good for the local economy. Part of keeping the United Kingdom united, frankly, is to have all the airports working with each other across the length and breadth of the country, all the way from Cornwall at the bottom of the country to Caithness at the top of the United Kingdom.
I congratulate the hon. Member for St Austell and Newquay (Steve Double). I represent the constituency in which Heathrow is located, which in no way can be described as a regional airport—I apologise if he feels that I am Zoom-bombing the debate—but I think it is absolutely critical to have a discussion about the need for a new aviation strategy, as a result of the development of regional airports over the recent period.
The aviation national policy statement previously before the House is no longer relevant. Aviation movements have changed. The way in which aviation will be used in the future has changed dramatically. As the hon. Member for Truro and Falmouth (Cherilyn Mackrory) said, we also now have to address aviation’s role in achieving net zero, as well as the impact of the pandemic. All of those factors need to be taken into account in the discussion of the future of regional airports.
The pattern of aviation is changing. We now know that the whole approach on which the last strategy and policy statement was based—with a major hub and a large number of regional airports that feed into that hub—no longer reflects the pattern of aviation. Even Howard Davies, the chair of the commission into the development of Heathrow and the potential for a third runway, identified that in the initial work and has confirmed it subsequently.
For my constituency, that means that we no longer want nor need a third runway at Heathrow, but we accept the need for investment in regional airports, because passengers simply want to fly point to point. In addition, we all want to overcome the environmental impact of aeroplanes coming from regional airports into Heathrow and outwards, which is wasteful and does not do regional economies any good whatever.
It is time for the Government to look at this matter overall. They need to look at a new national policy statement for aviation, which accepts that regional airports play a role in levelling up, of which there is no doubt; that the focus of concentration and investment should no longer be on a major hub at Heathrow and therefore a third runway is no longer necessary; and that if we are going to have an environmental aviation policy, it has to be localised and focus on minimising travel in some forms and, at the same time, on developing the science.
It is important that other hon. Members have time to speak in the debate about their own airports, so I have one final point. It is a plea from all of us for help on the pandemic. We are all hoping that we can come out of the pandemic as rapidly as possible, that people can start travelling again and enjoying their foreign holidays, and that we can maintain the level of jobs in our aviation sector. I still believe that will take some time and we have to be realistic, and therefore, communities that are dependent on aviation, on their local airports and on the aviation sector will need continuing support. I am worried about the run-down and closure of the furlough scheme.
The sector needs special assistance and our communities need longer term strategic support, particularly if jobs are to be shed in the sector. We need to ensure that we have a comprehensive strategy for the workers who will be displaced. That means investment in training and in developing local economies, which will be based on new high-paid, high-skilled jobs, particularly in artificial intelligence and technology, because many of our constituents who work in the aviation sector are highly trained. This is a time to stand back, put in motion some urgent measures to deal with the pandemic and then look at a long-term, stable aviation strategy that contributes to our economy and to tackling the existential threat of climate change.
It is a pleasure to serve under your chairmanship, Ms McVey, and I congratulate my hon. Friend the Member for St Austell and Newquay (Steve Double) on securing this very important debate.
As has been said, regional airports are key to our economy, particularly for those of us—such as those of us in Nottinghamshire and my part of the east midlands— who are so far from coastal ports. Our rail, air and road connections are key to our vitality and our economy.
The pandemic has had a devastating impact on East Midlands airport. It is the largest pure freight airport in the country, but two thirds of its income comes from passenger travel—short-haul tourism flights—that obviously has not happened for the last 15 months. So, two thirds of the airport’s income as a business has disappeared. Obviously, there has been no sector-specific support for the airport as a business. It has taken advantage of furlough and other general business support to stay afloat. However, given the importance of East Midlands airport to our regional economy, I hope that this week the Transport Secretary will lay out a clearer and much more certain plan for the sector to get moving again. The peak time for tourist travel has already begun and allowing travellers who are fully vaccinated to travel without quarantine, and allowing operators to get flights back up and running, would be a huge boost for the sector.
The key benefit in the east midlands—because, as I have said, we are very far from coastal ports—is the potential to link up a real multi-modal hub for travel around air, and around road and rail links. We can also boost East Midlands airport and its economic potential with improved connectivity if we can get freight onto rail. As I say, East Midlands airport is the biggest pure freight airport in the country. Decisions coming up around the integrated rail plan and the Toton hub in the east midlands will be key, and I am raising those issues with Ministers directly.
East Midlands airport also plays a key role in our wider economic plans, for example our freeport. It is a unique proposition—an inland freeport, based on customs tax incentives that will attract business to our region—but clearly East Midlands airport is the key to delivery of that proposal. I very much welcome the support that East Midlands airport as a business and its chief executive, Clare James, are giving to that plan and the work they are doing in trying to put that business case together and deliver it.
With our development corporation sitting alongside that plan, we have an incredible and highly attractive opportunity to masterplan these sites and to build something positive in terms of future-facing jobs and growth for our region, which will make it a highly attractive prospect for business to invest in. East Midlands airport is key to the delivery of all that.
As I have said, in my part of the country East Midlands airport is vital to our connectivity and our economic growth; it would be hugely challenging to deliver a levelling-up agenda in the east midlands without a strong East Midlands airport. We have the potential through our freeport to play the role in the heart of the country of connecting together other freeports around the UK, and to play a role, as we already do in the region, in central logistics; I think that 90% of the country is within four hours of East Midlands airport. The airport has huge potential, if we can help it to survive these very difficult times and if we can support it as part of our wider economic plans.
A couple of key decisions will be made later this year: the integrated rail plan and planning for our development corporation have the potential to kickstart a huge boost and a huge step forward for our regional economy, if—and only if—we are able to support our regional airports to continue to offer the current £300 million a year gross value added, which is a huge uplift for other businesses, and if we are able to support the 9,000 people who work on site at East Midlands airport. EMA needs certainty on international travel. I hope that in his statement later in the week, the Secretary of State will be able to offer some of that certainty and a boost to our regional airports around the whole of the UK.
In summary, regional airports such as East Midlands airport will be key if the Government are to be able to deliver on the levelling-up agenda, to grow our economies and to create good, sustainable and well-paid jobs in the future. I urge the Minister to do everything he can to support East Midlands airport.
It is an honour to serve under you as Chair, Ms McVey, and I thank the hon. Member for St Austell and Newquay (Steve Double) for securing this important and timely debate.
The UK’s regional airports are important engines of economic development. As an international and domestic transport hub, Newcastle International airport in my constituency is a large regional employer that supports many regional jobs on site, off site and through its supply chain. It supports manufacturing business exports, higher education through its work with our world-class universities and, of course, the tourism sector, which thrived before this crisis. It is a strategic asset for the north-east and is central to our future economic growth but, like many other airports, its future and transition to sustainability is seriously challenged by the devastating impact of the current crisis on international travel, and the Government’s apparent unwillingness to support and understand the special nature of this sector.
We all know the pandemic has taken an especially hard toll on aviation. Between April and December 2020, passenger numbers were down 89.3% year on year. In the first quarter of 2021, they were down 94% on 2019. It has been an absolute collapse. The numbers are not expected to return to pre-crisis levels until at least 2023, in the most optimistic scenario. Although I and colleagues have continually raised the need to support aviation throughout the crisis, the Government still do not seem truly to grasp the special circumstances faced by the sector.
Unlike almost every other kind of business, which we know have all struggled through this crisis, airports are by their nature unable to adapt and diversify their product in a meaningful way. When travel itself is the product and it has essentially been shut down by regulation, adaptation is not an option. The key reason airports find themselves in such tremendous difficulty, however, is because they are stuck with very high fixed costs for the provision and maintenance of infrastructure and services, such as safety and security. They are unable to adjust down their operating costs, let alone their fixed capital costs, to compensate for the low levels of traffic, at a time when they have been effectively shut down by Government.
It is widely accepted that airports are, therefore, looking at elevated costs for the next few years at least, if not longer. With travel demand likely to remain weaker in the short term, due to ongoing restrictions and travel hesitancy, they cannot pass those costs on to airlines, nor would it be fair to do so. A level of ongoing, bespoke financial support to cover those costs should, therefore, be provided by Government, as we transition to the recovery phase.
The airport and ground operations support scheme provides some relief but a longer term and more extensive commitment is clearly needed. Ministers must urgently bring forward the long-delayed aviation recovery plan, and start thinking in earnest about linking the need for ongoing support to our wider goals as a country on climate change and sustainability. The immense problems airports are facing are due to factors entirely beyond their control. They are the result of understandable regulatory interventions from Governments, to prevent the spread of the virus, which include travel bans, traffic light lists and quarantine periods. From the Government’s announcements over the past couple of days, it seems as though aviation will be the sole industry to remain under restrictions.
Ministers like to talk about their £7 billion package of support, but only a very small amount of that has been sector specific. Other European Governments have provided much greater levels of financial support for their aviation industries, and have specifically linked that support to meeting climate goals, something the UK has also refused to do. A big chunk of that Government support will end in two months’ time, when the job retention scheme winds up. That scheme has been a lifeline for aviation workers currently on furlough, along with 51% of those working for tour operators. The Chancellor has been adamant that he will not consider continued sector-specific support for jobs. Unless he has a change of heart, significant redundancies will become stark reality for many in Newcastle, where Newcastle airport is a significant local employer. The loss of expertise will leave us with a less dynamic aviation sector when the recovery comes.
In 20 years, we will look back on the past year as a pivotal moment for UK aviation that will have long-term consequences. The covid-19 pandemic and the Government’s lack of support have crippled airports’ balance sheets. That will have a long-term effect on their ability to invest and create a sustainable future. It may not seem like much of an issue while international travel remains extremely limited, but problems are being stored up for when the recovery comes. The north-east needs Newcastle airport to thrive, to increase global connectivity and to drive our region’s growth and development. We need a clear road map from the Government for the safe resumption of international travel. Particularly if aviation is to continue to remain under restrictions, we urgently need the long overdue aviation recovery plan, alongside a comprehensive package of sector-specific support.
It is a pleasure to speak in this debate. First, I congratulate the hon. Member for St Austell and Newquay (Steve Double) on bringing forward this debate. Westminster Hall debates offer the opportunity for those with a deep interest to participate, so I thank him for providing the opportunity to do just that.
We need to make no mistake here. I know the Minister understands that; all the hon. Members who have spoken have expressed it and I hope to further express their viewpoint. This is a UK-wide issue because the ripples of difficulties for the airports will affect every community in the United Kingdom, but I will speak specifically about Northern Ireland. I know the Minister has a deep interest in these matters and I am pleased to see him in his place. As a Northern Ireland MP, flight connectivity is vital for me. It is the reason I get here on time and get home on time. Flying over on a Monday or early on a Tuesday morning and flying back on a Thursday night is my routine. If Northern Ireland is to be on a path to fulfilling its full potential, some of that journey will be in the air, through reliable and frequent national and international flights.
Let me put on record my gratitude to the Minister for all his endeavours, his vast knowledge and his interest in this matter. I am not saying that other Ministers do not have that, but it is always good to represent our views to him and to get a response. I am very pleased to see the spokesperson from the Scottish National party, the hon. Member for Paisley and Renfrewshire North (Gavin Newlands) and the Labour spokesperson, the hon. Member for Wythenshawe and Sale East (Mike Kane). They also have a deep interest in this matter and I know they will reinforce the opinion of other hon. Members.
The statistics are clear: aviation is still firmly in the grasp of the worst crisis it has ever faced. Numbers of passengers travelling through United Kingdom airports last summer were the lowest since 1975. My goodness, that is hard to believe. Between April and December 2020, passenger numbers were down 89.3% year on year. In quarter one of 2021, they were down 94% compared with 2019—a drastic reduction in figures and in revenue generated. In the same period, passenger numbers were down almost 89% in London airports, 91.1% in English regional airports, 89.1% in Scottish regional airports, 86.1% in Northern Irish airports and 96.8% in Welsh airports.
Taken together, that meant that the economic output for the air transport sector between February and December 2020 reduced by 89%. That is phenomenal and really shows the magnitude of the pressure on the sector. I am not a wealthy man and I do not come from a wealthy background, but I cannot imagine that anyone other than the very wealthiest in this country could afford to cut their income by 89%. It would be impossible to manage. Yes, furlough has helped and I thank the Government for all they have done with the furlough scheme, the grants and the assistance. But the fact is that regional airports are at crisis point and need help to get through and out the other side, where hopefully we will find ourselves in a better position. We will, but we are all asking just when that will happen.
It is nobody’s fault, either. It is always very easy to point the finger but Government cannot respond to something that is not within their control. I asked the Secretary of State for Transport the other week how we can give confidence to travellers who want to go on holiday. But that is not within his control; it is controlled by all the other countries. It is hard for him to say, “I can tell you what is going to happen and give confidence to your constituents that they can travel to the States or Europe or wherever else they want to go and return safely.” Between April and September 2020, UK airports lost £2.6 billion in revenue, with passenger numbers peaking at 22.1% of 2019 levels in August 2020—up some 11.6% from July, but falling dramatically afterwards. On the current trajectory, summer 2021 will see significantly fewer passengers, meaning airports will lose at least another £2.6 billion in revenue.
We had hoped that we would be coming out of this situation this summer. The Government have set the trend. The Prime Minister’s statement was welcome because, as he said and as the Government’s strategy now seems to be, we need to live with covid and deal with it in such a way that life can hopefully resume as normally as possible. What can we do to alter this situation? We must look at how other nations handle their flight systems and how they treat those coming to their borders who are fully vaccinated. Perhaps the Minister and the Government are seeing a developing trend for how to deal with that.
Regional airports are clear on what they need. The Airport Operators Association briefing puts it well. Support measures should be extended. Office for National Statistics figures show that 57% of aviation jobs are currently furloughed, so the job retention scheme should be extended beyond 30 September for jobs in aviation and travel, or replaced by another grant scheme that supports such jobs beyond that. The restrictions are having an impact on regional airports as well as on international travel—they cannot be divorced. If we in Northern Ireland want to catch international flights, we have to go to Dublin in the Republic of Ireland, or to Manchester or Heathrow. If international flights are cut back, that will have an impact on regional airports and domestic travel.
The airport and ground operations support scheme should be extended beyond 30 September, and the £8 million gap should be removed. Currently, AGOSS provides only minimal financial support of £8 million at most—equivalent to the total business rate bill for airports. AGOSS grants cover fewer than 14 days’ worth of an airport’s operational losses, so they do not last long. Further financial support should be put in place, because airports remain open for critical services. We have to remember that it is not all about domestic travel; it is about the coastguard, the police, the air ambulances and maintenance for offshore oil gas and windfarms, despite near zero passenger numbers. This support should cover operational costs, including those for policing and air traffic, and regulatory costs such as the charges levelled by the Civil Aviation Authority. I gently and respectfully ask that consideration be given to that, because there are things that have to happen for the emergency services and for workers. The hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) referred to that, and I know that the Scottish National party spokesperson, the hon. Member for Paisley and Renfrewshire North, will do so, too.
It is essential that we protect the viability of airports, especially in Northern Ireland, and indeed in all the regions of Wales and Scotland that are hampered by their distance from the mainland. We are very much an integral part of the United Kingdom of Great Britain and Northern Ireland—I am always keen to put that on the record—and as such should be fully integrated in the decision making on the way forward. I join others in asking the Government and the Minister to step up and step out for this sector by providing long-term support in a clear and defined way to ensure viability and connectivity long beyond this debate.
It is a pleasure to serve under your chairmanship, Ms McVey. I congratulate the hon. Member for St Austell and Newquay (Steve Double) on securing the debate. He led it very well. I could not disagree with anything he said; in fact, that goes for pretty much every contribution.
The hon. Gentleman spoke of regional airports and regional connectivity being vital to the levelling-up agenda. It is also crucial to other sectors, as I outlined a couple of weeks ago. We have had a number of debates on a similar theme in recent weeks. I will try not to repeat too much of what I have said, but inevitably I will cover similar ground.
The hon. Gentleman also covered PSOs. He can correct me if I am wrong, but I think he said that there are only three in the UK and they are all linked to London. However, that is the English position, because there are a number in Scotland. There are three PSO routes linked to Glasgow—Barra, Tiree and Campbeltown—and a number of other PSO routes are subsidised by local authorities in the Shetlands, Orkneys, Western Isles and Argyle and Bute. As we heard from the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone), there is a potential additional PSO route to Wick, which I would very much welcome.
The hon. Member for Truro and Falmouth (Cherilyn Mackrory) made a fantastic speech. Sadly and unusually, a number of Members have pulled out of the debate, but other contributors included the right hon. Member for Hayes and Harlington (John McDonnell), who always takes part in these debates, and the hon. Members for Mansfield (Ben Bradley) and for Newcastle upon Tyne North (Catherine McKinnell). And, of course, no Westminster Hall debate would be complete without a contribution from the hon. Member for Strangford (Jim Shannon). He said that we had regional airports to thank for getting him here on time each and every week. I do not think there is any better argument for regional aviation.
As well as being the SNP Front-Bench spokesperson on this topic, I also represent Glasgow airport, which is operating at just 10% of normal capacity at the moment. In addition, we are losing another summer. Let us not forget that, while we talk down here about the school holidays and summer season starting at the end of the month, in Scotland the summer season has been under way for two weeks, and the Northern Ireland school holidays started in the past week or so. The season is already getting beyond Scotland and, to a large degree, Northern Ireland. It is crucial to recognise that.
Glasgow has lost 100% of its long-haul routes, 70% of its international flights and half of its domestic flights. Last year, Glasgow carried 1.9 million passengers—bear in mind that some of last year’s restrictions were not as bad as they are this year—compared with about 9 million in 2019. The last time passenger numbers from Glasgow were this low there was in 1970. Airlines UK has found that without Government support, UK airports will lose around 600 routes as a result of the pandemic. Crucially, it says that some 80% of those lost routes will be from the UK’s regional airports. In other words, the Heathrows and the like will be shielded in the medium term from the worst of the damage.
Given that, and given the long delay in publication, will the Minister confirm when the regional connectivity review will see the light of day? If the Government are genuinely serious about the levelling-up agenda, they must do something to address that specific point. Regional airports, as has been said by many speakers today, drive the regional economies they serve. It is not just about going on holiday. Commerce follows connectivity, and without a meaningful direct route network, Scotland’s place on the world’s stage is at risk, thereby affecting our ability to export and attract foreign direct investments —something we have been incredibly successful at for a number of years. Our successful inbound tourism industry is also at risk.
Pre-covid, tourists were, obviously, spending. Tourism in Scotland generated approximately £12 billion of economic activity for the wider Scottish supply chain and contributed around £6 billion to Scottish GDP, representing about 5% of Scotland’s total GDP. Pre-covid, Glasgow exported over £1.7 billion-worth of goods—more than any other Scottish airport. The majority went out in the belly hold of passenger flights—the very flights we are at risk of losing for good.
There has been much understandable consternation in the industry and beyond with regard to the decision-making process behind the traffic light system. The Government must be more transparent about the decisions they are making regarding why country X, with a potentially lower incidence rate, is on the amber list, while country Z, with a significantly higher rate, is on the green list. Despite what the Secretary of State said during Transport questions the week before last, that level of data is simply not available. The virus is a big enough variable for the industry to cope with—it does not need an even bigger variable in the form of completely unpredictable Government decision making on the traffic light system. The public also need to be convinced and to trust a traffic light system. It has to be said again that the decision to put India on the red list for England was delayed for far too long, and we can see the direct result in our current incidence rate.
One third of on-site jobs at Glasgow airport have already gone, and countless more off-site jobs have been lost from supply chain companies. As I said in this very room two weeks ago, the crucial point is that, such is the cash burn of and outlook for the sector, thousands of jobs have gone while there is a furlough scheme in place. As the Minister knows, jobs in aviation and, indeed, in the wider travel and tourism industry will be decimated in September if the furlough scheme is not extended for those sectors. Not only will that be an economic and social tragedy for thousands of families across Renfrewshire, and perhaps hundreds of thousands around the UK, but the loss in economic output and the cost to the Treasury of short to medium-term unemployment support and associated benefits would be an act of economically illiterate self-harm. There is no pontification or equivocation here—furlough must be extended for these sectors, or many parts of the industry and the hundreds of thousands who work in it face ruin.
The Minister will get up and repeat the sums about the support given to industry. Much of that is furlough, which I and many others of course welcome and which must continue, but in essence the rest is debt, resulting in our airline industry having a much higher debt ratio than much of its international competition, where support, as outlined already, is largely through non-repayable grants. The sum in the USA is £23 billion, in Germany nearly £8 billion, in France £6.5 billion, and in the Netherlands more than £3 billion.
As others have mentioned, limited relief was provided to English airports in November, when the UK Government finally introduced a limited business rate support scheme for the sector. That was seven months after the Scottish Government had announced a similar but more generous scheme in Scotland, where it is not capped and extends to airlines based there, too. Moreover, the Scottish Government moratorium has been extended by a full year, whereas the UK Government’s limited and capped version will continue for only six months. That is clearly an unsustainable position. Will the Minister, in summing up, confirm that an extension is being considered?
Another issue that has hit regional airports a lot harder than the bigger airports was the loss of VAT-free shopping on 1 January, through the scrapping of the extra-statutory concession scheme. I was reminded of that by my hon. Friend the Member for Glasgow East (David Linden), who travelled through Glasgow airport a bit earlier than me on Monday. He spoke to a member of the duty-free staff who said that, just prior to my colleague going in, they had lost out on £6,000-worth of whisky sales to an individual, because the rules now do not allow for that. That was £6,000 lost in just one transaction.
The result of the Government consultation on the extra-statutory concession was overwhelming. In fact, it was near unanimous, such was the support for the continuation of some form of ESC after Brexit, but again the Treasury ignored those responses. This is yet another revenue stream that helps employ thousands of people across the country and is vital for many airports. Regional airports depend on the revenue from air-side shopping to a far greater degree than the Heathrows of this world. In fact, up to 40% of a smaller airport’s revenue is generated through shopping, as a higher proportion of passengers are flying point to point, rather than domestically through a hub such as Heathrow.
Kicking away that financial structure at a time of huge pressure on the finances of airports is another unnecessary blow to an industry that is reeling from the pandemic, and many regional airports in England are still dealing with the after-effects of the collapse of Flybe. In Scotland, it is estimated that the abolition of the concession will potentially result in the closure of most retail outlets at airports and lost revenue of about £20 million and hundreds more jobs, which neither retail or airports can afford. In fact, in Glasgow five retail outlets and at least three food outlets have closed and will not reopen. The UK Travel Retail Forum said:
“This could be the final nail in the coffin of several UK regional airports.”
