On 18th March 2020 the House of Lords debated the Budget Statement made the previous week by the Chancellor of the Exchequer. The Archbishop of Canterbury, Most Revd Justin Welby, spoke in the debate:
The Archbishop of Canterbury: My Lords, a Budget is social morality in numbers. Whatever we say we believe about the dignity of human beings and about the existence or otherwise of society, the reality of our belief is demonstrated by the way we act, and especially by the way we act with money. The crisis through which we are passing will change this nation in deep and unpredictable ways, as the noble Lord, Lord Oates, has just said. Like a nuclear explosion, the initial impact is colossal, but the fallout lasts for years and will shape us in ways we cannot even begin to predict at the moment.
The Budget and the extra package announced yesterday must be both adequate in amount and sufficient in their aims to ensure that this country emerges confident from overcoming the virus—positively better than before it began. We will overcome the virus. The noble Lord, Lord Tunnicliffe, commented that small groups all over the country are showing fresh signs of community spirit and collaboration, and it is from those small groups, through to the large-scale government measures, that things will change.
During a crisis, keeping the long-term direction is as important as tackling the short-term problem. The enormous package of short-term measures is, by its very size, sufficient to raise hope, and for that it is welcome. Fifteen per cent of GDP is a ‘war Budget’ commitment. The obvious questions, which have already been raised, are: how will it be distributed and how will it be used effectively? If we are to put confidence as the aim and people at the centre, the distribution and the impact must be both swift enough and imaginative enough to maintain confidence right across the economy, not only in the big cities with their own self-sustaining economies, but in the myriad towns and smaller communities across the country.
For many of them, there has been decline for many years, particularly, as we all know, those on the coast and in remote areas. Covid-19 may well be the last straw for some. Even exceptionally beautiful and normally tourist-filled cities, such as Canterbury, with good pedestrianised city centres full of bars and restaurants, and with major chains and everything in between based there, have seen this decline. In the past 12 months in Canterbury, Debenhams has closed and the number of vacant stores is noticeably larger. This could be repeated across the country. Shutting down the hospitality industry, necessary though it is, will empty the city centre. The cathedral, in which I should probably declare an interest, with its 300 employees, is one of the largest private sector employers in east Kent. It has apprentices, people with unusual skills and many other workers, but it depends from week to week and month to month on the income from tourism. Its solvency protects much of the local economy. Its 2 million visitors a year are at the beating heart of what makes the east Kent economy work. The same could be said about so many other places, from Durham south. A local economy is people, and an ecosystem as well. It is a complex structure, and losing one bit leads to overall decline. The package that has been announced and the Budget must be used with the vision of preserving the most fragile parts of the system, or we will lose all.
The use of these sums, so enormous and unprecedented, must be seen as being based in a clear moral and ethical structure, aimed at enabling those excluded by lack of adequate training and skills, the misfortune of being in declining industries, social change or other reasons to renew aspiration and to have jobs and secure homes in mutually supportive communities. We see the importance of community at this time.
It has been said that we should be especially concerned about the five-week gap in the payment of universal credit. That remains a significant problem in many areas. Thanks to the hoarding and panic buying that has been going on, food banks are desperately short of supplies for those who need them. They do not need money; they need the physical goods to give out, but they are not available. They are most needed when people move on to universal credit; 45% or so of those who come to food banks come because of problems with credit.
Free school meals have hardly been touched on. We will hear a Statement later today which may speak, as in Wales, of the closure of schools. For many children in the most deprived areas, school is where they get not just education but food. That needs to be addressed. What possibilities can the Government offer to enable free school meals, for instance, to continue during the gap? There has been talk about the need for provision for those who are self-employed and of statutory sick pay; I shall not repeat it.
To be moral and ethical, there has to be a vision on a scale with the spending, a vision that recovers “us” and “we” from the era of “I” and “me”—in short, a vision to recreate the notion and reality of society. That vision requires the mobilisation of not only the economy but of partnerships across society. In the Church of England, with 1 million children in schools, we are already planning and thinking about what education should look like to give abundant life. The phrase “abundant life” comes from the words of Christ. It marks the deeply embedded Christian tradition in our society to do with human flourishing, but human beings are responsible for making it happen. We are going to see huge change. It can be towards what we choose, or it will be what the strong make it.
