With permission, Mr. Deputy Speaker, I wish to make a statement on the Government’s Green Paper, “No one written off: reforming welfare to reward responsibility”.
The welfare state is a vital part of our country. We take pride in it. It is how we come together as a nation to support those who are vulnerable and in need of help. But our welfare system has not always kept pace with the changes in our society. In preserving some of the structures inherited from its founders, we have neglected their principles. William Beveridge’s contract for welfare had three founding ideas, the first of which was that revolutionary times called for revolution, not patching, and the second was that welfare was about more than just income. He wanted to topple not just want, but the other four giants of disease, ignorance, squalor and idleness too. These became the defining issues for the Attlee Government and inspired that Administration’s creation of the welfare state.
However, over time, Beveridge’s third principle—that the system of social security should not stifle incentive, opportunity and responsibility—was perhaps lost. The purpose of the welfare state was to help people in need today so that they could reduce their need tomorrow. From the 1960s onwards, that principle was eroded. The nadir came in the 1980s, when all conditions were removed from unemployment benefit and unemployment rose to more than 3 million—much higher than it needed to do.
In 1997, we inherited an essentially passive welfare state. Since then, we have been turning it into an active one. The Green Paper completes that transformation. It is based on the marriage of two simple ideas: more support and more responsibility—the root of a fair system for claimants and the taxpayer. It aims to meet five main goals.
First, the Green Paper aims to end the idea that there is a choice between claiming and working. Instead, from now on, the longer people claim, the more we will expect in return. At three months and six months, claimants will intensify their job search and have to comply with a back-to-work action plan. After a year, they will be transferred to an outside provider, who will be paid by results. Claimants will have to work for their benefits for at least four weeks—longer if the provider requires it. For the 2 per cent. whom we anticipate to be still out of work after two years, we will explore mandatory full-time work programmes and other approaches, such as daily signing.
We will give our advisers the power to use full-time work as a sanction at any stage of a claim for those who abuse the system. We will improve treatment for those who have a problem with crack cocaine and opiates, but require them to take up that support. We know that our support works, but we also know that conditionality works. By getting more people to take up the support, we can increase employment and reduce poverty.
When we introduced the new deal, we started to end the idea that people could claim benefits indefinitely when work was available. As long-term youth claimant unemployment fell by nearly 80 per cent., we extended that principle to other workers. Consequently, we now have more people in work than ever. Claimant unemployment has been halved, saving £5 billion a year. Nine out of 10 people leave jobseeker’s allowance within 12 months of claiming.
Work works, and it is only fair that we make sure that a life on benefits is not an option. The second goal is to ensure that no one is written off. In 1979, around 700,000 people were on incapacity benefits. By 1997, the total had risen to 2.5 million and was going up by 50,000 every year. We have reversed that trend, and the number on IB is the lowest that it has been for eight years. Annually, nearly 400,000 fewer people are flowing on to IB compared with 1997.
We have created the Pathways to Work programme, which helps people improve their health, adapt to their condition, rebuild their confidence and look for work. We know that that support works, too, and have made it mandatory for all new claimants.
We have legislated to abolish IB and replace it with the employment and support allowance. That new benefit treats people as individuals, looking to what people can do, not what they cannot. Today, I am announcing that we will migrate everyone from IB on to ESA between 2010 and 2013, with personalised support for everyone, based on our successful pathways programme. We will review the medical test to ensure that it reflects the latest evidence that work is generally good for people’s well-being, and we will reassess all existing claimants to ensure that they are on the right benefit for them.
Those who are ready to work will move on to JSA. Those with the greatest needs will get a higher benefit rate—up from £86.35 to £102.10—and can volunteer for Pathways to Work. We will increase funding for our specialist training programmes and for supported employment. Everyone else will get personalised help, based on pathways, to get them back to health and back to work. However, they will be required to take up that help, and look for work when a doctor recommends it.
The changes mean that, for the first time, no one will be abandoned to their fate, to get by on benefits. For the vast majority, ESA will be a temporary benefit, not a permanent snare.
Our third goal is to transform the rights of disabled people. Disabled people do not want to be told that they cannot work. Instead, they want society to remove the discrimination that makes it harder for them to work. So we will double the Access to Work budget, paying for sign language interpreters, specialised IT or help with mobility. Our aspiration is that everyone who could benefit from access to work should be able to do so. We will also consult on a new right to control. We know that individual budgets work. I want to give disabled people the right to know how much the state is spending on them, and request that that money be given to them as a budget that they control. We want to put disabled people in control, not under the control of others.
The fourth goal is to strengthen parental responsibility. We have lifted 600,000 children out of poverty and, following the £1 billion invested in the Budget, we are set to help another 500,000. But we need to strengthen family life, too. So, for the first time, we will allow parents on benefits to keep all their maintenance payments and require both parents to register the birth of their child. Together with our changes to lone parent benefits, we estimate that these welfare reforms will lift 200,000 children out of poverty.
Fifthly and finally, we propose to devolve power, so that services can be personalised to the needs of the individual. We want a triple devolution: to our advisers, to our providers and to local communities. Jobcentre Plus is recognised as one of the best back-to-work agencies in the world. Its staff have unrivalled knowledge of their customers and their needs, so we will give our advisers greater flexibility over how much time they spend with each client. We will offer our providers the right to bid for any part of our services that they think they could do better. We will also give local communities the chance to shape how back-to-work services are delivered in their area.