The entire industry is on its knees, and I am concerned that the forum is right.
To come to a conclusion, I have made this point recently, such that I sound like a broken record. This is about the 37th time I have asked about support for the aviation sector. That is not just the furlough scheme, crucial though it is, but bespoke support for the sector, which let us not forget is the sector hardest hit by covid. Indeed, we need the kind of bespoke support that the Chancellor and the Secretary of State promised at the outset of the pandemic. I well remember being in the room when the Secretary of State, having claimed to have saved Flybe only to watch it collapse, said to the industry:
“I understand the enormity of what you are facing, and this Government will stand by your side.”
No one in the industry feels that the Government have been by its side. I ask the Minister again: are the Government actively considering a bespoke aviation, travel and tours recovery package? Many sectors that have been far less affected than aviation have had that kind of support.
As I have said, the UK started the pandemic with the world’s third-largest aviation sector, but as one third of that workforce are already gone, it will certainly not come out of this as the third largest. Thousands of people in my constituency alone are losing their jobs. Parts of the industry are on the verge of collapse. As I said two weeks ago, time is running out. We need action, and we need it now.
It is a pleasure to serve under your chairmanship, Ms McVey, as you are my constituency neighbour.
I congratulate the hon. Member for St Austell and Newquay (Steve Double) on securing this timely debate and on his superb chairmanship of the APPG on general aviation. He was followed by the hon. Members for Truro and Falmouth (Cherilyn Mackrory) and for Caithness, Sutherland and Easter Ross (Jamie Stone)—it was almost Land’s End to John O’ Groats, but not quite. They gave strong defences of their airports, including Wick airport in the north, and spoke of the exciting prospect of the first hybrid flight from Newquay to Exeter.
There have been a few common themes. As ever, my right hon. Friend the Member for Hayes and Harlington (John McDonnell) spoke about the need for continuing support, as did the hon. Member for Mansfield (Ben Bradley), who said that there is no sector-specific support. Indeed, those Members will know that 19,000 BA staff are still on furlough. Those section notices have to go out in the next few weeks. We are standing on a cliff edge and something needs to happen.
My hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) spoke eloquently about how uneven the opening-up process of international travel has been. Less than two weeks ago, the Minister got uncharacteristically upset with me when I diverged on policy and said that Labour’s view was to scrap the amber list. We now know that, as The Times reported this morning, the Government will scrap the amber list tomorrow when the Secretary of State makes his announcement, so there we have it.
Following on from the remarks by the hon. Member for Paisley and Renfrewshire North (Gavin Newlands), I am glad that peace has prevailed between our nations. The people’s republic of Greater Manchester and the Scottish nation were almost going to go to war when the First Minister banned us from travelling. Some 2.8 million of us were going to march up the M6 in our City and United shirts, under our Oasis parkas, and stand at the border at Gretna shouting, “Nice one, nice one!” but the First Minister has backed down. That decision alone has cost businesses in my constituency tens of thousands of pounds. I hope that the Scottish Government will now think about adequately compensating business for that, but peace now reigns in our time.
I have listened intently to the debate, and to unions, airports, operators and representatives of the aviation industry. What is clear is that without a genuine sectoral deal, the sector and our regional airports will be in peril. Look back at all that the regional airports have had to contend with over the last few years: the collapse of airlines such as Flybe and Monarch, and of the operator Thomas Cook, which are hugely significant in our part of the world in Manchester, as well as for regional connectivity.
Those low-cost carriers opened up areas such as Southampton, Blackpool, Newquay and Birmingham for business and leisure travellers, and they opened up the rest of the world to the people who live there. Welcoming tourists to those areas boosted the economy, hotels, restaurants and taxi drivers. My hometown is currently hosting the wonderful Manchester international festival. Without Humberside airport, would we have seen such a fantastic event at Hull city of culture? Airports are vital for regional economies.
It is not merely culture and tourism that are affected. I understand only too well the value, economically or otherwise, of representing an airport community. I am sure that colleagues who have spoken to represent their constituencies know how important those communities are when it comes to connectivity, particularly the hon. Member for Strangford (Jim Shannon). I must ask him: do airlines arrange their schedules around his interventions in debates? I really wish to know the answer to that question.
Although the Government repeatedly refer to the package of support that aviation has had, there are some specific industry concerns that do not seem to be recognised at all. The covid pandemic has hit this country and its people hard. We have one of the worst death tolls in the world, and we cannot allow the death of the aviation sector and the closure of regional airports to exacerbate the devastation. The often-talked-about £7 billion package of support, which the Minister will mention in his response, is in the form of loans to the industry—it is debt to the industry. As we move into our lost second summer, the ability to service those debts while being unable to operate is striking fear throughout the industry, and there is the looming spectre of further job losses.
We must consider broader sector-specific support. It is not just about airlines and airports; it is about a whole range of other businesses. My colleagues and I have worked with stakeholders to reach a position that protects jobs, the wider supply chain and—crucially, as we head towards 2050—the environment. The sectoral deal that we suggest is based on six conditions. It will save jobs, tackle climate change and ensure that companies benefiting from the sector support rebase their tax affairs in the UK, which is the patriotic thing to do.
We support global Britain, but we are falling behind the rest of the world. If the Government are serious about rebalancing our economy, they must provide a sector-specific deal. The fund was announced last March, but here we are in July and there is no meaningful restart for aviation. If the Government are to provide confidence for travellers and protect these vital hubs, they have to give us a deal.
My last point—I am sure we are all in agreement—is that we absolutely must rebuild the sector, get businesses going again and get people flying again. As far as possible, we must make this a green recovery. There is no easy way to mitigate the environmental impact of aviation, but whether the green recovery is achieved by reducing fuel consumption, by introducing smarter flight operations and new aircraft engine technology, by modernising the airspace, on which I hope to work with the Minister, or by using sustainable aviation fuels, we must make the industry cleaner and greener. What better footnote to the terrible impact that we have all felt from the coronavirus pandemic than to have our regional airports thriving, with green jobs alongside the other jobs that we previously mentioned? Our regions are crying out for new types of well-paid, highly skilled employment. Let us use this opportunity to save our regional airports and create a greener, sustainable recovery in every region of this nation.
It is a real pleasure and honour to serve under your chairmanship, Ms McVey. I thank my hon. Friend the Member for St Austell and Newquay (Steve Double) for securing this important debate. He and I have spoken on many occasions—not just about his vital airport, but about regional connectivity in general. He is hugely knowledgeable and passionate. As a consequence, he is an incredibly powerful advocate not just for his local community, but for regional air connectivity in Cornwall and the whole of the UK.
I thank all hon. Members for the varied and excellent points that they have made, and I will do my best in the time available to respond to as many of them as possible. The Government entirely understand and recognise the severe economic impact that the covid-19 pandemic has had on regional airports. They are critical regional and national infrastructure, and we continue to work to understand the industry and to see how it can be best supported at this time. Before I address some of the wider points that have been made, I will say a word or two about Newquay airport, because it is so important to my hon. Friend the Member for St Austell and Newquay.
Newquay airport is vital for connections to the south-western corner of our nation. It connects to nine UK airports, the Isles of Scilly, Faro and Alicante. Newquay airport provided vital access for world leaders accessing the G7 summit last month and, as my hon. Friend rightly says, it was clearly vital to the success of the summit. The £7.8 million provided by the Cabinet Office for infrastructure improvements for the G7 enabled the efficient handling of air traffic and the aircraft that were required for the summit. I am pleased that the works will also ensure that the summit leaves a long-term economic legacy at Newquay airport.
I will be in Cornwall tomorrow as part of the Maritime Safety Week programme. I will be returning from Newquay airport, and I am delighted that my hon. Friend will, I hope, be joining me on a visit to and tour of the airport. We will see again, for ourselves, quite how vital this airport is, not only to him, his area and the constituencies surrounding it but to the whole of the UK. That is because the UK enjoys one of the best connected, best value and safest aviation industries anywhere in the world. The aviation industry creates jobs, encourages our economy to grow and connects us, as my hon. Friend the Member for Truro and Falmouth (Cherilyn Mackrory) eloquently explained, with the rest of the world. It consolidates and expands this country’s position as a dynamic trading nation. That is doubly the case with regional airports.
Regional airports serve our local communities. As the hon. Member for Newcastle upon Tyne North (Catherine McKinnell) vividly explained today, they support thousands of jobs and act as a gateway to the international opportunities to which I have already referred. They maintain social and family ties, and strengthen the bonds between our four nations.
The hon. Member for Strangford (Jim Shannon), as ever, made a wonderful contribution. He explained that regional aviation is vital not only to Northern Ireland as a whole but to his weekly commute. The hon. Member is the personification of the vital economic and social link that regional aviation provides for Northern Ireland and for the United Kingdom.
Prior to the pandemic, the aviation sector directly contributed at least £22 billion to GDP each year and supported half a million jobs in the UK. Maintaining a strong, privately operated and competitive aviation industry is vital to our economy. It supports a truly global Britain and the communities that surround airports.
The hon. Member for Wythenshawe and Sale East (Mike Kane) used a wonderful phrase: “the airport community.” He is absolutely right. He referred in particular to Humberside and, of course, to Manchester, which is so important to him. The phrase “the airport community” could apply, and does apply, to so many of the Members who have contributed to this debate, and to many others who would have liked to have done so.
I would like to dwell for a moment, Chair, on some of the points made by my hon. Friend the Member for Mansfield (Ben Bradley). He made powerfully clear the importance of East Midlands airport to his constituency and region. Regional airports are vital for levelling up. They enable local communities and businesses to connect with London and beyond. They play a key role in levelling up our regions and building global Britain. It is absolutely vital that that air network is maintained, because it is key to achieving positive and growing economic outcomes for our regions. Our objective is to ensure that all nations and regions of the UK have the domestic and international air transport connections that local communities and businesses rely on, while of course ensuring that we meet our net zero commitments. I will come to that in a moment.
The importance of this regional aviation network has been seen as never before during the covid crisis. Although it has clearly impacted regional airports across the UK, and the airlines that operate out of them, the sector has continued to perform well and has adapted despite the challenges. We have spoken of Newquay already. The Newquay to London route is operating during the summer, as commercial operators are offering enough flights to be able to meet the demand for staycations. We have heard that the G7 summit was facilitated by that.
As of last week, a new route began operating from Teesside airport to London Heathrow. It will link passengers from Teesside, via Heathrow, to 134 destinations throughout the world. We have seen vividly over the course of the last year that the sector has adapted to provide critical support during the pandemic. For example, aviation freight has been vital for getting the amount of personal protective equipment the UK has needed, both through airports that are freight specialists and through passenger airports that also deal with a heavy amount of freight. My hon. Friend the Member for Mansfield has clearly explained the importance of East Midlands to his region, and Birmingham airport has also stepped up to provide more red-list terminal capability and capacity.
I shall return to the hon. Gentleman’s points, but on that point, in brief, we will look to publish that regional connectivity piece as part of the strategic framework for recovery of the sector that we will publish later this year. I will come on to some of the regional connectivity review points in a little while, but that is the brief answer to his question.
I would like to say a word or two about the wider use of airfields, the diversification of them, and the ability for airports and airfields to provide highly skilled, dynamic and innovative businesses with opportunities to grow and flourish. That involves things such as the maintenance of aircraft, manufacturing, aviation services, and research and innovation. Airports and airfields are not just vital for their local economies, but critical to the success of the aviation sector more broadly. My hon. Friend the Member for St Austell and Newquay of course chairs the APPG on general aviation and will know how important they are for that. I know that he shares my passion for that.
My hon. Friend the Member for Truro and Falmouth spoke about the use of commercial airports for aerospace or military aerospace. There are of course many examples all over the country, but Cobham at Teesside airport is one that immediately springs to mind. Then there are regional airports that have diversified into other, additional functions—things such as pilot training. Oxford airport, just outside my own constituency, is a powerful example of that. Perhaps the most vivid example of all is Newquay airport in hosting a spaceport.
The hon. Member for Strangford pointed out that many services need regional aviation. He rightly referred to search-and-rescue helicopters, to police helicopters and, of course, to oil and gas maintenance and facilitation. The mixed use of aviation and airspace is absolutely vital, going far beyond the immediate core vital function that we have spoken about today.
I would like to say a word or two about route support and PSOs—an issue raised by a number of hon. Members, including of course my hon. Friend the Member for St Austell and Newquay but also the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) and the hon. Member for Paisley and Renfrewshire North (Gavin Newlands), who spoke just a moment ago. The hon. Member for Caithness, Sutherland and Easter Ross had the wonderful phrase “from Cornwall to Caithness”. I suspect that other hon. Members might wish to add some stops en route, so that we have Cornwall to Caithness via Manchester, via Glasgow and via Belfast, for example; there are many other places. His phrase was wonderful; I apologise to him for having mangled it in the course of including other hon. Members. His essential point, that regional aviation covers the country from Cornwall to Caithness, is of course a very important one.
We continue jointly to fund public service obligation routes from, for example, Londonderry and Dundee into London, protecting air connectivity from some of the most far-flung parts of the UK. We are, as I have stated already, very pleased that commercial services have operated between Newquay and London over the summer and will continue until the end of October. We are working closely with Cornwall Council to ensure that air connectivity on the route can continue beyond the end of the summer season.
I recognise, of course, the significant impact that covid-19 has had on regional airports, airlines, economies and connectivity. We will consider whether there are further opportunities to utilise PSOs alongside other policy measures that look towards meeting our ongoing regional-connectivity and levelling-up objectives.
The hon. Member for Caithness, Sutherland and Easter Ross asked to meet me about Wick airport. Of course I would be delighted to meet him to discuss that and any other issue that he may wish to discuss with me. He will of course realise that if a PSO is considered to be intra-Scotland, the Scottish Government would be the right place for him to direct his inquiries, but of course I am happy to work with him to see what more we can do to strengthen regional aviation in his part of the world.
A number of Members mentioned air passenger duty. Of course, as part of its plan to boost regional connectivity to support the commitment to net zero by 2050, the Treasury launched a consultation on aviation tax reform that explores reforms to air passenger duty. It is an area often cited by the sector as a barrier to domestic connectivity. That consultation has set out the Government’s initial policy position that, following our departure from the EU, the effective rate of APD on domestic flights should be reduced. The consultation closed on 15 June. The Treasury is now considering responses and will give an update on response timings in due course.
I have already briefly referred to the regional connectivity review, in answer to the hon. Member for Paisley and Renfrewshire North. The Union connectivity review by Sir Peter Hendy is under way and will be published later this year. That will explore how improvements to transport connectivity between the four nations of the United Kingdom can continue. That is independent of Government and is expected to examine various modes, including air links.
A number of hon. Members rightly mentioned decarbonisation: my hon. Friends the Members for St Austell and Newquay and for Truro and Falmouth, and the hon. Member for Wythenshawe and Sale East, in particular. The Government have introduced a wide range of measures to support the decarbonisation of the aviation sector, including a £15 million competition to support the UK production of sustainable aviation fuels—SAF, as they are called—and the introduction of the UK’s emissions trading scheme, which is 5% tougher than the EU equivalent, and covers all domestic and UK to European economic area flights. In June, we launched the first round of the £3 million zero emission flight infrastructure competition, supporting the development of the infrastructure that is required to aid electric and hydrogen aircraft. That will help to build the UK airports and airfields of the future.
The UK’s domestic aviation sector is well placed to be at the forefront of decarbonisation. I welcome the recent announcement from Loganair that its operations will be carbon neutral by 2040, to be achieved through the use of SAF, hydrogen and battery-electric propulsion, as technological advances allow. The Government will shortly consult on our jet zero strategy, setting out the steps that the sector will need to take to achieve net zero by 2050.
A number of hon. Members asked about the future, the recovery of the sector and the strategy: my hon. Friend the Member for St Austell and Newquay, the hon. Member for Newcastle upon Tyne North and the right hon. Member for Hayes and Harlington (John McDonnell) who was not Zoom-bombing—his contributions are always very welcome, whether on Heathrow, the green recovery or any other matter concerning aviation. We will be looking ahead for the sector and will need to set out the path for recovery in a way that supports not only the aviation market but the wider objectives of levelling up and building back greener.
We are working on the strategy for the future of aviation in the UK, to be published later this year. It will explore the sector’s return to growth, including workforce and skills, aviation noise, innovation and regulation, consumer issues and, critically, regional connectivity, as I have explained. It will also consider climate change and decarbonisation, as well as the critical role that aviation plays in retaining the UK’s global reach. As I explained, the strategic framework will be published later this year.
There is no doubt that the pandemic has had a devastating impact on the UK’s aviation sector but regional connectivity and regional airports are a vital part of it, and we are committed to ensuring that they are at the forefront of Government plans to help the sector to recover. The Government are always keen to engage with aviation stakeholders to find ways to ensure the swift recovery of the sector.
Although uncertainty remains in the path ahead, we are committed to this world-leading aviation sector, both its international and regional parts. We will ensure that the sector has the tools it needs to return and grow in a safe and sustainable way. I thank all hon. Members who spoke for such an excellent, wide-ranging, highly knowledgeable and helpful debate on this critical topic.
I thank all hon. Members for their contributions to the debate. The level of concern and commitment to our regional airports from colleagues across the country is clear. I also thank the Minister for his comprehensive response. I know he shares our passion and commitment to regional connectivity. I hope he continues in his role for a long time, because we have someone who champions aviation. There was a clear message from all contributions, and I know from his response that the Minister gets it.
We are at a critical moment for our regional airports. The impact of the pandemic, on top of a fairly tough environment even before the pandemic with the collapse of Flybe and other factors, means that we need to do all we can to support them. I acknowledge and welcome the Minister’s comments about the Government’s determination to support the sector going forward. There is no time to be lost, particularly with the phasing out of the furlough scheme. We need to see something come forward sooner rather than later for those jobs and businesses. As many hon. Members have commented, there are so many different businesses that support our regional airports. They need to know what the support will be going forward, so that they are able to plan for the immediate future as we emerge from the pandemic.
This has been an excellent debate. I thank everyone who has contributed. I am sure we will continue to engage together and with the Minister to champion each of our regional airports and the vital role they play.
Question put and agreed to.
That this House has considered the future of regional airports.
I remind hon. Members that there have been some changes to normal practice in order to support the new hybrid arrangements. Timings of debates have been amended to allow technical arrangements to be made for the next debate. There will also be suspensions between each debate. Members attending physically should clean their spaces before they use them and as they leave the room, putting the cleaning materials in the bin.
I beg to move,
That this House has considered Immigration Rules and highly skilled migrants.
It is a pleasure to serve under your chairwomanship, Ms McVey. With yesterday’s announcement of the new Nationality and Borders Bill, I am pleased to have the opportunity to lead this debate on the immigration rules and highly skilled migrants. I want to start by thanking the right hon. Member for East Ham (Stephen Timms), who originally secured this debate and asked me to take it on. I know he is doing a lot of work in this area.
I also want to mention my hon. Friend the Member for Glasgow Central (Alison Thewliss), who recently challenged the Chancellor and the Home Secretary on the introduction of yet another scheme to bring in highly skilled migrants in the 2021 Budget. I echo her sentiments that the Chancellor, the Home Secretary and the UK Government must sort out this injustice once and for all before another person is given a highly skilled migrant visa. I am sure that people of colour from Commonwealth nations contemplating bringing their talents to the UK, including under the new scheme, will want to know of any potential risks to their and their families’ immigration status prior to applying. I also want to commend BBC “Newsnight” for covering the issue a few weeks back, raising awareness and prompting people to contact me.
What is it that has got everyone so exercised? It is complicated and simple. The nub of it is this. Her Majesty’s Revenue and Customs has been sharing information about a subset of non-white highly skilled migrants from specific Commonwealth countries in the global south with the Home Office. That enables the Home Office to then refuse their visas to remain in the UK. The basis for the refusals are historical, non-criminal tax discrepancies, some very minor—I understand one was for only £1.30—and most dating back years, long ago resolved, and none of which HMRC felt required further action. Let us bear in mind that the people we are talking about have been here for 10 years or more. Finally, the legal basis on which this has been done is questionable. So that is the summary.
These individuals, who were invited to these islands to contribute to our economy and wider society, now find themselves in a precarious immigration limbo, without any investigations into the circumstances or nature of people’s tax discrepancies before the visa refusals. There remain many questions about whether the decisions taken have allowed fair assessments and hearings, and how proportionate visa refusals are for something that has not even been proven to be deliberate or careless under HMRC’s own threshold for discrepancies and within HMRC’s normal 12-month timeframe for investigation.
Through a number of Government initiatives spanning decades, there has been a consistent call to invite the brightest and best to these islands, with the idea being that the UK would take control over who they allowed to work and live here. Yet somehow the UK Government have systematically failed to build the immigration system that they say they want. Instead, they have adhered to a policy of hostility, exclusion and really disproportionate punishment. I am sure the Minister will likely talk about “minded to refuse” letters that allow migrants to explain the discrepancies, but, in 80% of the remaining cases, those have not been received and, where they have, some have contained more than 100 questions for response within 14 days. Also, it is about issues much wider than tax discrepancies.
There is a concern that the letters are being used not to give a fair and timely hearing of evidence, but to double down on the initial decisions made. The deeply precarious situations that many of these highly skilled migrants and their families are now experiencing highlight the issue only too well.
Highly skilled migrants in the UK have been criminalised and denied indefinite leave to remain based on the Home Office’s discretionary and subjective bad character or dishonesty judgments in paragraph 322(5) of the rules, as I said, for historic tax discrepancies, many up to 10 years ago. Paragraph 322(5) sets out the general grounds for refusal. Unlike other immigration provisions for criminal behaviour, which this is not, it seems to be still applicable even after 10 years. Clarity is needed—I hope the Minister will provide it—about how this immigration rule will be used in future immigration applications of highly skilled migrants who have been granted some form of leave.
I also note with concern that paragraph 322(5) and related clauses in the immigration rules have recently been redacted online. I hope that this redaction is not a means of limiting scrutiny of how these clauses are being used in immigration decisions, and I expect the Minister to have an explanation for that.
