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Covid-19: Economic Package
12 May 2020
Lead MP
Anneliese Dodds
Debate Type
General Debate
Tags
EconomyTaxationEmploymentTransportForeign AffairsBusiness & TradeBenefits & Welfare
Other Contributors: 63
At a Glance
Anneliese Dodds raised concerns about covid-19: economic package in the House of Commons. A government minister responded. Other MPs also contributed.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Lead Contributor
Opened the debate
Asked the Chancellor of the Exchequer for a statement on the Government’s economic package in response to the COVID-19 outbreak.
Rishi Sunak
Con
Richmond and Northallerton
The Chancellor of the Exchequer announced an extension of the job retention scheme for four months until the end of October, maintaining current levels of support. He emphasised the dignity of work and the Government's commitment to supporting workers and businesses during and after the crisis.
Anneliese Dodds
Lab Co-op
Oxford East
Welcomed the extension but called for more information on employer contributions, alternatives to the scheme, and collaboration with trade unions, businesses, local authorities, and further and higher education institutions.
Mel Stride
Con
Central Devon
Welcomed the additional flexibilities in the furlough scheme but asked for a clear plan from the Government to assist companies with their debts as they invest and grow post-crisis.
Asked if removing or reducing wage support levels prematurely would increase universal credit claims, force workers back before it is safe, risk a second peak, and sought assurance that the job retention scheme will remain in place across all UK nations.
Acknowledged international comparisons showing the UK as best for supporting businesses during the crisis and asked about steps to continue this support as lockdown measures ease.
Caroline Lucas
Brighton, Pavilion
Welcomed the continuation of the furlough scheme and its new flexibility for part-time work. Proposed a reduction in VAT on tourism to support businesses affected by the pandemic. Requested inclusion of small business owners who take their income in dividends or combine PAYE with freelance work.
James Daly
Bury North
Expressed gratitude for the speed at which money has been made available and praised the coronavirus job retention scheme as one of the most generous globally. Acknowledged support to businesses in Bury and thanked the Chancellor.
Kate Green
Stretford and Urmston
Asked about full support for the creative industries, which are likely to be among the last sectors to exit lockdown and predominantly consist of freelance or self-employed workers.
Natalie Elphicke
Dover
Welcomed the Chancellor's announcement on furlough but expressed concern over redundancy plans at P&O due to lack of support from its Dubai owners, urging them not to rely solely on taxpayer handouts.
Shabana Mahmood
Birmingham Ladywood
Asked about the equality impact assessment of economic measures regarding women and BAME communities disproportionately affected by lockdowns and job losses.
James Sunderland
Workington
Expressed concern over the future of commercial airlines, particularly near Heathrow and Gatwick, and inquired about further government support for UK aviation.
Edward Davey
Kingston and Surbiton
Welcomed the extension of the furlough scheme but urged consideration for employees who have moved jobs or were not on their employer's payroll by mid-March, proposing a new starter scheme.
Cheryl Gillan
Chesham and Amersham
Congratulated the Chancellor on his support to businesses and individuals during the crisis. Urged British Airways to remove threats of redundancy after implementing furloughing measures.
Asked about support for people who started or were due to start a new job after 28 February, highlighting their lack of assistance from current schemes.
Rishi Sunak
Con
Richmond and Northallerton
Defended the job retention scheme's eligibility criteria, emphasising its aim to protect taxpayers from fraud. He noted that extending the date of employment recognition brought in an additional 230,000 people out of about 350,000 who were left uncovered by the original criteria. The scheme covers 7.5 million people notified to HMRC and is benefiting several million people across the country.
Saqib Bhatti
Con
Meriden and Solihull East
Welcomed measures announced by the Chancellor, particularly the bounce-back loan scheme. He asked for confirmation that work continues to increase the number of accredited lenders providing bounce-back loans.
Rishi Sunak
Con
Richmond and Northallerton
Reported on the progress of the bounce-back loan scheme, stating that more than a quarter million loans have been approved with over £8 billion in capital benefitting small and medium-sized enterprises. Additionally, 35,000 CBILS loans worth more than £6 billion have now been distributed.
Asked the Chancellor to issue guidance for local authorities on providing grants to charities that are excluded from securing small business grant funds despite having received local charitable rate relief. She highlighted financial struggles faced by small and local charities due to lost income.
Rishi Sunak
Con
Richmond and Northallerton
Announced a top-up fund for local authorities worth over £600 million, allowing them to distribute further rate relief as they see fit. He also mentioned a £750 million package to support charities through the crisis.
Asked the Chancellor about extending the furlough scheme for islanders involved in tourism and event-related businesses, which are heavily impacted by the pandemic.
Rishi Sunak
Con
Richmond and Northallerton
Acknowledged the impact of the crisis on the leisure, hospitality, and tourism sectors. He confirmed that an industry taskforce would be created to help these industries recover.
