One of the key responsibilities of my Department is to ensure that all those who have a health condition or a disability but who could work are given the right type of help and support to enable them to find and keep a job. Many of the 2.64 million people of working age are currently on incapacity benefit because the personal capability assessment has focused more on people’s incapability than their capability for work. In October 2008, I am therefore introducing a new medical test—the work capability assessment—that will assess people’s physical and mental ability and what they can do rather than what they cannot do. I placed a report evaluating the new test in the Library this morning.
May I invite the Secretary of State to indulge in a bit of interdepartmental thinking and action to overcome a problem that is becoming very apparent in inner-city areas such as mine? Single parents have great difficulty in accessing council or housing association properties because of the shortages and are therefore placed in private accommodation by the local authority, often on a very high rent—sometimes as much as £300 or £400 a week. That rent is then paid for by housing benefit. I have no problem with people getting housing benefit; this is not an attack on housing benefit, but the problem that then emerges is that, if and when they are offered a job or encouraged into a job by the agency, they have to reject it because they need to get one that pays more than £15,000 to start with just to pay the rent. That means that they are in danger of losing benefits and we are in danger of losing somebody who wants to work and contribute to society. This is a twin problem of benefits and housing. I realise that it is not entirely the Secretary of State’s responsibility, but does he recognise that it is a serious issue, and is he prepared to do something about it?
I recognise that this is a real problem, especially in London, with high housing costs as well as, in the case of lone parents, high child care costs. That is why the Prime Minister recently announced that for London there will be an in-work credit of £60 a week for an individual coming off income support, in the case of a lone parent, to enable them to take a job and to deal with precisely the problem that my hon. Friend describes. We will continue to look into the problems of housing costs and how we can resolve them, because we do not want them to be an impediment to work in the way that he describes.
This morning, the Secretary of State provided the media with a briefing about his new announcement on incapacity benefit assessments. According to the BBC website, he said that he would tackle sick-note Britain and that the new system will place greater emphasis on what the sick and disabled can do rather than on what they cannot do. Funnily enough, two weeks ago, on 5 November, he made exactly the same announcement to the media, saying that he had plans to “rip up sicknote Britain” and that there would be “an assessment” that would look at
“what people can do rather than what they can’t.”
Why did he make the same announcement twice in a fortnight, and why does he keep briefing the media first and MPs second?
I placed a copy of the report that makes an analysis of the new medical assessment in the Library this morning. The House was the first to see it, as far as I know. We sought to draw attention to a radical change from what has gone on in the past, in the 1980s and 1990s, when people were smuggled off the unemployment statistics on to incapacity benefit. The numbers tripled, which led to the benefit mountain we received as a legacy from the previous Conservative Government. We are reducing it. For the first time in a generation, the figure has come down—by 120,000 during the past few years—having risen year on year as a result of that legacy. The new, stringent, personal capability assessment, of which I have informed the House, will enable us to bring that number down even more.
In fact, the first time we heard about that was in a press release from his Department in January 2006.
Will the Secretary of State confirm that today’s announcement involves 20,000 fewer people claiming incapacity benefit? Will he confirm that that represents less than 1 per cent. of the total of 2.6 million currently claiming the benefit? Unless he manages to increase his current rate of progress, he is set to be 25 years late in hitting his target of getting 1 million people off incapacity benefit.
On the contrary, compared with the record of the Tory Government, where incapacity benefit tripled, we have already brought the numbers down by 120,000 and this additional test will enable us to accelerate that process. In addition, the rolling out of pathways to work throughout the country by April next year will bear down even more sharply on those figures. At last we will begin to get rid of the awful legacy bequeathed to us by the previous Tory Government, where people were written off on incapacity benefit, instead of being helped into a job, or being given new opportunities, skills and support to get a job, which enable them to transform their lives as a result.
The comments in the Aon Consulting review were directed at the basic state pension, and then it worked out that figure. Of course, we know that there is a second state pension—an important part of the UK state pension system—that brings people up to a third of average earnings. In the UK, private pensions are more important, and 86 per cent. of UK pensioners have income other than state pensions. Private pensions are also eligible for tax relief so, including a private pension, a pensioner on a medium income gets an income of two thirds of average earnings. The Aon report got a headline, and added a lot of heat but little light. We remain committed to our policy of re-establishing the link to earnings.
First, we are changing the basis on which people will be entitled to come and work and introducing a points-based system. In respect of the wider situation, there are 660,000 vacancies in Britain today. It is not like the 1980s and 1990s when people were stuck on incapacity benefit and could not get a job because there were no jobs in constituencies such as mine—former mining constituencies in south Wales. Now there are jobs. There are vacancies everywhere, in every constituency in this country, which is why we want people on incapacity benefit, lone parents on income support, older workers and the long-term unemployed to join the jobs programmes we are undertaking with local employers to get them into work, and we can do that.
I appreciate the points that my hon. Friend makes about the important role that grandparents often play in the bringing up of the children, but those are matters for other Departments. However, I shall happily refer what he said to them, and I am sure that they will contact him.
I can clarify the situation for the hon. Gentleman. We shall not be recovering the overpayments from anybody who was overpaid in those circumstances, as was set out clearly in the written statement. In case he has not understood the point, let me clarify it for him: there will be no recovery of the overpayments. Indeed, in some instances we shall continue with the current payments—to those who are terminally ill, for example—while ex gratia payments will be made to those disadvantaged by the error.
I share the hon. Gentleman’s concern for the 125,000 people whose pension schemes have failed. We are awaiting the outcome of the review by the Government Actuary, Andrew Young, which is due in the next few weeks. We have indicated that we are looking to maximise the returns from the amounts that remain in those failed pension schemes. We shall then see whether we can match that, to move towards 90 per cent. of the core pension.
I do not agree that the process has become less efficient. The fact that benefits and employment advice are now dealt with in one place has been welcome. The transformation of our jobcentres from places where furniture was chained to the floor and people looked over large counters to the rather more friendly and welcoming environments that we have today is a plus. Again, however, we constantly seek to improve the delivery of our benefits and to keep on target for waiting times, to ensure that those who are entitled to benefits receive them and that those who are not do not, but get into work.
It is very much our intention to have the staff to do the jobs that we want them to do. However, the issue is not just about numbers of staff, but about how they work. We have a number of different advisers for different types of programmes, and a certain amount of rationalisation would help in that regard. The issue is also about how our Jobcentre Plus staff work with other organisations, such as the housing benefit office, and with the voluntary sector and, importantly, about the changes that we are going to make to the contracting of provider services, to ensure that we get better outcomes for the taxpayer’s investment, rather than just paying for processes. That is the direction for the future, with jobcentre staff, others in partnership and contract providers playing an even more effective role.
Perhaps the hon. Gentleman would like to stand and give us his question, then we can get on with it. This is a topical question; he asks the question and he gets a response.
Thank you, Mr. Speaker. I would be grateful if the Secretary of State could tell the House how many people are not in work, education or training, and what the Government are doing about that?
I congratulate the hon. Gentleman on his belated question; it was a very good one. We are taking action to ensure that we reduce those numbers, including by extending the age until which people will need to remain either in training, in an apprenticeship or in full-time education at school. That policy will help us to bear down on the number of 16 and 17-year-olds who are not in education or training.