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We need a Back to Work Budget for Erith and Thamesmead

It is clear the Government was too slow to recognise the scale of the health crisis from coronavirus and we are already paying the economic price.

I am increasingly worried that the slow and muddled health response is now being followed by a slow and muddled response to saving jobs. The window is closing to protect existing jobs and encourage firms to invest in creating new ones.

There were 2,780 people in Erith and Thamesmead claiming for Universal Credit and other benefits last month, a rise of 132% since the outbreak of coronavirus. Although this is an imperfect measure of unemployment, it hints at the scale of the looming jobs crisis in our community.

Reports the government has pushed back its next full budget to the Autumn worry me, as we’re already behind other countries like Germany, which announced a full economic package weeks ago.

We need an urgent package of economic measures with a clear focus: Jobs, Jobs, Jobs.

Supporting this, we need a strategic withdrawal of support schemes tailored to the needs of specific sectors and areas.

Nearly 1 in 4 people of working age in Erith and Thamesmead are relying on the Job Retention Scheme (16.7%) or the Self-Employment Income Support Scheme (7.22%).

Labour called for and welcomed these schemes, but we are concerned about their abrupt withdrawal which risks pushing millions of people into unemployment. The Chancellor plans to withdraw support for all sectors and areas of the economy at once and has not linked his plan to other public health measures, such as easing social distancing guidelines where it is safe to do so.

This one-size-fits all approach won’t work for sectors like hospitality. Pubs, restaurants and cafes will be operating well below capacity when they eventually reopen, and their fortunes are closely linked to the decisions that are taken on social distancing. It makes no sense to withdraw support for the 2,315 hospitality workers in Erith and Thamesmead at the same time as sectors that are operating as normal and will need less support.

Similarly, firms relying on tourism face losing the majority of trade from the summer high season. Snatching away all support in October, just as the high season ends, could be ruinous for the tourism sector and the roughly 1,640 jobs it creates in Erith and Thamesmead.

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Erith and Thamesmead see unprecedented 2% unemployment rise

Unemployment has risen to unprecedented levels across the UK with Erith and Thamesmead seeing a rise in unemployment to 5.6% of the adult workforce, just above the average figure for the whole of London and the wider UK.

Centre for Cities, an independent research organisation, has been recording the rise in unemployment rates across the UK between March and April. Data recording the number of people applying for Universal Credit and Job Seekers Allowance shows and increase in unemployment of 850,000, taking the UK wide total to 2.1 million.

Between March and April 2020, an increase of 1,605 people applied for Universal Credit or Job Seekers Allowance in Erith and Thamesmead, a rise of 2%. The Royal London Borough of Greenwich has been affected slightly more than the London Borough of Bexley with a 0.2% higher uptake in this time period.

It is expected that the unemployment rates are likely to have risen between April and May but this data is not yet known. There are also disparities in the unemployment increases in different areas of the UK. London has an average unemployment rate of 4.9% compared with 5.6% in Erith and Thamesmead and 8.9% in Blackpool.

The reasons for differing increases in unemployment are not yet known but it is suspected that places that rely heavily on the most impacted industries such as hospitality, and where people are unable to work from home, have seen a greater impact.

In a letter to the Secretary of State for Work and Pensions to raise concerns about the rise in unemployment locally, I said:

“I am concerned that residents in Erith and Thamesmead will face increased difficulties compared to the wider region of London post-Covid-19 due to decreased local job opportunities and restricted travel routes around London. It is already evident that my constituents have felt more severe impacts compared with the rest of London, as unemployment has risen 0.7% higher than the London average.

Many local businesses have contacted me throughout this crisis detailing their financial hardship and inability to access the SEISS or Job Retention Scheme. As more businesses fall into financial hardship residents in Erith and Thamesmead will be faced with more job losses.

If the working age population in Erith and Thamesmead is going to recover from this crisis there will need to be a specific focus on boosting the local economy, improving transport links and supporting industries that have been hit particularly hard.”

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The Government must protect jobs in the aviation sector – starting with British Airways

British Airways announced they plan to cut up to 12,000 jobs as part of their response to economic losses due to COVID-19. I have joined London MPs in calling on the Director of IAG, Willie Walsh, to reconsider these plans and work with trade unions to develop a long-term strategy.

I’ve been contacted by several employees of BA, resident in Erith and Thamesmead, who are concerned about their future. It is irresponsible of BA to make these announcements at a time of financial hardship for many, without first consulting with staff, unions and local stakeholders. I have personally written to the Secretary of State for Business, Energy and Industrial Strategy, Alok Sharma MP, to ask that his department to make representations about these concerns to IAG.

Moving forward from the COVID-19 crisis we must look to protect as many jobs as possible and create a plan to help people re-skill and find new employment. The aviation sector has faced huge losses during COVID-19 as almost all flights have been completely grounded over the past two months.

I am pleased that MPs from across the political spectrum have been working hard on this issue and trying to engage the relevant bodies. However, the Prime Minister and Chancellor, Rishi Sunak MP, who is at the forefront of protecting jobs and businesses, do not appear to be as enraged as MPs representing constituents who will suffer if this goes ahead.

Huw Merriman MP secured an urgent question on June 3rd 2020, “to ask the Chancellor of the Exchequer if he will make a statement on covid-19 and the economic impact on aviation”. Unfortunately, the Chancellor did not attend this debate to listen to concerns.

Wes Streeting MP, Shadow Exchequer Secretary to the Treasury, raised concerns that more job losses were to come if we did not act, he said:

“This is a sector that contributes £22 billion a year to our economy, with 230,000 jobs across the industry and the manufacturing supply chain dependent on it. It needs to change to meet the challenge of climate change. So why did one industry leader tell the Transport Committee just a fortnight ago that the Government were ‘asleep at the wheel’?”

I will be continuing to make representations on behalf of my constituents and attempt to engage IAG and the Chancellor in this issue. In the meantime, if you have been personally affected by job losses in the aviation industry, please do get in touch at abena.oppongasare.mp@parliament.uk