I am not the only one saying that the Government are wrong; the Court of Appeal has already ruled in two separate cases that the Home Office has acted unlawfully in this regard. Paragraph 322(5) permits refusal when an applicant is considered
“undesirable…in light of their conduct, character or associations”,
or the fact that they represent a threat to national security. This measure also allows discretionary refusal by inferring “undesirable” character. According to the latest guidance, that could be because of criminal-related activity short of a conviction, or for what are called “wider reasons”. So, with no convictions and no reasoning, the Home Office can unfairly label someone as being “undesirable” or of bad “character”. Can Members imagine how such labels affect someone’s ability to live and work in a community, or impact on their self-esteem?
Being denied their indefinite leave to remain has left these highly skilled migrants in a legal limbo; they are unable to work, rent, drive, receive NHS healthcare, open bank accounts, or get vital access to public funds. Imagine a situation in which someone has a minor tax discrepancy hanging over their head. And bear in mind that, according to the Institute for Fiscal Studies, around 60% of self-assessment tax returns in the UK contain discrepancies. For anyone who has had to complete one of these returns, that is not difficult to believe; they are not easy. For most of us, a minor tax discrepancy would just mean reminding ourselves to amend our tax return, or we would call an accountant to sort the problem out for us; the worst that can happen is that we will get a slap on the wrist and a cursory fine. We would not be in a situation where we were left destitute, as is the case with so many of the people who we are talking about today.
Understandably, this situation has been described as a “personal purgatory” by some of those experiencing it: a half-life, in which someone is unable to contribute, without any recourse to appeal or explanation. It must be a truly devastating prospect for someone to think that they could be treated as criminal under an immigration rule that was reserved for those deemed a national security threat, based on a simple discrepancy in a tax return.
Although the actual amount of these discrepancies ranges widely, some of the figures involved are shockingly small. As I have already said, a discrepancy of around just £1.30 could see someone being deemed as dishonest or of bad character by the Home Office. In the two cases that were heard in the courts, one involved a small amount of money and one involved a larger figure, but the courts found the people concerned to be honest and granted them leave, which shows that the amount of tax discrepancy per se should not matter and does not automatically mean that the person responsible for such a discrepancy is a criminal. The courts certainly did not think so.
Investigation into the circumstances and a balancing exercise regarding the person involved and their family is key. Indeed, this cohort of people are not criminals. They are hard-working migrants who were invited to this country, which is now determined to use a system of legal loopholes and loose statutory interpretation, which I will come on to, in order to remove them.
Tax discrepancies are neither a criminal nor an immigration offence, and in all of the cases reported, HMRC did not independently pursue the discrepancies at the time of filing. So why is the Home Office pursuing these migrants? Why are the thousands of other cases are uncovered every year—including those of the 60% of people who fill in tax returns inaccurately—not being pursued with the same vigour? And I am not suggesting that they should be.
Tellingly, UK Visas and Immigration has refused applications under this rule, instead of using certain other provisions in the immigration rules that it could use, such as those related to dishonesty. I would suggest that UKVI has done that because of the broad wording of this measure and the lower burden of proof required, because using this rule is an easy and fast way to dispose of the migrants we invited to these islands.
Paul Garlick QC, who specialises in extradition and human rights law, said the following in regard to the Home Office investigations:
“They genuinely have no idea of the difference between tax years and accounting years, or what is a legitimately deductible expense. My feeling is that since Theresa May’s announcement of a ‘hostile environment’ for immigrants, caseworkers have been told to look for discrepancies that could form the basis of an accusation that the applicant is lying, because that’s the quickest way to dispose of an application”.
That is some accusation, and not one that any QC would make lightly.
Since 2016, 1,697 of these highly skilled migrants have been denied indefinite leave to remain after the establishment of a very untransparent Home Office and HMRC data-sharing memorandum of understanding—one that allowed HMRC data to be analysed if an immigration offence had been suspected. I will come on to that point in greater detail later.
These highly skilled migrants have been living in the UK for at least 10 years and contributing significantly to our skills base and our economy. They were once welcomed here because they were needed. What is most worrying of all is that all of those affected are migrants of colour, from six south Asian and African countries. More than half of the remining indefinite-leave-to-remain refusals are Pakistani nationals, and 70% are Muslim. Tellingly, no one whose data was shared and used to refuse their visa was white. As a long-standing antiracism activist, that profiling and targeting of ethnic minorities by the state chills me.
I want to focus on the worrying aspects of data sharing. The people we are talking about were refused indefinite leave to remain through the use of detailed, historical, HMRC-held tax data. According to research by the Migrants’ Rights Network, it is unclear whether any due processes or protections were in place for the access and sharing of that data, especially those that would now meet GDPR requirements.
The memorandum of understanding for data sharing between both Departments was accessed via a freedom of information request. It is an enlightening piece of evidence. It is not a contract, nor is it legally binding. It does not in itself create a lawful means for the exchange of information. It simply documents the processes and procedures for information sharing agreed between the Departments. Yet, when I pushed the Treasury on this issue recently, the Minister who responded leaned heavily on the provisions within the MOU as being
“well-designed, information-sharing gateways…grounded in strict obedience with the law.”—[Official Report, 22 June 2021; Vol. 697, c. 748.]
The annexe of the document provides the legal basis for the sharing of information and conveniently links to several pieces of legislation, including the Immigration, Asylum and Nationality Act 2006, the UK Borders Act 2007 and the Anti-terrorism, Crime and Security Act 2001. There are others. What we discover when directed to the signposted sections is that the minor tax discrepancies in question do not amount to the offences described in the memorandum of understanding that could permit the sharing of data between HMRC and the Home Office. The MOU provides no evident lawful due process or safeguards for sharing the data that was used to refuse indefinite leave to remain to highly skilled migrants.
There are huge questions to be asked about how this information was accessed and shared and whether unlawful lists of people of concern, based on a traffic light system of nationalities, were used. I appreciate this cannot all be resolved today, but I would very much appreciate if the Minister would agree to meeting me, other interested Members and the Migrants’ Rights Network to unpick all this and to, I hope, put an end to it.
The tech justice group Foxglove successfully forced the Home Office to scrap its visa streaming algorithm in response to legal action in 2020 and there are analogous similarities with the data-sharing system that I am talking about today. The streaming tool took decades of institutionally racist practices, such as targeting particular nationalities for immigration raids, and it turned them into software. The Home Secretary was willing to admit that the system was required to be rebuilt from the ground up. Surely serious consideration should be given to the system currently persecuting highly skilled migrants.
The Government’s threat to increase their use of data sharing and data matching is now, unfortunately, becoming a reality. There are plans to expand the national fraud initiative. If that happens, we will see the current data-matching powers used in tackling fraud extended to cover other criminal activity, as well as debt recovery and data quality.
I knew little about data matching until this highly skilled migrants issue was brought to light. It involves combining, comparing or matching personal data obtained from multiple sources. The national fraud initiative already collects more than 20 data types over 8,000 datasets from 1,300 participant organisations. That can include public sector payroll, housing benefit, social housing waiting lists, council tax and the electoral register—the list goes on.
An information law specialist, Chris Pounder, has already given examples of how migrants’ details are mixed up in the national fraud initiative, with housing benefit, tenancy waiting lists and the electoral roll all cross-matched with immigration records. We have seen the Home Office go from losing application forms, passports and all sorts of documentation in 2001, to being determined to gather every single tiny piece of data that it can on every migrant in 2021. Information sharing or data matching—call it what you will—has been utilised to unfairly target highly skilled migrants. This cohort sets an incredibly important precedent for how personal tax data could be gathered, shared and used in immigration decisions, highlighting why we need to ensure transparency around data sharing for immigration enforcement.
Through freedom of information requests, we now know that between 2015 and 2020, 463,000 people’s HMRC tax data were shared with UKVI at the Home Office. That is a staggering amount of data sharing that the public are simply not aware of. Any expansion of this already expanding regime will mean a lot more data being shared about migrants, and it will provide numerous opportunities for abuse by the Government, who are already determined to pursue a hostile environment policy. Such data needs protection and safeguards. Any system that seeks to share the data must be built with legal restrictions and strict adherence to GDPR.
The UK Government consultation document on data matching refers to the need to recover debt post covid, but it fails to recognise that any inequalities present before the covid pandemic have both increased and widened, and that extending the powers will serve only to unfairly discriminate further against minorities. I am aghast that the cover of covid recovery is being used to usher in further intrusion into our personal data, and I have no doubt that the wider public would be just as alarmed if this was affecting their right to work, rent, drive or even open a bank account.
When previous and successive Governments implemented schemes that were designed to welcome highly skilled migrants to these islands, it was done with fanfare. The brightest and best would help us fill the gaps that our economy desperately needed to be filled. Nobody arriving on these shores to such a welcome would ever suspect that, a decade later, they would be subjected to an invasive sweep of their personal and financial data in a bid to remove them and their families from the country they now call home. Nobody would have dreamt that, 10 years later, they would be labelled dishonest or as being of bad character, when they are clearly not. Nobody would have imagined that they could have been made unemployed, bankrupt or homeless by the state that invited them to build their lives here, but that is exactly what is happening.
I hope that today’s debate will allow a conversation to be started where it has not been possible thus far. I look forward to hearing the Minister’s response, and I repeat my request for him to sit down with me, the right hon. Member for East Ham, the other Members who have been pushing this issue and Migrants’ Rights Network, in order to resolve the situation for the families suffering now, but also for the success of the Chancellor’s new highly skilled migrants scheme.
It is a pleasure to serve under your chairmanship, MsVey. I thank the hon. Member for Glasgow North East (Anne McLaughlin) for securing the debate with the right hon. Member for East Ham (Stephen Timms), and for the contribution that she has made. Such debates are an important aspect of the Home Office’s accountability, and they ensure that our decisions are held up to scrutiny. I am therefore pleased to have the opportunity to set out some of the background to this particular cohort of cases and what we are doing to ensure that all the applications involved are treated fairly. There are some legal actions going on, but I would be happy to meet hon. Members and groups that are not involved. Perhaps we can discuss the details separately, given the limited time.
It has to be said that the tier 1 general route, to which highly skilled migrants applied, was beset with problems and opportunities for abuse, which is why the Government closed it to new applications back in 2011. The investigations that we have concluded so far show that the principal issue is not tax records and the evasion of tax payments that should have been made, but applicants falsifying their earnings to obtain their immigration status, often involving five-figure sums. It would be simple to ignore those concerns and grant all the outstanding applications. However, that would not be a right or just outcome for those who did play by the rules, given that the scale of the discrepancies is often far beyond those that might be attributed to innocent mistakes or accounting practice.
Surely the Minister is not suggesting that everyone I am talking about has been denied indefinite leave to remain because they falsified earnings in order to get themselves here. Those people were invited and allowed to come in. He is not suggesting that, is he?
I am afraid that we have evidence from a range of cases showing that people did look to inflate their earnings from self-employment. In each case we will make an individual decision, but in each case we are satisfied that there is evidence. There will be an opportunity for people to make their representations directly, but we should not ignore the fact that there has been some quite clear evidence. We are not talking about a difference of a couple of quid between their tax return and what they told the Home Office; we are talking about quite significant amounts. We will continue to consider all the evidence fairly and objectively in each individual case and not generalise about them all. We will give applicants the chance to respond to any concerns we have. But, as anyone would expect, we will be firm with those who have sought to play the system.
The Minister says that he will consider every case on its merits, but what happens to those people in the meantime? They are not allowed to work, rent, drive or have a bank account, and they are not allowed any recourse to public funds. Those people have families, with children at school. The kids will not be allowed to go to school. What happens to them in the meantime, because it is taking a very long time to reach decisions?
There are a number of processes that we are going through, but it might be helpful if I set out the scale of the discrepancies. In cases where investigations have been completed, there were instances of applicants claiming points for earnings that were, in 80% of cases refused, at least £10,000 higher and, on average, £27,600 higher than the earnings shown by their tax records. We would all agree that those are not minor errors. In any context where we were talking about someone with a discrepancy of £27,000 on their tax return, we would probably make a point about whether they were paying the tax they should be paying.
I congratulate the hon. Member for Glasgow North East (Anne McLaughlin) on securing the debate. Will the Minister outline what steps his Department will take in conjunction with HMRC to investigate whether the tax discrepancies of highly skilled migrants refused indefinite leave to remain met the normal HMRC deliberate or careless threshold? How did the Department determine that such discrepancies constitute bad character?
We do so by sharing information between the two Departments. If someone gives information about their salary to one part of Government, saying that it is an honest declaration of their tax position to meet taxation laws, it should not come as a huge surprise if that is then considered when looking at a declaration of income that they have made to another part of Government relating to rules on immigration status.
Let us be clear that not all tier 1 general cases share those characteristics. Many applicants did find highly skilled employment, and the vast majority were successful in their applications. There are outstanding cases because it is important that we take the time to get to the bottom of concerns in those outstanding cases and establish whose earnings were genuine and whose were not.
With regard to the tax discrepancies, the Home Office does not trawl through people’s tax records looking for any errors or discrepancies in order to refuse applications. Where we have checked tax records, it is because the evidence of an applicant’s claimed earnings was not strong, and we were actually looking for further evidence to support their claims and grant their applications, as we are doing in other parts of the immigration system. Sadly, all too often our investigations found their tax records did not support the claims they made to the Home Office about their earnings.
It is interesting to note that when it became widely known that we were doing that, HMRC saw a surge in requests from tier 1 general visa holders to make some highly unusual amendments to their tax records, often involving large amounts solely for the earnings periods relied on in visa applications. That pattern was actually so unusual that HMRC brought it directly to the Home Office’s attention.
Again, we are not talking about the sorts of minor discrepancies or tax errors that HMRC deals with day in, day out. Our investigations show instances of individuals increasing their earnings on their tax records, waiting until a Home Office application is granted and then amending their earnings back down again so that they do not have to pay the extra tax that these variations would have incurred.
I need to put on the record that I am not for one minute suggesting that in those circumstances, when someone has done all three things, that person has done nothing wrong. However, not all of these people fit that category. Is it just a coincidence that not a single person who has been refused a visa on that basis is white? Is it just a coincidence that 70% of them are Pakistani nationals? What is the explanation for that?
I will come on to our response to the Migrants’ Rights Network report in a moment. However, to be very clear, in each instance it is the evidence in the case and not any other factors, such as nationality, that is looked at. Of course, given that there was free movement at the time, those from the European economic area would not have been applying under this type of migration system—again, there is a narrower scope for it.
In response to some of the points made earlier, let us be clear that the principal concern is not tax avoidance—it is not the idea that people have not paid tax on £27,000 of earnings, for example—but visa fraud. It is people effectively saying to the Home Office that they made earnings that meet this bar that they did not actually make—not that they did not pay tax on significant earnings. Just saying, “HMRC did not take action, so neither should the Home Office” misses this rather crucial point.
Particular reference was made to paragraph 322(5). It does not relate only to serious criminality or terrorism; it has always had a much broader remit, including an applicant’s general conduct in the UK, which unsurprisingly has always formed a part of immigration decision making. The courts consistently agreed that the use of paragraph 322(5) was appropriate in cases in which applicants failed to give any convincing explanations of discrepancies in the earnings for which they had claimed points. Yet, to touch on the point made earlier, as part of our new immigration system we have been overhauling and simplifying the immigration rules, so this paragraph will no longer apply to future applications. Under our new rules, we no longer group criminality and terrorism together with issues such as conduct or false representation, which is a clearer approach. However, those were not the rules that applied at that time.
I am aware of the recent report by the Migrants’ Rights Network suggesting that only people of certain Commonwealth and former Commonwealth nationalities are being refused. Sadly, the Migrants’ Rights Network has not shared its data with us. However, our own data show that the six nationalities mentioned in its report accounted for 68% of all people in the tier 1 general route since 2010. The same nationalities represent 65% of those granted settlement in the route since 2010. What difference exists relates to the greater proportion, for whatever reason, of applicants of these nationalities who relied on self-employed earnings, rather than earnings via pay-as-you-earn, in their applications. Our approach is therefore is to examine each case individually, look at all the evidence on its merits and not make assumptions based on an applicant’s nationality or any other attributes. We have strengthened our processes further since the Court of Appeal judgment in the Balajigari case to avoid any possibility of procedural unfairness.
For those investigations that we have concluded, we have found that, in a small minority of cases, applicants have provided new and more credible evidence of their earnings, and their cases have now been granted. In all others, we are carrying out a balancing exercise, weighing any false representations that applicants made in the past against any compelling reasons for allowing their stay in the UK in spite of this conduct. Where there are strong grounds for doing so, we are granting these applications. We have also supported applicants through the process and given them extra time to provide evidence, especially when their ability to do so has been affected by the pandemic.
Turning to the queries about the approach for highly skilled migrants in the future, we are looking to implement an unsponsored route. We are going to learn very clearly from the issues and problems of the previous tier 1 route, especially the issue of how earnings were declared to the Home Office. We will shortly provide details of the new route in the forthcoming innovation strategy, and I hope Members concerned to avoid these issues will be reassured by what they read.
We will not ignore the actions of those who sought to play the system by inflating their earnings to seek an immigration advantage, but we will ensure that all applicants are treated fairly, based on the individual circumstances of their cases, and given a fair opportunity to rebut any queries about the earnings they have declared to HMRC and the Home Office. However, no one should be surprised that we check each other’s notes.
Question put and agreed to.
Delays in the Asylum System
[David Mundell in the Chair]
I remind hon. Members that there have been some changes to normal practice in order to support the new hybrid arrangements. Timings of debates have been amended to allow technical arrangements to be made for the next debate. There will be suspensions between each debate.
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Members attending physically should clean their spaces before they use them and before they leave the room. I also remind Members that Mr Speaker has stated that masks should be worn in Westminster Hall.
I beg to move,
That this House has considered delays in the asylum system.
It is a pleasure to serve under your chairship, Mr Mundell. I thank the many Members attending the debate for their ongoing efforts to push the Government to address the delays in the asylum system. It is shocking that not a single Conservative Member thought it necessary to take part in a debate on such an important issue.
I pay tribute to the many organisations and charities that campaign tirelessly to raise awareness of the issue, as well as those—including the Refugee Council, Detention Action, the Greater Manchester Immigration Aid Unit, and Lift the Ban, to name just a few—that provide vital support to some of the most vulnerable people on our planet. So many people are worthy of recognition for their incredible work, such as Councillor Wilson Nkurunziza, Councillor Irfan Syed and Stockport’s own Mrs Sandy Broadhurst. There are also those who do so much at national level to keep the issue at the forefront of everyone’s minds, such as Lord Alf Dubs.
In my region, Refugee Action Manchester and the Refugee Council provide life-saving and life-changing support to asylum seekers, while Stockport Baptist church in my constituency has done so much over the years to help to raise funds to provide accommodation, food, pocket money and transport to those in need. I am grateful to the volunteers from the Greater Manchester Immigration Aid Unit, who support the incredibly vulnerable people who are subject to immigration control. Significantly, they have worked with local authorities across Greater Manchester, and seven of the 10 councils have signed up to remote asylum interviewing for looked-after children: Bolton, Bury, Manchester, Oldham, Rochdale, Salford and Wigan.
Our country has a proud history of standing up for and protecting refugees, who are among the most vulnerable people on earth, having undertaken perilous journeys to reach our shores to seek sanctuary from the very worst of humanity. We are the fifth richest country in the world and that is absolutely the right thing to do. It is also right that our country provides shelter to people—not excluding them, but enabling them to earn a living to support themselves and their family.
I am proud that my part of the world, the north-west, is the largest asylum dispersal conurbation in the UK, housing 25% of our country’s applicants, with 70% of those living in Greater Manchester. Data provided by the House of Commons Library reveals that 138 asylum seekers are based in Stockport and more than 6,000 in Greater Manchester as a whole, which is two thirds of the total in the north-west region. It is heart-warming to see how my community has embraced those people and helped them to integrate into our community. I have long been an admirer of the work of Stockport Baptist church, whose congregation and supporters have raised funds to support refugees with food, pocket money, accommodation and transport costs.
It cannot be right, however, that so many are simply stuck in the system for long periods, unsure of what their fate will be. Detention Action revealed that more than half of the almost 40,000 people in detention centres have been waiting for a decision for more than a year. A similar number have been waiting for up to five years, with almost 25,000 people indefinitely detained last year.
Greater Manchester Immigration Aid provides urgent assistance to more than 50 young people who have been waiting the best part of a year for an asylum decision, despite half already having had a remote interview. Even when the asylum system is functioning marginally more efficiently, the average wait for those handled by my local unit is 51 days, with the longest wait being 82 days—almost three months. That is completely unacceptable, and it involves the livelihoods of some of the poorest people in our society, including young people.
It is vital that the Government look again at how those in the system are treated. One issue that must be addressed is the Aspen card handover debacle. I focus on that issue because it reflects many of the problems in the system. Aspen is a debit payment card given to UK asylum seekers by the Home Office to provide basic subsistence support via a chip-and-pin system. However, purchases made using the card are closely monitored by the Home Office, making it an insidious surveillance tool. Recently, the Home Office switched providers, which proved nothing short of disastrous owing to the 48-hour period between the old card being deactivated and the new one going live, forcing people to live off what little means they had.
That is just one of myriad problems, from claimants not receiving their cards to their receiving cards carrying the wrong name, cards without money on them or cards that do not work, or people being unable to activate their cards. When cards were not working, asylum seekers could apply for emergency cash payments from accommodation providers, but those have been inconsistently applied and people could not access any more payments. There are stories from the Refugee Council of such people having to survive for days without food.
That is an absolute disgrace, and it can never be allowed to happen again. Why was it even allowed to happen in the first place? Perhaps the Minister will answer that question today. However, well before the card changeover took place, multiple organisations forewarned the Home Office that there could be problems, and it is clear they were simply not listened to. When the matter was raised in Parliament, the Government attempted to give the impression that it was a minor issue, rather than one that had gone on for weeks. Their claims could not be further from the truth, with many asylum experts describing the Government’s handling of the issue as the worst failure they have seen in the system. That is why the likes of Asylum Matters are continuing to raise awareness of it—they want the Home Office not only to acknowledge its failings, but to learn from them so that we never again put the neediest people in society in this desperate situation.
There are also well documented and widespread concerns about the way women are dealt with in the asylum process, particularly whether that process is sensitive to specific issues faced by women. The expectation that a woman has been the victim of domestic abuse or rape, and will be able to disclose that during her interview with a UK visa and immigration caseworker, has been pointed to as a serious problem.