Most of all, we will implement all the reforms in the Freud report, the report that inspires our Green Paper. We will release the creative energy of the private, voluntary and public sectors. By paying them out of the benefit savings that they generate, we will free our providers to help even more of our customers back into work. And, as David Freud recommended, we will simplify the bewildering complexity of the benefits system. We propose to abolish income support and move current customers on to JSA when resources allow. The result will be a dual system of working age benefits, with ESA offering the right help for sick and disabled people, and JSA doing the same for those actively seeking work or with caring responsibilities. The conditionality regime would be appropriate to each and would not change for carers or parents of younger children.
Today’s publication marks the beginning of the consultation process. We want these proposals to be shaped by the opinions of the public and Parliament, and by the expertise of charities, providers and academics.
In the past, people were able—in many cases encouraged—to spend a lifetime on benefits. Once they had signed on, the welfare system all too often switched off. There was no expectation that anything could change and precious little support to make that happen. This Green Paper ends all that. It puts us on the road to our ambition of an 80 per cent. employment rate, with 1 million people off incapacity benefit by 2015, the eradication of child poverty by 2020 and equality for disabled people by 2025. The Green Paper will also restore Beveridge’s third principle—the principle of incentive, opportunity and responsibility—to where it always should have been: right at the centre of the welfare state. For that reason, the Green Paper will transform the lives of hundreds of thousands of people. I commend it to the House.
I start by thanking the Secretary of State for an advance copy of his statement, although after last week the contents did not come as much of a surprise.
May I also congratulate the Secretary of State on getting the Green Paper out before the summer recess? I know that many in his party most definitely did not want it published three days before the Glasgow, East poll and I have some sympathy with them. If I were running a by-election campaign on which my leader’s future depended, I would not want such a document published in an area of high benefit dependency three days before polling day, either.[Interruption.] But then, hon. Members may suspect that the Secretary of State had other reasons for wanting the document published this week in particular.
Hon. Members may not know that the Secretary of State began his political career as Tony and Cherie Blair’s babysitter. He has come a long way since then—[Interruption]—and this Green Paper—
Order. I am sorry to interrupt the hon. Gentleman, but the House should give him a hearing, just as it did the Secretary of State.
Today marks the day when the Secretary of State comes into his inheritance as the Blairs’ outrider in the House of Commons.
Today, the whole House should pay tribute to David Freud for the work that he has done and the influence that he has had on the welfare reform debate. His work formed a key part of our welfare green paper in January and of today’s announcement.
Much of today’s package is a straight lift from our green paper published in January. It included our plans for compulsory community work programmes for people who have been out of work for more than two years out of three; the Government have now adopted that proposal. It included plans for an independent medical assessment for all claimants of incapacity benefit; the Government have adopted that proposal. It planned to change things so that people could no longer sign on and off benefits for a week to avoid back-to-work programmes; the Government have adopted that as well.
We should bear it in mind that when we announced our proposals in January, the former Secretary of State described them as uncosted and unworkable, so the Government’s Pauline conversion since then is very welcome. Since these are Conservative proposals that we are discussing today, we will certainly support them. Indeed, I know that the Secretary of State will have some difficulties getting them through his own party, so may I assure him that we will help him to get them through the House even if he does have a Back-Bench rebellion to contend with?
In fact, I would go further than that. Hon. Members should not underestimate the importance of today’s announcement and why I am so grateful to the Secretary of State. It is much too late to start making a difference to Britain’s benefits culture during this Parliament, but by starting early, this Government are laying the ground work for the next one. We always expected it to take two or three years to get the new system up and running and then for it to take some time after that—when the various pilot projects are done—to maximise the potential savings and benefits of these proposed programmes. Today’s announcement means that during the next Parliament—beyond any of the current spending review periods—we will see real savings that can be reinvested in eliminating the couple penalty in the tax credits system, and those plans will take 300,000 children out of poverty. I am very grateful to the Secretary of State for giving us a head start.
Let me ask the Secretary of State about two points of detail in relation to the Green Paper. First, how much additional budget does he have to pay for the extra back-to-work places that will be needed under Pathways to Work for those currently on incapacity benefit who will be tested between 2010 and 2013 in those areas that are not covered by the annual managed expenditure-departmental expenditure limts—AME-DEL—pilots? Secondly, given all the concerns raised about the employment and support allowance by pressure groups and Labour Back Benchers, can the Secretary of State confirm to the House that no individual will be worse off in real terms after they are transferred from IB to ESA?
The Opposition welcome today’s announcement enthusiastically. We look forward to a constructive debate about it and to trying to work with the Government to turn these proposals into reality as quickly as possible.
I welcome the hon. Gentleman’s support, of course. When parties agree on proposals, they should not invent artificial political differences. If something is the right thing to do for the country, that is exactly what we should do. The hon. Gentleman was not quite as complimentary as he was outside the House, when he said that the Green Paper was revolutionary, that he was “delighted” and thrilled and that the proposals were great news, but I will wait for him to write to me with those comments.
