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Work and Pensions

Volume 519: debated on Monday 22 November 2010

The Secretary of State was asked—


1. What recent assessment he has made of the effect of trends in longevity on his Department’s expenditure on pensions. (25106)

Between 2004 and 2008, our estimates of life expectancy at pension age rose by more than a year. For those who reach pension age this year alone, that will add £6.5 billion to their expected pensions over their lifetimes.

Does not increasing longevity make even more urgent the Department’s plans to get more people saving for their old age?

My hon. Friend is absolutely right. We have taken forward plans introduced by the previous Government for automatic enrolment into workplace pensions, so that as people are working for longer, they can still retire on decent pensions, through more workplace saving.

Everybody recognises that increasing age has an impact on the funding of pension schemes, but does the Minister accept that there is a huge difference between a population such as the one that I represent, in which life expectancy is some 10 years less for males and roughly the same for women, and those populations with the highest life expectancy in the country? Simply increasing the state retirement age has an unfair impact on communities such as mine.

The hon. Gentleman raises an important point, and it is one that we are aware of. However, he will be encouraged to learn that in the past decade, life expectancy for both manual workers and non-manual workers, for example, has risen by two years for men. Although there are still differences, both groups are seeing improvements in life expectancy.

Universal Credit

2. What steps his Department plans to take to assist employers to provide real-time pay data for universal credit computations. (25107)

Her Majesty’s Revenue and Customs is continuing to consult with employers on how best to collect real-time pay information. I should stress that the information required for the universal credit is already being collected by HMRC as part of its reforms to the pay-as-you-earn system, which are on track. The adoption of the new real-time information system, for the benefit of employers, universal credit customers and taxpayers, is already well on track.

Can the Secretary of State tell the House what proportion of the £2 billion allocated in the comprehensive spending review to implement the universal credit will go to support HMRC’s IT project, and what proportion will go as compensation, so as to avoid losers in the transition to the new universal benefit?

The right hon. Lady will forgive me if I do not give her the absolute details. We will be publishing the details shortly—well, soon, anyway—but I can tell her now that she can expect to see a significant amount, as a proportion, for the computer change. All this is covered by the money already granted through the settlement in the spending review—more than £2 billion—which will go to protect those who would have nominally been losers and to implement all the necessary IT changes, and to cover every other detail too.

I welcome my right hon. Friend’s earlier answer. In the light of several terrible cases in my constituency, does he agree that it is extraordinary that the whole system of credits was introduced at all without a proper real-time information system?

The PAYE system is ultimately the responsibility of my colleagues at HMRC, although we will obviously require an element of that to implement the change. That change will make life considerably easier for us in delivering those benefits without the normal mistakes that are made—mistakes that have caused overpayments to people, followed by attempts to claw them back that cause hardship for many people on low incomes. I believe that in due course the change will deliver a net benefit to everybody.

Under the Secretary of State’s proposals, councils are to use the real-time data to calculate entitlement to council tax benefit, although the entitlements will vary according to each local authority. What is his estimate of the cost to the Department for Work and Pensions of supporting councils in creating their own mini-benefits system in each locality?

I will give those details soon. I will not give them today, but I can say that we have already been working on the issue. We believe that, as things stand right now, we will manage the cost within our present budgets—it will not require anything extra for us. Of course, as the right hon. Gentleman said, it forms a challenge to us—I accept that—but localising elements of benefits is important to local people, and councils have very much wanted to do this. I will definitely give him the figures for that in due course, but we believe that we will be able to manage it, and I am more than happy to discuss that with him.

Work Programme

3. What steps he is taking to encourage social enterprises to become providers under the Work programme. (25109)

As the right hon. Lady knows, involving the specialist skills of the voluntary and social enterprise sectors in delivering the Work programme is extremely important, particularly where they have expertise in helping the hardest-to-help groups. Across the summer, we held a series of consultation events across the country, and we have had meetings through some of the professional organisations that represent different elements of the voluntary sector. The Minister for Welfare Reform—Lord Freud—and I have held meetings in the City to try to encourage financiers to support the voluntary sector in its approaches to the Work programme. I cannot give the right hon. Lady information about the specifics of the process today, because we will be publishing more details in due course, but I can assure her that we are keen to keep those organisations present.

I am grateful for the Minister’s reply. He knows that many social enterprises, such as Work Solutions, which does a fantastic job in the Ordsall area of Salford to get people back into work, have very tight margins, and often struggle with cash flow. If the national system is to be about payment by results, what measures will he take to ensure that small organisations, which are often without a financial buffer, can survive within the system and provide the specialist services that only they can provide?

We have introduced the Merlin standard, a new code of conduct for suppliers to the Department for Work and Pensions, which will apply to the prime contractors for the Work programme. They will be obliged to do the right thing to support their subcontractors appropriately financially. If they fail to do so, and treat their subcontractors financially inappropriately, they could lose their contracts. The system has just won an award for its role across Whitehall—there is potential for it to be used elsewhere in Whitehall—as best practice for dealing with small subcontractors. We must protect them, because they have a huge role to play.

