Rachel Reeves
MP for Leeds West and Pudsey · Labour · United Kingdom
“I thank my hon. Friend for his question and his work on the Treasury Committee. On pensions reform, through the Mansion House accord and Sterling 20, we have got pension funds to commit to investing more in British businesses, both through British venture schemes and in British infrastructure.”
“I thank my hon. Friend for her question. As Members will know, this Government are working on plans with our NATO allies for a multilateral defence mechanism. We have already signed a treaty agreement with Finland and the Netherlands, and we are working closely with Scandinavian, Baltic and eastern European countries.”
“At a time of great global uncertainty, it is more important than ever that we deepen ties with our closest allies and biggest trading partners, whose values we share, and whose interests are bound to ours.”
“Today the Government have responded to the covid counter-fraud commissioner’s recommendations in a report that I commissioned, which confirms that the Conservative Government left the door open to more than £10 billion of pandemic fraud.”
“As I just said, the DIP will be published before the summit. It will involve more money spent more effectively, and it will meet the scale of the challenges we face. Frankly, I will take no lectures from the Conservatives, who left our armed forces, in the words of their former Defence Secretary, “hollowed out”.”
“I thank my hon. Friend for bringing the story of Darren and Nicole to this House. I hope that they and their children will benefit from the change I made to the two-child limit for universal credit, as well as from the rolling out of free breakfast clubs to all primary schools, and the introduction of free school meals for all children wh…”
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“Specifically on the bedroom tax, we have said that we would cancel it by closing the loophole in the shares-for-rights scheme, the bogus self-employment in the construction sector, and the tax credit that the Chancellor gave to hedge funds in the Budget earlier this year. We have been very clear about how we would pay for this. In the hon. Gentleman’s local authority of Birmingham, 2,100 households are being affected; I wonder whether he might speak for them and their concerns. The implementation of the bedroom tax has been a shambles. Ministers have been unable to explain whether the policy is supposed to reduce overcrowding or whether, as their costings assume, people are expected to remain in their properties.”
“According to the latest numbers from the National Housing Federation, two thirds of the households hit by the bedroom tax have already fallen into arrears, hitting the finances of the very housing providers we need to be building more homes to deal with overcrowding, and a staggering one in seven of the tenants affected have already received eviction warning letters.”
“Let us see where Bradford is by the end of the financial year, not just six months into it. Many of those who are moving because of the bedroom tax are ending up in private rented accommodation which, though smaller, is more expensive. Analysis by the university of York suggests that this could mean the Government paying out £160 million more in housing benefit than had been budgeted for. Ministers have also been forced to admit that 35,000 of the disabled people affected have had their homes specially adapted for them with, for example, wheelchair ramps, wider doors, stair lifts and accessible bathrooms. If they are forced to move, it has been estimated that the costs of repeating those adaptations in new properties could be as much as £234 million.”
“In my hon. Friend’s local authority area—Nottingham city council—200 people have been wrongly paying the bedroom tax because of this Government’s mistakes. She is absolutely right to mention the number of people in her area who are in arrears and the difficulties they will have in moving. The eviction warning letters that have gone to so many people raise the threat of millions more being wasted in eviction proceedings and the emergency accommodation that will be needed for those who are made homeless. What a shambles.”
“The Government should instead do the right thing and cancel the bedroom tax.”
“But as the hon. Lady well knows, the reality is that for many of these people it is not a spare bedroom. It is the bedroom that their sons and daughters who serve in the armed forces stay in when they come home; it is the bedroom that their sons and daughters stay in when they are home from university; it is the bedroom that is used to store the dialysis equipment; and it is the bedroom that the carer comes to stay in. These are not spare bedrooms; these are rooms that are needed by many people with disabilities or with children. We can debate whether it is a spare room subsidy or a bedroom tax, but what we do not have to debate is the impact it is having on people. In the hon. Lady’s constituency and mine, and in places across the country, people are suffering because of the decisions this Government are making.”
“All that money could have been spent on building the houses we need to deal with the overcrowding crisis and other crises of which the Government speak; instead, house building is at its lowest level since the 1920s. Let me turn to the loophole. Just when we thought that things could not get any worse, the latest shocking turn in this sad and sorry story was the revelation last month that because the Government could not even draft their own legislation and regulations correctly, many of the households that they had told local authorities should be made to pay the bedroom tax—those who had been in continual receipt of housing benefit for the same residence since 1996—were in fact not covered by the legislation.”