I am glad that, for the first time today, the hon. Gentleman has paid tribute to David Freud and his report. To listen to him sometimes, we would think that the Opposition had commissioned the David Freud report, but it was actually commissioned by the Government. When the Opposition published their green paper, they said:
“Our plan is to build a programme based around the concept set out by David Freud in his report.”
The Government commissioned the report, we have consulted on it and now we are implementing it.
I am reminded of the quote by Ronald Reagan—I am sure that he is someone the hon. Gentleman will approve of my quoting—who, I think, said that there is no limit to what someone can do in politics if they do not care who gets the credit. The hon. Gentleman can scrabble around trying to get the credit if he wants to; we will get on with doing the right thing for the country.
When the hon. Gentleman talks about Glasgow, East and Glasgow in general, he betrays a deep misunderstanding, which still pervades the Tory party, about parts of this country. It was the Conservative party that allowed that city to be abandoned for so long, and over the past 10 years, we have been putting that right by halving unemployment in Glasgow and reducing incapacity benefit by 25 per cent. That city has been transformed under a Labour leadership. The hon. Gentleman should be saying to people in Glasgow that he will provide them with that extra support. People will not say that they do not want that support. When I was there recently, people were asking for extra powers and extra support, and asking us finally to put right the mistake that the Conservatives made in the 1980s, which was to abandon people on incapacity benefit without the support that they deserved. We will put that right.
The hon. Gentleman asked two questions of detail. I am glad to be able to reassure him that the programme outside the areas with AME-DEL pilots—to use the jargon—are also fully funded by the Treasury, and that our budget will be increased to ensure that delivery. That will allow us to offer personalised support across the whole country, and AME-DEL will be on top of that. Also, the hon. Gentleman can be reassured that there will not be any cuts to people’s benefits. We will use a much better way of targeting people in the future, using the support group to get more money to people. That is exactly the right thing to do. It is also worth saying that, although these proposals build on David Freud’s recommendations, they go further in significant respects. The right to bid is a new initiative, as is the right to control. The doubling of the Access to Work budget and the full child maintenance disregard are new policies that encapsulate the idea behind our Green Paper that there should be support as well as responsibility.
If the Conservatives want to support that approach, there are two further lessons that they need to learn. The first is that responsibility without support is a hollow bargain, yet that is what the Conservatives are proposing. They say that they want to dismantle the tax credit system because it results in poverty disguised rather than poverty cured—
When did we say that?
The hon. Gentleman’s leader said last week that we had reached the end of the road for transferring money from the rich to the poor. That was a clear signal that a future Conservative Government would cut back on benefits for the poorest people in this country. We need the right approach—one that combines support and responsibility. The second lesson that the Conservatives need to learn is that any proposals that we or they make need to be costed and funded. They are agreeing to our policies today, and we welcome that, but that means that there is no further money to invest in the couples’ penalty, as the hon. Gentleman called it. That money is fully costed in our plans. I trust that, if he wants to repeat that proposal, he will find a new way of funding it. We welcome the Conservatives’ support. We will work with them and we hope that we can teach them those two lessons as well.
Given that the social security system compensates people with disabilities through the disability living allowance, and given that I thought most people agreed that it was unwise to have higher rates of benefit for people who stayed on benefit the longest, why did the Secretary of State reject the one radical move that he might have made today—namely, to introduce a single rate of benefit for all people who are workless, irrespective of the cause?
We continue to be interested in the proposals around a single benefit system. Indeed, we are taking a major step towards that today by abolishing income support on top of the abolition of incapacity benefit. That will lead to a system that is based essentially around two benefits: jobseeker’s allowance and the employment and support allowance. In the short term, however, going in the direction that my right hon. Friend suggests would involve either spending hundreds of millions of pounds to take the JSA rate up to the ESA rate, or reducing the benefit levels of disabled people on ESA, which is not something that we are prepared to do. We continue to look at proposals for a single benefit system, but I hope that my right hon. Friend will acknowledge that today’s proposals represent an important simplification.
It is good to have the opportunity to talk about welfare reform. I think that all my predecessor Lib Dem spokespeople have done so, given that this is the seventh Green Paper on the subject to be produced in the past 10 years. I thank the Secretary of State for giving us an advance copy of his statement, although I think I learned more from what I saw on television on Friday than I did from today’s statement.
I welcome the emphasis today on helping everyone back into work and the focus on the assumption that many more people are capable of contributing if they are given the right support. It is also good to see that the Department has persuaded the Treasury that a new funding model will be essential if this system is to work. I am also glad to see that there is finally recognition that the benefits system is far too complicated, which is something that the Liberal Democrats have been going on about for a number of years.
However, I would like to raise a number of concerns with the Secretary of State. The first is that these policies are very centralising, and that individuals do not appear to be at the centre of the reforms, no matter what he says. Every jobseeker is different. Many can easily find themselves a job within a few months and with very little assistance, but for others that simply is not the case. Instead of adopting centralised timetables, we should devolve more discretion to advisers in job centres and employment providers so that they know who is able to get jobs themselves and who will need assistance right from the start, rather than waiting a number of months before support can kick in—and the same should apply to sanctions.