Will the Minister join me in congratulating Progress Recruitment on its work in Blackpool? It is a social enterprise that works with many of the hardest-to-reach people in my constituency to get them back to work. Will he do all he can to encourage local government, when it again considers its service provision, to look at whether it can spin off organisations such as Progress Recruitment as social enterprises, as part of reconceptualising that service provision?

I certainly praise the work that has been done in Blackpool, and I praise my hon. Friend’s work in supporting that activity. Not many people understand the scale of the social challenge in Blackpool, and the work that is done by organisations such as the one in his constituency is extremely important. I very much hope that the framework that we are creating for the Work programme will give local authorities and local organisations the scope to work alongside providers to deliver local solutions to some of the problems. I have no doubt that social enterprise should be and will be part of that. Local authorities can help to make that happen.

Does the Minister accept that there is considerable support on the Labour Benches for the point that my right hon. Friend the Member for Salford and Eccles (Hazel Blears) raised? Does he accept that if we are to protect social enterprises, and if they are to play a greater part in welfare reform, that will require almost a total change in attitude from the big providers? Birkenhead had one of the best organisations—A&P Group—but it did not win the larger contract, and did not want to, and the large provider had no interest in making sure it survived. It was a huge loss to young people in the area who, until then, had had a Rolls-Royce service.

I am grateful to the right hon. Gentleman for highlighting such an important point. I have been very clear to people who are bidding for the Work programme that we expect them to demonstrate their ability to assemble a consortium or organisations with the specialist skills to help the hard-to-help groups. Many of those organisations are in the voluntary sector or the social enterprise sectors. If they do not demonstrate that ability and if they do not have those networks, they will not get the contracts. It is as simple as that.

Child Maintenance

The coalition Government are determined to ensure that all parents meet their financial responsibility for their children. At present, around 50% of separated parents have no maintenance arrangements in place. We are working with colleagues in the Department for Education, the Ministry of Justice and the voluntary sector to ensure that we deliver a seamless approach to supporting parents pre- and post-separation.

First, I pay tribute to my hon. Friend’s immeasurable work, particularly with the Croydon family justice centre. She is an expert in such matters, and raises an important matter. The Child Support Agency’s performance is improving, with more children benefiting from more money collected. However, the present system does not do enough to provide effective child maintenance support as soon as possible after parental separation, nor does it do enough to promote positive relationships between parents. Making those improvements to the system is in the best interests of children, as is ensuring that we have more enduring financial support for them.

Disability Living Allowance

5. What recent discussions his Department has had with disability organisations on proposals to remove the mobility component of the disability living allowance from residents in publicly funded care homes. (25111)

I have had discussions with a number of disability organisations on the proposals to modify eligibility for DLA following the Chancellor’s spending review announcements. Specific spending review measures, along with those in other Departments across Government, have not been subject to public consultation, but they will of course be subject to full parliamentary scrutiny.

Of all the proposals on welfare reform, this is absolutely the most brutal and cruel. Disabled people in publicly funded care homes deserve much better than is being offered at the moment. What will the Minister do when she has to meet a disabled person in one of those homes face to face, and how will she explain why she is taking away their much-needed lifeline to the outside world?

I think that the hon. Gentleman is referring to the measure on mobility. Local authorities, working with care homes, have a clear duty to promote, where practical, independence, participation and community involvement for every single disabled person living in such care homes. The proposed change to DLA eligibility should not leave disabled people more isolated. Importantly, we have to ensure that there is clarity in funding streams as we move towards personalisation, which is something that almost every disabled person welcomes.

Constituents of mine in Atworth have come to see me about their 30-year-old daughter who suffers from cerebral palsy and will be affected by the changes. In her care home, different residents have very different mobility needs to maintain their independence, as well as experiencing different challenges. Can we expect care homes to meet those needs in an individually tailored way?

My hon. Friend raises an important point. It is important that we have personalised care for disabled people. Every disabled person has different needs and, working with colleagues in the Department for Communities and Local Government and the Department of Health, we will ensure that the correct level of support is being delivered locally.

Will the Minister take this opportunity to clarify exactly who will lose the mobility element of their DLA? There is quite a lot going around the blogosphere about who might be affected. Will the changes affect children in residential schools? Will they affect those in residential care who are self-funders as well as those who are funded by the local authority? Will there be exemptions, or will everyone in residential care lose the mobility element of their DLA?

I thank the hon. Lady for her question. This does not affect self-funders, and we will be making clearer as we get towards the Bill exactly how the measure will affect all other groups. I reiterate that it is important to get clarity in the funding streams as we move towards personalisation, which is overwhelmingly welcomed by disabled people.

My hon. Friend makes a good point about the need for clarity and clarification as we move towards the universal benefit, but we must also consider the issue of decency. The measures that she is taking are having deleterious effects on the well-being of people in my constituency. Many of the families concerned have looked after their children for many years outside care. Will she take the opportunity to meet me so that we can discuss some of these constituency issues?

I thank my hon. Friend for his question, and I am very happy to meet him to discuss this matter further. I would draw hon. Members’ attention to the fact that colleagues in the Department of Health have put £2 billion into social care, which will be available to ensure that local authorities and social care providers are able to meet people’s needs.