There cannot be a one-size-fits-all approach. We must acknowledge that these are incredibly vulnerable people in the most desperate of circumstances and act accordingly. That means shining a light on the failings of the system, rather than demonising those within it. Just last month, asylum seekers held at the Home Office’s widely criticised Napier military barracks claimed they would be blacklisted if they spoke out following the High Court ruling that to use the site was unlawful. That included them being told that their asylum application would be at risk if they talked to the media about conditions at the camp. Instead of attacking those in the barracks who are in conditions described as “squalid” during the successful legal challenge, the Government should have acted immediately to close the camp.
The failures in our system cause untold distress and are a considerable factor in the high levels of mental health problems among asylum seekers. Refugees are five times more likely to have mental health needs than people in the general UK population, while 61% report that they have suffered serious mental distress as a result of their ordeal, including higher rates of depression, post-traumatic stress disorder and other anxiety disorders.
The way the Government treat asylum seekers in this country—the fifth richest in the world—is truly shameful. That lack of humanity was exposed during the 2015 migrant crisis when our European counterparts, such as Germany, showed benevolence, true compassion and leadership by giving asylum to more than 1 million people fleeing war in Syria, Afghanistan and Iraq. In stark contrast, the UK allowed a paltry 25,000 the safety and sanctuary of our shores.
I am sure Members on both sides of the House agree that on this issue language is important. Asylum seekers are people—fellow human beings who deserve to be treated with respect and in a fair manner—and following a decade when we have experienced the hostile environment orchestrated by the Home Office under this Government, I urge the Minister to do the right thing and offer those people a route out of poverty and destitution.
We do not need more distressing words and scenes from the Home Secretary. Sadly, just yesterday, we bore witness to the Home Secretary’s latest demonisation of migrants, with her shamefully describing those vulnerable people as “vile criminals”, smearing the vast majority of honest, law-abiding citizens who seek sanctuary in our country. As HOPE not hate made clear in its response, the Home Secretary’s words were disgraceful.
The Home Secretary also set out callous plans with proposals revealed for new legislation that will pave the way for offshore centres for asylum seekers, and criminal charges for migrants arriving in the UK without permission. The new laws will likely see thousands of refugees turned away and vulnerable migrants criminalised for seeking a better life. Furthermore, a Refugee Council analysis of Home Office data suggests that 9,000 people who would be accepted as refugees under the current rules—those confirmed by official checks to have left war and persecution—might no longer be given safety in the UK because of how they arrived. That really would be an all-time low for this Government.
The Government must do more to enable those seeking asylum to have the right to work. Last year, the Lift the Ban campaign—a coalition of more than 240 charities and trade unions, including Unison, the National Education Union and the NASUWT, as well as businesses, faith groups and think-tanks—presented the Home Office with a petition signed by more than 180,000 people, which called on the Government to lift the ban. They are still waiting for that ban to be overturned, which is why I recently tabled an early-day motion, which has been signed by 42 MPs to date. It calls on the Government to
“recognise the injustice of preventing people seeking asylum from working”,
particularly when they are forced to live on a derisory £5.66 a day. After all, that is in the Government’s own interest: if those seeking asylum had the right to work, that would lead to fewer support payments and increased income tax and national insurance receipts of up to £100 million for the public purse.
The bottom line is that the pandemic has exposed the harsh reality that asylum seekers cannot be safe under such restrictive rules. Far from being looked after, they are forced to depend on tiny handouts each day and to choose between food, medicine and hygiene products, while being prevented from having the dignity of work.
The Government must do far more to address their unfair dispersal system. The majority of asylum seekers are housed in disadvantaged local authority areas while dozens of councils support none at all. Figures show that more than half of those who seek asylum or who have been brought to Britain for resettlement are accommodated by just 6% of local councils, all of which have household incomes that are below average.
Finally, the Government must heed the United Nations Human Rights Council proposal to reform the registration, screening and decision making process, including introducing an effective triaging and prioritisation system, as well as simplified asylum case processing and front-loading the asylum system to enable more information to be gathered earlier in the process.
It is time our Government stopped their gunboat diplomacy and treated asylum seekers with the dignity and humanity that they deserve. When most are fleeing war-torn countries that the UK helped to play a role in devastating, that is surely the very least we can do.
It is a pleasure to serve under your chairmanship, Mr Mundell, and I congratulate my good and hon. Friend the Member for Stockport (Navendu Mishra) on securing this important debate.
This country had a long-standing tradition of providing sanctuary to those fleeing danger and violence. It is our duty to assist those in need, and in a timely manner, especially those who have already suffered grievously through war and persecution, yet when those most in need arrive here, they immediately find themselves confronted by an asylum system seemingly broken beyond repair.
The Refugee Council’s latest report, “Living In Limbo”, found that the number of people awaiting an initial decision for more than a year increased tenfold from over 3,000 people in 2010 to 33,000 in 2020. The cost of that failure is staggering, with every year of delay costing the Home Office at least an additional £8,000 per person. The Refugee Council estimates that the total cost of delays is over £200 million.
The Home Affairs Committee, among many other bodies, has made that message very clear over many years, yet nothing has been done to ease the plight of asylum seekers. The Home Office must simplify its asylum case processes and recruit more caseworkers. It must also undergo a thorough review to find out why it has gone so badly wrong over the last 10 years and then take appropriate action in good faith. None of the proposals in the Government’s report, entitled “New Plan for Immigration”, will get even remotely close to achieving that. In fact, the Home Secretary’s response seems to be to follow the merciless responses of her predecessors, as she suggests that asylum seekers should be held on disused ferries, or even oil rigs, or using floating walls to deter them.
We must lead by example. Tens of thousands of asylum seekers living in the UK receive just £37 a week on which to survive. After all they have gone through, that paltry sum forces even greater indignity on people who have overcome tremendous hardship just to make it here. Their suffering must not be allowed to continue in their sanctuary. In my view, asylum seekers need to be given the right to work, which would give them the chance to prosper in this country and stand on their own two feet.
Amid the despair and the delays, there is still great hope among asylum seekers. During Refugee Week at the end of June, I took part in a Working West London employment event hosted by East London Advanced Technology Training, which offers training and skills development courses for asylum seekers and refugees. I met a group of people who were crying out for the chance to contribute to this country, and I could see the rich array of skills, talent and passion they have to offer.
The Government must fix this broken asylum system urgently and once again embody the fundamentally British values of compassion and humanity, and a commitment to protecting the most vulnerable.
It is a pleasure to serve under your chairship, Mr Mundell.
I start by thanking my hon. Friend the Member for Stockport (Navendu Mishra) for securing this vital debate. I say to the Minister that I am angry. I am angry because, as an MP, I see the daily occurrence of the human misery caused by the failings in his Government’s asylum system. I see that everywhere in my constituency. I am angry because I see my staff dedicating so much of their time to asylum cases, although that is a mere sticking plaster on his Government’s shortcomings.
Countless examples demonstrate how the chaos in the system is inextricably linked to the human misery on display in our urban centres. Let me give one example. I will refer to the man involved as C. He was in the asylum system for four years. He made an initial application followed by a fresh claim. He waited 18 months for a decision on his fresh claim. During that time, his mental health deteriorated. He was hospitalised on several occasions following serious incidents of self-harm. He repeatedly told those helping him that he needed a decision, one way or another. The waiting was so unbearable for him that he resorted to going to the Home Office building in Liverpool and attempted to take his own life in its reception area.
I pay tribute to the work of organisations such as Asylum Link Merseyside, which, alongside MPs’ staff, do the vital work of supporting those in need of support. For all the tough talk that emanates from the Home Secretary’s mouth, it is not her self-styled steeliness that will come to define her tenure; it is incompetence. The Home Secretary is more concerned with playing to the gallery than with tackling any of the causes, symptoms or problems that exist in the system. That incompetence fails asylum seekers, fails communities and fails the British people.
Let us understand the facts. First, the problems in our asylum system long predate the pandemic. As of March 2021, the total work in progress asylum case load consisted of 109,000 cases. Since 2014, the asylum case load has doubled—yes, doubled—in size. It has been driven by both applicants waiting longer for initial decision and a growth in the number of people subject to removal action following a negative decision. Minister, we cannot separate that spiralling case load from workforce issues. These range from downgrading the decision-making grade in the Home Office earlier in the last decade, to announcing increases in weekly targets to 10, as well as failing to initiate recruitment in a timely fashion when higher executive officers started to jump ship. All of those issues have been raised time and again by the Public and Commercial Services Union and ignored by the powers that be. Even one of the former permanent secretaries, Mark Sedwill, called the decision “ill-judged”. This caused so much chaos that attrition rates in the asylum workforce reached 37%.
Alongside the PCS, I want to thank the Refugee Council for its excellent briefing on these related topics. Its summary of evidence shows that the size of the backlog is most evidently influenced by the difference between the number of applications and the number of initial decisions made each year. The delays in the asylum system are of the Government’s own making.
Sadly, it gets worse. In March 2021, the Government published their “New Plan for Immigration” and began a six-week public consultation on proposals to make wide-ranging changes—changes that I have opposed for their contravention of the 1951 United Nations refugee convention. While asylum seekers end up being treated like animals at Napier barracks, the Minister for Future Borders and Immigration wrote in a letter to me two days ago that
“our New Plan for Immigration will reform the broken asylum system”.
Minister, it will not. None of the proposals outlined in the paper was aimed at addressing the backlog of asylum cases. To describe it as a missed opportunity would be an understatement. Instead, all we have is more posturing from a Government who benefit from their own chaos. It is that chaos that has brought the system to breaking point.
It is a pleasure to serve under your chairmanship, Mr Mundell. I congratulate my hon. Friend the Member for Stockport (Navendu Mishra) on both securing and leading this debate.
As we have heard today, delays in the asylum system are currently all too common, and the impact they have on those trying to navigate that system should not be underestimated. Almost every day, I receive communications from constituents who have been left in limbo by the Home Office—constituents like Hanna, who arrived in this country from Yemen. Having made an asylum claim in early 2019, Hanna did not get a response until my office stepped in almost two years later. For years, Hanna had dreamed of completing a PhD, and she received an offer from a good university only to have to refuse it because of Home Office delays. She described that as
“one of the worst moments of my life”.
That is one example of the impact that delays have, but each week I see many more, like my constituent Erkin, a Uyghur Muslim who fled the genocide in China three years ago. He approached my office in March 2020, at which point he had been waiting more than a year for an asylum interview. It was not until earlier this year that the Home Office decided that he did not need an asylum interview after all and granted Erkin and his family refugee status on the evidence available.
With the experiences of my constituents in mind, I have three proposals for the Minister. I know that he understands these issues very well, and I look forward to hearing his response. First, the Home Office’s decision to move away from the six-month service standard needs to be reversed. As every Member will know, one of the main points of distress for our constituents who are experiencing Home Office delays is that they do not know when their torment will end or at what point they can take action to expedite the process. Giving claimants a clear timescale is a key part of reducing delays and the distress those delays cause our constituents.
Secondly, the Minister must do more to reduce the number of unnecessary asylum interviews, which only delay the decision-making process, particularly in cases where individuals have arrived from countries where the Secretary of State accepts a universal risk of persecution or violence. I think we can all agree that in such cases there must be an effort to reduce the number of interviews.
Finally, it is vital that the frontline workers at the Home Office are given the resources they need to do their job. Data show that by the end of 2020 more than 33,000 asylum seekers had been waiting at least 12 months for an initial response to their application. As previously stated, the pandemic alone cannot explain that. From the length of delays that so many experience, it is clear that the Government need to recruit more staff and conclude asylum interviews online whenever possible. It is the duty of the Secretary of State to decide asylum cases as soon as possible. That means that, whenever the evidence is sufficient, a decision should be made without resorting to an asylum interview. I urge the Minister to look into what can be done and to act quickly.
As I draw to a close, I want to highlight that this is a cross-party issue. Whatever one’s views of the Government’s immigration policies, nobody believes that we should leave thousands of people in limbo, unable to participate in society. I urge the Minister to consider carefully the points that I and other hon. Members have made and will make today, and to commit to putting forward a concrete plan to bring delays in the asylum system under control.
It is a pleasure to serve under your chairmanship, Mr Mundell. I also thank my hon. Friend the Member for Stockport (Navendu Mishra) for securing this important debate.
Only this morning I received an email from a constituent who has been waiting for more than four and a half years for a decision on her asylum claim. That is four and a half years she has been unable to work, four and a half years of mental anguish, and four and a half years excluded from the fabric of the country to which she desperately wants to contribute because it offered her a place of safety. This is no way to treat a fellow human being who fled unimaginable horrors in search of a safe, secure life.
We are lucky in Salford to have the brilliant Salford Forum for Refugees and People Seeking Asylum, which is led by Councillors Wilson Nkurunziza, Irfan Syed, Alexis Shama and a team of brilliant people who have established a support network for people such as my constituent. Sadly, her case is one of thousands and most areas do not have a support network like ours. The Select Committee on Home Affairs, the independent chief inspector of borders and immigration, the National Audit Office and the all-party parliamentary group on refugees have all raised concerns over the rise in the backlog of cases over recent years and the failure of the Home Office so far to address the issue.
As we have heard, the Government’s “New Plan for Immigration” sadly appears to contain no proposals to address this backlog, and I fear it will make the problem much worse. The most dangerous part of the proposals is that someone’s means of arrival will determine how worthy they are of protection in the UK. Asylum seekers arriving through anything other than resettlement will receive a lesser form of protection, including temporary status, with no access to financial support and limited rights to family reunion. In fact, the new proposals go as far as criminalising anyone arriving “irregularly”, not through official channels. As we know, people fleeing war and persecution are rarely afforded the luxury of arriving through official channels.
I would argue that those proposals are in breach of the refugee convention, which protects people seeking asylum from persecution on the grounds of their method of entry, and guarantees them access to claim asylum, for the very reason that there is no viable way to seek permission to enter a country in order to apply for asylum. To conclude, those are cruel and unworkable new immigration plans. As Refugee Action has said:
“Compassion, evidence, and 193 refugee and voluntary organisations tell us to fight against the principle of these plans, not help to thrash out the details.”
I hope that the Minister has listened to my concerns and will not just address the backlog at the Home Office, but throw out the unworkable and callous new immigration proposals.
It is a real pleasure to serve under your chairmanship, Mr Mundell. I pay tribute to the hon. Member for Stockport (Navendu Mishra) for raising this massively important issue. How we treat people who come to this country seeking sanctuary is probably the most significant measure of whether we are allowed to call ourselves Great Britain. It speaks of us as a people and it speaks around the world about what kind of country we are.
I have some figures of which people will perhaps be aware. At present, 66,185 people in our asylum system are waiting for a decision—that is the highest figure for a decade. Of those people, 50,000 have been waiting for an initial decision for more than six months—again, that figure is the highest for a decade. In 2014, 87% of cases were decided within six months; in 2020, it was just 20%.
I understand, as we have heard it before, that Ministers will say that that is down to the covid crisis, the pressure on the system and excessive numbers. The reality, of course, is that the number of asylum seekers coming to this country fell by 21% last year, to among the lowest recent levels, with just 35,355 applications—down from the height of 84,000 in 2002. That gives us a bit of a sense that what we have is a massive backlog that has a colossal impact on the lives of people who have already gone through desperate situations.
Let us not have any nonsense about them being bogus asylum seekers, because we know that the majority of them will succeed in claiming refugee status and a right to remain in the end. By the way, if I apply for a job and I do not get it, I was not bogus; I was unsuccessful. The notion that people who come here seeking asylum are doing something nefarious is a rotten thing to start off with in any event.
The idea that we are being swamped by asylum seekers, and that that is why there is a problem, does not stack up. What does stack up is a failure of Government—perhaps we could be generous and argue that it is a failure of Governments over the years—to tackle this issue. Their lack of competence is being disguised by the bogus rhetoric that we have too many asylum seekers. As I say, we have fewer this year than last year by the order of 21%, so there is even less excuse for this backlog than there has been in the past.
The notion that we are overwhelmed with asylum seekers is, again, the same rhetoric and the basis on which the “New Plan for Immigration” is formed. We will get bad legislation if it is formed on a bogus basis. That bogus basis is that we are overwhelmed with asylum seekers, but we had 35,000 asylum seekers in 2020, while Germany had 120,000 and France and 96,000. If we were to add ourselves back into the EU for the purpose of a league table, we would be 17th out of 28—we would be a Blackburn Rovers, in the lower-mid table. The notion that we have a problem is nonsense. Actually, we do have a problem, but it is the competence of the Home Office’s systems, not that we are “overwhelmed” with asylum seekers. Because this country is an island, we find ourselves with fewer of those desperate people to help, so why on earth are we making it so hard for them when they are here?
Imagine the things that they have gone through and experienced on their way here. We then make them wait six months, a year, 18 months and longer, in poverty and often in totally inappropriate accommodation, almost punishing them for having fled appalling circumstances. The “New Plan for Immigration” will make that worse. It will formalise the incompetence in the process because it will mean that some people will have to wait more than six months before they can even be looked at, and then they will be given a maximum right to stay of only 20 months.
I will finish by challenging the Minister to think about an intelligent, compassionate way through this: giving people the right to work. Why cannot people who are waiting for asylum be given the right to work? That would be good not just for the Exchequer, because they would pay their way, but for their mental health, their personal income and, given that we know that most of them will be given the right to remain, their ability to integrate into our community. As the MP for the Lake district, which is desperate for staff because the Government’s new visa rules have robbed my businesses of a workforce this year, I say that that might be one way of helping us through this.
I will end with this cheeky request. Will the Minister meet me and, more importantly, Cumbria Tourism chiefs to talk about how the Government’s immigration policy could help rather than hinder the Lake district’s tourism industry? Finally, surely we have to prioritise solving the backlog in a compassionate and competent way, not legislate to make things worse, which is the Government’s current plan.
It is a pleasure to serve under your chairship, Mr Mundell. I congratulate the hon. Member for Stockport (Navendu Mishra) on securing this hugely important debate.
The current delays in the asylum system are appalling, with 66,000 people waiting for an initial decision from the Home Office on their asylum claim—the highest number for more than a decade. Three quarters of them have been waiting for more than six months, with many waiting in a state of severe anxiety for as long as three years or more. I am dealing with cases in my constituency of people waiting seven or eight years for a decision. That is why we must fully support the Lift the Ban campaign, which calls on the Government to overturn the ban on people seeking asylum being able to work. How do the Government expect people to survive for months and years without earning a living?
Under this Government, the number of children waiting for an initial decision for more than a year has increased more than twelvefold—from 563 in 2010, to 6,887 in 2020. That appalling record robs those children and young people, who have already endured unimaginable suffering, of their childhood. The size of the backlog is a result not of an increasing number of asylum applications but rather of the inability of the Home Office to keep pace with initial decisions. This is a crisis of the Government’s own making and it stems from their utter disregard towards those seeking safety. I fear that this crisis will only get worse, as the Government’s immigration plans lack basic humanity and represent the latest step in their pernicious demonisation of migrants and asylum seekers. They have rightly been criticised by human rights organisations such as the United Nations High Commissioner for Refugees and the British Red Cross.
Yesterday, as we heard, the Government confirmed that they will press ahead with the Nationality and Borders Bill, which is anti-refugee to its core. The Bill will enable the UK Government to block visas for overseas visitors if the Home Secretary believes that their country of origin is refusing to co-operate in taking back rejected asylum seekers or offenders. It will also allow for the removal of asylum seekers from the UK while their asylum claim or appeal is pending, which opens the door to offshore asylum processing, and family reunion rights will be further curtailed as well. Analysis of Home Office data by the Refugee Council found that, under the reforms, 9,000 people who would be accepted as refugees under the current rules may no longer be given a place of safety in the UK due to their method of arrival. Time and again, the Government have chosen to turn their back on those seeking protection from climate catastrophe, war, torture, persecution and other heinous acts. The Bill will compound the misery of people fleeing intolerable conditions.
The Government must end the delays in the asylum system, as well as the abhorrent practice of indefinite detention, which has led to inhumane treatment in centres such as Yarl’s Wood and Napier barracks. Ultimately, the Government must repeal the Immigration Act 2014; end the destructive demonisation of undocumented people, migrants and asylum seekers; address the backlog of those seeking asylum; and abandon the deeply damaging Nationality and Borders Bill.
It is a pleasure to serve under your chairmanship, Mr Mundell. I pay tribute to my 2019 colleague, my hon. Friend the Member for Stockport (Navendu Mishra), for calling for this important debate and bringing the matter to the Government’s attention.
Our asylum system is in disarray. A recent report by the Refugee Council found that more 50,000 people had waited for more than six months for an initial decision on their applications, the highest number for a decade. In the past 10 years, the number of people waiting for more than a year for an initial decision has increased almost tenfold.
Hon Members have noted the fact that most asylum seekers are not allowed to work and that many are denied the assistance and support to which they are entitled. In its findings, Refugee Action discovered that fewer than half of the initial applications for emergency assistance were granted, although 92% of applications were upheld when challenging the initial decision, that initial refusal. The barriers to people accessing support and their being wrongly denied assistance mean that people are further pushed into poverty and destitution. The delays have an immense impact on the mental health and wellbeing of asylum applicants.
My hon. Friends the Members for Liverpool, Wavertree (Paula Barker), for Edmonton (Kate Osamor) and for Salford and Eccles (Rebecca Long Bailey) have highlighted cases in their constituencies. I, too, will talk about two of my constituents, because these are real people we are talking about—they are not just stats from the Home Office figures.
The first is a Yemeni national, who contacted me while he was in the immigration centre waiting to be deported. He told me that he had been the victim of trafficking to the UK. I contacted the Home Office to ask for his deportation to be halted. Since then, the Home Office has confirmed that my constituent is a victim of trafficking and it has halted the deportation. That is good news for my constituent, but that was more than a year ago. Since entering the UK in June 2020, he has still not been invited for that initial interview.
My second case is that of an Eritrean national, who entered the UK in January 2020. Since then, he has been moved by the Home Office to four different hotels while waiting for an initial interview. When he was staying in one of the hotels, he and his friend were the victims of a suspected hate crime, an acid attack that led to his friend losing his vision at just 18 years old. Only yesterday, I received a response from the Home Office confirming that he is still waiting for that initial interview—18 months after he claimed asylum, and despite that horrific attack.
My constituents’ experiences speak for themselves, without me needing to state the obvious or to impress on the Minister just how shameful this is: that is how we treat asylum seekers when they come here for safety and shelter. The Minister must not only offer warm words of reassurance today; he must give us concrete guarantees that that disgraceful situation will be corrected immediately.
It is a pleasure to serve under your chairship, Mr Mundell.
