The Parliamentary Under-Secretary of State, Department for
Business, Energy and Industrial Strategy () (Con)
My Lords, I will now repeat in the form of a Statement the answer
to an Urgent Question made in the House of Commons by the
Economic Secretary to the Treasury, . The Statement is as follows:
“Mr Speaker, this is an uncertain time for our country, but the
Government are clear that they will do whatever it takes to
protect our people and businesses from the coronavirus pandemic.
On Tuesday, the Chancellor of the Exchequer set out further steps
in the Government’s economic response, building on the initial
response he outlined in the Budget last week. This included
standing behind businesses small and large, with an unprecedented
package of government-backed and guaranteed loans to support
businesses to get through this crisis. I have been working very
closely with him and the banks and they are very clear about
their responsibility to make these work.
The Government have made available an initial £330 billion of
guarantees—equivalent to 15% of our GDP. That means that any
business which needs cash to pay salaries will be able to access
a government-backed loan, on attractive terms. The Government
will do whatever it takes to support our economy through this
crisis and stand ready to provide further support where
necessary.
As the Chancellor announced, we will go much further to support
people’s financial security, working with trade unions and
business groups. Following his appearance before the Treasury
Select Committee yesterday afternoon, the Chancellor spoke to the
trade unions and he will today be meeting the TUC, the CBI, the
BCC and the FSB—I will not spell out those acronyms. This will be
with a view to urgently developing new forms of employment
support to help protect people’s jobs and incomes through this
period.
I am sure that you will appreciate that these are unprecedented
times. The Chancellor has said he will look at further steps to
help protect jobs and incomes, and he will announce further
details in due course.”
My Lords, that concludes the Statement.
12.38 pm
(Lab)
My Lords, I thank the Minister for repeating the Statement. We
welcome the Government’s commitment to do whatever it takes
during this crisis, and especially the comments about not just
standing behind business but standing shoulder to shoulder with
businesses and workers and engaging with the trade unions and the
TUC. I have only two questions for the Minister. First, when will
the new forms of employment support be introduced? Secondly, are
the Government considering paying the majority of wages to
provide the job guarantees? As said earlier today, if
families do not have income protection, there will be a lot of
other consequences. People may try to work when they are sick,
putting themselves at risk, so their health becomes a public
health issue.
I thank the noble Lord for his questions and for the responsible
attitude that the Opposition are taking to this emergency. I am
afraid that I am unable to give him a timescale at the moment; I
can say only that all government departments are working as
urgently as they possibly can on these matters. As soon as we
have any further information on schemes that will be introduced,
the Chancellor will make the appropriate announcement.
(LD)
I wish to associate myself with the thanks for the Statement. The
difficulty is that the people are being laid off now, and those
who have no cash are the ones we worry about most. Have the
Government considered paying two-thirds of salaries, like the
Governments of Denmark and France, in order to ensure that people
have temporary relief? Will the Government consider the very
interesting Resolution Foundation suggestion of using a model of
statutory maternity pay? The welcome measures yesterday for
private renters will not be enough. I regret the lack of scrutiny
of that in this House today. Will the Government consider looking
at the local housing allowance, given that there is such a
shortfall at the moment? Perhaps something could be done about
that, because it reaches directly into the homes that we are most
concerned about. Finally, what will happen to freelancers, from
creative industries right through to cleaners? They are not in
business and are not employed but self-employed. Often they do
not even have the status where the Government will find them.
I thank the noble Baroness for her questions. Their extent
reveals the number of different sectors of the economy that we
will need to look at. As she says, they range from sole traders
to small businesses and to the very largest companies. We are
looking at a comprehensive package. There are a number of
different international models that have been introduced. A
number of think tanks in the UK have also produced suggestions.
They are all being examined at the moment. We are guided by three
principles: it has to be a comprehensive package; it has to be
co-ordinated; and it has to be coherent. The noble Baroness will
understand that we need to look at these things properly. It is
no good having a scheme that comes into effect in six months’
time. It needs to work now, it needs to be available and it needs
to be deliverable. We are doing all those things, and we will
make the appropriate announcements as soon as we possibly can. I
understand people’s natural frustration and their wish for urgent
action.