The spending review said that this measure would apply only

“where such costs are already met from public funds.”

Perhaps the Minister will take the opportunity to reassert that this afternoon. However, Scope and other leading disability organisations have established that removing the mobility component will hit thousands of disabled people. They have described the change as “callous”, and called on the Government to think again. Will the Government listen to those organisations, or do they believe—and can they guarantee—that there will be “no losers” as a result of this policy?

I thank the hon. Lady for her question. She will obviously realise that one reason for having to look at these sorts of measures is that we were left an immense fiscal deficit by the previous Administration. I can confirm to her today that we will, of course, listen to the concerns and thoughts of voluntary organisations and disabled people—indeed, I am already doing so—and that the measure we are putting in place will ensure that the existing duties of care homes and local authorities, which are to ensure that disabled people are able to live independent lives, will be fully enforced so that the correct level of support can be delivered locally.

Comprehensive Spending Review (Barnsley East)

6. What estimate he has made of the likely effects on his Department’s expenditure on out-of-work benefit payments to residents of Barnsley East constituency of implementation of the changes announced in the comprehensive spending review. (25112)

Although estimates of expenditure savings are not available at constituency level, the impact of the changes has been published at the UK-wide level on the website of Her Majesty’s Treasury.

Is the Minister aware of last week’s report by Professor Steve Fothergill of Sheffield Hallam university, which showed that in areas like my own, private sector employment is unlikely to rise significantly in the next few years? Is it not the case that unemployment will increase, as will benefit payments, in areas like my own, because of the ending of the future jobs fund, the ending of the working neighbourhoods fund and the massive cuts to the local authority, with consequent effects on local employment?

The hon. Gentleman is right to stress the importance of private sector employment, which is why I looked at the situation in Barnsley East. I found that the year to March 2010 saw an increase in employment of more than 3,000. I therefore think that it is vital not to talk down economic growth, because the private sector is creating jobs, including in Barnsley East.

Mobility Support

7. What discussions he has had with representatives of the social care sector on the cost of mobility support for disabled people. (25113)

The Government remain committed to involving disabled people when developing their policies, and I can tell my hon. Friend that we discussed the care homes measure with a number of disability organisations at the Department for Work and Pensions policy and strategy forum on 16 November.

We have already heard a number of concerns raised today about these particular proposals. I understand the Government’s rationale, but what consideration has been given to ensuring that residents in care homes who currently receive mobility disability living allowance will still be able to buy Motability cars, and scooters where appropriate, so that they can remain as independent as possible?

My hon. Friend has raised an important facet of these changes, and I can assure her that the Department is already in discussions with Motability about how it might be handled.

Have the proposals for disability living allowance been subject to an equality impact assessment, and if so, what has been the result?

As the hon. Lady may be aware, when elements are included in primary legislation, statutory equality impact assessments are published at the time that the legislation is published—and will be available to the House.

Work Programme

The commercial delivery of the Work programme is on track. Before the end of the month, we will be releasing a list of those organisations that have successfully bid to be part of the framework for employment-related support services. Shortly after that, in early December, we will publish the full invitation to tender for the Work programme. We are still on course to launch the programme next summer.

Regrettably, my constituency has one of the worst records for its over-50 unemployed people ever getting back into work. I would be interested to hear some specific advice about what the Government are planning for that age group.

Of course, this was one of the great failings of the Labour Government, who failed to understand the challenge that older workers faced. Their employment programme offered none of the personalised support that is necessary to deal with the specific challenges that my hon. Friend mentions. What we will do through the Work programme is offer personalised support by paying providers by results; they will have a full incentive to do the right thing by older workers and ensure they get into work.

Last week, Leavesden studio in my constituency was given a £125 million investment by Warner Bros. Will my right hon. Friend assure me that the Government’s new Work programme will help local unemployed people to get off the register and get jobs in this fantastic opportunity?

That is a great example of new private sector investment in the United Kingdom, which proves that the private sector can indeed create the jobs that we all want to see for the future. I congratulate my hon. Friend and his constituents on the work that they have done in bringing the investment to the United Kingdom. I hope that the local provider for the Work programme will forge a close partnership with Warner Bros to ensure that it delivers people with the right mix of skills and capabilities to fill vacancies, and I hope that my hon. Friend will help to facilitate that partnership.

In the last four months alone, an employment agency in my constituency has helped more than 300 long-term jobseeker’s allowance claimants and single parents into work under the employment zone programme. Four such agencies operate in the constituency, but long-term JSA claimants and single parents will no longer be able to apply for that extra support after 31 December as a result of the transition to the Work programme. What specialist support will the Minister give thousands of my constituents, and thousands of others throughout the country, to help them back into wok?

We will provide enhanced support for people in that position through Jobcentre Plus for a short period, but I hope and expect that providers who are already in the framework and who win Work programme contracts will be able to take up some of the challenges that those people face and help them before the formal launch of the programme in the summer.

There are some good ideas in the Work programme, and all of them were in the last Government’s flexible new deal. What proportion of the payment to be handed over to a Work programme provider in respect of a jobseeker will be handed over when that person obtains work, and how long will he or she need to remain in work before the whole payment is handed over?