My second concern is about privatisation in the current economic downturn. We agree that private and voluntary sector organisations should be involved in back-to-work support, but the Government’s approach is too centralising and large scale and the regional contracts are far too big for voluntary sector organisations to have much of a role in providing them. That will be exacerbated by the right to bid, as the only organisations with the capacity and resources to put in speculative bids will be big private sector companies rather than voluntary organisations.
That brings me to my biggest concern, which relates to the economic climate. Under the right to bid, there could be very little state provision left, but if it became apparent that the companies were finding it insufficiently profitable to provide those services or could not afford to run certain ones, there would be problems. Has the Secretary of State looked at the evidence and can he assure us that that will not happen?
My third concern is the system’s complexity. The Green Paper reflects what we have said for a number of years—that the benefit system is too complex—but genuine simplification seems to be on the backburner. Will the Secretary of State provide more detail on what he wants the simplification of the system to achieve and a timetable for doing so? Given that the Conservatives say that the Government have adopted all their ideas, may I recommend that the Secretary of State implements the Liberal Democrat policy of a single working age benefit?
Tackling poverty is the next matter of concern. The Green Paper is based on welfare to work—getting people into work as the route out of poverty—but more children with working parents were living in poverty last year than were children with no parents in work. The number of children of working parents living in poverty has risen over in the past three years, whereas the comparable number of children in poverty with parents out of work has fallen. The lesson appears to be that, under this Government, work does not pay. How do the Government plan to tackle that problem? If this is a genuinely cross-departmental initiative, will the tax credit system be taken into account when looking at benefit simplification?
The final matter I want to raise with the Secretary of State is that of mental health. The Green Paper talks about drugs misusers, but does not mention people with alcohol problems. In fact, more than a million people on incapacity benefit have mental health problems, which is barely mentioned at all. Although we welcome some elements of the Green Paper, I would be grateful for more suggestions about what it will do to help that large group of people. I look forward to the Secretary of State answering my questions and to seeing the legislation that results from the Green Paper.
I welcome the hon. Lady’s backing for our support measures, the new funding mechanism and the simplification measures. We are, of course, happy to continue to reflect on proposals for a single working age benefit, but I think that the Liberal Democrats have to say how they would achieve that. Which benefit rates would they cut in order to have that harmonisation; or, if they are not proposing to cut any benefits, where would they find the extra money to lift everybody up to the level of the highest benefits within the system? [Interruption.] I note that the hon. Lady says that she is happy to have that conversation and I would happy to hear her set out her proposals.
It is also important to say that we want to give greater discretion to our advisers. They already exercise quite a lot of discretion, but we want to go further—for example, by giving them more time to discuss issues with people who may need half an hour or a bit longer, so spending correspondingly less time with those who are already looking for work and may need only a couple of minutes to arrange the next interview. We also want to give more discretion to our providers. That is why we are following the so-called black-box approach, where we set the outcomes and the results we want to achieve, but we also free up the people involved to determine how they actually achieve those ends. Where the private and voluntary sector is concerned, it is important that we do not curtail discretion with too many centralised rules.
The hon. Lady is absolutely right that the third sector and social enterprise have a vital role to play in the delivery of services. Indeed, they already do so, and we are determined that, as we bring in these prime providers, that will be a way of improving our work with the third sector. That is exactly why I have asked the Association of Chief Executives of Voluntary Organisations and Tony Hawkshead from Groundwork to lead a taskforce looking specifically into this issue. If the hon. Lady has any suggestions, we would be happy to consider them.
The hon. Lady is wrong to say that the Green Paper does not mention the important issue of mental health. It says specifically that our interventions with pathways for people with mental health problems have not been as successful as others. They have had some success, but we want to look at how to make them more effective, how we can dovetail that with improving access to the psychological therapies roll-out—the roll-out of talking therapy led by the NHS—and how we can work with local areas to improve the co-ordination of mental health and back-to-work services. Work is often the best way of helping people to improve their mental health. We also need to work with employers to change the culture of stigma that too often still applies to people who have mental heath problems.
The hon. Lady asked about child poverty, and we all agree that its eradication is an important goal. I am not sure that she agrees with us, however, on the target of eradicating child poverty by 2020. [Interruption.] I am glad that the Liberal Democrats are now formally committed to the 2020 and 2010 targets. [Interruption.] I am not sure that their commitment is entirely clear. I am interested in how they could achieve that commitment given that their leader wants to cut £20 billion of public expenditure. It will be hard for her to square that circle. I look forward to her trying to do so, but also to working with her on those parts of the Green Paper on which we agree.
In congratulating my right hon. Friend on his statement, may I say that it is part of an evolving process over some years whereby the Government have concentrated their efforts on those who are completely isolated from the world of work, who have become used to dependence on benefits, and who have perhaps become comfortable in poverty, which is not a position that we should be satisfied for them to be in? Will he continue to consult those who understand people who have become comfortable in poverty, and not those who feel that people in poverty are scroungers? Does that not preclude consulting the Conservative party?
My hon. Friend is absolutely right to suggest that we should never stigmatise people in poverty and that the vast majority of people on IB want to work. We want to provide them with exactly that support, and that is what Pathways to Work does—it provides them with help to manage and improve their condition and to get back into work. It improves the chances of people being in work from 28 per cent. to 35 per cent., and we want to ensure that everyone has the chance to get that support.