Called for an impact assessment based on equalities principles to ensure the economic recovery plan is inclusive for people with disabilities.
Rishi Sunak
Con
Richmond and Northallerton
Confirmed that appropriate equalities assessments will be undertaken. He also mentioned a fund created to help local authorities build or adapt new changing places for those with complex disabilities.
Judith Cummins
Lab
Bradford South
Asked whether the Treasury had assessed how many employers are topping up wages of furloughed workers and what would happen if they could not continue to do so after the reduction in government contributions.
Rishi Sunak
Con
Richmond and Northallerton
Described additional support for businesses through grants, tax cuts, and loans. He noted that extending the furlough scheme to eight months would provide significant support alongside the plan outlined by the Prime Minister.
Ben Spencer
Con
Runnymede and Weybridge
Welcomed measures supporting livelihoods and businesses during the pandemic, particularly in relation to the aviation industry. He asked whether planes should start flying again as soon as possible.
Rishi Sunak
Con
Richmond and Northallerton
Suggested that reopening parts of the economy once the virus is controlled would be the best way to support industries like aviation. He agreed with the importance of this approach for his constituent's jobs.
Helen Hayes
Lab
Dulwich and West Norwood
Highlighted concerns about new starters who are not receiving support due to employment dates after 19 March, asking if contracts could be accepted as evidence of employment.
Rishi Sunak
Con
Richmond and Northallerton
Emphasised the safety net strengthened by several billion pounds in investment. He highlighted extra support through tax credits, universal credit, local housing allowance, and a hardship fund for local authorities.
Welcomed the extension of the furlough scheme and asked for hope that the creative industries would survive and flourish post-pandemic. He noted that many people in these sectors are freelancers or on short-term contracts.
Rishi Sunak
Con
Richmond and Northallerton
Acknowledged the importance of the creative industries in the UK economy, stressed the need to support them safely as the country recovers from the pandemic.
Gerald Jones
Lab
Merthyr Tydfil and Aberdare
Asked for greater flexibility in the furlough scheme to include new starters who missed out on support without risking fraudulent payments, urging the Chancellor to consider these proposals urgently.
Rishi Sunak
Con
Richmond and Northallerton
Responded that changes were made to extend eligibility dates for the furlough scheme from 28 February to 19 March, highlighting operational challenges in implementing such schemes.
Welcomed the coronavirus job retention scheme and asked if support would be kept under review to reach businesses that need it most, specifically mentioning Redcar and Cleveland's needs.
Rishi Sunak
Con
Richmond and Northallerton
Reassured Jacob Young about reviewing the schemes regularly and thanked him for his support in engaging with businesses to inform scheme developments.
Kirsty Blackman
SNP
Aberdeen North
Asked if the Chancellor would consider sector-specific support for industries affected by both the pandemic and a drop in oil prices, focusing on Aberdeen's situation.
Rishi Sunak
Con
Richmond and Northallerton
Explained that regardless of industry, companies can benefit from the furlough scheme; mentioned regular engagement with all sectors to address concerns.
Neil O'Brien
Con
Harborough, Oadby and Wigston
Welcomed the extension of the job retention scheme and questioned how youth unemployment could be prevented from rising as the virus affects apprenticeships and work placements.
Rishi Sunak
Con
Richmond and Northallerton
Emphasised the importance of supporting young people entering the labour market for the first time, mentioning plans to offer skills and retraining opportunities.
Highlighted the automotive industry's importance in recovery efforts and asked about continuation of the job retention scheme beyond October 2020, alongside measures to help companies with liquidity issues.
Rishi Sunak
Con
Richmond and Northallerton
Acknowledged the automotive industry's critical role and announced extended loan schemes for larger companies like Jaguar Land Rover and their supply chains.
Welcomed the Chancellor’s extension of the job retention scheme to October 2020, inquired about certainty regarding the scheme ending then if the Prime Minister's reopening strategy is adhered to.
Rishi Sunak
Con
Richmond and Northallerton
Responded that while the scheme would extend until October 2020, its indefinite continuation was not feasible due to economic costs; stressed support would be phased as reopening plans progress.
Dwyfor Meirionnydd
Asked for assurance that the furlough scheme remains in place as long as necessary, adhering to expert-led public health guidance in each UK nation.
Rishi Sunak
Con
Richmond and Northallerton
Stated the furlough scheme's application equally across all regions and sectors of the UK until October 2020, thanked Liz Saville-Roberts for her wishes.
Complimented the Treasury team on their comprehensive economic support package during lockdown and requested assurance that work is in progress to prepare businesses for easing restrictions, especially in the tourism sector.
Rishi Sunak
Con
Richmond and Northallerton
Thanked Rob Roberts for his advice and confirmed work on establishing a taskforce to help tourism businesses safely open as soon as possible.
