Commons passes Labour motion demanding Covid economic support

Elliot Chappell
© UK Parliament/Jessica Taylor

The House of Commons has passed a motion – by 272 votes in favour to none against, as Conservative MPs abstained – calling on the government to immediately provide businesses and individuals with economic support.

Bridget Phillipson opened the debate for the opposition earlier this afternoon. Noting that Rishi Sunak was absent from the debate, she commented that it is “becoming clear that accountability is very much not part of his brand”.

The motion called for the extension of business rates relief and the reduced rate of VAT, expansion of eligibility for the self-employed income support scheme and for the fourth version of the scheme to be set at 80% of pre-Covid profit levels.

It also reiterated Labour’s demand that the government allow businesses to defer paying back Covid loans when they are growing again and for the Chancellor to extend the coronavirus job retention scheme in line with ongoing restrictions.

Welcoming the positive steps taken in the vaccine roll-out, Phillipson said: “Thanks to the vaccine and the incredible work of NHS staff and volunteers, there is real hope that before long we can return to some semblance of reality.

“Yet while there are grounds for optimism, on these benches we know that there are still deep worries among so many businesses and working people about whether firms and jobs will still be viable when restrictions are lifted.”

The Shadow Chief Secretary to the Treasury highlighted that while Boris Johnson has outlined his ‘roadmap’, indicating when businesses might be able to reopen, there had been no statement on economic support for firms in the meantime.

“As with almost every major announcement throughout this crisis, we’ve had an update on restrictions but no update on economic support,” Phillipson told MPs in parliament this afternoon.

“It’s not even clear whether the Chancellor believes that there is a relationship between restrictions and additional support or whether he believes that businesses and workers should simply be grateful for what they’ve got.”

She argued: “Whether the Chancellor is being careless or negligent his approach is the opposite of what businesses need, which is to provide certainty and assurances so that they can plan ahead.

“Where issues do exist they expect government action to address them, not for problems to be dumped in the ‘too difficult’ box. There are few more egregious examples of this than the Chancellor’s persistant failure to help the excluded.”

The Labour frontbencher highlighted the millions of self-employed people across the country excluded from the self-employed income support scheme (SEISS) and urged Sunak to extend the grant to anyone with a 2019-20 tax return.

The Institute for Fiscal Studies reported in January that there are around 1.8 million self-employed people and around 700,000 company owner-managers who are currently not eligible for support through the government programme.

Phillipson stressed to MPs today that it is not just the self-employed who need greater clarity on economic support from the government, but “workers in businesses large and small right across our country”.

She called on Sunak to immediately announce, instead of waiting until the Budget, the extension of the furlough scheme in line with the ongoing health restrictions that are set to remain in place for at least several more months.

Phillipson argued the Chancellor could learn from the Welsh Labour government, which she highlighted has “offered more generous support for businesses through a more targeted and responsible approach” throughout the pandemic.

The UK government initially announced in March last year that all retail, hospitality and leisure businesses would not be required to pay business rates in England for the year 2020-21 as a result of the implementation of Covid restrictions.

The Welsh government capped the relief, making those with properties with a rateable value over £500,000 ineligible. The move freed up £100m for its Economic Resilience Fund and enabled grants to 2,000 small businesses.

Phillipson told the Commons today that the measures outlined in the Labour motion could have been announced “long ago” and could be implemented by the Conservative administration immediately “if the government had the political will”.

“But, once again, businesses and workers are being forced to endure an excruciating and inexcusable wait so that the Chancellor can have his day in the sun at next month’s Budget,” she declared as she concluded her contribution this afternoon.

Several of the MPs contributing to the discussion raised the struggle of those excluded from SEISS. Luton North MP Sarah Owen said that, after a year, the lack of support is now “either sheer incompetence or a deliberate choice”.

Bill Esterson highlighted that those left out of protection under the scheme’s eligibility criteria represent 10% of the entire workforce and urged a “change of heart” from the Chancellor in his upcoming Budget due be given next week.

“It’s not too late for genuine, targeted support for the three million who are yet to support any support whatsoever from this government,” the Labour MP for Sefton Central and shadow minister told MPs this afternoon.

Closing the debate this evening, shadow minister Abena Oppong-Asare remarked that all the contributions from MPs made clear the need for economic support packages provided by the government to go “hand-in-hand with restrictions”.

“Our country has seen the worst excess death rate and the worst economic crisis of any major economy. That was not inevitable and nor is it inevitable that people should be worried about their jobs and livelihoods,” she said.

“This government can and should be taking decisions now with relentless focus on jobs and growth, not putting them off for another week or longer.

“These are the decisions that the Chancellor should have taken, be taking and be prepared to go on taking and the failure to take them is in itself a decision. And a decision that the Chancellor should be here defending today.”

The non-binding motion passed this evening was the second of two tabled by Labour today. MPs also passed a Labour motion against the planned cut to Universal Credit, the imposition of council tax rises and the public sector pay freeze.

Shadow Chancellor Anneliese Dodds described a “triple-hammer blow to family finances” and warned that Sunak is pressing ahead with “economically illiterate” plans that will stifle demand in the economy ahead of the Budget next month.

The government continued with Johnson’s new policy today, adopted last month in the face of motions on free school meals and the Universal Credit cut, of ignoring opposition day motions and instructing Tory MPs to abstain.

Below is the full text of the motion table by the opposition this afternoon.

That this House calls on the government to support businesses and individuals still struggling as a result of the coronavirus crisis in the forthcoming budget by extending business rates relief for at least another six months, extending the temporary 5% reduced rate of VAT for three months after restrictions are lifted or for another six months, whichever is later, helping British businesses struggling under the burden of government-guaranteed debt by ensuring that small businesses can defer paying loans back until they are growing again, extending and reforming the furlough scheme so that it lasts whilst restrictions are in place and demand is significantly reduced, immediately confirming that the fourth self-employed income support scheme grant will be set at 80% of pre-coronavirus crisis profits and extending eligibility to that scheme to include anyone with a 2019-20 tax return and fixing the gaps in coronavirus support schemes to support those who have been excluded from the beginning of the crisis; and further calls on the Chancellor of the Exchequer to make a monthly oral statement to parliament updating the House on these matters.

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