The Secretary of State will not be surprised that I welcome him announcing policies that I originally enunciated ahead of the 1997 election. I congratulate the three people responsible for today’s statement: himself for delivering it; David Freud for persuading him to do so; and my hon. Friend the shadow spokesman for his powers of ventriloquism in spelling out the policies that the Secretary of State has enunciated today.
However, has the Secretary of State committed himself to David Freud’s central proposal, which is based on his realisation that getting people into work is good for the workless person and the taxpayer, but that those who find jobs and help people back into work are not rewarded? Will he reward the success of those in the public sector and in the private and voluntary sectors who bid for programmes getting people back into work? Will he pay them by their results? If so, why has he not spelled out how he will deal with the two central problems—parking people who are difficult to get back into work, and creaming off those who are easy to get back into work? Those are the central issues, and he has not even addressed them in his statement.
I am happy to do so. I confirm, as I said in my statement, that we will pay people by results. We are already doing that in the flexible new deal contracts that we are letting, and in pathways. We will take that approach further with the new funding mechanism—the awfully named AME-DEL mechanism. That will enable us to pay people out of future benefit savings. Instead of leaving people on benefits and then paying the cost, the money will be brought forward and invested. That will improve those people’s lives and ensure that we save money, which can be reinvested elsewhere.
In the flexible new deal, for example, we will avoid people being parked—as the right hon. Gentleman called it—and left without any help, or cream-skimmed, as he also said, by requiring everybody to do at least four weeks mandatory work. As that requirement will be expensive, it will give providers an incentive to get everyone back to work so that they do not have to spend the money. As we develop our new contracts, we will ensure that people are given the right incentives to help everyone—from those who are hardest to help to those who are closest to the labour market.
I congratulate my right hon. Friend and his ministerial team on today’s announcement of measures building on the early new deal and employment zone partnerships—which have taught us a great deal—and on the principles set out by the Government in 2005. I particularly welcome the doubling of the Access to Work budget.
Will my right hon. Friend say something about the timetable for social fund reform, which will be widely welcomed by the 10 major anti-poverty charities with which I have had the privilege of working, and by the 2.5 million people who rely on legal but incredibly high APR repayment rates of more than 180 per cent. and who are caught in poverty as a consequence?
Let me also thank the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Warwick and Leamington (Mr. Plaskitt), for his tenacity in sticking to the issue and avoiding those who would drag him down with their inevitable conservatism.
I echo those congratulations, and also congratulate my right hon. Friend on the work that he has done. The employment zones, which I believe he started, have been one of the inspirations for our work in giving people more flexibility and rewarding them on the basis of the outcomes that they deliver.
My right hon. Friend was right to point out that reforming the social fund and, in particular, trying to eradicate loan sharks and the terrible damage that they do to many people in our constituencies are at the heart of what we are attempting to do in the Green Paper. We intend to include in our welfare reform Bill powers enabling us to conduct a major pilot to establish how we can reform the social fund so that it can benefit more people, as well as taking significant steps towards getting rid of loan sharks. I look forward to working with my right hon. Friend on those proposals.
In his statement, the Secretary of State said that he wanted to give disabled people the right to know how much the state was spending on them, and to request that the money be given to them as a budget that they could control. I welcome that move towards individual budgets, but will the Secretary of State tell us whether they will contain not just the sums that his Department spends, but the money spent by local authorities on adult services and, more radically, by the national health service?
We want to include as many funding sources as possible, and there is wide support for that across government. We have seen the way in which giving people control can improve their satisfaction with services, ensure that those services are much more appropriate to their needs, and reduce costs. We will certainly examine local authority spending, as well as a range of other spending. As the right hon. Gentleman will know, the NHS is piloting its own individual budgets approach, and we have agreed to build on that. We will consult widely on how we can proceed with our radical proposal.
As my right hon. Friend will know, numerous people in constituencies such as mine began receiving incapacity and other benefits when the last Government closed the mines and steelworks, and we have a deep problem because so many people have been receiving those benefits for so many years. However, I have observed the exceptionally good work of Jobcentre Plus staff and some of the special teams that pathways has put together, and that of organisations in the voluntary sector that are working with people who have given up on themselves and their families. Can my right hon. Friend assure me, and other Members with constituencies similar to mine, that that special work—done, in some cases, by very small voluntary sector agencies—can be continued and strengthened, so that many more people who have given up will find that there are ways back to the normal world of work for them and their families?
My right hon. Friend is absolutely right, and I can give her precisely that reassurance. That is why the commission I have mentioned is looking into how we can maximise the role of the voluntary sector and of social enterprise in helping people. She is right to emphasise the importance of those specialist voluntary groups that provide services that no one else can. She also makes it clear that people in her constituency, and constituencies such as mine, who have been out of work sometimes for as long as 10 or 20 years want help to get back into work. She and I will have met many people who have received such help and who have said, “I wish I’d done that years ago.” These proposals will address precisely that situation.