I will publish the full details of the contractual arrangements for the Work programme in a few days’ time, but I can tell the right hon. Gentleman that we will not be paying up front as the flexible new deal did. Last year, the flexible new deal paid providers £500 million for 16,000 starts. That is £30,000 per job start, and in my opinion it was an inefficient use of public money. Even as the programme becomes more mature, the previous service fee arrangements would still mean a huge up-front cost. We will do things differently: we will pay providers when they succeed, and not before they have done so.

Disabled People (Employment)

The Government are committed to increasing the employment rate for disabled people by giving them the help that they need to follow fulfilling, mainstream careers whenever possible. The Work programme will provide more personalised back-to-work support for unemployed people, including disabled people, from next year. Work Choice, which began on 15 October, provides specialised support for disabled people who face more complex barriers, and the access to work programme provides financial help with reasonable adjustments for the workplace above and beyond what the employer could reasonably provide.

Does the Minister agree that for far too many disabled young people, both in my constituency and elsewhere, the transition into adulthood and the jobs market can be very challenging? What steps are her Department taking to ease the process into adulthood and jobs?

The transition from education to work can be difficult for all young people, but particularly for disabled people. I am impressed by the work that has already been done by employers whom I have visited in recent months, who are already focusing on the importance of disabled young people in their work forces, but the specific support that the Government have provided through Work Choice and the Work programme will help—particularly the differential pricing that is available through the Work programme, which will enable more organisations to work with disabled young people to get them into work.

My constituent Nigel Freeman has suffered a very aggressive bout of cancer, and his best efforts to re-enter the world of work have been frustrated by the operation of the benefits system. Can my hon. Friend assure me that she will end the “one size fits all” approach to health conditions, so that people no longer find themselves trapped on benefits?

My hon. Friend has raised a subject about which we are all eager to hear—people who are committed to returning to work despite very difficult personal circumstances. Under the Work programme, we shall be able to provide more personal and individual back-to-work support for those who face more significant barriers. We want to provide a system of Government support that treats people in a dignified way and assesses them for what they can do, not for what they cannot.

I welcome Government moves to help those who can work to get back into work and off incapacity benefit, but how will the Minister use the expertise of existing disability organisations such as One Voice in my constituency, which is run by the disabled for the disabled, so that we can begin to end the present waste of talent?

Local user organisations have a vital role to play in providing that sort of grass-roots support, and the Shaw Trust and other organisations are already bringing their expertise into play in Work Choice. Several of them will also be involved in making the Work programme available next year.

May I draw the Minister’s attention to the case of Mr Spivack in my constituency, who is autistic and relies on his mobility scooter? Is it not fatuous of her to suggest that she is keen to help the disabled into employment if she is withdrawing the means for them to get to work?

I can assure the right hon. Gentleman that the support his constituent will need in order to get to work will be available through either his disability living allowance or access to work. There are clear opportunities for his constituent to get the support he needs.

How do the Government believe that removing the mobility component of DLA for people living in residential care homes helps disabled people back into work, or enables disabled people who—like a number of my constituents who came to see me in my surgery last week—currently depend on their mobility allowance to get to and from work, to stay in work?

The hon. Lady is right to be concerned that constituents of hers should be able to get to work, and that is why we have support in place for those not in residential care through DLA and also through access to work. That is an important programme that helps many thousands of people get into employment, and we will be supporting more people into employment through access to work this year than last year.

The Government have stated their intention to reduce the number of people on incapacity benefit in order to reduce the welfare bill, but some of us were concerned that the tests the previous Government applied for incapacity benefit were already very strict. What checks and balances will the Minister put in place to ensure that people with severe disability are not impoverished by stricter guidelines for staff conducting assessments of those on incapacity benefit?

Obviously, this is a situation that we inherited, and my right hon. Friend the Secretary of State will soon bring forward proposals to address just the sort of issue the hon. Gentleman raises. I am very aware of the fact that we need to make sure we have an assessment process that identifies people’s real needs for support, and I know that my right hon. Friend is committed to that too.

Work Capability Assessment

11. what recent progress has been made on the work capability assessment independent review led by Professor Malcolm Harrington. (25117)

Professor Harrington will publish his report on the work capability assessment tomorrow. He will be available to take questions and I hope Members will come forward and put any issues and concerns to him, and indeed to me, during the course of the day.

I thank the Minister for that reply. Can he assure the House that those who have varying support needs because they have fluctuating conditions will be considered accordingly during the assessment process?

I am very happy to give my hon. Friend that assurance. This issue—along with that of people with mental health issues—has been of paramount importance to me, and it is one of the subjects to which I asked Professor Harrington to pay the closest attention. I hope my hon. Friend will see tomorrow that he has recommended a number of measures that will help in that respect, but I can also assure her that we will continue to review this issue. We will continue to study the process as it unfolds, and we will make further improvements as and when necessary.

I thank the Minister for that answer, which we welcome. He knows that there is support from both sides of the House for Professor Harrington’s review and Labour will support the Government in taking forward meaningful reform, particularly in identifying mental health problems such as depression and schizophrenia. What assurances will the Minister give the House that reforms to the work capability assessment will better support people with mental health conditions get back to work?