“The facts speak for themselves: two thirds of the households hit by the bedroom tax have fallen into arrears and councils up and down the country are trying hard not to evict people, because they know it is the wrong thing to do. They are trying to help people and we should welcome that and applaud them for doing the right thing, unlike this Government, who are failing to do the right thing.”
“The right hon. Gentleman knows full well that this scheme is retrospective in a way that the scheme for the private sector was not. The people affected by this loophole have been living in their properties since 1996. They thought they had a secure and permanent tenancy, but it turns out that they do not, because they cannot afford to live in the home they have lived in for, in some cases, their whole lives.”
“A 56-year-old woman from Rotherham, who receives support for health-related problems, has had to pay more than £700 in extra rent, which we now know was unlawful. In Greater Manchester, a grandmother who looks after her granddaughter, has been diagnosed with depression and anxiety and who paid £200 in additional rent as a result of the bedroom tax fell into arrears and was threatened with eviction from the home she has lived in for 26 years. These people and many like them are now due a rebate, but nothing will compensate for the distress they have been caused or the time and money that the council will have to spend sorting out the mess this Government have caused. And now the Government want to apply the bedroom tax again to these people and thousands of others like them.”
“I shall not give way to the Secretary of State, because he will have a chance to respond in a few minutes and I look forward to hearing what he has to say. Let us take a moment to reflect on what this means. The Government have been telling local authorities to take housing benefit away from people who were in fact legally entitled to it all along. Most of these people were already in vulnerable positions and will have been pushed even further into severe hardship as a result of this Government’s errors. Let us look at a few examples. A widower in Staffordshire suffering from mental health problems told of the sacrifices he had to make to find the extra £14 a week he needed to stay in his home.”
“Councils up and down this country have been put in an impossible position, and people in need have been put through needless anxiety and uncertainty. As I have said, money that could have been spent on building houses has been spent on having to sort out this mess. It beggars belief that like universal credit—another of the Government’s flagship welfare reforms—this policy has become mired in chaos, confusion and spiralling costs.”
“Today is our only opportunity to stop the Government closing the loophole, and to urge them to cancel the bedroom tax altogether. We have a chance this afternoon to walk through the Lobbies and either to stand up for our constituents or to stand against them, as this Government have done repeatedly. Many of the people who have wrongly paid the bedroom tax have already been forced to move and have fallen into arrears with their rent. Because many local authorities do not have electronic records back to 1996 to allow them easily to identify cases that meet the relevant criteria, they have been forced to spend time and money on manual trawls through paper files to begin to sort out this huge mess. What a waste of time and money, and what a mess caused by this Government’s incompetence.”
“—[ Official Report , 13 January 2014; Vol. 573, c. 577.] The next day, Lord Freud, the Minister for welfare reform, said in another place that “the numbers involved in this anomaly are small and the amounts are modest.” —[ Official Report, House of Lords, 14 January 2014; Vol. 751, c. 106.] At oral questions this week, the Secretary of State told me that “some 5,000 people may be affected.” —[ Official Report , 24 February 2014; Vol. 576, c. 19.]”
“Closing the loophole will indeed cost a huge amount of money—borne by local authorities that will have to do the work to sort out this mess. Even as they seek to close this loophole, the Government do not have any understanding of the number of people affected by it. We asked Ministers on the Floor of the House to tell us how many people have been unlawfully charged the bedroom tax as a result of the loophole. On 13 January, the Minister of State, Department for Work and Pensions, the hon. Member for Wirral West (Esther McVey), who has responsibility for employment, told us in a written answer: “This information is not available.” —[ Official Report , 13 January 2014; Vol. 573, c. 449W.] On the very same day, the Secretary of State told us in this House that “the number is likely to be between 3,000 and 5,000”.”
“The chaos, confusion and extra costs are mounting, with the heaviest price being paid by the poorest and most vulnerable. The Government should scrap the bedroom tax today, but instead they are making it apply to an extra 40,000 households. If this Government will not scrap the bedroom tax, the next Labour Government will do so.”
“That is on the basis of responses from barely half the councils, while many of them have said that they cannot give complete answers that include housing association tenants. It is therefore already clear that not only have this Government made a complete mess of their own policy, but they do not even have a clue how many people are affected by the loophole. The Government have responded to this fiasco by scrambling to cover up their own mistake. They introduced a statutory instrument to close a loophole in their own legislation, without even giving this House an opportunity to scrutinise and debate it; it is only through this Opposition day that we can have a vote, which is why we called this debate today. The bedroom tax was misconceived from the start, and it has been incompetently executed every step of the way.”
