Queen’s Speech — House of Lords, 2021-05-12
Topic: Mixed Topics
Prem Sikka (Labour, Centre-left): My Lords, I welcome new Members to the House and offer my best wishes to the right reverend Prelate the Bishop of Portsmouth for his retirement Adam Smith said: "No society can surely be flourishing and happy, of which by far the greater part of the numbers are poor and miserable." Yet economic justice and redistribution are absent from Her Majesty’s gracious Speech. The wealthiest 100 people in the UK have as much money as the poorest 18 million people. This concentration of wealth and related power is damaging to every aspect of our society. Even before Covid, 14.5 million people, including 8.1 million people in working families, were living in poverty. Some 4.5 million children live in poverty. It is the highest number of people living in poverty since figures were first collated in 2002, and the numbers are expected to rise. It is a matter of national shame that people have to rely upon food banks and charity to survive. Do the Government even care about this In 1976, the workers’ share of GDP in the form of wages and salaries was at 65.1%. Zero-hour contracts, anti-trade union laws, a low minimum wage, wage freezes and job insecurity have reduced that share to 49.4%. This decline is unmatched by any other democratic country on this planet. Millions of people are denied access to good housing, food, healthcare, education and pensions, and are condemned to an early death as a result, yet the Government have no policies for improving workers’ share of GDP People on low incomes will inevitably rely upon state pensions in later life, yet despite the triple lock the average UK state pension is around 29% of average earnings. It is the worst in the OECD countries. Thousands of retirees die each year due to lack of heating. Nearly 3 million Brits are malnourished, and 1.3 million of these are retirees. If the Government care, they need to align the state pension with the minimum wage. Why should the state pension be less than the minimum wage Regressive taxation has deepened social injustices. The poorest 10% of households pay, on average, 42% of their income in direct and indirect taxes, compared to 34.3% by the richest 10%. VAT, council tax and national insurance are examples of regressive taxation and there is no reform in sight, yet the Government continue to shower more gifts upon the rich There is no qualitative difference between earned and unearned income, but capital gains are taxed at rates between 10% and 28%, compared to earned income which is taxed at marginal rates varying from 20% to 45%. Most of the beneficiaries live in London and the south-east of England, and the capital gains tax regime has exacerbated regional inequalities Tax relief of around £40 billion a year is provided on contributions to pension schemes. Most of it goes to individuals paying income tax at the rate of 40% and 45%. Just 10% of taxpayers receive 50% of the tax relief. Some 1.3 million individuals with earnings below the tax-free personal allowance receive zero help with their contributions to pension schemes. Why are the Government content with this The Government have increased tax-free allowances, though they will be frozen until 2026. The increase in personal allowances has not changed the burden of tax on the poorest, as I stated earlier. It does absolutely nothing for the 18.4 million individuals whose annual income is less than £12,500 a year. No doubt the Government will claim that they are providing £4.8 billion for their levelling-up fund for local infrastructure. However, this investment simply goes into the pockets of corporations, while workers remain poorly paid, insecure and disempowered. I would welcome a detailed reply from the Minister.