Tower Hamlets Council has called out the Government for failing to provide adequate support to avoid a “potential catastrophic growth in unemployment and poverty” as the economic impact of the pandemic continues to build and as the country faces the biggest economic slump in more than 300 years.
At a meeting of the Full Council last week, the Labour Mayor and Councillors spoke out against the Government’s failure to support families and businesses, highlighting the upcoming cut to Universal Credit, a lack of support for self-employed workers, and the huge amount of uncertainty caused by last-minute policy decisions and U-turns, for example on Free School Meals and school closures.
The motion debated and overwhelmingly agreed by the Council, put forward by Mayor John Biggs and Cllr Motin Uz-zaman, called on the Government to do more to support families and local businesses and set out a range of measures it could take to help, for example extending the current VAT relief scheme and expanding the grants scheme, as well as cancelling the cut to Universal Credit.
Last week in the House of Commons, the Government voted against a Labour motion to cancel the £20 p/w cut to Universal Credit, equivalent to £1040 a year, which is scheduled to happen in April and will impact 6 million families.
John Biggs, Mayor of Tower Hamlets, said: “The lockdowns have been vital in tackling coronavirus, but these need to be matched with enough support for families and businesses who are really struggling with the economic impact of the pandemic. Many thousands of local people have faced hardship with so many businesses closed, and a large number of our residents have jobs that cannot be done from home. Many face job losses and a massive cut in income.
“The Government simply hasn’t gone far enough to support people, and their decision to press ahead with cuts to Universal Credit is absolutely shameful.
“We’ve set out some concrete steps the Government could take to give people much-needed support, and we urge the Chancellor to listen.”
Cllr Motin Uz-zaman, Cabinet Member for Work and Economic Growth, said: “Small businesses are the lifeblood of our economy in Tower Hamlets and this past year has been an extraordinarily difficult time for them. As a council we have worked hard to support them, but we urgently need the Government to go further, particularly as the impact of Brexit and the pandemic are hitting businesses at the same time.
“We’re calling on the Government to take urgent steps to support our local businesses, such as expanding the grants programme. We have this week launched the Additional Restrictions Grant scheme which will be really important for some businesses, but the Government can build on this and provide much more extensive support.”
The motion agreed by the Council:
This Council notes:
- A further national lockdown requires additional economic support across all sectors.
- The Office for Budget Responsibility does not expect GDP to recover to pre-pandemic levels until late 2022.
- Universal Credit – a lifeline to around 43,000 people in the borough – is due to be cut by £20 in April.
- As a council we’ve stepped up to support our businesses and distributed over a million pounds to businesses.
This Council believes:
- That there is a potential catastrophic growth in unemployment and poverty for which we cannot prepare without adequate support from Government. To support families and individuals the Government must:
- avoid cliff edges and last-minute announcements and consider extending the furlough scheme beyond the end of April, further extending the bans on evictions and repossessions, and mortgage holidays
- maintain the £20 per week uplift to Universal Credit which is currently due to be cut in April and which is a real lifeline to those that receive it and the local businesses where it is spent.
- set out additional support for the self-employed and working parents impacted by the closure of schools.
- give councils the resources to properly cover discretionary payments for the £500 isolation scheme, as boroughs like Tower Hamlets have seen a high uptake.
- As well as the impact on families and individuals, the continuing impact on our economy and businesses is deeply concerning. London’s economy will continue to be severely impacted and is at risk from a ‘triple whammy’ of the pandemic, Brexit and the Government’s so called ‘levelling up’ agenda.
- Small businesses are the lifeblood of our economy in Tower Hamlets.
- Inner London faces specific challenges of reduced footfall and areas like the City Fringe and Canary Wharf will have to adapt and require specific support.
- The Government must take further action to support businesses, including:
- extending the current VAT relief scheme for the whole of 2021 and extending the business rates relief scheme.
- expanding the grants programme delivered by local authorities and adjust it so it is based on the number of businesses within a borough rather than the number of residents.
- providing targeted support to night-time economy businesses.
This Council resolves:
- To call on the government to set out a comprehensive plan to protect jobs and support our economy.
- For the Mayor and lead Cabinet member to write to the Chancellor making the case for the interventions listed above.
- To continue to lobby the Government for adequate economic support and work with our business community.
- To lobby for adequate support for individuals and families affected by the economic impact of Covid-19.