I thank my hon. Friend the Member for Stockport (Navendu Mishra) for securing this important and timely debate. I also thank organisations such as Asylum Link, Migrant Help and Our Liverpool in my constituency for their tireless and invaluable work and the support that they give to asylum seekers in Liverpool, stepping in to fill the role of Government in supporting some of the most vulnerable people who have fled unimaginable circumstances, seeking safety on our shores, because Liverpool has a proud history as a city of sanctuary.
Asylum seekers are met with appalling treatment by the Home Office, forced to live on just £5 a day, not permitted to work, housed in substandard accommodation and trapped within a system that was never designed to be used over the long term. On top of the desperate living conditions that asylum seekers are forced into, the toll of living in protracted states of limbo with so little support is extremely damaging, cruel and unjust. Many asylum seekers are already desperately vulnerable when they reach the UK.
I receive many emails about the delays from victims of war, persecution, modern slavery, torture and sexual abuse. After entering the system here, their mental health deteriorates drastically through years of uncertainty and powerlessness. Women stuck in abusive marriages are left unable to leave their husbands, who are the principal asylum applicants, because they would be left without status or support. The separation of families torn apart by conflict is prolonged indefinitely, with no family reunion rights for the years that they are stuck in the asylum system. Countless constituents have contacted my office describing sleepless nights, escalating medical problems due to the stress and anxiety, endless months of waiting without the ability to work or get an education, and the devastating sense of powerlessness and hopelessness that creates.
The Government’s new plans for immigration contain no plan to reduce the backlog. Its provisions are instead likely to worsen waiting times for applicants, so even more vulnerable people will be living in limbo, plagued by uncertainty and anxiety. We need urgent action to ensure that the system is fair, humane, efficient and effective. We must implement the proposal set out by the UNHCR for reform of the registration, screening and decision-making processes, including investing in more caseworkers, establishing a dedicated backlog clearance team and putting in place an action plan to determine and address the reasons for the backlog by a given deadline, among many other recommendations.
The Government’s Nationality and Borders Bill, to be debated next week, not only fails to protect those in need of safety but treats them as criminals. All people seeking protection should be allowed to make an asylum claim, no matter how they have arrived. Creating a two-tier system that grants lesser rights to those who arrive in the UK outside the so-called official route flies in the face of the refugee convention. Instead of tackling the current inhumane conditions in our asylum system, the Bill will leave those asylum seekers with a wait of up to six months while the Government try to remove them to so-called safe countries. The provisions will only add to the backlog of cases and create further anxiety and uncertainty for those people who deserve our compassion and protection.
Instead of treating people fleeing war, persecution and trauma as criminals and forcing them into poverty and destitution with no prospect of escape for years, I implore the Government to show humanity and to stop punishing people for seeking protection. Instead, they should address delays in the asylum system, improve the provision of support and legal aid, publish data on waiting times of all those in the asylum system, restore permission to work and grant an immediate uplift in asylum support rates to lift asylum seekers out of destitution.
I thank my hon. Friend the Member for Stockport (Navendu Mishra) for securing this debate. I wholeheartedly welcome the debate because it provides me with another opportunity to raise the plight of those who are the hardest hit victims of the delays in the asylum system—those who are detained.
As we heard, the process for claiming asylum is complex, slow and, at times, chaotic. It can be inhumane, degrading and a humiliating experience. Many of the people who reach us to seek asylum have experienced severe trauma on their journey of hope to reach safety and security in our country. In my community, the most recent arrivals have been from Iran, Syria and Eritrea—some of the most dangerous areas on the planet where human rights count for very little. Many have lived in destitution. Doctors in my local community whom I met recently have identified many of them as suffering from post-traumatic stress disorder as a result of the suffering they have endured and the hardships they have experienced, even on their travels to our country.
The processing of claims can be a lengthy process of uncertainty, which just piles additional worry and distress on these people whom I count as my constituents. As we have seen from reports today of the breakdown in the Aspen card system, the refusal to allow those people to work, who desperately want to work, leaves them dependent on the vagaries of financial support from the state and struggling to live on just over £5 a day. As has been said, nearly 80% of them have to wait at least six months for their asylum claim to be considered, but example after example today has demonstrated that it can be so much longer.
I want to raise the plight of those who are the hardest hit by the current system—those who have been forced into detention. I have two detention centres in my constituency—Harmondsworth and Colnbrook—which can hold more than 1,000 detainees. The UK has been described as an outlier when it comes to the scale of the number of asylum seekers that this country detains. On average, more than 20,000 people are detained every year. The covid pandemic has resulted in the numbers being reduced, but I fear that number will rise again as we come through the pandemic. Why? Well, the detention centres produce significant profits for the private companies that run them. The detainees have become valuable, profitable economic units under this system. As we have witnessed in the United States, incarceration pays for these companies.
Detention can be a brutal experience. There have been 38 deaths in detention since 2000 and self-harm is endemic within the system. We have seen the reports of brutal treatment of women at Yarl’s Wood in the past, and the suicides and deaths in Harmondsworth in my constituency. Despite the strength of the condemnation from human rights bodies across the world, the UK has retained indefinite detention. The Government have even recently, to their shame, changed the rules—it is disgraceful—and they have admitted that more people who are potential victims of trafficking will now be detained.
There is a savage irony in the fact that about 60% of those detained will be released. In the light of various UNHCR investigations and reports, Governments across the world are now promoting alternatives to detention. I urge the Government to bring forward their own strategy for developing alternatives to detention, because the aim should be to close down these monstrous institutions.
It is a pleasure to speak in this debate, Mr Mundell—thank you for calling me. I thank the hon. Member for Stockport (Navendu Mishra) for securing the debate. He and I have been in many debates together over the last two days, and I am sure there will be many more where we will be on the same side.
The way we treat asylum seekers is something that I have spoken about on numerous times in this House and the message remains the same. I am not changing my stance; I cannot give encouragement to the Government. I believe in the immigration system, I understand that an open-door policy cannot work in terms of security and in distribution of resources, but I also believe that we have a duty of care to help those who do not have the capacity to help themselves. While they are in the process of determining their status, we must do better by them.
The hon. Member for Stockport referred to the Baptist church in his town and I want to refer to all the faith groups in my constituency who are enormously active in trying to help in every way. I give credit to the Government and the Minister in particular for the Syrian resettlement scheme, which was an excellent scheme in my constituency. Six Syrian families needed help at a time when they were under pressure. The churches came together collectively and ecumenically in a great way, Government bodies came together, and the people came together. It was a superb scheme. Is there any intention of doing something similar in a wider sense in the future?
I was contacted by the British Red Cross regarding the asylum process. It highlighted the need we are facing and the steps that it believes must be taken. I am happy to give it voice this afternoon. Since the outbreak of the covid-19 pandemic, we have supported more than 30,000 people at all stages of the refugee and asylum process across 58 UK cities and towns, including people who are being accommodated in hotels and military barracks. That shows the scale of the issue faced by the asylum system at present.
I am quite fond of the British Red Cross, which does excellent work. We should give it credit. It asks for the expansion of safe routes for people to reach the UK; improvements in asylum decision making to ensure decisions are made quickly and are right the first time, which is important to retaining confidence; and the provision of the right support to people, at the right time, so that they can engage with the asylum system and integrate successfully.
I totally agree with all those requests. Last week, or perhaps this week, the Home Secretary referred to the family who were trafficked from across the water and who were forced on to a dinghy at gunpoint. The two wee girls were left on the shore. They have not seen them since. That is an example that makes your heart ache. We are all touched by the images of children in dinghies trying to make their way here, but I agree that they should not have gotten this far. However, given that they are here, should we not treat them with the same care and respect with which we would want our own children to be treated? Should we not ensure that they are living free from fear? Above all, should we not extend our compassion? We should and we must.
I recently read an article highlighting that the queue for asylum decisions is nine times longer than it was 10 years ago, rising from 3,588 in 2010 to 33,016 in 2020. The number of children waiting more than a year for an initial decision has risen twelvefold from 563 to 6,887, and 55 applicants who applied as children have been waiting five years, as referred to by some hon. Members here. I have great respect for the Minister and believe that he has an interest in this subject and wants to help, so what is being done to shorten those waiting times?
In conclusion, there are simple and straightforward changes that can and must be made. They will not allow more people in; they will simply help us to treat those who are here better. They seek to cut the waiting times for decisions and improve the mechanisms for living while waiting, which is right and proper. I look forward to working with the Minister and charitable bodies, such as Red Cross and Mears, which has the contract in Northern Ireland to supply accommodation for asylum seekers, to see how we can collectively do this in a better way.
It is a pleasure to serve under your chairmanship, Mr Mundell. I congratulate the hon. Member for Stockport (Navendu Mishra) on securing this debate, which provides Members with an opportunity to raise concerns about both specific cases and the generality of the increasing and increasingly worrying delays experienced by so many people in the asylum and immigration system. It is pretty clear from today’s debate that the delays are just one failure among many in a system that is no longer fit for purpose, and has not been for many years, and is one that—whether by accident or, as is more likely, design—contributes to the continuing hostile environment for people seeking safety and refuge in this country.
We should thank the Refugee Council and some of the other organisations that have been mentioned for their hard work in producing the report that has provided the statistics about difficulties and delays in the system, which are borne out by the experiences from our own case work. That is, I suspect, a cross-party experience—even in the absence of any Government Back Benchers. To ensure that the Minister and the Labour Front-Bench spokesperson have plenty of time to respond, I will briefly consider the situation, the evidence, the consequences, some specific examples, the wider context of the hostile environment, and the need for action from the Government.
The stark reality of the situation has been set out in the report from the Refugee Council and in today’s speeches. There is a significant and growing backlog of cases and asylum applications waiting to be cleared, and that simply compounds the pressure, with things starting to spiral out of control. In recent months, we have all become familiar with the difficulties of exponential growth, and that is almost happening here. That comes despite the fact that, yes, there has been some investment in Home Office caseworkers. It is worth noting that many of them are hard-working—like our own caseworkers, as the hon. Member for Liverpool, Wavertree (Paula Barker) pointed out—and have to deal with incredibly difficult situations and listen to people’s difficult life stories. This is challenging for our caseworkers and for Home Office staff.
Individual Home Office officials are not to blame, but they are implementing the policies that are to blame. What they are having to do is ultimately driven by political decisions and a culture that pervades the Home Office. Earlier today in this Chamber there was a debate about visas for high-value migrants who are having their status denied due to minor tax return issues. I have spoken repeatedly in Westminster Hall and in Adjournment debates about the trouble with visas for artists, for priests and even for diplomats invited to this House to speak to all-party parliamentary groups. Later on, my SNP colleagues will be debating the impact of the bringing to an end of the European settled status scheme.
The basic message from the UK Government seems to be that people are simply not welcome in this country unless they have an awful lot of money that they are prepared to spend very quickly before they leave again. So, despite all of the rhetoric, it is clear that the “hostile environment” is still very much in operation, not least in the detention system, as the right hon. Member for Hayes and Harlington (John McDonnell) pointed out.
We have heard about plenty of individual cases today. In my own constituency, by May 2021 we had at least eight cases waiting more than six months for a response, and it was not the individual asylum seekers who were waiting more than six months for a response—it was our constituency office. Eventually we got some of those cases cleared by writing directly to the Secretary of State for the Home Department, but it should not have to be that way. Going to Members of Parliament to get a case dealt with should be a worst-case scenario, not a routine part of the process. Having a case raised by a Member on the Floor of the House, either in Westminster Hall or in Prime Minister’s Question Time, as we hear so frequently now, should not be a normal part of the process.
It is clear that the UK simply wants to make it as difficult and unpleasant as possible for people to apply for asylum in this country, despite the fact that, as Members have said, many of those who come here have been driven here by factors that we helped to cause, whether it is conflict, the use of weapons that we have manufactured and sold, or climate change caused by pollution from this country and other countries in the west. They have had to overcome extreme hardship and make incredibly difficult journeys, and they have not done that so they can live on £5 a day or so that they cannot even access things by using their Aspen card, which we have also heard about today.
Meanwhile, we deny our economy the opportunity to benefit from the skills and experience that people bring by denying them the right to work. The Conservatives are supposed to be in favour of entrepreneurship and a liberal, free-market economy, yet the hon. Member for Westmorland and Lonsdale (Tim Farron) spoke about the fact, which is true across the country, that tourist areas are crying out for people to work and the health service is crying out for support during covid. How many doctors and nurses do we know who are waiting for their asylum claims to be processed, but are being denied the opportunity to help others in this society?
In addition, people are forced into substandard and inappropriate accommodation, not least in Glasgow. There was the tragic situation of the people caught up in the incident in the Park Inn hotel. Just in the past couple of weeks, I have spoken to two constituents who were traumatised by their experiences there, as if they were not traumatised enough by the situations that caused them to come here and seek asylum in the first place. I would particularly like to hear from the Minister about what support, including what trauma counselling, is being provided to people who were caught up in that incident through no fault of their own, but through a decision taken by the Home Office to force people into hotel accommodation.
Many asylum seekers receive support from incredible community-based organisations, a number of which have been mentioned today. In particular, the hon. Members for Stockport and for Salford and Eccles (Rebecca Long Bailey) spoke about the local organisations in their areas. I will just mention the Maryhill Integration Network, which does incredible work in Glasgow, North. This year, it is celebrating 20 years of working with the community and its outgoing director, Rema Sherifi, has worked for it for over 17 of those years. I wish her all the best.
Such organisations should not have to be firefighting. They are supposed to be about proactive integration across the community as a whole, building stronger communities. Many of them do that, but they could do more.
On the point of voluntary organisations and professional organisations that campaign on these issues, lots of them have said that lifting the ban on work is very important. However, there is also a toxic environment in the media—perpetrated by the Home Office and several Government Members—that these humans should not be treated as humans. Does he agree that treating people with basic decency and kindness is extremely important?
Yes, absolutely, and that is the approach taken by the Scottish Government. They have published their “New Scots” strategy, to ensure that people arriving are supported and integrated from day one. That strategy sets out the vision:
“For a welcoming Scotland where refugees and asylum seekers are able to rebuild their lives from the day they arrive.”
The strategy commits to better access to essential services, such as education, housing, health and employment, recognising the skills, knowledge and resilience that refugees bring, and it aims to help people to settle, become part of the community and pursue their ambitions. The message that comes from Scotland, and from many of the Members here despite the message that comes from the UK Government, is that refugees are welcome and we want them to stay.
I endorse all the calls in the report from the Refugee Council; the hon. Member for Edmonton (Kate Osamor) in particular spoke about them in detail. However, what is clearly needed is a step change in attitude, and that is not provided in the “New Plan For Immigration” and the forthcoming Nationality and Borders Bill. Debates such as this one will help to make sure that the UK Government continue to be held to account, even if it is uncomfortable for the Minister that none of his party’s Back Benchers are here, either to support the Government’s policy or to speak about the difficulties that their constituents are facing. The message from the rest of us who have spoken in this debate today is very clear indeed—refugees are welcome and we will do all that we can to continue to make that a reality.
It is a pleasure to serve under your chairmanship, Mr Mundell. I congratulate my hon. Friend the Member for Stockport (Navendu Mishra) on securing this timely and important debate, his excellent speech and his commitment to raising the serious issue of delays and the myriad of associated problems with the asylum system.
Many people, myself included, are proud of the British values of fairness and decency. Those values underpin our shared sense that people in the UK will get a fair hearing, backed up by the rule of law. However, chronic delays in the asylum system are undermining and eroding those values, causing human suffering and creating a system that is unfair and chaotic. There is copious evidence of this in the “Living in Limbo” report, published by the Refugee Council earlier this month, and referred to by hon. Members throughout the debate.
The Minister should be alarmed and appalled by its findings. The raw data obtained from the Home Office via freedom of information requests are truly shocking. The data make it crystal clear that delays in the asylum system are endemic and have got worse and worse over the last decade. If the asylum system were a hospital patient, it would be in intensive care on a life support machine with a prognosis of a slow but terminal decline. The facts speak for themselves. The hon. Members for Strangford (Jim Shannon) and for Westmorland and Lonsdale (Tim Farron) made compelling cases illustrating the Government’s failures via the data. More than 30,000 people are currently waiting between one and three years for an initial decision—in 2013 this was only 4,500 people—and 6,388 of those in 2020 were children, which is a tenfold increase since 2012.
The data and the facts say one thing, but the decision to propel myths about asylum seekers is a cruel and politically calculated choice by the Government. Instead of blaming the people, the Government should hold up the mirror to themselves to address the actual problems they have caused by refusing to fix the broken asylum system. Even more staggering is that at the end of March, over 66,000 people were waiting for an initial decision from the Home Office—more than will watch England at Wembley tonight. That is the highest number in over a decade and a truly shocking state of affairs.
The statistics are shocking enough, but the human cost of the delays is even worse. I am talking about people—many of them children—whose trauma of lived experience is compounded by being left in limbo in the asylum system, in many case for years on end. My hon. Friends the Members for Edmonton (Kate Osamor), for Salford and Eccles (Rebecca Long Bailey), for Vauxhall (Florence Eshalomi) and for Liverpool, Riverside (Kim Johnson), my right hon. Friend the Member for Hayes and Harlington (John McDonnell) and the hon. Member for Leicester East (Claudia Webbe) gave examples of worrying cases of constituents who have been caught up in the asylum system and whose cases are unresolved. I have an example of constituent F who came to the UK from Afghanistan as a child and applied for asylum in August 2013. It took seven and a half years, and my involvement as his MP, for the matter to be resolved this February. As the SNP spokesperson, the hon. Member for Glasgow North (Patrick Grady) said, it should not take an MP’s intervention to resolve such problems: it is not good enough. The impact on the mental health and wellbeing of people in this position is devastating.
During the time before a decision is made, people live on just £5 a day and are not permitted to work. People awaiting a decision are accommodated within a system that was not designed to be used for the long term. People are becoming increasingly mentally unwell as the years of uncertainty, trauma and demonisation erode their mental and physical health. The Refugee Council reported that this has led to an increase in the numbers of individuals self-harming and reporting suicidal thoughts. We heard of the appalling situation for the constituent of my hon. Friend the Member for Liverpool, Wavertree (Paula Barker), which is really concerning. The Children’s Society report “Distress Signals” also outlines serious concerns about the damage done to children’s mental health in those conditions—damage done at a formative age that will last a lifetime.
As a lawyer, I am fond of the axiom that justice delayed is justice denied. Those cases, where people are placed in limbo, is justice denied on a vast scale. Beyond the human cost of these delays is the financial cost. The backlog adds considerably to the overall cost of the asylum process. My hon. Friend the Member for Ealing, Southall (Mr Sharma) spoke about the cost and failure of the asylum system. The Refugee Council has calculated that, for every month of delay, the additional cost to the Home Office per person is at least £730.41, equating to £8,765 per year. Therefore, the total cost per year of the current backlog of people awaiting an initial decision for more than six months is estimated to be approximately £220 million. The delays make absolutely no financial sense. What is clear is that the Home Office needs to get a grip of why it is that staffing increases have not helped to reduce the unacceptable delays and backlog.
What further concerns me is the fact that the Government appear to have very little by way of a plan to solve the backlog issue. For instance, the Government’s Nationality and Borders Bill, published yesterday, contains no measures for tackling the backlog. The Government’s desire to define safe and legal routes in an increasingly narrow way while criminalising irregular routes will do nothing to help with the backlog. The measures are likely to make delays in the system far worse, because the inadmissibility proposals will result in more people having to wait six months before their claims are even looked at.
Rather than chasing headlines through the draconian measures outlined in the Nationality and Borders Bill, there are practical steps the Government could take to make the asylum system function in an effective, fair and humane way. Some actions could be taken straightaway to tackle the unacceptable delays in the system, which cost so much in terms of both human suffering and public money. In February 2021 the UNHCR outlined proposals that would address the current backlog and prevent future ones from building up. Those proposals include introducing an effective case prioritisation system and introducing simplified asylum case processing procedures.
I also urge the Government to stop the increased pressure on our judicial system by ensuring that there is better decision making at the outset, with fair, quick decision-making processes instead of processes that drag on and leave lives in limbo. The Government must look at the proposals seriously and not repeat the mistakes of the past. Only by making concrete change to the system will they enable it to be effective, fair and humane. That, I believe, is what everyone wants to see. We must reflect on what the Government’s plan would mean for Britain as a society: I do not want to see our British values of decency and humanity eroded.
The end of this month, 28 July, marks the 70th anniversary of the refugee convention. In the aftermath of the second world war, in a shattered Europe, Britain came together with 26 other countries to form a strong foundation and create the convention. That is true British pride and patriotism, and a historical legacy. Almost 70 years later to the day, the UK Government are seeking to step back from that agreement. That is the sobering reality, and one of the many social and political impacts of the Government’s proposals.
We can look back on how we treat people seeking sanctuary here today with pride, or we can look back on this time as one that could and should have been much better. The humane treatment of those seeking sanctuary is as much about us rescuing our own values as it is about rescuing people in need. The Government must not delay in dealing with this issue.
Thank you, Mr Mundell. It is a pleasure to serve under your chairmanship—I think for the first time, and I hope not for the last.
It is worth mentioning that I am appearing here today on behalf of the Under-Secretary of State for the Home Department, my hon. Friend the Member for Torbay (Kevin Foster), who is participating in an Opposition day debate at the moment. He has direct responsibility for the area that we are discussing this afternoon.
Let me start by adding my congratulations to the hon. Member for Stockport (Navendu Mishra) on raising this important issue and on the thoughtful speech he gave in opening the debate.
Let me outline the steps that the United Kingdom has been taking and is taking to discharge our obligations to people who are in need of protection; they are obligations that we stand by and will not resile from. I first point to our resettlement programme, which the hon. Member for Strangford (Jim Shannon) referenced in his speech earlier. The programme has been going for some time, but it really took off in around 2015. Working with the UNHCR, we directly resettle into the United Kingdom people who are most directly in danger. The scheme is particularly focused on people in and around the Syria area, for obvious reasons. Over six years, a total of 25,000 people have been resettled directly into the United Kingdom from places of danger; 20,000 of them under the vulnerable persons resettlementj scheme, which focused particularly on Syria. That 25,000 is more than any other European country, which is something that the Government and we as a nation can be extremely proud of.
We also offer safe and legal routes via refugee family reunion, where people granted refugee status can bring in close family members and, in exceptional circumstances, wider family members. That scheme, over the past five or six years, has seen about 29,000 people come into the UK, about half of whom were children. We can also be proud of our record in that area.