The Secretary of State will know that the best providers in the field of back-to-work support say that it can take five years to get somebody into work. Is he prepared to let contracts of that length, and if he is, will he ensure that, should the Government decide to change the terms of the contract or to walk away from it, they will, in accordance with best practice, negotiate proper compensation?
Yes and yes.
I particularly welcome my right hon. Friend’s commitment to doubling the Access to Work budget, not only because it will help more disabled people back into work, but because it will help employers retain in the work force people who, through sickness or disability, might otherwise be lost from it, which would be bad for employers as they would lose skills and loyalty, and bad for the individual, who needs to retain the dignity of work. However, in taking these policies forward, will my right hon. Friend remember that there are wolves in sheep’s clothing in this place and that we are hearing some good advice today from Members who in the past told us that unemployment was a price worth paying?
My hon. Friend is right about the importance of Access to Work. These proposals will give employers the confidence to employ disabled people because they will know that the state will be there to help with any costs that are not to be met under the Disability Discrimination Act 1995. They will also help us cope more effectively with fluctuating conditions, and they will mean that Access to Work will no longer be the best kept secret in my Department. We look forward to working with my hon. Friend on making these proposals work.
May I bring to the Secretary of State’s attention the predicament of a uniquely disadvantaged group of disabled people: the blind and those with severe visual impairment? I know that he and his fellow Ministers have had constructive discussions with the Royal National Institute of Blind People and others representing the blind. Will this group of people now be able to qualify for the higher rate mobility allowance, and can the Secretary of State say how much that is likely to cost and whether it will be possible to meet it from within the budgets he has now been able to establish?
This Green Paper does not cover disability living allowance, so there are no proposals on that issue. The hon. Gentleman is right to say that we work closely with the RNIB on it, and we are not against the principle. Some of our discussions have helped to refine the proposal, but we want to continue to work with the institute on the proposal, and we are also happy to continue discussions with Members of this House on the issue.
I welcome today’s statement, which will support people into work and out of poverty. Will my right hon. Friend explain in a little more detail how his proposals will help those individuals who face multiple barriers into work? They could be a lone parent, disabled, from a minority ethnic group or lack any educational qualifications. How will his proposals help such individuals?
That is a very important point, and the Select Committee on which my hon. Friend serves has repeatedly spoken about it. It is the inspiration behind the approach to the flexible new deal and what we are doing with Pathways to Work. Instead of grouping people into the new deal for disabled people, the new deal for lone parents or the new deal for 50-plus as we have done in the past, we will have a single new deal—the flexible new deal—which will allow individuals to be treated according to their circumstances, so that we can help them overcome the barriers to work that they face. That is the approach that will be taken with people on incapacity benefit as well. We want to look at whether we can go even further and have contracts that bring people from different client groups together—those on jobseeker’s allowance, or on the employment and support allowance—to give even greater discretion to our providers, so that they can help the person across the desk from them, rather than a notional group invented in Whitehall.
Last week, I tabled a written question asking the right hon. Gentleman to place before the House the work-focused health-related assessment questionnaire that claimants of the employment and support allowance will need to complete from October. I seek an assurance from him that those assessing the applications will have the necessary specialisms to deal with some of the more complex conditions, in particular the range of learning disability and autistic spectrum disorders. There is a tipping point between giving such people the opportunity to work if we can make that happen—we should, of course, do that—and not undermining their ability to maintain independent living. Such living is sometimes obtained only if there is a recognition that it takes a lot more out of them than it does out of other people
The hon. Lady makes an important point. I am afraid that I have not yet seen her question. She refers to probably the worst of our acronyms: the WFHRA—the work-focused health-related assessment—as it is called in the Department. It is perhaps not the best known of things, but it is vital to the system, because it will not only allow the test to be a medical one, but people with medical expertise and people with expertise in getting people back into work will be able jointly to discuss the right approach for the individual. We want to do that much better to help the kinds of people to whom she referred: those with learning disabilities and people with an autistic spectrum disorder. They will be much better helped under this new test, which is based on consultation with people who have expertise about those conditions. This approach also explains why we want to expand the Workprep and Workstep programmes, which are of particular help to people in those categories.
My right hon. Friend has thought perhaps not the unthinkable, but the now thinkable because of the support that his Government have given people in the position that we are discussing. The mentally ill cannot always do work in the same way, and they can come and go. Flexibility of work is important, and that is often available only in the public sector, so does he agree that the public sector sometimes needs to have an opportunity where the private sector does not achieve things?
My hon. Friend is right to say that the public sector needs to play its part and that we need to use procurement to make a big difference in the agenda that he mentions. We need to change the culture in all areas of our work force, as I am sure he would agree. As we were discussing, we need to remove the stigma around mental health. Our Pathways to Work support helps people to cope with fluctuating conditions by giving them the skills to do so. The higher allowance that people will be able to earn in the new employment and support allowance will allow them to try work for more hours than they were able to do previously and, if that works, they will then be able to move into full-time work. If they then want to come out of work, they can return to their previous rate of benefits without fearing that they will then be stranded on a lower rate of benefit.
There is a story in The Herald today suggesting that Glasgow is to be a pilot for all these proposals, but that, surprise, surprise, no announcement is to be made before Thursday. The Chancellor and Prime Minister have been conspicuous by their absence from the streets of Glasgow in the past few weeks. Surely they should now come to Glasgow to explain fully their intentions to the people of Glasgow—if they dare.
