I draw the House’s attention to the fact that today, as I referenced earlier, the Department for Work and Pensions and Her Majesty’s Revenue and Customs published a joint strategy to tackle fraud and error in the benefits system, which we believe should save £5 billion each year. The proposals in the fraud and error strategy, which together represent an additional £425 million of funding over the next four years, will, we believe, deliver a £1.4 billion reduction in fraud and error by 2014-15.
Can the Secretary of State explain to a large number of my constituents why he reduced the support for mortgage interest payments before his Department ensured that mortgage lenders would average out rates? Why did he communicate this only a few days before it was reduced, and is it not true that lenders are fighting this reform tooth and nail?
I do not know whether the hon. Gentleman was listening to the Minister of State, my hon. Friend the Member for Thornbury and Yate (Steve Webb), when he pointed out that the last Government left plans to slash that support. It is we who have actually brought it to the average, which means that people will do better under us than they ever would have done under the last Government—so an apology would do very nicely thank you.
T2. I know that the Secretary of State is aware of conversations I have been having in my constituency with youth leaders about how we can communicate changes in the welfare programme to young people who do not watch the Parliament Channel and sometimes do not read the papers. Do we have a campaign plan to try to communicate the changes to them, perhaps through texting or facebooking and the internet? (17507)
We do indeed. My hon. Friend is right to draw the matter to the House’s attention. Using new media, it is important that we ensure that young people are brought fully into the net, particularly through voluntary sector organisations, which are much better at using the new media. However, I must also draw her attention to the Department’s commitment—a commitment that I have made—to ensure that older people approaching retirement should not retire without the ability to use the net and the web. That is a big commitment but one that we will stand by.
Last week, PricewaterhouseCoopers suggested that 1 million jobs could be lost over the next year. Given the answer we just heard from the Secretary of State and the present uncertainty in the labour market, will he confirm again that people affected by the change he just discussed will do very nicely—as he said—and assure the House that the reduction in the interest rate used for the support for mortgage interest programme will not lead to a rise in the number of repossessions among the approximately 255,000 people affected?
I welcome the right hon. Gentleman to his position, although it would have been nice if he had risen at the Dispatch Box and first apologised for being part of a Government who left plans to cut the support to mortgage holders—[Interruption.] Yes, as the Minister of State, my hon. Friend the Member for Thornbury and Yate implies, they planned to slash the rate. So when the right hon. Member for Paisley and Renfrewshire South (Mr Alexander) next gets to the Dispatch Box, perhaps he will tell the world that he was going to do that, and apologise. We will give the support necessary and reform the system. As he knows, organisations and individuals, including a lot of very senior businessmen today, have said that our economy will grow, that they will provide the jobs and that therefore this Government will be right.
I am delighted to tell my hon. Friend that we are looking to expand the support available to people in parts of the country that are particularly affected by unemployment and that have a small local private sector economy. We will provide enhanced support from early next year, including through more money than is currently on offer to help the self-employed and—this is particularly important—through mentoring for small businesses, to ensure that people have practical advice and guidance so that they not only set up small businesses, but those businesses survive, grow and flourish.
T5. Will the Secretary of State join me in recognising the great contribution that the 54 supported employment Remploy factories make to our country? Even at this late hour, will he agree to lobby the Treasury on their behalf? It would be entirely unfair and unacceptable for 3,000 of the most vulnerable disabled workers to be handed their P45s by the Chancellor on Wednesday. (17510)
I thank the hon. Gentleman for his question, and I agree that Remploy plays an important part in providing employment services for disabled people. As he would expect, we have been looking at the contribution that Remploy makes as part of the spending review process. I would just urge him perhaps not to believe everything that he reads in the newspaper, and say that he will get further details on Wednesday when the Chancellor speaks.
T4. Following a succession of soundbites from the previous Government, who promised to be tough on benefit fraud but delivered, as usual, very little, can my right hon. Friend the Secretary of State explain to the House why he thinks the new initiatives that he has proposed today will succeed where those of other Governments have failed? (17509)
Yes, I can. One thing that it is important for everybody to understand is that not only will we have the three-strikes policy, but we will try to disincentivise people in what I call the low-level area of fraud, which is when they knowingly fail to report changes in their circumstances. In those cases, there will be the ability to fine them £50 on the spot, which will have a big effect on people saying, “Well, I forgot and I didn’t do it.” Providing that we think they knew, it is time they realised that they have, in fact, defrauded the state as well.
T6. Does the Secretary of State accept that the result of changing indexation from the retail prices index to the consumer prices index is that pension increases in 2012 will be cut from 4.6 to 3.1%? Is that what he regards as fairness? (17511)
The right hon. Gentleman is probably not aware that the planned increase in 2012 under the Labour spending plans was 2.4%, which was what the previous Government thought earnings would be. Whatever the pension rises, we have guaranteed that the increase will be at least 2.5%, so whatever we do, it will be more than he had planned.
T7. Before the election, one of the policies that resonated most with my constituents was the Conservative plan to eliminate the couple penalty—the absurdity whereby people can be better off splitting up as a family than staying together. Can my right hon. Friend assure me that that penalty will be erased completely in the next few years, and that there will be no unintended consequences of any other policies that we might be putting forward? (17512)
I must say that this remains a target for us, which is—[Interruption.] It is all very well for the Opposition to laugh: they are the ones who created the couple penalty. They could not care less whether people had to split up because of their benefits bills; the disincentives were all there and they created them. We will do our level best to eradicate them.
On the Secretary of State’s announced crackdown on people fraudulently claiming benefits, the latest figures from his Department for fraud and error in the benefits system show that £1 billion is due to fraud, but that another £1 billion is due to official error. How will he ensure that his campaign against fraud is as high profile as any campaign against official error in his Department?