One of the things I made sure to do when we set up the review was invite the chief executive of Mind to take part in one of the support groups for Professor Harrington. That input has been hugely valuable. I have also invited the mental health charities to make recommendations about possible changes to the descriptors, which might also help enhance the process. They are due to respond shortly. We will make sensible changes as and when we can. I intend to brief the hon. Lady and her colleagues about the contents of the Harrington review tomorrow morning, and perhaps we can talk briefly behind the Speaker’s Chair about how best to arrange that. I want them to be part of the process, and I am very happy to take suggestions from Opposition Members as well. As the hon. Lady rightly says, this is a cross-party issue. We have to get it right. It is in all our interests that we get it right, and I think we share the aspiration that this process should be fair and firm.

Universal Credit

We believe that universal credit will make work pay. We have done some assessment and we can announce that we believe we should reduce by 1.3 million the number of workless households facing a participation tax rate of more than 70%. We also believe that we will improve earnings incentives for some 700,000 people and that we could reduce the number of workless households by about 300,000.

I thank the Secretary of State for that response. Caudwell Children is a charity that has significant experience in helping the parents of disabled children back into work. Could he give some assurances as to how the universal credit will make that process easier?

I hope and believe that if we implement universal credit correctly, it should allow people with caring responsibilities to meet those responsibilities with greater flexibility in the number of hours they can work. At the moment, it is very difficult for many of them to work the sort of hours they need to work without damaging their ability to fulfil their caring responsibilities. We think that flexibility would be most effective for them and, strangely enough, for lone parents.

The universal credit has the desirable and indeed the shared objective of reducing the rate at which tax and benefits are withdrawn as earnings rise. But for every pound that will go into the universal credit, £8 is being removed as a result of the June Budget and the comprehensive spending review. When the Secretary of State says that nobody will be worse off, is he making the comparison with the period before or the period after those cuts come into effect?

What I said originally was that we believe that from the position we inherited, the implementation of the universal credit will have a net beneficial effect for the poorest people in this country who are trying to achieve work. So it is not just a case of people not being worse off; we believe that people will be far better off than they were when the hon. Lady’s Government left us.

Benefits Regime (Gender Impact Assessments)

14. Whether his Department plans to publish a gender impact assessment of the changes to be made to the benefits regime as a result of the comprehensive spending review. (25120)

The Department for Work and Pensions assesses the equality impacts of any new policies or changes to existing policies and practice. In line with that commitment to transparency, equality impact assessments are published when they are available, and gender impacts are included as part of those documents.

I thank the Minister for that answer. What assessment are the Government making of the needs of vulnerable women, particularly those who receive housing benefit and are aged between 25 and 35? How will the Government ensure that their needs are met and, in particular, that if they have disabilities, they do not end up inappropriately in shared accommodation?

As the hon. Lady will know, exemptions are already in place for the most vulnerable people, and those will continue. The package of reforms set out in the spending review, particularly the introduction of the universal credit, will make a huge difference to women on some of the lowest incomes, particularly lone parents seeking to get back into work. The credit will make that journey much easier and mean that they are better off going back to work than they would otherwise have been.

Universal Credit

16. What assessment he has made of the likely contribution of the proposed universal credit to his Department’s objective of encouraging people to work. (25123)

I listened carefully to my right hon. Friend’s previous answer. Given the benefits for so many of the introduction of the universal credit, what chance is there that the Government might be able to accelerate its introduction beyond the 2017 time scale currently announced?

I will resist the temptation to accelerate anything. I simply say to my hon. Friend that the plan we have put in place allows us to spend the right amount of time making sure that we are integrating those on the current benefits correctly and that we are not making any mistakes. We do not plan to accelerate that, but clearly we hope that this process will go smoothly—we believe it will. That is the most important thing.

Can the Secretary of State give an estimate as to how many parents with young children will return to work under his universal credit, and can he explain the incentives?

We believe that we will lift some 350,000 people in that category out of the poverty that we inherited. I am not going to give any significant answer to the second part of the hon. Gentleman’s question, simply because I am happy to write to him in due course and give him the figures. His party says it accepts and supports this process, and the reality is that the universal credit has the biggest effect on the poorest people trying to get back into work. That surely has to be welcomed by him and the whole of his party.

Work Programme

17. What assessment he has made of the likely effects of the Work programme on unemployed people who volunteer. (25124)

My message to my hon. Friend would be that we are doing everything we can to promote volunteering for jobseekers, both before they enter the Work programme and, once the programme is in place, after they enter it. We have set out plans to allow jobseekers to do up to eight weeks’ work experience and I think that that gives them an important opportunity to take a step into the workplace that they would not otherwise have taken.

I thank the Minister for that reply. Many people who are out of work or who have fluctuating medical conditions already undertake part-time voluntary work but that was not previously recognised by Jobcentre Plus officials as part of the flexible new deal. What assurances can he give me that those people, who are already participating in the big society, will have their voluntary work positively recognised under the new Work programme?

I see volunteering as extremely important, particularly in helping those who have been on sickness benefits or incapacity benefit in the long term to make the step into work. I can assure my hon. Friend that we will give Work programme providers maximum flexibility to use volunteering as one of many vehicles to help people get into employment.