I do not know what to say to that. Unfortunately, if we had done the opposite and not included Scotland, the hon. Gentleman would be saying that it was an outrage that we were helping people in all other parts of the United Kingdom but not those in Scotland. As he knows, the election purdah rules restrict what we can say about Glasgow specifically. He should also know that what we are doing in terms of devolving powers to people is based specifically on what people in Glasgow and, in particular, the Labour council, have asked us to do. It has an innovative and radical approach of guaranteeing apprenticeships to all young people. It is doing that in spite of the cuts that his Administration are making to apprenticeships in that country. He needs to step up to the plate to provide the child care, the drugs treatment and the apprenticeships to make this policy work. I trust that he will do just that, rather than scoring political points.
My friend told us in his statement that Jobcentre Plus is recognised as one of the best back-to-work agencies in the world. Does he have a target for the number of civil servants that he would like transferred to the private and voluntary sectors to deliver the new proposals?
No, because that would be very much the old agenda of trying to privatise things and this is exactly the opposite; it is to say that we now have the private and voluntary sectors as part of business as usual in the DWP. They deliver a third of our services. That is a massive transformation compared with the system that we inherited from the Conservative party, and we do that because they provide good services. If the private and voluntary sectors or social enterprise organisations can help to improve our services, we should do exactly that. I hope that my hon. Friend will welcome that and back it.
The Secretary of State has been studying our green papers closely and I commend that, but he will know that the proposed right to bid appears in our voluntary sector green paper. We call it the right to supply. Will he implement that fully and, in particular, allow charities and social enterprises to make a return of surplus to reinvest if they succeed, and not limit them just to having their costs returned?
I hope that it will not offend the hon. Gentleman too much if I say that I have not read that particular green paper, which I think was published relatively recently. I think that our proposal was made before his green paper came out. The key point is that we want people who provide good services to be able to make good profits and, if they are in the voluntary or social enterprise sectors, to be well rewarded. Such an approach will improve our services.
I welcome my right hon. Friend’s statement. Lone parents and carers would also benefit from the availability of more flexible work. Will steps be taken to promote flexible working, so that many more such jobs are flagged up and advertised, and many more people can be encouraged back to work?
Yes, that is a good point and it is exactly what we are doing as part of our local employment partnerships and in taking forward the carers strategy. Many carers say that they want to return to work and we have worked closely with Carers UK to ensure that we can deliver services that are specific to carers and to help them to overcome the particular barriers that they face.
Will there be any restriction, limitation or guidance on the range of occupations that may be expected to be taken up by those who are perhaps slightly choosy about the work that they would like to do? People in my constituency often look around, see a load of litter and ask why it is not being picked up, perhaps by young offenders doing community service, and we are told that that is because such work is considered demeaning. Will any particular guidance be given on the range of occupations that people may be expected to take up whether they like it or not?
That will be up to our providers. That is an example of what I was saying about our not telling our providers exactly how to deliver the service. We will reward them on the basis of results and it should be up to them to determine the kind of work, and combination of work and skills in preparation for returning to work, that will be right for the people for whom it is provided. I do not want to undermine the innovation of the private, voluntary and public sectors by defining from the centre how they should deliver, but we should not be stigmatising people but rather doing what will help them to get back into work. If we end up stigmatising people, we make it harder to do that.
Ever since the pits closed across south Wales, far too many of my constituents have been consigned to a life of benefits-based poverty, so I wholly welcome what my right hon. Friend says. But one significant problem is that more than 50 per cent. of my constituents on incapacity benefit receive it for mental health reasons, and many employers are chary of employing people with such problems, so what will be done about that? Has he spoken with the Welsh Assembly to ensure that more talking therapies are available in south Wales so that we do not just have people popping pills all the time?
My hon. Friend is absolutely right. Those are vital steps to take to increase the employment rate among people with mental health conditions, which I think is the lowest rate for any of the conditions that we are trying to help people with. We need to remove the stigma around mental health and to improve the provision of talking therapies, as he says, and he will be glad to know that we are in close contact with the Welsh Assembly Government to ensure that we can dovetail our policies. As he knows, the whole approach that Pathways to Work follows was piloted and inspired by work done in Wales, and that is why we are confident that it will be the right approach in Wales as it will be in the rest of the UK.
As somebody who likes to think that he is on the right wing of the Conservative party, I am thrilled to hear today’s statement, which is great news. In that statement, the Secretary of State says that for the 2 per cent. anticipated to be still out of work after two years, mandatory full-time work programmes will be explored. Does he mean that he will explore whether to have such programmes, or explore the details of programmes that we will definitely have?
No, we will spend £20 million on those programmes. It will be a national pilot. We want to work out what works and then roll it out.
As a general principle, it is hard to overstate the importance of fathers’ involvement in the lives of their children, but people have messy and complicated lives. It would not be unfair to say that the history of Parliament reminds us that not just people on benefits have messy and complicated lives. I welcome the announcement that people on benefits will have maintenance payments disregarded, which is a very positive thing, but will the Secretary of State assure me that women who, for good reason or through no fault of their own, are unable to have a father registered at the birth of their child will not be penalised?