Richard Burgon
Lab
Leeds East
Many minimum wage workers have been furloughed. They are now expected to get by on just 80% of the minimum wage, even though rents, bills and food prices have not fallen. Will the Chancellor implement guarantees, so that no furloughed worker is ever forced to live on less than 100% of the national minimum wage?
Meg Hillier
Lab Co-op
Hackney South and Shoreditch
The Chancellor has spoken about freelancers, who often work on short-term contracts or for personal service companies. In answer to the right hon. Member for Ashford (Damian Green), he talked about optimising the existing mechanisms for those people, but will he come forward today with the suggestion that there are concrete proposals in place? These are people with clear financial records and they often have accountants, so there is a track record. Will the Chancellor support these different types of self-employed people?
Ellie Reeves
Lab
Lewisham West and East Dulwich
Women who are eligible for the self-employed income support scheme but have taken a period of maternity leave since 2016 could receive up to one third less financial support. This discriminates against women on lower incomes in particular, penalises families with young children, and exacerbates the gender pay gap. Will the Chancellor therefore exempt periods of maternity leave from the self-employed income support scheme calculations?
Zarah Sultana
Your Party
Coventry South
It is estimated that the economic impact of the pandemic will hit the west midlands the hardest. It was announced this week that a manufacturer and supplier to Jaguar Land Rover in Coventry South has gone into administration, putting 600 jobs at risk. Will the Government therefore step up efforts to protect manufacturing jobs, especially in the automotive industry, and invest in them to provide green sustainable jobs for the future?
Andrew Griffith
Con
Arundel and South Downs
The generous and unprecedented schemes that my right hon. Friend has put in place are doing a tremendous job, protecting thousands of employees, small businesses and the self-employed in my constituency. Many in West Sussex work in aviation, so in addition to heartily welcoming today’s extension of the excellent job retention scheme, may I ask him at least to consider temporarily suspending air passenger duty as well as testing passengers on arrival as an alternative to the 14-day quarantine, to help this vital sector of the economy?
Wendy Chamberlain
Lib Dem
North East Fife
In North East Fife, much of the economy is seasonal and workers, who had contracts often agreed months in advance, face no income and no access to existing support. Fundraising for some golf caddies in St Andrews is under way and, although I applaud local community efforts and their generosity, rather than have the seasonal workforce rely on charity, what support can the Chancellor offer them this year so that they can return next year?
Mike Wood
Con
Kingswinford and South Staffordshire
These measures are exactly what manufacturing firms in Dudley South have called for as they start to reopen. Will the Chancellor undertake to work with our excellent Mayor, Andy Street, to ensure that the needs of west midlands manufacturing and its employees are fully considered as they start the task of rebuilding our economy?
I am glad that the Chancellor has confounded recent worrying rumours regarding the job retention scheme that caused grave concern to my constituents. Will he liaise with the Department for Business, Energy and Industrial Strategy to ensure that workers are not forced back to work in dangerous conditions, bearing in mind that the Health and Safety Executive has issued no enforcement actions as yet and that employers may struggle to pay the 20% he asks for while ensuring employee safety?
Mr Speaker, I hope you and your family are well. About 19% of Calder Valley residents work in the manufacturing sector, and thousands of them are incredibly grateful for the Chancellor’s ingenuity around the furlough scheme. Will my right hon. Friend, on his birthday, confirm how today’s announcements on furlough will be a massive help to those manufacturers as they phase the return to work and deal with social distancing in the workplace?
Rishi Sunak
Con
Richmond and Northallerton
The Chancellor announced flexibility for manufacturers to bring employees back on a part-time basis while allowing furloughing for the remainder of their time, highlighting the scheme's value in helping businesses get back up to speed quickly. He expressed sympathy for the families affected by the pandemic and acknowledged the Health Secretary's initiative to support families who have lost loved ones during the crisis.
James Murray
Lab Co-op
Ealing North
Asked the Chancellor to extend the life assurance scheme for frontline workers beyond health and care workers to include bus drivers such as Ranjith Chandrapala, who died from covid-19, leaving behind a family including his daughter Leshie.
Aaron Bell
Speaker
Expressed appreciation for the extension of the job retention scheme and inquired about introducing tapers to business grants and self-employed income support schemes to avoid cliff edges in support for those in similar positions.
Flick Drummond
Con
Meon Valley
Expressed gratitude for the comprehensive set of measures introduced by the Treasury and requested guidance on discretionary grant funding from councils, emphasising that the Treasury should make it clear that local authorities have discretion to use their judgment.
Andrew Gwynne
Ind
Gorton and Denton
Welcomed the announcement on furlough but emphasised the need for full reimbursement of all covid-related costs and lost income for local councils, given that they are now financially on the brink.