Housing Benefit

18. What assessment he has made of the likely effects of his proposed reductions in housing benefit entitlement on jobseeker’s allowance claimants who have been unable to find work for more than 12 months. (25125)

The detailed design of the measure is still being developed and we are carefully considering its impact. We will publish a full impact assessment to accompany the relevant legislation when it is introduced in Parliament.

The proposal is obviously designed as a work incentive measure, but it could be argued that any claimant affected will represent a failure of the measure to get people back into work. What steps is the Minister taking to ensure that anyone who is affected is genuinely unwilling to find work?

My hon. Friend raises an important point. The key is to try to stop people being unemployed for 12 months. He will be aware that 90% of those who come on to JSA flow off before the end of 12 months. My right hon. Friend the Minister of State is bringing forward the Work programme, which will help the most hard-to-help groups before the end of the 12-month period to give them the maximum chance of not being in that position in the first place, which is our priority.

There are already single parents in my constituency—not exclusively but in the majority female—who are experiencing serious difficulty in convincing employers that they must have flexible working to maintain their child care. What are the Government doing to ensure that employers are aware of their responsibility, given the draconian effects of the proposed reduction in JSA?

The hon. Lady is right to point out the importance of a flexible jobs market. The good news is that a large proportion of the new jobs that are being created are part-time jobs that will be of particular benefit to lone parents. The Government will consult on the right to request flexible working in the coming year.

The number of job applicants and the number of posted job vacancies varies widely from constituency to constituency and country to country. Is it fair to apply a universal rule to all claimants when their ability to comply with that rule varies so widely?

The hon. Gentleman will know that Jobcentre Plus advisers already have a good deal of discretion in how they respond to individuals to reflect individual circumstances. We are keen to see that measures such as the Work programme are tailored to the individual so that they can address the particular problems that they face. If those problems involve transport or a lack of very local job vacancies, they can be addressed through the Work programme.

Flexible New Deal Programme

19. What recent assessment he has made of the value for money delivered by the flexible new deal programme. (25126)

The flexible new deal began in October 2009. Results of its full evaluation will be published in 2012. However, the initial figures, published last week, certainly give rise to concern that it represented poor value for money and that the arrangements set out by the previous Government were extremely expensive.

People in my constituency are concerned about the transition to the Work programme. What assurances can the Minister give me that the Government will take measures to ensure that people are not disadvantaged during the transition period?

I can absolutely give my hon. Friend that assurance. That is a priority for me at the moment. As it becomes clear who is on the framework and who is not, it will become increasingly clear where we might have issues with the transition. In those areas where the flexible new deal will continue to run until the summer, it is not an issue, and in those areas where the flexible new deal does not exist, it is a concern. We will take urgent measures in the next few days, as we have completed work on the framework and identified the gaps, to ensure that we put in place the necessary support, probably through Jobcentre Plus, to ensure that we look after those who are affected.

Universal Credit

20. What effects he expects the introduction of the proposed universal credit to have on marginal deduction rates experienced by households currently in receipt of tax credits only. (25127)

I repeat that the universal credit will benefit a large number of people, improving work incentives for some 700,000 people who will see their marginal deduction rates fall from about 96% to 76%. The specific group that the hon. Gentleman is talking about will have their withdrawal rates rise marginally, although that will be met by our guarantee that nobody will be a loser in the course of this.

I genuinely welcome the Secretary of State’s attempts to get more people incentivised and back into jobs, but does he accept that his proposals are more likely to fail because the regional development agencies that created many jobs in Rochdale and other parts of the country are to be replaced by what Lord Heseltine has called a “high-risk” regional growth fund?

I do not accept that point. We recognise that it is critical to create those jobs and we expect them to be created as the economy grows. The big problem with creating jobs under the previous Government was that 70% of all the jobs created in 15 years went to people from overseas and not from the UK. The big issue for us is getting people in the UK ready and able to do that work, which the Minister with responsibility for employment, the Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Epsom and Ewell (Chris Grayling), is busy doing through the Work programme.

The Opposition seem convinced that the introduction of the universal credit will be dogged by IT difficulties. Does that not reflect their lamentable experience in this area? What reassurance can the Secretary of State give us that we will succeed where the previous Government failed so badly?

The previous Government had problems with IT development, as did lots of Governments—both sides accept that. To be fair, I have spoken to the shadow Minister, the right hon. Member for East Ham (Stephen Timms), who has been very positive about general developments. In his time, the development of the employment and support allowance computer was a very positive development, for which I compliment him. That is a very good example of the scale of computer development that we can undertake with the universal credit.

Topical Questions

We are busy working very hard on employment programmes. I draw my hon. Friend’s attention to the very positive employment figures from last week, which indicate that the Government’s direction of travel places employment growth at the heart of all we do.

I thank the Secretary of State for his answer and I note the earlier comment by the Minister of State, Department for Work and Pensions, the hon. Member for Thornbury and Yate (Steve Webb), that economic growth should not be talked down and that jobs are being created. How are the providers of the Work programme going to work with employers to identify those jobs and make sure that people are placed in private sector jobs as we go forward?