Some comments were made earlier, particularly by the hon. Member for Westmorland and Lonsdale (Tim Farron), asking whether we were playing our fair part. I have already pointed out that our resettlement programme is the largest of any European country. He also mentioned asylum numbers. In 2019, the last full year for which the European Union published data, the UK received 44,800 individual applications, according to the European Union’s website. Of the 28 countries covered, including the UK at that time, we came fifth. As far as unaccompanied asylum-seeking children under 18 are concerned, in 2019 the UK’s intake was, from memory, 3,775—higher than any other country in Europe. Last year, 2020, only Greece had a higher UASC intake than we did. All of that shows that the UK is committed to meeting its obligations.
When it comes to supporting asylum seekers, referred to by a number of hon. Members, the provisions we make are more generous than many European countries. We provide accommodation and free health care. Council tax and utilities are paid for. There is free education for those under 18, and a cash allowance is paid in addition, which has been endorsed by the courts as adequate to cover essential costs. We are meeting our obligations. That system as a whole is extremely expensive, partly because of the backlog, which I will come to. It costs about £1 billion a year, so we are spending a huge amount of money supporting the asylum-seeking population. Those measures we are taking are more generous than most other European countries.
Hon. Members referred to the “New Plan for Immigration”, a policy statement published a few months ago, and the Nationality and Borders Bill, which was introduced yesterday. Second Reading will be shortly before the summer recess, so we will have the opportunity to debate that more fully in a few weeks’ time. I would like to make a couple of points regarding the policy statement and the Bill. The Bill is intended to be fair to those who are genuinely in need but firm where people are trying to abuse the system. By fair, we mean continuing to commit to that resettlement programme. We have already continued the resettlement programme beyond the 20,000 people I mentioned earlier. The VPRS 20,000 commitment was met in February of this year, a few months than expected because of coronavirus. We are still resettling people under the replacement UK resettlement scheme.
The German scheme was not a resettlement scheme. What Angela Merkel did briefly in 2015 was simply declare that their borders were open. About 1 million people irregularly just crossed into Germany, many of whom were not from Syria or Afghanistan. That was not a resettlement scheme; that was essentially mass illegal migration. With our resettlement scheme, which we do properly in partnership with the UNHCR, we go directly to dangerous places around Syria, although we plan to expand that in future. We identify people in need of protection and bring them to the UK from dangerous places such as Syria, or near Syria, rather than have them make dangerous, illegal journeys across Europe first. That is the right way to do it. We are committing to safe and legal routes and to being fair to people in genuine need via the Bill, but at the same time it is important that we are firm where people abuse the system.
There are problems with our legal system, to which the hon. Member for Enfield, Southgate (Bambos Charalambous) referred. The legal system often gets protracted in the most extraordinary way when people make repeated claims often over a period of years, many of which turn out to be without merit, and yet they can do that repeatedly, which does not serve anybody’s interest. Partly as a result of that, there are now for the first time ever more than 10,000 foreign national offenders circulating in the community, which is an unacceptable situation that we intend to act on.
It is worth saying a word about illegal migration. When people come here from France—I am thinking about the small boats—that journey is unnecessary, because somebody coming from France is not directly fleeing a war zone. Calais, and France more generally, is not a dangerous place. They do not need to leave France to claim protection or asylum because France has a well-functioning asylum system, and so does Germany, Belgium, Holland, Spain, Italy and the other European countries that people have passed through. No one needs to cross the English channel in a rubber dinghy to claim asylum. They should claim it ideally in the first safe place that they arrive in, which would include France.
Such journeys are dangerous. People have died. A family of five, including an 18-month-old boy, died trying to cross the channel last October. There have been incidents where ruthless people smugglers who take money to facilitate illegal routes have threatened people with guns, including a family that was separated because the people smuggler they had paid to smuggle them into the country turned on them. We should all seek to shut down those routes. It is not humanitarian to have people smugglers paid to smuggle people across the channel. It is dangerous and unnecessary, and we should stop it. Routes into the country should be safe and legal, not dangerous and illegal, and that is the objective of the Nationality and Borders Bill, which I am sure we will debate at length in a few weeks’ time.
Specifically on delays in the asylum system, it is true to say that the delays are considerably higher now than they were a year ago. A great deal of that is due to the disruption caused to the asylum decision-making system by covid, which has obviously affected many areas of our life. It has affected us here in Parliament. We are still sitting here wearing masks and having remote proceedings. It has affected the NHS, our call system, all of our national life, and the asylum system has been affected in the same way.
For some months last year, asylum interviews stopped entirely because it was considered unsafe to have a face-to-face asylum interview. People who worked in asylum decision-making offices, including in my own borough of Croydon and elsewhere in Glasgow, Liverpool, Leeds and other places, were not able to go into the office in the normal way to take asylum decisions and conduct interviews, and that has been enormously disruptive over, roughly speaking, the past year and three months, which means that the number of decisions taken in the past year has been dramatically lower, and we have not yet fully recovered.
We are still sitting here wearing masks, and the asylum decision-making process has not fully recovered either, which means the backlog and delays have built up. I agree with the points made by hon. Members that the delays are not what we want to see at all. For those whose claims will be granted, clearly we do not want to see them kept in limbo for protracted periods of time. If they are going to have their asylum claim granted, it is much better that it is done quickly so that they can move on with their lives. Equally, if the asylum claim is rejected, we should then look to move them to the country of origin quickly, because if someone’s claim is not genuine, it is only right and fair that they are removed. Whether it is accepted or rejected, we need faster decision making. That is a completely fair point.
That is an interesting point. We had a six-month operational guideline previously, but that was moved away from in order to try to focus resources on the cases that most need attention. For example, priority is given to cases involving children. Hon. Members have mentioned that some cases have been waiting a long time. We are now putting a particular focus on trying to resolve those long-standing cases, so a slightly more holistic view has been taken, but I will take away the hon. Gentleman’s point and mention the idea, which I know was offered in a constructive spirit, to my hon. Friend the Member for Torbay.
Actions are being taken to address the issue that we have been discussing. First, we have been introducing remote interviewing by video link, like we are using now. We did not really have that at all about a year ago. It has now been introduced and its usage is more widespread. Indeed, for reasons of convenience for applicants and others, it is something that we may well continue with, even after the pandemic, I hope, subsides in the near future. That investment in remote interviewing technology has been made and is being rolled out.
Secondly, we are interviewing on sites outside the Home Office. We are trialling interviews in places such as the Napier barracks in Folkestone, as well as in the hotels where some people are accommodated, to try to speed things up a bit. We have also opened up additional registration centres where people can register their asylum claim, so there are now offices in Glasgow, Belfast, Liverpool, Leeds, Solihull and Cardiff, in addition to Croydon—it used to be that Lunar House in my borough was principally the place where people went before. Those places are now available, too, which was intended as a covid measure, but continues to this day.
We are also investing in better IT systems. We are trying to make the work rate of the caseworkers more efficient by, for example, shortening the letter to someone who is granted asylum. When someone is granted asylum, they are not going to argue with it, clearly, so rather than writing a great long letter, it has been shortened to make the whole process a little faster. There is some effort to prioritise cases in which we think a quick decision can be made. If particular indicators suggest that the case is likely to receive a positive response, we would like to do that. We are also introducing specialist caseworkers, such as specialists in a particular nationality. If people feel familiar with a particular country and its circumstances, that will facilitate quicker decision making.
My hon. Friend for Torbay intends to increase staffing levels, to which hon. Members have referred. About 550 people are currently engaged in making those casework decisions—550 full-time equivalents—and the objective is, over time, to get that up to 1,000, which is almost double. That investment in people should clearly have a dramatic effect on speeding things up. As someone said earlier in the debate, wherever someone sits on the immigration issue—we believe in proper border control, as well as fairness—it should not be difficult or contentious to say that it serves everybody’s interests to get those decisions made quickly, whether they end up being positive or negative.
I have outlined the steps that my hon. Friend is taking, and I am sure that all hon. Members present will hope and expect that the measures I have outlined will have the desired effect and that waiting times will come down. We are of course somewhat in the hands of the intake. We have had an extremely high intake in the last few weeks because of the dangerous, unnecessary, illegal English channel crossings, and if they continue in large numbers, that will add to the backlog. The intake is somewhat unpredictable—I mention that caveat for completeness. In the interests of giving the hon. Member for Stockport an opportunity to reply, I will conclude my remarks.
I am incredibly grateful to all hon. Members who contributed to the debate and brought many powerful stories from constituency casework. I thank the Minister for his contribution, although I must highlight that he did not comment on the Aspen card disaster and people being left without food or hygiene products, or on my remarks on the special requirements for women asylum seekers fleeing domestic abuse and rape. The one-size-fits-all approach simply does not work. Asylum seekers and refugees are five times more likely than British nationals to have serious mental health issues.
Clearly, there is a lot of appetite among MPs for the Government to lift the ban on people working. Just over £5 a day is simply unacceptable. We also want to see an end to the toxic and divisive language from the Home Office, the Home Secretary and some MPs on the Government Benches. Treating people like insects is not acceptable; everyone deserves decency and respect. We also want proper financial support for local authorities that support asylum seekers. We have a system whereby some local authorities support asylum seekers and will accept them, while others do not—that needs to be changed. We need reform to the system.
Motion lapsed (Standing Order No. 10(6)).
UK Casino Industry
I remind hon. Members that there have been some changes to normal practice in order to support the new hybrid arrangements. Members attending physically should clean their spaces before they use them and as they leave the room. I also remind Members that Mr Speaker has stated that masks should be worn in Westminster Hall.
I beg to move,
That this House has considered the UK casino industry.
It is a pleasure to serve under your chairmanship, Mr Mundell. Before I begin, I refer the House to my declaration in the Register of Members’ Financial Interests.
People’s perceptions of casinos often fall into two categories, either James Bond at the Monte Carlo Casino or problem gamblers chasing their next win. For 99% of people, however, that is simply not the reality. Casino goers are just ordinary people enjoying time out with family and friends. They have budgeted an acceptable cost for an evening’s entertainment, which is no different from purchasing an admission ticket to the theatre or attending the football on a Saturday afternoon.
Casinos bring many benefits to local communities. In Great Britain, 13,000 people are directly employed in casinos, with thousands more additional jobs generated in their supply chains. More than half of those working in the gambling industry are under the age of 35, a far higher proportion than in the wider economy, demonstrating the importance of the industry in providing entry-level jobs for young people looking for experience in the workplace.
Hundreds of people in Blackpool are directly employed in the three casinos across the town, as croupiers, waiters, security and chefs. Casinos offer long-term, year-round employment in my constituency, in what is otherwise a tourism-focused and therefore seasonal local economy.
Casinos also make a substantial contribution to the Treasury. In the financial year 2019-20, 128 casinos were operating in this country, paying a total of £213 million in gaming duty. Their contribution to the national economy and the job opportunities created in many towns, therefore, must be taken into account in the upcoming review of the Gambling Act 2005. The review has to be established on the evidence, not on preconceived ideas and ideology.
The hon. Gentleman may give me the answer that I wish to hear, and I hope that the Minister will endorse it when he responds. I have a real problem with some people in my constituency who are worried about gambling addiction. Will the hon. Gentleman confirm that for casinos overall—I know we do not have them in Northern Ireland—there will be protection for those with a gambling addiction? If they enter a casino, will that protection be in place, with the help they need to prevent them spending the money they should not be spending? I am very concerned about people with gambling addictions and need that reassurance.
The hon. Gentleman makes a valid contribution. I am sure that many people across the country share such concerns. I have visited a number of casinos, including the ones in my constituency, and I can honestly say that the safe gambling practices they have in place are second to none. I am sure that the Minister will address that point further in his remarks.
The gambling review needs to allow for the casino sector to implement much-needed modernisation and allow the industry to provide the services and experiences that its customers desire. Thankfully, I know that the Government’s objective is to ensure that the legislation is fit for the modern day, while of course committing to player protection and safer gambling measures, to which the hon. Member for Strangford (Jim Shannon) just alluded.
Legislation for casinos should have been updated in the 2005 Act. That in effect introduced an experiment for the sector: it legalised two new types of casinos, eight large and eight small, in predetermined areas. However, the truth is that that experiment has stalled. Fewer than half the 16 permitted casinos are now open but, crucially, an evaluation of the changes introduced by the 2005 Act has not occurred, meaning that there has been no consideration whatever of how the vast majority of other casinos, still governed by the 1968 legislation, would be modernised. Now is the time to do exactly that.
The outdated rules are exemplified by the number of gaming machines allowed in casinos. The 2005 Act allowed a maximum of 80 gaming machines on the premises of the small licence category casinos and 150 for the large licence category casinos, but the rest are limited to just 20 machines, regardless of their size. Most casinos across the world have thousands of machines. Let us take, for example, Belgium and Denmark, which have up to 140 times as many gaming machines per customer compared with casinos in Great Britain.
I draw the House’s attention to my entry in the Register of Members’ Financial Interests. Does my hon. Friend agree that if restrictions are too stringent, there is a great danger that people will play on the black market? PricewaterhouseCoopers, in a recent report, estimated that the value of people’s gambling on the black market had increased from £1.4 billion in 2018 to £2.8 billion just two years later. Is that not a worrying trend that we need to be careful of?
My hon. Friend makes a very valid point. Of course, many people will be concerned about some of the Gambling Commission’s proposals on affordability and the extent to which they could drive people into the arms of black-market operators. I know that that will be tied up in the gambling review, and the Minister will potentially address those points—if not today, then as the review continues on its way to the autumn.
I thank the hon. Gentleman for drawing attention to regional casinos, but does he, like me, find strange the Government’s lack of desire to improve and upgrade the legislation? It is especially stranger given that casinos are part of the tourist attraction offer not only domestically, but internationally, particularly in London, with high-value visitors, and that that is an enormous contributor to national revenue through gambling tax—let alone some of the changes that are taking place, such as the disappearance of cheques. Is there not an urgent need to recognise this industry’s importance for the Treasury, but also for the wider ecosystem that makes Britain a desirable destination?
Absolutely. I thank the right hon. Gentleman for his valid points. I hope that, as part of the review that is ongoing, those points can be addressed. Over the last 14 years or so, it would have been hoped that the experiment that I just alluded to from the 2005 Act would have allowed ordinary casinos to be updated, in terms of their practices and regulation. Disappointingly, that has not happened, but the review offers a golden opportunity to now do exactly that.
I was talking about the number of machines operated in some ordinary casinos. The Hippodrome in Leicester Square is restricted to just 20 machines. That in effect means that during busy periods there can be up to 75 customers in the building for every one gaming machine, which is incredibly perverse. Of course, there is little, if any, evidence to link problem gambling to the number of slot machines available. Gamblers can only play on one machine at a time. And there have not been any such issues from the casinos licensed under the 2005 Act that have substantially more machines. Instead, the lack of available machines means that potential customers face long delays to play and, when they finally are able to play, they feel uncomfortable, knowing that others are waiting to do so as well. In fact, it stops people leaving their machines, through fear of losing their spot—counter-intuitive to safer gambling practice.
Introducing a machine-to-table ratio would relate the number of machines to the size of the casino. That would ensure a suitable number of machines for the size of premises and stop ridiculous scenarios such as that at the Hippodrome. Rank Group, which operates 52 casinos, has suggested starting with a five-to-one ratio to cater for customer demand. The size of a casino, and therefore the number of machines, would be for local authorities to decide during planning applications, which would enable them to ensure a suitable local offering.
Existing laws also limit the choice for customers using gaming machines by restricting electronic versions of casino games to those based on physical events. In effect, that restricts casinos to offering only electronic roulette, as games such as blackjack are much more difficult to offer electronically with the necessary physical event. That makes little sense as there is no identifiable reason that a customer is safer or receives any additional protections from a random physical event rather than a random number generated game. [Interruption.]
Thank you, Mr Mundell. Legislation fit for the modern-day customer would also enable casinos to offer a wider range of casino games via electronic terminals. That would allow gamblers to play at much lower stakes than on live tables.
A second inconsistency between the 2005 Act and the 1968 Act relates to the ability to offer sports betting. The new legislation allows for sports betting at the casino, yet the historical legislation does not. There is a relatively small number of casinos in the UK compared with the thousands of licensed betting offices. Therefore, any change to legislation to allow sports betting in casinos would have little effect on the betting offices sector. Casinos would not become the favoured place for sports betting, yet they would be able to offer a complementary service to the casino floor. It is archaic and puzzling that casinos cannot offer sports betting when casino customers can simply pick up their phone, open an app and make a sports bet online. There have been no reported issues from casinos that can offer that facility. Yet again, internationally that means we are lagging behind, because that is normally a standard offering in a casino.
It is not just placing bets that people increasingly do electronically. Society is rapidly moving away from using physical cash in all transactions, with electronic payments estimated to be used in up to 80% of transactions in the retail industry. Yet the majority of payments in casinos remain cash-based. No doubt accelerated by the pandemic, in many situations across the UK it is impossible to pay for goods or services with cash. As such, it is scarcely believable that restrictions would bind an industry to cash payments only.
Casinos need to be able to offer a cashless option to keep up with changing customer expectations. The controls on cashless opportunities in casinos are detrimental to business and restrict customer choice. There would be no additional risks to customers, as operators would continue to ensure that safeguards were in place to prevent people from spending beyond their means. That could be similar to the measures casino operators have in place elsewhere.
Other credit issues relate to high-end casinos in Mayfair, which bring in incredibly wealthy individuals from around the globe. Those casinos can accept cheques from players to facilitate the transfer of funds from abroad. However, the future of cheques is constantly in doubt, and some countries have already stopped their use in favour of electronic payments. Without the ability somehow to accept payments from those individuals, casinos would close overnight. Jobs and the significant contributions to the Treasury in gaming duty would be lost, along with the indirect investment and spending brought by those gamblers when they visit the UK. Electronic payments and permitting those casinos to give credit for gambling to high net worth individuals, with robust anti-money laundering controls in place, would make it possible to continue offering that service.
No part of the betting and gaming industry has been as severely affected by the pandemic as land-based casinos. These are small asks that would future-proof the sector while safely increasing what it could offer to consumers. Refusing to bring legislation into the 21st century, and ignoring the demand for gambling by over-regulating the industry, will only see casinos left behind, unable to compete and match the modern-day expectations of customers, which in turn will lead to a decline in jobs and tax revenue, and the sector’s contribution to economic growth. I hope the Minister will address those issues in the review, and I look forward to his response to those points.
The 2005 Act allows for one regional casino, or super-casino as it is sometimes known. A regional casino is defined as having a minimum total customer area of 5,000 square metres, and will be permitted to have up to 1,250 gaming machines. Paul Ward, a hotel operator in my constituency, has experience of working in a large casino abroad, and he has said:
“A super-casino isn’t just about gambling. I worked in a casino in Perth, Western Australia for a while. The employment opportunities were incredible… it created jobs for 1,500 people. The tourism it generated on top was amazing.”
The Government of the time agreed with that assessment and expected that a regional casino would be a major development, offering clear potential for regeneration and bringing in major investment and providing accommodation, as well as conference facilities, restaurants, bars, areas for live entertainment, leisure attractions and, of course, a premium gambling experience.
The primary criteria laid down by the Secretary of State at the time were to ensure that any chosen location would satisfy the need for the best possible social impact, and focus on areas needing regeneration. In a 2019 study comparing 32,000 neighbourhood areas across England, the Ministry of Housing, Communities and Local Government looked at income, employment, education, health and a few other factors. All the neighbourhoods were then ranked against each other. The sad result of the study was that eight of the top 10 most deprived neighbourhoods in England are based in Blackpool—a shocking statistic that clearly underlines the desperate need for substantial regeneration in my constituency.
There is widespread support across town for a regional casino. Ian White, a director of the approved hoteliers’ group, StayBlackpool, has said:
“A super-casino, bringing in dynamic investment would stimulate and support a truly year-round economy that the resort needs.”
Following the introduction of the 2005 Act, local authorities could bid for small, large or regional casino licences. Blackpool, of course, was a clear frontrunner to be awarded the regional casino. However, somewhat surprisingly, the panel recommended that it should be awarded to Manchester. Partly owing to that, a statutory instrument that was required to approve its location was defeated in the House of Lords in 2007. The issue has since been swept under the carpet, ignored and never returned to.
The Select Committee on Culture, Media and Sport looked at casinos in its 2012 report on the Gambling Act, as I am sure the Minister recalls. On regional casinos, the report said that there was
“a general reluctance to discuss the development of regional casinos”.
Perhaps now, 14 years later, the time has come to re-examine the issue. Allow me to share the words of Amanda Thompson OBE, owner and managing director of the Pleasure Beach:
“The creation of a super-casino in Blackpool would herald a new powerful tourism brand for the resort and create a new holiday experience that would be a catalyst for inward investment, supporting growth, development and prosperity across all sectors.”
Although there is clearly no silver bullet to change Blackpool’s fortunes, a super-casino would create many jobs in the town, from contractors working on the site initially to staff at the premises once completed. There would also be a significant boost for local companies that could offer goods and services to the casino, its staff and its customers.
Will the Minister commit himself to reviewing the case for a regional casino during the gambling review and assess the significant positive economic impact that a regional casino could make to a town such as Blackpool, which would be the obvious location to host such a casino?
It is a pleasure to serve under your chairmanship, Mr Mundell.
I congratulate my hon. Friend the Member for Blackpool South (Scott Benton) on, and thank him for, giving us the opportunity to debate these issues. I also thank the right hon. Member for Warley (John Spellar), the hon. Member for Strangford (Jim Shannon) and my hon. Friend the Member for Tewkesbury (Mr Robertson) for their contributions.
Casinos come in all shapes and sizes. As my hon. Friend the Member for Blackpool South said, I have been involved in the issue as Opposition spokesman during the passage of the 2005 Act and as Chair of the Select Committee on Culture, Media and Sport for 10 years. As a result, I have visited quite a number of casinos, ranging from the Venetian in Macau, which I believe is the biggest in the world, and the Crown in Melbourne all the way down to the Genting in Westcliff, in Southend-on-Sea, and Aspers in Stratford, which is one of the few operating under one of the new licences.
My hon. Friend is absolutely right to stress that, obviously, casinos are centres for gambling, but that they offer much more. Last week, I was at the Hippodrome in Leicester Square, where I was able to observe not only the gambling, but the excellent restaurant in that place. It is possible to enjoy hospitality there right through the night, unlike many other places in London. Although I did not attend, there is also regular entertainment by, I believe, Magic Mike.