I thank the hon. Lady for her question. The reality is that going after error—and not just fraud—is a critical component. As I said earlier, one of the big changes that we are making is the reform of the benefits system, which is so incredibly complex that many of my officials say that often they simply cannot quite figure it out until 45 minutes or an hour of serious study for each case. Simplifying the system will reduce the scope for error, which will be in the interests of all her constituents and members of my Department.
T8. A constituent with bowel cancer has been found fit for work, despite having his colostomy bag changed 16 times a day. He is now going through appeal. How will my right hon. Friend ensure that those who are genuinely and obviously not fit for work are dealt with more humanely? (17513)
The point about cancer patients is a particularly apposite one. One thing I was astonished to discover on taking office was that we still had tough return-to-work requirements for those going through chemotherapy. Anybody who knows someone who has been through that knows it is a time when people cannot possibly return to work. We have sought to change that and we will make a number of other changes through the Harrington review. As I said earlier, our goal is, above all, to get this right. I do not want to do the wrong thing by those people who need support; I do want to do the right thing by the people with the potential to get back into work and make a better lot of their lives.
Does the Minister agree that we want to minimise the number of people claiming mortgage interest payments by keeping them in work? Does he agree that the best way of keeping my constituents in work is to ensure that the aircraft carrier goes ahead?
T9. My right hon. Friend would no doubt agree with me that the last Labour Administration presided over a system of welfare that trapped people in poverty and ignored devastatingly high levels of workless families in our country. Will he tell the House what he is going to do about it? (17514)
My hon. Friend will know that we are planning to bring forward a White Paper on reform of the benefits system soon. As I alluded to earlier, one of the biggest problems is that the existing benefit system has become so complex, with so many different withdrawal rates and different tapers—some at gross, some at net levels—done through different Departments. By bringing all that together and simplifying the system by giving people basically one withdrawal rate, we should be able to allow them to understand what they will retain, while also ensuring that work always pays. That, I think, is in the interest of everyone in the House.
I welcome what the Minister of State, the right hon. Member for Epsom and Ewell (Chris Grayling), said previously about looking into the work capability assessment. I met a delegation from Chesterfield and north Derbyshire on Thursday, although they were due to have a meeting with him. One in the group was told that she was fit to work four days before a cancer operation, while another who had a plaster cast the whole length of his arm was told that he was fit to work. Unfortunately, the Minister cancelled his appointment to see them on the day before they came down to London. Will he commit to seeing them? If he really wants to learn about the work capability assessment, he should meet some of the people who have been affected by it.
I did not cancel any appointment, and I had a meeting with the TUC official who organised the rally on that day. What I cannot do is get into discussion of every individual case. My goal remains to do the right thing by those people who are on incapacity benefit in the long term. We need to modify and refine the work capability assessment based on the best information available to us. What we face today is what we inherited from the previous Government. What I am doing right now is trying to improve it so that it is as foolproof as possible when we come to the national roll-out next spring. I will do my best to get that right and I hope there will be cross-party support for doing so.
It is always very difficult to know what keeps auditors happy—or if they are among that breed of people who are never happy—but the reality is that we are in discussions with them about the need to be a little more realistic between the two groups to make sure that the accounts are signed off in future. After all, this Department has made huge strides—both under the last Government and this one—to be more efficient. That has been acknowledged by the auditors, so perhaps it is time for us to come to a conclusion.
The Government have said that the June Budget will have no impact on child poverty up to 2012. Will the Minister confirm that the new benefits cap will not change that fact? Will he publish the figures to demonstrate the effect of the cap on all categories?
I thank the hon. Lady for her question. As she knows, we will produce our child poverty strategy in full by March next year. We will shortly go into consultation on it and I hope that she will contribute. On the effect of the cap on families living in poverty, as the Minister of State, my right hon. Friend the Member for Epsom and Ewell (Chris Grayling), said earlier, this is about people earning the equivalent of a gross income of £35,000 a year; the majority of families earning that would not fall into poverty.
How will the Minister ensure that lessons are learned from the review of the new work capability assessment, including, as discussed earlier, from the use of more medical information from claimants’ doctors, and how will those lessons inform the design of the medical assessment process for disability living allowance claimants when that is introduced?
I thank my hon. Friend for her question. I should like to set the record straight on that. There is no intention to introduce a medical assessment for DLA. The work capability assessment, which, after all, tests people’s ability to get into work, is very different. DLA is a benefit that is paid to disabled people to make up the additional costs that they incur for being disabled; it is not linked to their ability to work.
I welcome the earlier remarks of the Under-Secretary on achieving equality for disabled people by helping them back into work. Does she recognise the excellent work done by the RNIB college in my constituency to help those who are blind or visually impaired back into work? Will she visit the college with me at some point?
I thank my hon. Friend for her question. We have many different strategies for supporting disabled people back into work, and I know that the college in her constituency has done a great deal of work in that respect. I believe that there are plans to meet officials from her college in the not-too-distant future.
Many people in Sefton who work in the private sector rely for their livelihoods on customers who work in the public sector. What action will the Minister take to ensure that as a result of the comprehensive spending review, there is adequate provision in jobcentres around the country for both private and public sector workers?
Where we have issues in the labour market, whether public or private sector, we have a rapid response team within Jobcentre Plus that is available and able to provide advice to those who have lost their jobs. If the hon. Gentleman had read the letter that appeared in this morning’s media from some of our leading business people, whose businesses have a presence all around the country—we are also advised of this by the Office for Budget Responsibility—he would know that the private sector, in the right environment, with the deficit dealt with, can more than make up for any job losses that result of our dealing with the deficit, which we inherited from the previous Government.