Lord Skidelsky (Crossbench):…No doubt it does not feel much like boom time right now, and forecasts have suggested a recession. Nevertheless, today there is less surplus capacity in the British economy, and other western economies, than there was 10 years ago. In 2010, UK unemployment was 8%. Today, with less than 4% out of work, we are much closer to full employment. I know that the calculation behind the Chancellor’s stimulus was that the extra investment would draw workers from lower to higher-productivity jobs, thus boosting economic growth. That was a reasonable gamble, but it was a gamble all the same.
In any case, all this has been overtaken by the pandemic, which has led to the promise of an extra £350 billion to deal with it. The Prime Minister said:
“We must act like any wartime government”,
a sentiment echoed by the most reverend Primate the Archbishop of Canterbury. Let me say a word about the “war” metaphor, because it can be a source of some confusion. A war economy is above all a shortage economy; supply falls relative to civilian demand. To put it another way, it is an excess demand economy. People find it hard to get their heads round that idea because they are so used to the belief that crises come because demand has fallen, but a war economy is an excess demand economy for the simple reason that a part of supply has been taken by the state for other purposes—in the case of the war economy, for war purposes—and there is therefore less supply for civilian demand.
Today, the equivalent is that people, for very good reasons, are made to stay at home. It is sort of like conscription; suddenly there are fewer people available to produce supply and therefore the supply falls. That is what is happening. A fall in supply in that sense is independent of what is happening to demand.
Baroness Bennett of Manor Castle (GP):..The most reverend Primate the Archbishop of Canterbury was prescient in referring to free school meals. As we now know, from Monday, huge numbers of families will be wondering how to feed their children without those meals. There are people sitting in households in the dark and the cold, possibly ill too, wondering how they will top up their pre-payment meters. They are not supposed to go out. Why do we not have a measure to top up automatically such meters, owned by some of the most vulnerable people in our society?
Baroness Kramer (LD)..The Government simply must use this opportunity to remedy the two greatest travesties within universal credit. First, the five-week wait is intolerable. I know from talking to people who are dealing with this that paying back the five-week advance loan, even with a longer repayment period, leaves people living for months at just above destitution. The most reverend Primate the Archbishop of Canterbury and the noble Baroness, Lady Lister, made very powerful points about that.
Lord Stevenson of Balmacara (Lab):..We have also benefited from having seen how the Government have responded in real time to the economic aspects of the coronavirus pandemic, and many contributions today focused on that. Indeed, the contributions of the most reverend Primate the Archbishop of Canterbury, the noble Lords, Lord O’Neill, Lord Lamont and Lord Skidelsky, my noble friend Lord Adonis and several other noble Lords have broken new ground, which I hope the Minister will take back to his department and prosecute with some vigour…
…I was struck by the suggestion made earlier in the debate by the right reverend Primate the Archbishop of Canterbury and picked up by others that we may lack more of a moral dimension to some of the issues we face. One concern mentioned in the other place was the impact that all this will have on the charitable sector, which faces a bleak future if funding dries up. Have we thought through how we would function as a society if the third sector were not able to function after the end of the crisis? Let us take the recommendation to practise social exclusion. Why is the language being used so vague that those affected—hotels, restaurants, pubs, theatres, galleries and arts organisations—are not eligible to claim on the insurance cover that they have paid for?
Lord Agnew of Oulton (Con, Minister)…The most reverend Primate the Archbishop of Canterbury raised a number of issues. Perhaps the most important and relevant one, given the announcement that has come during this debate, was that of school closures. I do not have any more detail on that, other than on the one area of free school meals. I have been given a statement, which says simply that we will give schools the flexibility to provide meals or vouchers to children eligible for free school meals. Some schools already doing this, and we will reimburse the costs. I hope that that will provide some reassurance…
On the most reverend Primate’s comments regarding small towns and the decline of retail there, they have been hit particularly hard.
I think we all understand that retail has gone through the most extraordinary revolution over the last 15 years. Part of the levelling-up programme and the commitments in our Budget were to try to get out to some of these poor communities and to inject some more energy and infrastructure into them. One of the initiatives which I am personally involved in is encouraging civil servants to move out of London over the next seven to 10 years. This is an enormous opportunity, because we have a staff turnover rate of about 10% to 12%, and indeed it is higher in London, so there is a real opportunity to do this. I am also the Minister for the Government Property estate, so one of the things I have done is to ensure that break clauses are activated on London leases so that we do not have foot-drag by some departments that do not really want to move out of London. However, I can assure your Lordships that this is an important personal commitment because it is a win for everybody, and it will help some of these towns. For example, I live near Yarmouth, which is a classic example of an area of deprivation.