My hon. Friend is absolutely right. The difference between this Government and the previous Government will be that the Work programme—the most comprehensive, integrated work programme in existence, certainly, since the war—will make a huge effort to get those who have been out of work for the longest periods ready for work so that they actually get to work. As the economy grows, those jobs will be greater in number. A key point that I made earlier is vital to her question: for all the growth under the previous Government, prior to the mistakes they made that brought us the recession, most of those jobs went to people from overseas because British people simply were not capable of doing that work. That has to change.

May I take the Secretary of State back to his claim that job creation will be vital and ask him specifically about what the Office for Budget Responsibility has stated will be the estimated saving from threatening the long-term unemployed, about whom he has just spoken, with the 10% figure? Do the OBR’s estimates on how much that policy will save include an expectation that it will move more people into work, or is no significant saving in terms of work incentives expected? Do the calculations simply show OBR figures for the number of people who are going to continue with no job but less money? What do the OBR figures indicate?

The OBR figures show two things: significant growth during the course of this Parliament and significant growth in private sector employment. Our changes in housing benefit will get rid of a disincentive to taking those jobs, which a significant number of people failed to take under the previous Government, who failed to do anything about it.

T2. My constituent Rachel Clark, who has learning difficulties, enjoys working as a volunteer at a coffee shop run by the charity MacIntyre. Until recently, she received a therapeutic allowance but unfortunately that practice has had to stop for fears that it is in breach of national minimum wage legislation. Given that all parties were happy with the arrangement and that Rachel is happy to carry on as an unpaid volunteer, can we look into this grey area of the law? (25132)

I thank my hon. Friend for his question. We can be clear that individuals such as his constituent are able to undertake volunteering opportunities. Indeed, that is something we have been encouraging as part of the Olympics and Paralympics, and it does not cause any problems if they are in receipt of state benefits.

T4. May I ask Ministers to look again at the proposal to reduce housing benefit by 10% for people receiving jobseeker’s allowance for a year? The Minister for Housing and Local Government said this morning that people in social rented housing will be kicked out of their homes if they go into work, and under the proposal on housing benefit, people will be kicked out of their homes if they do not go into work. (25134)

I always appreciate the hon. Lady’s advice. We certainly keep all that under review and intend to do so all the way through until we introduce the Bill. However, having said that, there is a lot of good evidence out there to show that we have to give people some sort of incentive not to decide to refuse that work. We believe that that is one of the areas where a lot of international evidence shows that such a spur actually helps people to do that.

T5. What can the Secretary of State do to assure unemployed people in Staffordshire Moorlands that the Work programme will help them to find not just employment, but sustainable employment? (25135)

One of the key differences in the Work programme, compared to previous programmes, is that it will pay providers not simply for getting someone into work, but for supporting them while they are back in work over an extended period. That is crucial to ensuring that people do not come off benefits, stay in work for a few weeks and then return to the unemployment registers, as has so often happened in the past.

T9. Is the Minister aware that his own Department’s statistics show that the impact of restricting local housing allowance to the 30th percentile in Glasgow is that 92% of recipients in one-bedroom properties will lose out by, on average, £7 per week? The Glasgow Housing Association told me on Friday that that is likely to lead to higher levels of rent arrears and lower levels of available investment for its properties. Does not that show how unfair and badly designed the proposals are? (25139)

I can only agree entirely with the hon. Gentleman on the manifesto on which he stood for election, which stated that we have to cap the rents that we are paying. His analysis assumes a static situation in which rents do not change. The Department puts more than £21 billion into the local housing allowance. If we changed the rules for that, we would change the market. We are trying to put pressure on rents so that they will go down, which will improve the situation.

T6. The whole House will welcome the news that unemployment is on the decline and look forward to the introduction of the Government’s Work programme. However, my right hon. Friend will be aware of the particular issues facing the north-east. What steps is he taking to ensure that there is support in the meantime for those seeking employment in the region? (25136)

My hon. Friend will be aware that I am always extremely concerned about the employment situation in the north-east. I was therefore extremely pleased this summer to see an increase in private sector employment of 17,000 in the region. I was disappointed, however, that the number of people claiming jobseeker’s allowance barely changed, which simply underlined for me the need for the Work programme to deliver real change in that area. However, the introduction of the new enterprise allowance and some of the other measures that we are taking to support small businesses, as set out in the Budget by my right hon. Friend the Chancellor of the Exchequer, will help to continue the process of job creation in the private sector in the north-east, which is what we all want.

As the Secretary of State and his team develop their longer-term thinking on social security, including for state pensions, what emphasis and importance will they place on the contributory principle?

I am grateful to the right hon. Gentleman for his question. We believe that a link between what people put into the system and what they get out of it is important, and we are looking at ways of modernising that principle. He will know that the contributory principle, as it currently exists, was invented in the 1940s when the assumption was that men worked and women stayed at home. We live in a modern world and need to modernise the contributory principle.

T7. What measures will be contained in the Work programme to ensure that the unemployed in rural areas get the help they need? (25137)

One of the benefits of working with smaller organisations as well as the larger prime contractors is that we can get the input of specialist organisations with expert knowledge of the rural community and the rural jobs market. I believe that the contracting structure we have set up maximises the likelihood of prime contractors identifying the right organisations to deliver support in rural areas.