Yes, I can absolutely give my hon. Friend that reassurance. The proposals are based on what has happened in Australia, where they have got the balance absolutely right. The default is that both parents have to be registered, but not when it is impractical or not in the interests of the child. I hope that when she sees our proposals, she will be reassured.
I broadly welcome this move, which in many ways follows UKIP’s welfare to work policy, as it does Liberal and Conservative policies. May I ask how the Secretary of State will ensure that decisions taken by the providers on the type of work and on enforcing work over the mandatory four-week period will be maintained as rational and non-discriminatory? Will there be any appeals? How will the quality of the decision be underwritten?
It is absolutely right that the proposals should be subject to review and that they should be carried out in the right way. I am delighted to see that the hon. Gentleman’s parliamentary party is completely united behind his leadership in backing our proposals.
I very much welcome the proposals in the Green Paper to require people to seek drug treatment if they want to carry on claiming benefit. I have not yet had a chance to speak to many agencies in my constituency, many of whom are providing excellent drug treatment, but I suspect that they would have two concerns. First, it can be quite difficult to provide treatment to people if they are being compelled to attend rather than doing so through their own free will. The second point is on the simple question of funding. Such agencies are already rather overstretched. They would be delighted to be able to offer services to whoever puts themselves forward, but how will they be able to fund that?
As my hon. Friend knows, we have the progress2work programme, which helps people with drug addiction or previous drug addiction to overcome their addiction and get back into work. That is the approach that we want to build on.
This is a radical proposal that was inspired by conversations with people who are recovering or are in recovery from drug addiction. They say that at the moment the system treats them as though they are jobseekers when they are trying to recover. For example, we have been asking people to go to work focused interviews bang in the middle of carrying out their rehab. Clearly, that is the wrong approach. We need instead to work with charities and organisations in the field to see how we can provide them with the employment support and the treatment that they need to ensure that people can get off drugs. Drugs, as my hon. Friend knows, scar families, can scar communities and are a significant cause of poverty. If we can help people to treat themselves, we can help communities too.
I understand the Government and the Secretary of State’s desire to move people off incapacity benefit and on to jobseeker’s allowance so that they can get into employment, but there seems to be a flaw in the current policy because 50 per cent. of the appeals against being moved off incapacity benefit and on to jobseeker’s allowance are being upheld. Does the Secretary of State have some concern that vulnerable people are being moved off incapacity benefit who should really still be on it?
That is exactly why we want a new test for the employment and support allowance. We think that the previous test did not identify the right people. We think that the new test, the work capability assessment, will do that more effectively. Of course, we want to reduce the level of successful appeals and to take the right decision at the initial stage. The problem is often that people supply different and additional information at the second stage, meaning that a different decision turns out to be needed, which we had no way of knowing in the first place.
I warmly welcome the statement. I represent some blind and partially sighted people and the major obstacle we face in terms of Access to Work is making employers confident about employing disabled people. They see the disability, not the ability. How will my right hon. Friend engage with employers to bring them on board and make them feel confident that this is a serious opportunity for them?
My hon. Friend is absolutely right. If we do not use the potential of everybody in the work force, including disabled people, we are, first, not giving them the chance to realise their ambitions and, secondly, not having as successful a work force as we otherwise could. Access to Work will give employers confidence that if there are extra costs, they can be met from the Access to Work budget. It is vital that we change attitudes, and our employability campaign is doing exactly that. Recently, my right hon. Friend the Minister for Employment and Welfare Reform spoke to a primary care trust whose research showed that people who had come off incapacity benefit were less likely to take time off than the rest of the work force. People who had got better and gone back to work were determined not to go back.
Success has many parents and failure is an orphan, so it is no wonder there has been such widespread support for the Secretary of State’s announcement today. However, one part of his statement bears the unmistakeable leitmotif of the section of the party of which he is a distinguished luminary; I speak of the desire to outsource and privatise anything that is not bolted down. Will he tell the House what standards he will expect and impose on those who will want to deliver services so that he does not finish up in the same situation as his Cabinet colleague, the Secretary of State for Children, Schools and Families, dealing with firms such as ETS, which have a voracious appetite but not the competence to go with it?
Obviously, it would be wrong for me to comment on that issue. We want to use good providers and to choose people who will provide good services. We do not have to choose the cheapest provider; we can choose providers on the basis of quality. We value immensely the work of people in the DWP. It is a very good delivery Department, which has transformed its services over the past few years. We have reduced the head count by 30,000 but improved our productivity and services. We should thank our civil servants more often for their fantastic work.
It is right that when people can work, they do. No one would disagree with that, but what about people who can work only sometimes? There are such people on incapacity benefit and they would very much like to get back to work but they may have difficulty finding employers, particularly in the private sector. It is a lot to expect a small business to take on someone who may be off work from time to time with illness. The public sector has to play a massive role in getting people back to work—not only the voluntary sector.
That is absolutely right. All sectors must play their part. The doubling of the Access to Work budget will help, as will the higher amount that people will be able to earn on ESA—I think it is £86.35—which will allow them to try out work before having to decide whether to come off the benefit.