“That is what we are calling on the Government to do today—to scrap the bedroom tax altogether. We had no idea of the numbers affected and the Government clearly did not have a clue, so we asked the question that they should have asked: we asked local authorities how many people have been affected. Of 378 local authorities, 197 have now responded, including Birmingham city council, where 2,100 households are affected, Cardiff with 220 and Glasgow with 913, as well as Tory local authorities, such as Cheshire West and Chester council, where 275 households are affected, Tory Peterborough with 200 and Tory Wandsworth with 234—the list goes on. In total, our replies so far suggest that 21,655 households have been affected.”
“On 13 January, the Secretary of State told this House that between 3,000 and 5,000 people were wrongly paying the bedroom tax because of a loophole in the legislation. Since then, councils have been trawling through years of records to find out who has been overpaid. Will the Secretary of State update us on how many people were wrongly paying the bedroom tax?”
“Yes, we have put in a freedom of information request, because we did not think that the Secretary of State’s numbers were correct, and, as it turns out, they are not. The FOI request shows that with 194 out of 346 councils having responded so far, a staggering 21,500 people have been wrongly paying the bedroom tax, including 4,198 in Tory local authorities, so perhaps they have got their numbers wrong too. There are 275 in Tory Chester, 200 in Tory Peterborough, 234—”
“Instead of trying stealthily to close the loophole, will the Secretary of State now do the right thing and scrap the cruel and hated bedroom tax?”
“We have also called this debate today, at a time of difficulty for so many low-paid workers and with low pay a growing problem across our country, to call on the Government to take action to strengthen the minimum wage, crack down on rogue employers and restore the value that the minimum wage has lost over the past three years. We call on them to do more to build a stronger economy that enables people to earn their way out of the cost of living crisis.”
“For me, the proudest achievement of the previous Labour Government was the introduction of the national minimum wage. It was important because, as we know, the best way out of poverty is work and because taxpayers should not have to pick up the bill of subsidising bad employers. Making work pay is also vital to getting the social security budget under control and we will not allow the Government to let the national minimum wage wither on the vine. Fifteen years ago, on 1 April 1999, the national minimum wage took effect. We should and do celebrate the difference it has made to millions of people.”
“Members opposed its introduction; further notes that families are on average £1,600 worse off a year and that the National Minimum Wage is now worth less in real terms than in May 2010; further notes that the Government has not backed up its promise to name and shame firms not paying the minimum wage; calls on the Government to strengthen enforcement of the National Minimum Wage, including by increasing fines for non-payment of the National Minimum Wage and giving local authorities enforcement powers; and further calls on the Government to encourage employers to pay a living wage and take action to restore the value of the National Minimum Wage so that the UK can earn its way out of the cost of living crisis and to help control the cost of social security.”
“I beg to move, That this House celebrates the 15th anniversary of the introduction of the National Minimum Wage, which falls this year, and the contribution it has made to making work pay, boosting living standards and tackling in-work poverty; notes that, before the National Minimum Wage was established, poverty pay was widespread and that the Conservative Party and many Liberal Democrat hon.”
“Member for Witney (Mr Cameron), now Prime Minister and then a parliamentary candidate in Stafford, darkly predicted in 1997 that a minimum wage would lead to a rise in unemployment.”
“Member for Chingford and Woodford Green (Mr Duncan Smith), now Secretary of State for Work and Pensions, said in 1997 that a minimum wage would “negatively affect, not hundreds of thousands but millions of people.” —[ Official Report , 4 July 1997; Vol. 297, c. 526.] The right hon. Member for Richmond (Yorks) (Mr Hague), now Foreign Secretary, said back then that a minimum wage would have to be “so low as to be utterly irrelevant” otherwise “it would price people out of work.” —[ Official Report , 17 March 1997; Vol. 292, c. 617.] The right hon. Member for Sevenoaks (Michael Fallon), now the Minister of State responsible for business and enterprise, said that a minimum wage “will add costs to British business”. —[ Official Report , 11 July 1997; Vol. 297, c. 1240.] And the right hon.”