My constituent, Mr Edwards, is in receipt of the independent living fund, which empowers him to buy services to meet his needs. Uncertainty over the future of the fund is causing him and his family great concern. When will the Government end that uncertainty?

As the hon. Lady knows, the uncertainty is a result of the previous Administration not having correctly financed the independent living fund. That led to the trustees of the fund having to close it to new applicants. We have already undertaken an informal consultation about the future of the fund, and will shortly come forward with a formal consultation. My overwhelming requirement will be to make sure that existing recipients continue to be well supported.

T8. Will the Minister confirm that barriers to employment vary from one part of the country to another, that he has abandoned the one-size-fits-all policy of the previous Government, and that personalised help is being given to people seeking to get back into the employment market in accordance with their needs? (25138)

I can absolutely give my hon. Friend that assurance. It is particularly true for areas of the country that have high levels of incapacity benefit dependency. For the first time, we will be attempting to provide real support to people who have been on incapacity benefit long term and are found fit for work or potentially fit for work through the work capability assessment. I am convinced that the specialist support that we can bring to bear for those people will make a particular difference in those parts of the country where the problem is substantial.

Most jobseekers will become eligible for entry into the Work programme after they have been on jobseeker’s allowance for a period of 12 months. Can the Minister explain how it is sensible that at precisely the moment at which they become eligible for the extra support of the Work programme, they will see a cut in their housing benefit because of the period that they have spent on JSA?

The hon. Lady must understand that we are seeking to maximise the incentives in the system. What we inherited from the previous Administration is a system that is full of disincentives to go back to work. If we do not remove some of those disincentives, create a push to get people back into work and combine that with support to do so, we will end up with the same 13 years of failure as we saw under the previous Government.

T10. The Barry branch of the mental health charity Mind often advocates in favour of service users at work assessment appeals, with a very high success rate. This demonstrates the difficulty in assessing people with mental health illnesses. What action is the Minister taking to ensure that they are treated fairly in the new work capability assessment? (25140)

My hon. Friend will see tomorrow, with the publication of the Harrington review, some innovative suggestions about how we can deal with that problem. It is a very real problem. I am determined to ensure that we do everything we can to avoid people with mental health problems being wrongly diagnosed by the assessment. I pay tribute to Paul Farmer of Mind, whose input into the process has been hugely valuable.

May I bring the Minister back to the question asked by my hon. Friend the Member for Glasgow North East (Mr Bain) about the cuts to housing benefit? The cuts to local housing allowance are the same cuts that will make people in Chesterfield up to £11 a week worse off. Will the Minister confirm that that was not in the Labour party manifesto and is nothing to do with the cap? Will he set the record straight?

On the contrary. The Labour party manifesto said that people who were in work should not be in worse accommodation than people who are out of work. That implies the 30th percentile change, and that is what we have implemented.

What are the Government doing to prevent hardened drug addicts with consequent mental health issues claiming DLA in the normal way, which goes straight into their veins and up their noses? What are the Government doing to improve the situation and stop this waste of public money?

As my hon. Friend knows, we are undertaking a thorough review of the assessment process concerning DLA. Those are just the sort of issues that we will be looking at in detail.

Does the Secretary of State accept that the Government’s plans to accelerate the increase in pension age will come as a cruel blow to a whole generation of women in this country, because the financial reality of motherhood and family life makes it much harder for many women to build up a pension comparable to those of men? What provision is being made for women aged 54 to 59?

I can assure the hon. Gentleman that no woman aged 59 or 58 is affected at all by the changes. However, we are equalising men’s and women’s state pension ages somewhat more rapidly. No one will be affected until 2016, and those who are most affected and who have the longest increase in working life will have a period beyond 2016, so they will have at least seven years’ notice of the change.

I warmly welcome the long-overdue review of the work capability assessment, but does the Minister agree that there are problems after the assessment, and that the time spent going through appeals and tribunals is far too long? What steps is his Department taking to rectify that?

There are two aspects to what we are doing. First, we are seeking to improve the process not simply within the assessment itself, but before and after, in the way that individual cases are handled. I hope that that will make a difference. Secondly, my Department is working with the Ministry of Justice to ensure that we streamline and improve the appeals process, create extra capacity to deal with any appeals that result from next year’s migration and have a system that works as effectively as possible.

The Secretary of State knows how vital Remploy and other supportive workshops are in helping people back into work. Will he outline the steps that the Government are going to take to promote that through public procurement, and will he or one of his Ministers meet me and trade union representatives to discuss the matter?

The hon. Gentleman knows from the recent spending review settlement that Remploy’s modernisation plan and funding are in place, and we will continue to monitor its performance against that. I have already met trade union officials about Remploy’s future, and I will continue to do so as we move forward with the modernisation plan.

I, like many other hon. Members, have been contacted by a number of constituents whose pension provision has been seriously affected by the collapse of the former Ford UK parts manufacturer, Visteon. Will the Secretary of State meet me to explore how we might best help those who have been most adversely affected?