(Con)
I wish to make a very minor but important point. At the moment,
if a company is insolvent, the workers do not get paid. They can
have worked for several weeks up to the date of insolvency but
when insolvency comes, their pay is basically at the mercy of the
receiver, or whoever is winding up the company. In the Statement
the Minister said that any business that needs cash to pay
salaries will be able to access a government-backed loan. In
other words, a company that cannot pay salaries but is not
becoming insolvent will apparently be able to access it. I know
that in its submission to the Government the TUC has asked for a
relaxation of the rules on insolvent companies, and I realise
that it will probably be beyond the Minister’s pay grade to agree
that that will be done, but will he agree to reflect to the
Government that this point has been raised and possibly to write
to let us know what has been decided? This is a small category,
but companies are going to go bankrupt and workers may be denied
their wages, while others in companies that have not gone
bankrupt will be able to access a loan. It is a small point, but
it is very important.
The noble Lord speaks with great authority on these matters. This
might be a small point, but I agree with him that it is
important. Actually, within my ministerial portfolio I have
responsibility for the Insolvency Service, although not for the
Treasury and the guarantees that it will provide. I take on board
my noble friend’s point and will make sure that it is conveyed to
the Chancellor. My noble friend’s intervention is welcome.
(CB)
I declare an interest as a freelance series producer working at
Raw TV making content for CNN. The Minister was asked about
coverage for the self-employed and freelancers who have been made
unemployed and he said that he was looking at that and wanted it
done properly. However, these people have no prospect of work at
the moment. Their income has suddenly stopped, and their bills
have not. Is it not possible very quickly to put in place an
emergency fund, as has happened in other countries, and at the
very least to extend statutory sick pay to all workers affected
by Covid-19? Surely that could be done very quickly.
I think, again, the noble Lord makes a very good point. We have
of course already announced extensions to statutory sick pay and
the qualifying period. His points are well made and echo the
points made earlier about freelancers. All the different sectors
of the economy need to be looked at. We will do whatever it
takes. We will put in place a comprehensive package and will
announce details of that as soon as we are able to.
(Lab)
My Lords, all legal categories of worker will need income
protection in this crisis, but can the Minister say whether the
income protection proposals will cover, in the mind of the
Government, five particular situations? First, there are those
who will be off sick with coronavirus: clearly, they will be
entitled to statutory sick pay, even though it is a pittance at
£94.25 a week—a figure that will have to be increased. Secondly,
there are those who are self-isolating and are not sick—at least
not yet—and will not be entitled to statutory sick pay because
they are not sick. Thirdly, there will be those who are off work
to care for others, including children shut out of school, who
will never be entitled to statutory sick pay but who do need
income protection. Fourthly, there will be those who lose their
jobs because of the loss of trade by reason of Covid-19 or
following advice from Public Health England or the Government. I
remind the Minister that the Financial Times this morning said
that over 200,000 people in restaurants and catering have already
lost their jobs—have been laid off—since mid-February. I noted
that the figure did not include air transport or the holiday
trade; I saw in the newspaper yesterday that British Airways had
served an HR1, and it has 30,000 employees. Income protection
must cover those who have lost or may yet lose their jobs.
Fifthly, will it cover those who are redeployed from existing
work to do emergency work, social care work or other work, not
just volunteers?
I thank the noble Lord for his question, which illustrates the
complexity of the problem, all the different factors that need to
be taken into consideration, and how there needs to be a
cross-government response, across a number of departments and
obviously backed by the Treasury with comprehensive financing.
The answer to his question is: yes, all these matters are being
looked at. We are looking at various international options and
proposals and we will hopefully have something to announce very
soon.
(Con)
Can my noble friend inform the House whether much broader
thinking is now being done by government about employees who are
affected by the coronavirus crisis, not just regarding health
issues for those self-isolating or who have symptoms, but those
who are now affected because they have children at home or
because the people they work for do not have the orders and they
are therefore short-working, and those who are not contractually
protected—people on zero-hours contracts? Would it be easier for
the Government simply to respond to people’s needs because they
are impacted by coronavirus, rather than breaking them down into
specific categories?
Similarly to the previous question, my noble friend’s question
reflects the complexities of the issue and why a comprehensive
response is required. We are working on that; we of course have
universal credit, the social security system—the welfare
system—for people to fall back on, but there are numerous
different aspects to it and different sectors of the economy that
will require a response. We are working on it urgently and
cross-departmentally; the whole of government is focused on this
and we will come back to both Houses as soon as we possibly can.