“An investigation by the Low Pay Unit looked at pay rates before the national minimum wage was introduced and back then one worker in a residential care home was paid just £1.66 an hour. I agree that today, too, people working in that sector are too often exploited and that their employers get round the legislation. The Low Pay Unit considered pay before 1997 in a range of industries. I mentioned residential care but it also came up with other examples, such as a factory worker who was earning just £1.22 an hour in 1997 and a person working in a chip shop in Birmingham who was earning just 80p an hour. That is sheer exploitation. It is poverty pay and it was taxpayers who picked up the bill. Let us also remember what Government Members said back then. The right hon.”
“It is not just the Tories who should apologise; the Government’s junior coalition partners should apologise, too, because they were worried back then as well about the impact of the minimum wage. In 1994, their then leader attacked Labour’s “umbilical attachment to a national, high-rate minimum wage” and said that “a national minimum would…force many on to the dole”. The Liberal Democrats went into the 1997 general election with a manifesto commitment not to a national minimum wage but to a “regionally variable, minimum hourly rate.” Let us be grateful that they did not get their way. Despite the then Opposition fighting the legislation tooth and nail, line by line, clause by clause, using every trick in the book to slow, frustrate and obstruct its progress, the national minimum wage became law.”
“Two million jobs were created under the last Labour Government and employment reached a record high, so I am not sure where the hon. Lady gets her statistics from. I have quoted the former leader of the Liberal Democrats but, back then, where was the Secretary of State for Business, Innovation and Skills, the right hon. Member for Twickenham (Vince Cable)? He was nowhere to be seen in the debates. He was nowhere to be seen on the voting record. On Second Reading and Third Reading, he failed to vote. Apparently, he abstained because he had reservations about a minimum wage. Perhaps he will stand up today to profess his concern for the plight of the low-paid. I am happy to take an intervention from the right hon. Gentleman if he wants to make one.”
“I thank my hon. Friend for that intervention, which reminds me of a story that my predecessor as MP for Leeds West told me. He saw a job advert in our constituency for a security guard back in the mid-1990s that said, “Pay, 90p an hour. Uniform provided. Bring your own dog.” Those were the sort of jobs that existed back then, but members of this Government opposed the national minimum wage legislation. I look forward to hearing what the Secretary of State for Business, Innovation and Skills has to say later, but people will be entitled to ask him where he was when we abolished the scandal of jobs paying less than £1 an hour and when British workers won the right to be paid a decent minimum wage.”
“Many people earning £6.31 an hour will be shocked and outraged to find out that bankers this year will get bonuses worth more than they earn, but they will be even more shocked to find out that they are the ones who are paying for those bonuses.”
“I will come to that point shortly because the number of firms that are getting out of paying the minimum wage is incredibly worrying. We suggest increasing the fine to £50,000 for not paying the minimum wage, but there is no point in having such a fine if the legislation is not enforced.”
“At the Labour party conference, my right hon. Friend the Leader of the Opposition called for the fine to be increased to £50,000, and I support that. It is also important that companies that get out of paying the minimum wage are prosecuted, and we are not seeing that under this Government.”
“It helped to lift 1 million children out of poverty and every authoritative economic study concluded that it brought no negative employment effects, despite the warnings of Government Members. No wonder that a survey of academic policy experts conducted by the Institute for Government judged the national minimum wage to be the greatest policy success of the past 30 years. It is now a policy supported by the CBI and the TUC, whose nominees work together on the Low Pay Commission. It is seen by the British people as a vital British institution, underpinning basic rights and decency in the way our economy works.”
“I thank my hon. Friend for drawing the attention of the House to the voting record of other Members of Parliament on that night. Thanks to Labour Members of Parliament and a Labour Government, for the first time in history, in England, Scotland, Wales and Northern Ireland, British workers had a legal floor below which their hourly pay could not fall. Slowly but surely during the following years the rate rose. It was attacked every step of the way by many Government Members and, in 2003, when the Labour Government announced a 16% increase in the minimum wage over two years, the right hon. Member for Twickenham attacked the policy directly, saying that it would set a dangerous precedent. The result of the minimum wage was to boost the wages of nearly 2 million low- paid workers, two thirds of whom were women.”
“I have already made the offer to the Secretary of State, but we have not yet heard from him. All Members are welcome to make interventions, but in the meantime I will take an intervention from my right hon. Friend the Member for Delyn (Mr Hanson).”