My hon. Friend is right that casinos provide a significant tourist attraction, as well as a major economic contribution. They were, obviously, badly hit during the lockdown, in particular because, even when we were able to relax the measures, there was still a 10 o’clock curfew, and of course a lot of casinos do their business after 10 pm. It was with great relief, I know, that the casino industry was able to reopen on 17 May without a curfew in place. Casinos are still impacted by some restrictions. That affects the income of the local area, especially as casinos provide employment for a large number of people. My hon. Friend is right to remind us that the Chancellor also benefits considerably from the income from gambling duties.
The hon. Member for Strangford referred to the risk of problem gambling, which is at the top of our minds throughout. The gambling review that is taking place will address whether additional measures are needed to offer greater protection to those who may be susceptible to problem gambling. However, there has always been a pyramid of risk in the different places where one can gamble. Casinos have been seen to offer a safer environment than almost any other form of gambling. I have certainly observed that to be so, given the scrutiny of people who are gambling to ensure that they show no sign of having problems, as well as that regular intervention and the self-exclusion schemes. For that reason, it was felt right to allow more casinos to open.
My hon. Friend the Member for Blackpool South talked about the 2005 Act, and he is absolutely right that consideration in Committee was a tortuous process. We ended up with the creation of just eight small licences and eight large licences for new casinos. In actual fact, not all those licences have been taken up, or at least they have not been utilised. The majority of casinos still operate under the licensing arrangements of the original 1968 Act.
My hon. Friend made an excellent case that that has thrown up some bizarre anomalies, in particular the number of machines allowed under the licences pertaining to the new small and large casinos compared with those operating under the 1968 Act. As he said, a large casino under a new licence may have up to 150 machines, but, whatever the size, a casino is limited to 20 under the old Act. The House of Lords Gambling Industry Committee drew attention to that and said it needed to be addressed. That is certainly a matter that we are considering as part of the gambling review.
My hon. Friend flagged up one or two other anomalies, such as the fact that sports betting is allowed under the new licences but not under the old, despite the fact that someone who goes to a casino that operates under one of the 1968 Act licences can bet on sports—they just do it on their mobile phone, rather than through the casino itself. There are anomalies that are difficult to provide justification for and that we have said we will look at. There is also the development of technology. Furthermore, my hon. Friend flagged the fact that the requirement to have cash is becoming harder to fulfil as more and more people do not actually use cash any longer, which we need to take account of.
My hon. Friend rightly identified, and the right hon. Member for Warley alluded to, a very small but significant group of people whom I believe are known in the slang as whales, which means those people who tour casinos around the world and are quite capable of losing £1 million in an evening—the high rollers. This is an intensely competitive area, with maybe half a dozen or 10 venues in different countries around the world competing for their custom. The fact that we still require cheques when, as my hon. Friend said, they are becoming outmoded and more countries are not even using them is also something that we need to look at and on which the industry has made a case. The gambling review is considering all those issues.
I understand the right hon. Gentleman’s wish for these matters to be addressed as soon as possible, but that is likely to require legislation, possibly primary legislation, which will need to be considered against all the other demands on Parliament. However, we are hopeful that we will be able at least to come forward with the conclusions of the review in the autumn. I would like to be able to say a little more ahead of that time, although I absolutely take his point that these matters need to be addressed soon.
Finally, I will touch on the case made for Blackpool by my hon. Friend the Member for Blackpool South. I was Opposition spokesman on these issues in 2005, and originally, we were going to say we should not have any super-casinos or regional casinos because of the risk that they might lead to a significant increase in problem gambling. We changed our mind and supported the Government in making available one licence. Everybody in the House of Commons believed that that one licence, if awarded, should go to Blackpool, and we were all somewhat mystified when the panel advised that it should go to Manchester.
That is history, but it is why a regional casino has not yet been built. We would need to consider whether there was support for one—my hon. Friend quoted a number of people from his constituency—but obviously that is a decision for the local authority as well. We would also need to establish whether an operator was prepared to make that investment. If those two things were the case, I would certainly be willing to talk to my hon. Friend and others from his constituency about that possibility. As he knows, the legislation is still on the statute book and could therefore be utilised if those two things were proven.
I am most grateful to you, Mr Mundell, and to my hon. Friend. I assure hon. Members that these matters are under very active consideration as part of the gambling review.
Question put and agreed to.
Covid-19: Government Support
I remind hon. Members that there have been some changes to normal practice in order to support the new hybrid arrangements. Timings of debates have been amended to allow technical arrangements to be made for this debate and the preceding debate. There will also be suspensions between debates.
I remind Members participating physically and virtually that they should be present for the start of the debate. Members are expected to remain for the entire debate. I must also remind Members participating virtually that they must leave their camera on for the duration of the debate, and that they will be visible at all times, both to each other and to us in the Boothroyd Room. If Members attending virtually have any technical problems, they should email the Westminster Hall Clerks at email@example.com. Members attending physically should clean their spaces before they use them and as they leave the room. I also remind Members that Mr Speaker has stated that masks should be worn in Westminster Hall debates.
I beg to move,
That this House has considered eligibility for Government support during the covid-19 outbreak.
I am grateful to have the opportunity to move the motion, but I find it genuinely hard to believe that we are having to have this debate again. It is now 16 months since the Government should have filled the gaps on eligibility for their covid support schemes. In that time, I and countless other Members from across the House have raised the issue of the exclusion of 3 million people from Government support. I have personally asked five oral questions, made seven speeches, submitted dozens of written questions and led three debates, yet progress has been minimal.
At the start of the pandemic, I and many others could understand the Government’s argument that it was inevitable that some people would temporarily fall through the gaps during such an unprecedented time. Likewise, I accept and welcome the instances where the Government have taken constructive steps to plug the gaps. I do not dispute that some progress has been made, so I would be grateful if the Minister does not squander his valuable time by simply listing all the things that have been done. Perhaps we could focus on where the gaps still exist.
If it is the role of the Government to protect and improve the lives and livelihoods of citizens, it is incomprehensible that 10% of the working population can be accepted as collateral damage and left to be ground down by poverty and despair by a Government who claim to be business-friendly. Instead of looking backwards at what has already been done, I want to focus on where the gaps still exist and to look ahead to what can be done to tackle the long-term effects of the Government’s decision to let temporary gaps in support become a full-blown crisis of debt, poverty and mental health.
The Minister will be well aware that over 800,000 people have been unable to access the coronavirus job retention scheme due to last year’s real-time information cut-off date. He is no doubt champing at the bit to stand up and give the Treasury a pat on the back for the decision to amend the date to November, but those affected are telling us that this does nothing to support those who missed out on furlough because of their roles as pay-as-you-earn freelancers or annually paid limited company directors. Although the inclusion in March’s Budget of the 2019-20 tax returns for calculating eligibility for the self-employed income support scheme is welcome, the Treasury’s assertion that this will open eligibility to 6000,000 more self-employed people is categorically disputed by campaigners.
Likewise, the discretionary grant funds devised by the UK Government and the devolved Governments have been effective in plugging some of the gaps in places, but the eligibility criteria vary from council to council, keeping some groups excluded based on postcode alone—some because they do not have a premises, and some because they have too many employees. The list goes on. This is something that the Treasury could fix, either by issuing clear guidance on whom councils should consider to be eligible, or by distributing its own grant scheme rather than devolving the blame.
To save the Minister a bit of time later, I am well aware of the Government’s culture recovery fund, but the scheme does not do much at all to support many of my constituents who work in the supply chain—businesses in the events sector that have remained formally open but have been badly affected by the cancellation of live events. Only 3% of the fund went to supply chain businesses in the first round. That figure did rise to 12.5% in the second round, but only because of the campaigning efforts of groups such as We Make Events. Will the Minister explain how he intends to support the supply chain businesses excluded from this fund, rather than repeat the lines that we already know?
Finally on this point, as much as the Government point to universal credit as the last resort when all else fails, the reality is quite different. ExcludedUK estimates that about 60% of the excluded have been unable to access universal credit, often because they have partners working or savings set aside for business expenditures, such as tax bills, which is natural for any self-employed person.
I hope the Minister will be grateful that we have covered what the Government have already done and that we can focus today instead on the gaps that still exist. Some gaps have certainly been filled—I have no qualms about that, and I would certainly not try to detract from it. However, the onus is now on the Government to fill the rest, and not rest on their laurels.
Plenty of solutions have been presented only to end up being dismissed for spurious reasons; they have sat on a Minister’s desk while people who could have been helped languished in stress and deprivation. For instance, proposals for a directors income support scheme were dismissed by the Treasury because of concerns about fraud and an inability to gather data on dividends, despite the scheme using the Government’s own anti-fraud gold standard and avoiding dealing with dividends at all. Where there is political will, there is always a way, and the Government have displayed nothing but a lack of political will in this.
Throughout this sorry saga, the Treasury has shown that it believes that many Members, such as myself, sound like broken records and that the excluded are nuisances trying to swindle public funds. Perhaps there is a bit of projection going on. Time and again, the tone has been nothing but dismissive. The Treasury has used blatant straw-manning to paint limited company directors as fat cats and imply that the majority are actually just directors’ children and spouses.
With the Prime Minister pressing on with the ditching of all restrictions with trademark recklessness, I imagine that Ministers are rubbing their hands with glee at the chance to redirect attention to reopening and simply to dismiss or brush off the excluded as yesterday’s news. However, if the Government think that the end of restrictions will make the issue go away, they are very wrong; for many of the excluded, the hardest times are still to come. The fact that many jobs and businesses have survived until now does not mean that they are in the clear. Those who have been excluded from support have relied on the loan schemes, so by tapering off support now the Government are exposing them to an unimaginable crisis of toxic debt.
In a Westminster Hall debate in November last year, I raised warnings from TheCityUK recapitalisation group that UK businesses will have £100 billion of toxic debt by 2021, with £35 billion of that related to Government schemes. The report warned that up to 3 million jobs across the UK and 780,000 small and medium-sized enterprises are at risk. Now we are standing at the edge of that very precipice, with many having only just managed to scrape by in meeting the first repayment deadlines for coronavirus business interruption loans or bounce back loans. How does the Treasury expect entrepreneurs to reap the benefits of an open economy when the profits of so many are simply going to go straight to repaying ever-mounting debts? How many businesses that were saved through the pandemic will fold, collapsing in debt when the health crisis is finally over? Are the Government really content with giving some companies a competitive advantage by saddling others in the same sector with debt?
As we reopen, things are more uncertain than ever for the excluded, especially with the reopening process likely to be bumpy. As long as covid is still out there, cancellations and changes of plan can create deep uncertainty. Only last week, in my own constituency, Midlothian, a Tough Mudder event that had been planned over the space of seven months was cancelled at 6.30 pm on the night before it was due to start. While the health situation remains uncertain, there must at least be certainty in support, as well as quality decision making, which was sadly lacking in the Tough Mudder case.
The excluded are not a niche group. They are the backbone of our economy: business owners and risk takers. To take one example, the events industry demonstrates its incredible potential to build a world-beating sector that boosts both our economy and our spirits. It relies on the efforts of a diverse and highly skilled supply chain of around 1 million people. Those people’s skills should be used to boost the recovery, yet so many have taken such an economic beating that they literally cannot carry on in their current roles and sectors, with 1 million people leaving self-employment in the last year alone.
For all the Government’s talk of a strong economic recovery, we have been left with a looming toxic debt crisis and the decimation of key industries and sectors. The supposedly strong shoulders of the Treasury are quite happy to shrug off millions of livelihoods, and I have not even mentioned the human cost: poverty, hunger, and a serious mental health crisis. The Trussell Trust reports that gaps in social security have driven people to food banks and that universal credit has been totally insufficient in preventing the excluded from falling into food poverty. Many are already been forced to sell their homes to repay CBILS and bounce back debt. Tragically, some have already taken their own lives. It speaks volumes that groups such as #ForgottenLtd have established formal links with suicide prevention charities such as the Samaritans. I really hope the Minister will join me in expressing a deep appreciation for the work that those charities do in supporting the excluded.
In conclusion, never before has a Government been so complacent about a debt crisis, a mental health crisis and a grave injustice all rolled into one. Let us talk about solutions: backdated parity of support; eligibility for support as we come out of the pandemic; support for repaying CBILs and bounce back debt; delayed repayments; or perhaps even a student loan-style repayment scheme that kicks in only past a certain threshold. Those are just ideas, but they are ideas that the Government need to look at now.
Will the Minister recognise the graveness of the crisis we are about to enter and commit to exploring solutions as a matter of urgency? Doing so will require striking a new tone with campaigning Members and groups such as ExcludedUK and We Make Events, so will the Minister agree to co-ordinate a meeting between the various excluded groups?
It is worth noting that the people who have been excluded watch these debates, and the last thing they want to hear today is another generic list of the people who have been supported. Not only is that a waste of our time, it is an insult to them, rubbing their faces in the injustice of the situation. It is taunting to the level of trolling. I implore him to throw away the script and speak today as though he were speaking face to face with one of the excluded themselves. He should listen to their hardships and their stories and recognise the hurt that is out there, listen to those affected and commit to working constructively to resolve one of the greatest injustices of this generation.
It is a pleasure to serve under your chairmanship, Mr Mundell, and to speak on this subject today. I congratulate the hon. Member for Midlothian (Owen Thompson) on securing the debate.
Like all of us, I have been contacted by constituents from a kaleidoscope of different situations who have been unable to access Government support in spite of having been hit hard by the pandemic and the lockdown restrictions. From visiting businesses in Somerset and talking to owners and managers and those in their supply chains, it seems the economy is like a pointillist painting with apparently discrete specks of colour, but when one steps back they merge into a cohesive picture. The Government have provided huge support to countless businesses and individuals—to many of those specks of colour. It has been unparalleled in peacetime, and the package of support has ended up costing more than £300 billion, with some 14 million people supported. However, some have not been able to access that.
I met the Chancellor a few days ago and talked to him about those people. I very much understand both his intention to try to help as many as possible and the challenges in bringing more into the safety net through proper assessment. Of course, restrictions on livelihoods are about to be lifted. Those who managed to keep the show on the road ought to be back in business very soon, but there will be challenging months ahead, and we should now look carefully at those who have had to struggle without support for the past 15 months.
The different types of ineligibility are numerous and complex. We have the newly self-employed, anyone earning over £50,000 and those drawing their salaries as a dividend. This is a common one in the music sector where I have been trying to get more support. There are those with mixed income and those on zero-hour contracts such as peripatetic music teachers. This is not academic or theoretical. It is tangible and real. I know my right hon. Friend the Minister is more than sympathetic to it. The impact means businesses going bust and mounting personal debt, and there is a particular impact on younger and older workers, new parents, parents of young children and their families. I will not go into the detail of specific cases or numbers. I am sure we will hear more about that and we can argue or dispute numbers. However, we are talking about millions of people.
I hope, as we climb out of the abyss of the pandemic, we have the perspective to take a breath, look closer at overcoming the technical assessment difficulties, which I fully appreciate, and fish more people out of the pond with a net that is slightly more tightly meshed. Without wanting to mix my metaphors, that would protect those specks of entrepreneurial colour that together make up our national economic picture.
It is a pleasure to serve under your chairmanship, Mr Mundell, and I congratulate my hon. Friend the Member for Midlothian (Owen Thompson) on securing this important debate.
I raise the issue of the covid recovery loan scheme, described on the Government’s own website as supporting “access to finance for UK businesses as they grow and recover from the disruption of the covid-19 pandemic”. It also describes how businesses can receive up to £10 million and is clear the Government are guaranteeing 80% of the finance to the lender. Not all lenders appear to be engaged in this scheme, and those who are have varying degrees of enthusiasm—but I set that aside for the moment.
The rules say that eligible businesses must be trading in the UK, would be viable were it not for the pandemic, have been adversely affected by covid, but are not in collective insolvency proceedings—and there is the rub. There was, quite rightly, a large degree of forbearance during the crisis from the public and private sectors but many creditors are now calling in debts that result from covid before debtor companies have returned to pre-crisis cashflow and profitability levels.
I know of many otherwise viable businesses, who in normal times could perfectly well service their debts, now finding themselves financially distressed as a result. They may fall foul of the recovery loan scheme criteria or lenders’ risk management practices if they are subject to a Scottish decree or an English county court judgment. In short, they are being punished for being adversely affected by covid—one of the criteria to get the money in the first place—and are unable to apply for funds because of how that impact is being felt. Decisions by the lenders and banks are more irrational precisely because the Government are guaranteeing 80% of the loan.
I hope the Government will put pressure on the lenders to take part in the scheme and persuade them to analyse the underlying viability of a business, rather than issuing a hard no simply because of a CCJ or a decree. It would be irrational if a business meets the criteria of being adversely affected by covid, but is denied access to the help it needs at precisely the time it needs it the most because the financial distress caused has resulted in a court order.
I will briefly raise another problem. I have been told by a business finance brokerage that of the 60 businesses he has supported to make full applications for the recovery loan scheme, only a single, solitary one has received the money, and that is deeply troubling.
I am grateful to serve under your chairship for the second time in one day, Mr Mundell. I congratulate the hon. Member for Midlothian (Owen Thompson) on securing this debate.
In March last year, the Chancellor declared that the Government would do whatever it takes to support the country through the covid-19 crisis. While the furlough scheme, which the trade unions were central in establishing, and other financial support have provided a lifeline for millions, sadly far too many individuals and small businesses have still been excluded. I have countless constituents, most commonly the self-employed or owners of small businesses, contact my office saying they have gone a year without receiving any financial support, despite not operating at anywhere near their normal capacities. Time and again, the Government have ignored those excluded from financial support. To be clear, any policy that seeks to ensure financial security while tackling the pandemic must include, above all else, listening to the voices and experiences of people such as my constituents, and addressing their concerns.
When the Minister sums up, will he consider the following two proposals? First, will the Government expand the eligibility requirements for the fifth grant of the self-employment income support scheme. Millions of self-employed people have faced considerable hardship, which has left many of them in serious debt and poverty, struggling to make ends meet with little or no income. There are more than 1 million people who receive less than 50% of their income from self-employment or who have profits in excess of £50,000. They must receive a reprieve after facing uncertainty and financial insecurity for more than a year.
Secondly, the Minister cannot use the lifting of restrictions to wash his hands of offering financial support through this crisis. Some businesses will still be severely hampered despite the planned lifting of almost all restrictions. I am largely thinking of those in the aviation and travel sector, including an independent travel agent in my constituency. Sectors such as these may need long-term, targeted and tailored financial support to survive.
I will draw my remarks to a close. The pandemic disrupted many businesses, but the support offered by the Treasury failed to meet the needs of those small and medium-sized enterprises, including in my constituency, that no doubt will have, or have already had, no choice but to close, through no fault of their own.
It is a pleasure to speak with you in the Chair, Mr Mundell.
Since the first covid cases in the UK were identified in York 18 months ago, we have been inundated by businesses that are challenged. Although Government relief has been welcome, those ineligible for it have struggled. As covid cases soar again, we worry. This last year, those denied help have seen their life’s work slip through their hands. Many self-employed directors are an example, as are those in the tourism, theatre, events and travel sectors, and those in the supply chains. Even when safe solutions were offered, the Government simply said that they were unwilling to build the capacity to implement them.
Often, it has been the inconsistencies in Government guidance and support that have caused confusion and hardship. For instance, caravan parks with shared showers were open but holiday flats with shared hallways were closed, and those running them were not eligible for support.
As restrictions lift, we are already seeing infection levels spike in York, meaning staff isolating and businesses closing. It is set to get worse, given the Government’s illiterate plans. The economy is being hit and loyal customers are retreating into their homes, once more feeling unsafe. Reality and Government rhetoric are far apart in communities such as mine. The Government have seriously misjudged things and once again businesses and charities are calling for help, both for now and the longer term. Ineligible for support, they cannot depend on this season either. They urgently need a bridge to carry them through, so that they can then grow again.
I will turn to charities. On 8 April, the Government provided support lasting just 12 weeks. Charities have been ineligible for much Government funding. Many have had nothing at all and have had to cut back, yet all the while demand for their services has increased. Understanding of this sector, which forms a crucial part of our social infrastructure, has been severely lacking from the Treasury, which fails to recognise the role that charities have played throughout the pandemic and will play throughout the recovery. Generic schemes simply do not work for them. Will the Minister at least meet the sector’s leaders and listen to their calls for the support they need right now?
Perhaps the most frustrating thing of all has been how impervious the Treasury team have been when they have been written to. We hold the future of local companies in our hands, but we have been given a stock response, often unrelated to the issues that we have been trying to resolve. Businesses have been ignored; support has been denied. Recovery funds for businesses and charities are needed. While the Government are trying to race on, covid infections are racing up. Businesses and charities that have worked so hard to cling on feel that the rope is being cut. We have called for help; we have offered solutions. All we need is for the Government to engage, to rebuild socially and economically. That need has never been greater than it is now.
It is a pleasure to share in this debate under your chairmanship, Mr Mundell. We go back a long way. I congratulate the hon. Member for Midlothian (Owen Thompson) on securing this important debate.
I wish to talk about a subject that I have mentioned before: insurance for live events. Even those who have been eligible for support will struggle in the recovery phase if they are unable actually to stage live music events. Many events cited by the Government as examples of cultural recovery fund support have been unable to go ahead this year due to a lack of insurance, including huge events such as the Glastonbury festival.
Why are they cancelling? Because they cannot get commercial covid insurance cover, or not at a competitive rate. Since January, I and others in all parties have been calling for the Government to put in place a Government-backed covid cancellation insurance solution. I have said it before, but such a scheme is not unprecedented. It has been done before with insurance for terrorism losses and—I point out yet again—the Government made a profit on that, which is worth remembering. I have said that repeatedly to Ministers and I hope that they will heed my call.
If we do not get events back up and running again, I fear that, in addition to losing good events in this country, we will erode something that is very important to Britain. Our culture and music are part of our soft power and, as we know, people come from all over the world to attend such events. Again, that is exactly why it would be helpful if insurance could be put in place.
Before I conclude, as Members know, I have the honour of being the joint chair of the gaps in support all-party parliamentary group. I want to put on the record my sincere thanks to my joint chairs and all the many Members who pulled together to form the APPG. I think it is the biggest in the history of the House of Commons. That shows just how important the issue that the hon. Member for Midlothian has brought to our attention today is.
