On the 18th March 2022, I wrote the Chancellor in advance of the Spring Statement to express my concerns with adequacy of support for those who are going to be hit hardest by the cost-of-living crisis.
You can read my letter in full below:
I write to you in advance of the Spring Statement, to ask you to take strong action to protect living standards and livelihoods. The cost of living crisis that is set to worsen for many months to come is already having a devastating effect on many constituents, dashing hopes of a genuine recovery from the pandemic.
So many people in my constituency are being affected by the concurrent and complex impacts of Covid, Brexit, and now global rises in prices for energy, food and other basic and unavoidable costs for households. As you know, inflation was already forecast to hit 7% this year, and even these alarming forecasts have not yet incorporated the further impacts of the Russian invasion of Ukraine.
Unless you take further action, the Government’s cut of the £20 a week uplift in Universal Credit will be rapidly followed by another large real terms cut to families’ incomes from social security. As you will know, the Joseph Rowntree Foundation forecast that this real terms cut will pull 400,000 more people into poverty. Again, that estimate was based on previous inflation estimates that now look overly optimistic.
The same report found that low income families would have to spend 16% of their incomes on energy bills alone, and that previously announced Government measures would only protect them from 60% of the increases. Couples with children were expected to face a real terms cut to their incomes of £720 a year, on top of the £1000 a year cut to Universal Credit last October. Again, these forecasts were made last month, before the invasion of Ukraine.
Newham has the second highest child poverty in the country. The most recent Government estimates imply that more than half of the children in my constituency are growing up in poverty. These are children’s lives, stripped of the resources, opportunities and life chances that so many take for granted. The idea that this appalling situation could be allowed to get still worse is truly horrifying.
Last year, homelessness in Newham, already the highest in the country, rose yet again to an eye-watering 1 in 22 residents without a safe, secure home. The vast majority are in extraordinarily expensive temporary accommodation that disrupts children’s educations and parents’ work lives equally. My constituents are not only dealing with already extortionate and rising rents, and now rising mortage costs, but also council tax rises that could have been avoided if only the Government funded our councils properly. How many more families will lose their homes over the coming months due to the cost of living crisis? How much more public money will be spent dealing with the consequences of entirely preventable homelessness?
I write to ask that you take strong action now to shield my constituents, and particularly those on the lowest incomes, from the devastating wave of inflation that is coming.
In addition to these households who are in truly dire need, I urge you to give specific attention to business sectors that remain vulnerable. The hospitality sector is particularly important in my constituency of West Ham. The hoped-for recovery from the pandemic has already been put in significant jeopardy by the Omicron wave’s impact on trading during the Christmas period. This has been compounded by labour shortages and Brexit damage to supply chains.
Now, rising prices will have a further impact that must be addressed. You will know that Hospitality UK has found that 93% and 86% of business owners say they are facing increases in food prices and energy costs respectively. 82% say they will pass on some higher costs to consumers by increasing prices, with an expectation that prices charged to customers could increase by 11%.
This is not only about protecting viable businesses, employment, and living standards. In many cases, hospitality venues such as pubs have a huge role in providing community spaces. The same is true of the many entertainment and events businesses, like theatres, cinemas, wedding venues, exhibition centres, and all the associated supply chains for these businesses, that were also disproportionately damaged by the pandemic. These businesses do not only provide jobs and incomes, they are focal points for community, culture, and joy in local people’s lives.
I urge you to think more broadly about the implications of the living standards crisis for public services. Many public sector workers who have faced serious real terms pay cuts repeatedly and cumulatively over the past twelve years will rightly expect nominal pay to rise in order to avoid yet another severe cut in their living standards.
You must know that poor morale and overwork have become an unacceptable and unsustainable norm across too many public services, not just the NHS that we all know was so disastrously impacted by the pandemic. If you do not take action to ensure this situation changes, public services are likely to face still more vacancies, staff sickness absences, and lower productivity over the coming years. This will undermine the recovery from the abysmal backlogs that are undermining the service that the public rightly expect, and therefore their trust in public services to provide for them.
I hope that you will engage in good faith with trade unions across every sector of the economy, and ensure that local authorities, as well as all public services, are funded to enable them to manage their cost increases. If this does not occur, I fear we will see a return of the cuts and deterioration in services that has become horribly familiar due to the decade of austerity, just at a time when services need to recover from the pandemic and support the return to an economic and social normality.
I recognise that I have repeatedly called for additional urgent economic support for my constituents over the past few years. This reflects the consistent battery of threats that the people I represent have had to endure. I hope you can now respond adequately to the scale of the challenge, including a reversal of the cruel cut to Universal Credit.
Member of Parliament for West Ham