Nigel Mills
Con
Amber Valley
Asked if businesses could bring back employees part-time earlier than the extended period mentioned by the Chancellor to help them reopen their businesses next month rather than having to wait until a later date.
Ruth Jones
Lab
Newport West and Islwyn
Inquired about specific conversations between the Chancellor and devolved Administrations in Wales, Northern Ireland, and Scotland regarding these changes and when those conversations took place.
Government Response
EconomyTaxationEmploymentTransportForeign AffairsBusiness & TradeBenefits & Welfare
Government Response
Extended the job retention scheme until October, ensuring workers receive 80% of their current salary up to £2,500 a month through employer contributions. Emphasised collaboration with trade unions and businesses for future support. Emphasised the generosity of UK support measures for various sectors. Mentioned flexibility in furloughing arrangements, grants for hospitality businesses, VAT reduction benefits, extensions to self-employment schemes, and ongoing discussions with aviation sector companies. Reiterated the importance of considering equality impacts but maintained the current scheme's comprehensiveness. The scheme, as it is designed, does provide income support of 80% of those wages. Indeed, where those wages are variable the scheme allows an average to be taken to benefit the employee. We have also strengthened the safety net, as I mentioned earlier. Crucially, employees who are furloughed are then able to work elsewhere as well to supplement their incomes. That flexibility is often unnoticed, but it is very helpful. I know many people are taking advantage of that to boost their incomes during this time and I think the scheme, as it is designed, provides the required support especially to those on the lowest pay.
They are being supported. The scheme to support them goes live tomorrow, ahead of schedule. Those who are self-employed whose returns and earnings we are aware of will be contacted, and are already being contacted. They are able to apply from tomorrow and will receive cash in their accounts for a three-month grant as early as next week. The scheme is one of the most generous in the world for those who are self-employed.
My hon. Friend has spoken passionately about this issue before, and I look forward to continuing conversations with him. I am of course keeping those measures under review. As I said at the time, there is of course parity in the level of support, but the nature of the schemes is different in the sense that employers who have been closed and have to make employment decisions, potentially 45 days in advance in respect of redundancies, do need to be treated slightly differently in that regard. I will of course continue to keep all things, including that scheme, under review.
People have ups and downs and variations in their earnings for all sorts of reasons, whether because of maternity, ill health or something else. To deal with that, we have provided an average of income over up to three years on a look-back basis, to smooth out all the ups and downs in all people’s incomes. That was something that stakeholder groups were keen to see at the beginning, it is something that we delivered, and I believe it provides the fairest way to treat everybody, on a level playing field, whatever their circumstances. A three-years averaging of earnings seems to me to be a reasonable approach to take.
My hon. Friend is absolutely right: the plan that the Government and the Prime Minister have outlined does exactly what she says. For those who can go back to work now, they should do so in a safe way, as the Secretary of State for Business, Energy and Industrial Strategy will talk about later. As the rest of our economy reopens, people will have the benefit of a furlough scheme that extends all the way to October and provides for part-time flexibility. The combination of all those things means that my hon. Friend’s local businesses and many others can take the time that they need to get firing on all cylinders again.
I am very sorry to hear about the potential job losses in the hon. Member’s constituency. To me, every job lost during this period is heartbreaking, which is why I am doing my absolute utmost to provide the support that I can to protect as many as possible. I have said that clearly I cannot—and nor could any of us—save every single job or business, but the loans, the cash grants and the job retention scheme will all play a vital role in saving many millions of jobs and businesses, particularly in the automotive supply chain. The hon. Member is right that that is an important part of our economy, and it deserves our support to ensure that it can be a strong part of our recovery.
I thank my hon. Friend for his support and for the advice he has provided to me, with his extensive experience of business and of his constituency. He knows that I care deeply about the aviation sector. My right hon. Friends the Transport Secretary and the Foreign Secretary are considering the issues he raised. In particular, the Government have been clear that further detail on the quarantine measures will be outlined in due course, but I will pass on his suggestion.
Those who were in seasonal work can use an average of their earnings over a period for furlough payments, or indeed the same month on a year-over-year basis if that is a more generous way to calculate their eligibility. That is the most generous way to treat those in seasonal employment under the scheme and ensure that we reflect their earnings appropriately.
I can give my hon. Friend that reassurance. I look forward to speaking further to him and the excellent Mayor, Andy Street, as we all work together to drive the west midlands economy as part of the economic recovery plan. He, the Mayor and his businesses can play a leading role in that.
My right hon. Friend the Business Secretary will be here shortly to provide a fuller answer to the hon. Lady’s question, but it is right that employees should not work in unsafe environments and we have put in place measures to ensure that that will not be the case, with updated guidance, risk assessments and increased resources for the Health and Safety Executive. The Business Secretary will update the House in more detail.
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