I echo the thanks and appreciation to my hon. Friend the Member for Midlothian (Owen Thompson) for securing this debate and for the comprehensive way in which he set out the challenges faced by too many people. More than 3 million people went to work every day to pay their bills and to look after their families, only to find that when coronavirus took hold, the Government built a lifeboat called furlough—but they were not allowed a place on that lifeboat. In what at times appeared to be an act of random cruelty, they were left without support for themselves or their families.
When those people complained about their concerns, or their elected representatives did so on their behalf, the Government simply responded by pointing out all the support that was available for other people, as though the excluded could be comforted by the fact that their exclusion from support would be made more bearable by knowing that others had received support. I sincerely hope that the Minister does not repeat that bizarre cycle when he gets to his feet.
In fact, the self-employment support scheme failed to help most self-employed workers, with many left out in the cold. As the Government gradually withdraw furlough support—too early in my view and that of many others—it is clear, and has been for some time, that the excluded are to remain so. They have been left to manage as best they can.
On 25 March 2020, the Prime Minister promised to put his
“arms around every single worker”.—[Official Report, 25 March 2020; Vol. 674, c. 334.]
But he did not and he has not, despite all entreaties to do so. Now, we face a summer of redundancies, as furlough has started to be eased back before firms have had the time to scale up. Families will fall further into debt and many will fear losing their homes, while we see the scandal of lucrative covid contracts for pals without formal processes, as well as all the other questionable practices that were set out in the House of Commons in a debate earlier this afternoon.
It makes no economic sense to force people on to benefits rather than support them with assistance that might just enable them to keep their businesses and their jobs up and running, helping them to reach a point where they can again start to generate tax revenues. It is bad enough that millions were excluded from Government support, but if the purpose of furlough was to save jobs, as we were told, removing it before businesses have had time to scale up their operations runs counter to that aim. The Minister should reflect on that. I urge him to urge the Chancellor to tread carefully and realistically when people’s livelihoods are at stake.
It is a pleasure to serve under your chairmanship, Mr Mundell. I thank the hon. Member for Midlothian (Owen Thompson) for securing this important debate.
It is excellent that more than 10 million people in the UK have been able to benefit from the extended furlough scheme throughout the pandemic. However, for many people, access to much-needed funds was marked by one bureaucratic nightmare after another. For one group in particular, the challenge of receiving financial support is ongoing. The Government have repeatedly failed to reconcile the glaring imbalance in access to covid-19 support for the self-employed. Many self-employed workers continue to be unfairly marked as ineligible for Government support schemes.
Throughout the pandemic, I have received distressing emails and phone calls from constituents excluded from funding because of the obscure eligibility rules for the self-employment income support scheme. One such constituent started a business five years ago and in that timeframe experienced one year of minimal profit. Because of the initial year’s lack of return, they were deemed ineligible for funding. This constituent’s appeal to the Government to discount their start-up year fell on deaf ears and their appeal was rejected without due consideration of their circumstances. If the Government are to ensure that the process of granting SEISS funds is fair, they must do a much better job of providing transparent guidance for this seemingly arbitrary system of eligibility.
Although circumstances vary in detail, my self-employed constituents have collectively faced needless obstacles in trying to access grant money that they deserve. The difficulty, and often inability, of many of them to access Government funds has become the rule, not the exception. The Government must do better at offering accessible support to the self-employed instead of blocking them through non-uniform exceptions.
As we discuss continued access to covid-19 relief refunds, I also urge the Government to consider the devastating consequences of cutting off overall grant access too quickly. Over the past 18 months, businesses—particularly small, independent businesses—have faced a devastating financial fall-out from covid-19. They have seen their savings depleted, taken on massive loans and bent over backwards to accommodate safety restrictions, often at great expense. UK businesses have borrowed more than £75 billion during this pandemic, and it will take many small businesses decades to pay back loans.
This month, banks will begin to ask for the first repayments, and if the Government withdraw financial support completely, small business owners will need to grapple with repaying huge debt, often with little savings, with no safety net. The Government simply cannot throw small businesses under a bus. Instead, they must be prepared to provide greater flexibility on repayments and to consider what grants should continue to be made available for the self-employed and small business owners over the coming months as the economy recovers from the pandemic. Simply cutting away all existing support and then demanding repayment is a recipe for disaster.
It is a pleasure to see you in the Chair, Mr Mundell. I warmly congratulate my good and hon. Friend the Member for Midlothian (Owen Thompson) on securing the debate, on his consistent leadership on this topic and on looking after small businesses and folks in Midlothian and elsewhere. That has been really important. I also pay tribute to ForgottenLtd and ExcludedUK, two great organisations that have worked cross-party to represent people who really have needed a voice throughout this process.
There is strong representation from the SNP in the debate because a lot of people are being let down by the UK Government at present. I pay tribute to the UK Government for what they have done, but we have to engage with them because under the current constitutional arrangements—and contrary to our worldview—the UK Treasury holds most of the purse strings. The Scottish Government have some flexibility, as does local government in Scotland, but they do not have most of the levers that we have needed, as we have seen throughout this crisis. It is important that we make sure that decisions taken on Scottish taxes mean that they are spent well—or, in this case, that the debt taken on our behalf is.
The UK Government have not been idle—I acknowledge that. A lot of these decisions had to be made at speed, and the situation has moved very fast. However, as we heard from my hon. Friend, the excuses for excluding people in the early days do not wash any more. Deliberate policy choices have excluded millions of people from Government support. We have seen corporate welfare for big organisations and organisations that were already in the system, but a lack of flexibility has meant that a lot of people have been missed out. That is curious and I find it difficult to conceive the logic, because one would have thought that the real lifeblood of the economy—the entrepreneurs, the pram shops, the company directors, the music shops and the gym owners—would have been prioritised a while ago by the Conservative party, but that is not what we have seen in reality.
I am conscious of time, but I want to make a plea of the Minister. We are very far from out of this crisis. There has been a lot of cross-party work and I am doing my best not to score party political points here. We need to find solutions for a lot of people who will need long-term support in the future. I am thinking in particular of hospitality businesses and event businesses—businesses that will struggle with the transition from furlough to non-furlough. The idea that we will be out of this crisis in a matter of weeks is for the birds. We must keep these doors open and we must be flexible about better targeted means of support for organisations. If that is the way the Minister will go forward, he will find a ready ally in the SNP, because we must find solutions. It is too important for party politics.
It is a pleasure to speak in this important debate with you in the Chair, Mr Mundell, and I congratulate the hon. Member for Midlothian (Owen Thompson) on securing it.
Over the past 18 months, the people of this country have made extraordinary sacrifices to control the spread of coronavirus and to protect one another. At every turn, they have done what was required of them, but the Government have not been as reliable or committed. The financial support schemes put in place have often fallen short of what was needed. As we have heard, more than 3 million people have been excluded from Government support throughout the pandemic. Be it zero-hours workers who have been denied furlough by their employers, or sole traders who were excluded from self-employment schemes because of their registration status, the Government have consistently failed to plug the gaps in their support packages.
The greatest impact on many people in my constituency has been the gap between furlough and the self-employment income support scheme. For those working in the creative industries, it is common to work across a mix of short-term, pay-as-you-earn contracts and self-employed contract work. Unless more than half their income came from self-employed work, they could not get any support through the self-employment income support scheme. However, unless they happened to be working on a pay-as-you-earn contract at the start of the pandemic, they could not be furloughed.
People trapped in that situation have been left without support for 18 months, causing immense financial stress and leaving them trying to make impossible choices. Savings have been used up and I have heard from constituents who simply do not see how they can continue to pay their bills. I want to put it in their words and express their hurt. A constituent of mine who is self-employed and normally works in the entertainment industry described their situation:
“Through no fault of my own I’ve had no income since the grant in late November…It has been incredibly difficult trying to get through the last few months…All I want to do is earn a living in the way I have for the last 20 years. I’ve never asked for help and over the years I’ve had many ups and downs, but I need help now. The bills are mounting up and the wolves are at the door…I’ve had no option of work for 8 months out of the last 11.”
Another constituent described how they now owe money to HMRC:
“After being excluded and denied furlough for over a year, I now find myself somehow owing HMRC”
a sum of thousands. They continued:
“There has been no work, and schemes and jobs I applied for were suspended. I have no idea how I am going to be able to pay it back. I feel it is so unfair how I am being treated as a taxpayer. For me it’s like I’m being blamed for what the government did which isn’t my fault”.
As we move forward, my constituents and others excluded from the schemes need real financial support to make up for the debts that they have built over the last year. I hope the Minister can confirm that support will be offered as soon as possible.
It is a pleasure to serve under your chairmanship, Mr Mundell, and I thank the hon. Member for Midlothian (Owen Thompson) for securing the debate.
The increase in debt as a result of the coronavirus has been significant, and it has been particularly bad among groups of people who have fallen into the gaps of various furlough and other schemes. There seems to be an enormous lack of balance in who has been helped during the coronavirus pandemic. For example, if your name is David Cameron and you have a few handy phone numbers, you seem to have managed to do much better, by lobbying the Department for Business, Energy and Industrial Strategy eight times, whereas if you are a single parent living in Wood Green, you have been much more disproportionately affected by debt.
There are a number of options I believe the Government should look at to address some of the issues raised in this afternoon’s debate. First, they should review their decision, or impending decision, to take back the £20 per week top-up that they wisely gave to universal credit recipients earlier in the crisis. Now would be absolutely the wrong time. If we were to take a vote in this room, I am sure the answer would be that it was the wrong thing to do right now.
Secondly, the Government should take up the recommendations of the Excluded UK all-party parliamentary group, which the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) has already mentioned—he has very much led from the front on that. We have heard from a number of people, particularly in the creative sectors and in travel and aviation, about the uncertainty and the increase in rent. For example, in my constituency, a poor travel agent has been hit with a rent bill that has increased by 45% during this terrible time.
I would also like the Government to ensure that every single citizens advice bureau in the country is properly funded and that there are sufficient volunteers. I pay tribute to Daniel Blake, chief executive of my own CAB, and Lorna Reith, the chair. Other Members, too, will have excellent CABs.
Finally, the impact on many of the terrible ineligibility for schemes has led to an exponential growth in food banks and 1.3 million more children eligible for school meals—1,700 in my own local government area. We live for a future where there are no food banks. That rise shows the terrible situation for many who work in the informal economy and for small and medium-sized businesses. I look forward to the Minister’s speech.
Thank you, Mr Mundell. I am pleased to sum up for the Scottish National party this evening. I commend my hon. Friend the Member for Midlothian (Owen Thompson) for securing the debate, and, as others have mentioned, for his tenacity in refusing to let the excluded become the forgotten. I commend everyone else who has contributed.
I summed up in a Petitions Committee debate on the same subject in December 2020. Most of what has been said today was said in December 2020. It was ignored then. It cannot continue to be ignored. What did not happen in December 2020 did not happen today either. Nobody has made a fulsome defence of the Government’s action, or inaction. In 2020, eight Conservative MPs spoke. None of them defended the Government. In 2020, we got platitudes and fake sympathy from the Minister who responded. I hope that that is one thing that will not be repeated here tonight.
There is a saying much loved by a certain type of business analyst, which is, “If you fail to plan, you are planning to fail.” That is exactly what the Government did in the 10 years between knowing that a serious potentially lethal viral pandemic was coming and it actually appearing. They planned for the public health implications. There was no planning at all as to what they would do in the almost inevitable situation where significant sections of the economy would have to be shut down to protect public health from the ravages of the virus.
It is safe to say that when the Prime Minister made his famous, or infamous, “Don’t go to the pub” speech, neither he nor the rest of the Government had any idea what they were going to do to protect those in the hospitality sector from the immediate and inevitable collapse of their businesses, or indeed, to help anybody else in any other sector. An indication of how hasty and ill-thought-out the Government’s response was is that one of the mainstays of that support, announced on 11 March 2020 —the business interruption loan scheme—had to be completely rewritten 23 days later.
It would be tempting to assume that that same chaotic, shambolic approach is the reason that so many self-employed people and small business owners got overlooked, but that would be wrong because it was not a mistake. It was not an oversight. It was not an accident. It was absolutely deliberate.
The Chancellor told the House in his 11 March Budget statement last year:
“There are millions of people working hard who are self-employed or in the gig economy. They will need our help too.”—[Official Report, 11 March 2020; Vol. 673, c. 280.]
He knew—the Government knew—that those people did not fit into the packages of support that had already been identified, but he went on to announce that the help they were getting was being allowed to apply for universal credit—a benefit that has been deliberately designed to be not enough to live on for any sustained period.
Let us look at one group of excluded workers: people who were persuaded in the past, by previous Governments, to set up their self-employed business as a limited company with themselves as the only shareholder and themselves as the only director, or perhaps with a close family member as another director. When the Government claimed in May 2020 that they had not had time to work out proper eligibility criteria to apply to that massive group of workers, that was tenuous, two months into the pandemic. It is beyond ludicrous to continue—to keep saying that 16 months in—but that is exactly the excuse the Government are using. The other excuse is that it is too hard to tell the difference between a shareholder of a company who actively works in the company and a shareholder whose only involvement is to take the dividends at the end of the year.
This is not difficult; it is not rocket science. It is easy. If only Governments and Government agencies were as willing to use data-matching technology to help people through a crisis as they are, quite rightly, to use it to catch benefit fraudsters and other crooks fleecing the finances of the public sector. That is all it needs; it needs only the will. If the Minister, as I expect, is going to defend the Government’s inaction, all I ask of him is that he do the excluded the courtesy of admitting to them that the reason the Government are doing nothing is that the Government do not care.
It is a pleasure to serve under your chairship, Mr Mundell. I congratulate the hon. Member for Midlothian (Owen Thompson) on securing this important debate and thank all hon. Members for their contributions. My hon. Friends the Members for Edmonton (Kate Osamor), for York Central (Rachael Maskell), for Coventry North West (Taiwo Owatemi), for Worsley and Eccles South (Barbara Keeley) and for Hornsey and Wood Green (Catherine West) all made passionate speeches on behalf of their constituents. I hope the Minister will address their specific points.
For nearly 16 months, Labour has argued that public health measures and economic support must go hand in hand. We have called on the Government to address the gaps in support and ensure that no one is left behind. We have called on the Government to do more to support businesses and workers in the most affected industries. Time after time, we have called on the Government to fix the broken self-isolation system and ensure that no one is financially penalised for doing the right thing. Too often during the past year and a half, the Government have either ignored those calls or acted too slowly.
We are at a critical moment in the pandemic and the economic recovery. Thanks to our scientists and NHS staff, the vaccine roll-out is providing a route back to normality. We all hope that that will arrive sooner rather than later. In the meantime, businesses and working people face an uncertain future. Many companies worry about how they will clear covid debts over the coming years. Workers on furlough worry about whether they will have a job to return to. Millions of people who have gone without support simply worry about how they will make ends meet.
As hon. Members have said, a variety of groups have been repeatedly left out of the various covid support schemes. Those groups include people who make less than half their income from self-employment, company directors of small businesses, and people who regularly move between jobs in common creative industries. I want to use this opportunity to pay tribute to the many organisations that have made their voices heard on the issue—ExcludedUK and the trade unions, including Community, Prospect and the Musicians’ Union. Many of those excluded face mounting debts, which have been building during the pandemic. Therefore, will the Minister set out the Government’s plans to address both personal and business debt?
When asked what support is available for people who have been unable to access various covid schemes, Ministers have pointed to universal credit and the £20 uplift, but the Government propose to cut that very uplift completely in September. On Monday, six former Work and Pensions Secretaries—all Conservatives—called on the Government to rethink cutting universal credit for 5 million households. I truly hope that the Government will think again about that disastrous decision.
Let me turn to the winding down of the covid support schemes for businesses. Last week, the House of Commons Library produced new analysis showing that just under 400,000 businesses in England—400,000 businesses—will be affected by the cut in business rates relief for retail, hospitality and leisure businesses from 1 July. Many of those businesses will face significant restrictions on their ability to trade until 19 July. At the very moment those businesses need support, the Government are sending them a bill.
We have called on the Government to learn lessons from the Welsh Government, who have given the majority of businesses 100% rate relief for the financial year. At the same time, the Government have increased employer contributions despite the fact that many businesses remain closed and most people who are still on furlough are employed in the sector affected by ongoing restrictions. I urge the Government not to repeat the mistakes of the past, when too many people fell through the gaps, and to introduce a comprehensive system of self-isolation support without delay.
It is pleasure to serve under your chairmanship, Mr Mundell. I am grateful to the hon. Member for Midlothian (Owen Thompson) for bringing the debate to Westminster Hall and to colleagues across the House for their comments and remarks.
I have been very struck by the difference in tone among the contributions made. There has been a lot of denunciation, but there has also been a rather fair-minded strand of discussion that acknowledged the extraordinary circumstances in which we as a nation have been placed, and the scale and effectiveness of the Government’s interventions. I particularly thank my hon. Friend the Member for Somerton and Frome (David Warburton), the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) and the hon. Member for Stirling (Alyn Smith) for their fair-minded engagement with the issue.
If I may, I will talk a little about where we are and then come to the questions raised by colleagues. Let me be perfectly clear—it is important, as the hon. Member for Midlothian and others mentioned, for us to be tonally clear—that the Government absolutely understand the depth and difficulty of the situation that people have faced throughout the pandemic. That is why we have tried to support as many people and businesses as we possibly can, and to do so as quickly and as effectively as possible. The hon. Gentleman was highly dismissive of that, but actually, I am pleased to say that other hon. Members were not; they recognised that the Government provided a very wide-ranging package of national financial assistance worth over £350 billion, and that international commentators have recognised that. I think of the International Monetary Fund, which described it as
“one of the best examples of coordinated action globally”.
Those packages and bits of concentrated but wide-ranging support include the coronavirus job retention scheme—CJRS—which has supported 11.5 million jobs since its inception, and the self-employment income support scheme—SEISS—which has so far provided grants to almost 3 million people.
I am not giving way; I am sorry. I have no time whatever and I want to respond to all the comments made in the debate.
It is understood that the schemes continue to be the most generous of their kind in the world, and it is recognised by all fair-minded people that as restrictions start to ease, economic activity and demand will pick up. The Government need to tailor support accordingly, and that is why—I refer to the hon. Member for Edmonton (Kate Osamor)—we have announced that the fifth and final SEISS grant will have the value of the grant determined by a turnover test. That is because of the need to target support towards those most affected by the pandemic. I do not think that is a principle that people should wish to contest, given the overall financial impact of the crisis on taxpayers. For that reason, in relation to CJRS, we have also introduced an employer contribution.
Let me focus for a moment on the effects of that set of interventions. In its May forecast, the Bank of England projects the economy to return to its pre-crisis level by the end of the year—significantly earlier than previous forecasts. At the start of the crisis, forecasts suggested that unemployment would reach 12% or more. The numbers are now close to half that, which could mean almost 2 million fewer people losing their job than originally feared. We hope it must be so.
The five SEISS grants combined will have provided individual claimants with support of up to £36,570. That makes clear the scale of the support. I recognise, of course, that some people have not been eligible or not been able to receive support from those schemes. That is why so many other aspects of the interventions, including the support for local authorities, have been put in place.
If I may, let me pick up on some of the points made by colleagues. It was suggested by the hon. Member for Midlothian that the Government were somehow dismissing solutions that have been put in front of us by reputable independent groups for, as he put it, “spurious reasons”. Nothing could be further from the truth. As the hon. Member for Caithness, Sutherland and Easter Ross recognised in another context, we have leant into all those debates.
We carefully scrutinised the TIGS and DISS—target income grant scheme and directors’ income support scheme—proposals. In different meetings, I have met groups including the Federation of Small Businesses, ForgottenLtd, ACCA—Association of Chartered Certified Accountants—the gaps in support group, the Refused Furlough Group, the maternity petition campaign, Forgotten PAYE and a host of others. We will continue to entertain, and we very much welcome, thoughtful interventions designed to help us, recognising the constraints under which we operate.
The trouble, as I think colleagues understand, is that we are caught by the need to put in place schemes that respect fraud and error concerns. Let me remind colleagues, including the hon. Member for Glenrothes (Peter Grant) who raised this, that the very people who would denounce the Government for failing to extend support would themselves be the very ones to denounce the Government if it turned out that the fraud and error incurred by overly expensive support were to lead to a loss of revenue to the taxpayer. People cannot have it both ways. We are trying to bend over backwards to support those groups, and in many respects we are doing so.
Let me pick up a few other words. The hon. Member for Midlothian talked about “straw-manning”, but nothing could be further from the truth. There is no suggestion on my part that any limited company director is a fat cat—absolutely not. We recognise that in many cases those are extremely effective individuals. What we are trying to do is find an effective way to meet all the constraints I have described when supporting the wide range of people who have been affected.
The hon. Gentleman talked about debt management. Let me remind him that we have put in place a pioneering VAT deferral new payment scheme and that HMRC has made it clear that it is trying extremely carefully to manage the impact of different tax schemes and tax reliefs, and the withdrawal of those reliefs, on different groups.
The hon. Gentleman talked about whether the Government will show appreciation for the charities that support people through the crisis. Of course we will. We have expanded support for voluntary and charitable groups with HMRC. We very warmly support and recognise—and, as I said in another context, I work closely with—the Low Incomes Tax Reform Group, specifically trying to support people on low incomes. Of course we are working as hard as we can, and we have been for 15 or more months, to make things work.
Let me pick up a couple of important points made by other colleagues. The hon. Member for Stirling kindly referred to the work that the Government have done. He acknowledged, rightly, that the devolved Administrations and local authorities do have resources in part—they are heavily resourced by UK Government. In many cases, they have the capacity to amplify and extend their resources through local taxation of their own. That flexibility is one that they may wish to use in support of local people. I would support and welcome that as an exercise in devolved responsibility. With that, let me sit down.
I thank all hon. Members for their contributions. Clearly, across the board, there is a recognition that those gaps still exist and a frustration that, again, we are not hearing anything about how they can be addressed. I played out a hope that we could look forward, instead of backwards, but that has clearly not happened. The record will show that I was very welcoming of the support that has been provided to those who have it, but that is no comfort to those who have been left out.
In July 2020, the Chancellor said that although hardship lies ahead, “no one” will be left behind; he did not say “as many people as possible”. In October 2020, the Prime Minister said:
“We are wrapping our arms around the country to give people the support they need to get through this.”
That has not happened. On that basis, it is safe to say that this is clearly not the last time that we will have this conversation.
Question put and agreed to.
That this House has considered eligibility for Government support during the covid-19 outbreak.