PARLIAMENTARY DEBATE
Living Standards - 3 September 2024 (Commons/Commons Chamber)

The Government are focused on improving living standards across the country, which is why growth is a key priority. If real household disposable income per capita had grown from 2010 to 2023 at the same rate as it did between 1997 and 2010, it would have been £4,000 higher last year. This Government’s approach will centre on fostering good work. The Government will reform employment support to offer more people dignity and purpose in meaningful employment. The plan to make work pay sets out a significant and ambitious agenda to ensure that workplace rights are fit for the modern economy and to empower working people and deliver economic growth. We have launched a ministerial taskforce on child poverty and updated the Low Pay Commission’s remit to consider the cost of living when making recommendations on the national living wage.

I thank the Minister for that reply. Many of my Blackpool South constituents have contacted me regarding the means-testing of winter fuel allowance and the link to pension credit. There are probably thousands in my constituency who do not receive pension credit and are potentially missing out on £3,900 a year. What steps are the Government taking to ensure that all pensioners in my constituency and across the country receive what they are entitled to?

I welcome my hon. Friend to his place. He is absolutely right to highlight how important it is to make sure that all those who are eligible for pension credit but are not claiming it sign up and thereby receive the benefits to which they are entitled, which now include the winter fuel payment. The Government are undertaking a new campaign to drive take-up, and the Department for Work and Pensions is holding a pension credit week of action in the first week of September, when promotional activities will be supported by organisations including Age UK and local authorities. There will be further action in the coming months, including on TV, in the press and on radio, and we will be writing directly to up to 120,000 pensioners who receive housing benefit but are not claiming pension credit to encourage a claim where they may be eligible.

The economic chaos of previous Conservative Governments pushed up interest rates, causing mortgage costs to rise by £500 a month for families in Barnet. What steps is the Chancellor taking to bring down those rates so that families who have worked hard and saved hard can get the living standards boost that they so desperately need?

I welcome my hon. Friend to his place. As he rightly points out, the recklessness of the previous Government has had a direct impact on his constituents’ living standards. As a new Government, we recognise that many households right across the country have faced higher mortgage costs in recent years, and we are already taking action to fix Britain’s economic foundations with a new approach to growth, with the three pillars of stability, investment and reform. Sustainable public finances are necessary for economic stability and long-term growth. The Government will therefore set out the difficult decisions needed to secure the public finances in the Budget on 30 October.

In North Warwickshire and Bedworth, like in the constituency of my hon. Friend the Member for Chipping Barnet (Dan Tomlinson), monthly mortgage costs rose by an average of 22% in the year following the previous Government’s disastrous mini-Budget. That made life really difficult for hard-working families in my constituency. What steps is the Chancellor taking to ensure that such a devastating situation can never happen again to families in my constituency and across the country?

I welcome my hon. Friend to her place. She is absolutely right to highlight just how much damage the Conservatives’ recklessness in 2022 caused to families in North Warwickshire and beyond. The decisions of Conservative Ministers unleashed economic turbulence that pushed up people’s mortgages and made people across Britain worse off. Our new Government will hardwire Budget responsibility into Government with our new fiscal lock in the Budget Responsibility Bill, which will make sure that the disaster we saw nearly two years ago can never happen again.

The living standards of nearly 50,000 pensioners in Malvern Hills district and Wychavon district are going to deteriorate very sharply this winter in the face of a 10% increase in their energy bills and no winter fuel allowance. Many of those pensioners have incomes just above the pension credit threshold, and many are too frail and too old to work. Yet within the first few days of coming into office, the Chancellor managed to spend over £22 billion very quickly by setting up Great British Energy and a national wealth fund, and by giving in to the pay demands of her party’s union paymasters. Is it not the case that this Chancellor has made the chilling political choice to balance the books of this country on the very frailest shoulders?

I am disappointed that the hon. Member is talking down essential investments that we have made in our country’s future. She also seems to be confused: there is a £22 billion black hole because of the unfunded spending commitments made by the Conservative party when it was in government. But she makes an important point about protecting pensioners, which is why it is so important to ensure that all those pensioners who are eligible for pension credit take it up, and I look forward to her support in making sure that they do so.

Statistics from the Trussell Trust published today show that half of people on universal credit ran out of money and could not afford to buy food before the end of the month. What prospect do those people have of an increase in their living standards? The reintroduction of the household support fund is welcome, but what steps is the Treasury taking to make sure that people do not go hungry this winter?

As the hon. Member rightly points out, the Government are providing £500 million to extend the household support fund in England for another six months, and that will include Barnett consequentials. That is an important measure to help people in the months ahead, but the crucial way to increase people’s living standards and tackle the cost of living crisis in the longer term is to get the economy growing. We have spoken at length about the measures that we have already taken as a new Government—from planning reform and the national wealth fund to Great British Energy. All that is about getting the economy growing, because that is the sustainable way to make people better off and to invest in our public services.

Means-testing the winter fuel payment increases the burden on many vulnerable people and reduces their living standards. Unlike the Scottish Government, who have many statutory constraints on their budgets, the Chancellor’s fiscal rules are entirely self-imposed. Does the Minister think that sticking to the Chancellor’s fiscal rules is more important than the health and wellbeing of pensioners?

Let me be clear: if we do not have fiscal responsibility—if we do not stick to fiscal rules—we will lack the economic stability that is so crucial to getting the economy growing and ensuring that people across Britain are better off. We must return stability and fiscal responsibility to our country following the Conservative Government’s record. We saw what happened when they lost control of the public finances and made unfunded spending commitments. We need to ensure that that never happens again, which is why we are hardwiring fiscal responsibility into the future of government through our new Budget Responsibility Bill.