“I congratulate my right hon. Friend on his work in helping to put the national minimum wage on to the statute book. He is absolutely right to suggest that one of the contributions to the cost of living crisis that we see today is that the national minimum wage has not kept pace with the increase in prices during the last few years. The introduction of the minimum wage did indeed help to boost the spending power of workers.”
“For 41 of the 42 months that the Prime Minister has been in office, prices have risen at a faster rate than wages, and that continues to be the case. The only month that it was not the case was in April last year, when bank bonuses were deferred from March to April to take advantage of the cuts in the top rate of tax from 50p to 45p. [ Interruption. ] That is the only month in which prices grew at a slower rate than wages, not for ordinary workers, but the privileged few who the hon. Gentleman’s party always supports.”
“Work by the Institute for Fiscal Studies has shown that, taking account of all the changes to taxes, tax credits and benefits since the Government came into office, the average worker is now £850 worse off. The hon. Gentleman points to one thing, but the VAT increase means that people are worse off, as do the tax credit changes. Overall, when all those things are added up, people are worse off, not better off. I hope that he will stay a little longer than his colleague to hear a bit more of the debate. We know that we need to build on the success of the national minimum wage, because today we face a new challenge: getting our economy working for working people and tackling the worst excesses of insecurity and exploitation in our labour market.”
“If the hon. Gentleman looks at what has happened to living standards, he will see that the average worker is £1,600 worse off than they were in 2010. I am surprised that he applauds what the Government are doing—I certainly do not—because workers in his constituency are worse off, not better off, after three and a half years of Conservative government.”
“I thank my hon. Friend for that intervention. The reality is that under this Government we have seen record numbers of workers on zero-hours contracts, record numbers of people who want to work full time having to work part time, and wages failing to keep up with prices. The average worker is now £1,600 a year worse off and the number of people being paid less than the living wage is up from 3.6 million in 2010 to more than 5 million today. The value of the minimum wage has fallen by 5% over the past three and a half years. For a full-time worker that means a real-terms pay cut of £13 a week.”
“I thank my hon. Friend for that intervention. We saw similar things when Labour introduced the national minimum wage in the first place, because in many cases those who benefitted were the good employers who wanted to pay their workers a decent wage and who were being undercut by the cowboys.”
“There is an apprentice rate for the minimum wage, which is important, but we need to ensure that more people are doing good-quality apprenticeships so that at the end of them they can get jobs not only at the minimum wage, but above it. My worry is that too many of the current apprenticeships do not offer the decent training that will enable people to get a good-quality job.”
“I thank my hon. Friend for that intervention. Trade unions, including the Union of Construction, Allied Trades and Technicians, of which he is a member, did a huge amount of campaigning for the introduction of the minimum wage and campaign today to ensure that more people are paid a living wage. I will say a little more about what we are willing do in government to ensure that more people are paid a living wage above the national minimum.”
“My hon. Friend is absolutely right. Many councils, including mine in Leeds and his in Coventry, have been hard hit by the cuts to the local authority grant, which are affecting some of the services that the most vulnerable people rely on.”
“They have repeatedly said that they will name and shame firms that are flouting the legislation, but they have not named a single one.”
“We have shocking accounts of working conditions for some people in sectors such as elderly care which hurt not only employees but vulnerable people who need a reliable and good-quality service from people who are paid a decent wage. There are stories of legal loopholes being used to bring in migrant workers who are, as my hon. Friend the Member for Stockton North (Alex Cunningham) said, forced to work at exploitative rates of pay that also undercut and undermine the pay and conditions of all workers. Despite that, the number of enforcement cases opened or registered has fallen in every year of this Tory-led Government, and it is now at less than half the level it was in the last year of the Labour Government. Since this Government came into office, just two prosecutions have been brought for non-payment of the minimum wage.”
“I suggest that Government Members look at what we are debating: the national minimum wage. I know they do not want to talk about it, because they did not support it in the first place, but it would be nice if they could talk about its impact on their constituencies. However, I think we may have to wait for another occasion. We have a Government who opposed the national minimum wage when it was introduced and who are not enforcing the legislation properly today. Thanks to an investigation by the independent Centre for London, we know that as many as 300,000 workers are being paid less than the minimum wage. We have reports of workers having the costs of uniforms, accommodation, transport or training illegally deducted from their pay packets.”
“Not only are Government Members not 100% behind the national minimum wage; they cannot even bring themselves to say “national minimum wage”.”