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Welfare Reform Bill (Instruction)

Volume 527: debated on Monday 9 May 2011

I beg to move,

That it be an instruction to the Welfare Reform Bill Committee that it has power to make provision in the Bill to establish the Social Mobility and Child Poverty Commission.

This debate is focused on the motion and I do not intend to go through the purpose and effect of the proposed new clause in detail. Members will have the opportunity to debate the measure in full in the remaining stages of the Welfare Reform Bill, including in Committee. However, it may help hon. Members if I set out the Government’s reasons for this change.

We need to be sure that we have the right structures in place to hold the Government to account on child poverty. The previous Government attempted to do that by enshrining in law a child poverty commission. The commission was intended to provide independent scrutiny and to ensure that progress would continue to be made by Government. We supported and still support the concept of an arm’s length body to provide such an external challenge to Government. However, having considered carefully how best to establish the commission to ensure that it can fulfil that purpose, we do not believe that the child poverty commission, as currently defined in legislation, has the necessary remit or power to perform that function effectively.

Why do we want to change the commission? There are three reasons, which I will outline for the House. First, the commission cannot assess or comment on the progress made by Government on child poverty, meaning that it has no power to hold the Government to account. Secondly, we believe that the commission’s advisory role undermines accountability and provides Ministers with a means to delegate decision making to an arm’s length body. For a Government to consult on an important policy matter is absolutely proper, but responsibility should ultimately rest with Ministers. Finally, the scope of the commission is simply too narrow and does not cover issues that are crucially related to child poverty, such as life chances and social mobility. As I have said, this debate is not the place to go into the detail of the proposed new clause. It is intended to address the concerns that I have raised and to ensure that the commission has the functions and power that it needs to drive progress effectively and hold the Government to account.

It is appropriate to use the Welfare Reform Bill to make this change because helping people who are dependent on welfare to help themselves is one of its key aims. The reforms are designed to do that in two distinct ways. First, by ensuring that work always pays and is seen to pay, they will improve work incentives for people who are out of work. Secondly, by simplifying the benefits system, they will increase the take-up of benefits. It is therefore appropriate to use this Bill to make other legislative changes that allow the Government to take forward their new approach to tackling disadvantage, deprivation and welfare dependency in our society, such as these revisions to the child poverty commission.

Why is it necessary to make these changes now? We felt that it was important to consult stakeholders before making changes to the commission. We therefore decided to include our thoughts on the commission in our child poverty strategy consultation document, which was published in December last year. The consultation closed this February, after which it was necessary to consider the responses before deciding how the commission should be revised. Given that time scale, it was not possible to include the proposed new clause in the original version of the Welfare Reform Bill. Since then, we have set out clearly the changes that we wish to make to the commission and emphasised the need for it to be established as soon as possible. If we had waited for a second-Session Bill to put the required changes to the House, it is possible that a commission would not have been established until 2013, and we do not believe that delay is acceptable.

I restate that our intention is to move a new clause to the Bill, amending the Child Poverty Act 2010 by inserting a new section 8 and corresponding schedule. The new provisions will extend to England and Wales, Scotland and Northern Ireland. We believe that the motion will give us the opportunity to create a stronger and more effective commission, and I commend it to the House.

I thank the Minister for her contribution, and I wish to make a few comments in response. On behalf of Labour I welcome the Government’s motion, and we look forward to the full debate in Committee about the substance of their proposals. However, we are disappointed that we must have that debate in the Welfare Reform Bill Committee, because as she will be aware, a child poverty strategy has been published and there have been a number of criticisms of it. It would perhaps have been better if the commission had been set up first, to inform that strategy. I will return to that point, because that situation perhaps explains why there have been so many comments that the child poverty strategy is insubstantial. I appreciate that the substance of those comments will be featured in Committee, but if I may I wish to make one or two points about issues that the Committee will cover as it examines the Government’s proposals.

The child poverty commission was a significant element of the Child Poverty Act 2010, which received cross-party support and was regarded as a landmark piece of legislation. It was to be a commission of status and influence, which would be evidence-led, examine different approaches, engage with those with direct experience, harness the experts’ views and, as the Minister indicated, work with the devolved Administrations. I hope that when the Committee has discussed the matter, she will ensure that the commission does exactly that.

I am sure the Minister is aware of the substantial point that some child poverty organisations have made in questioning the legality of the Government’s approach to date, given the status of the 2010 Act. They say that because the child poverty strategy has been produced before the setting up of the commission, the Government are acting illegally. I hope she will address that point.

The broadest point that needs to be made is about the Government’s decision to widen the scope of the commission from purely being about child poverty to also embracing social mobility. I appreciate the substance of the argument about social mobility, policy on which underpins any Government action. Of course there are links between child poverty and social mobility, and as I understand it the commission would already have had powers to examine those links. However, the Minister will appreciate that broadening the scope of the commission so far has raised many concerns among organisations, and indeed among many Labour Members. There are links between child poverty and social mobility, but they are not the same thing. There is deep concern that including social mobility means that the commission will lose its edge and its focus on dealing with child poverty. It may well dilute the urge to tackle child poverty.

I have a number of questions to put to the Minister. Given that the matter is now going to the Welfare Reform Bill Committee, may I ask that the commission be established urgently and that there be no further delay? Once its scope has been established, it should go ahead. Will the Minister consult the devolved Administrations on their wider child poverty strategies as a matter of urgency? May we have a guarantee that commitments on child poverty will not be delayed or watered down because of the extension of the commission’s scope to social mobility?

May we have clarity on what the Government’s child poverty targets actually are? The Minister will know that the Prime Minister made a categorical and unequivocal commitment to maintaining relative poverty income measurements. Can she guarantee that that will still be central to the Government’s proposals? Finally, can she guarantee that the commission will retrospectively examine the already published child poverty strategy so that its fundamental weaknesses can be addressed and we can have an altogether more substantial plan? I appreciate that the meat of the subject will be discussed in Committee, but given that we are making a decision this afternoon on whether to enable the Committee to establish the commission, it would be very helpful if she addressed those points.

I very much look forward to a full debate on the merits of the Government’s proposal in the remaining stages of the Welfare Reform Bill if the instruction is agreed to. However, I cannot wholly share the Minister’s reasoning on why it is appropriate to approach the expansion of the child poverty commission’s remit in this way.

The Minister said that allocating an advisory role to an arm’s length body would in some way weaken the Government’s accountability. I am confused about why advising should mean becoming responsible, and no doubt she will want to explain that. However, I welcome her acknowledgment of the importance of wide consultation. I hope that that will continue to be the case on the subject of the expanded remit that we are discussing.

I believe the Minister is mistaken to think that the planned child poverty commission would have had as limited a remit as she seemed to imply. As she acknowledged, the 2010 Act and the functions and remit of the commission had cross-party support, and the Act uses a wide understanding of what child poverty encompasses. That includes a number of the building blocks of social mobility, including on parenting, housing and education, that she seems to suggest would be missed. I hope that she can assure us that when the debate is passed on to the Welfare Reform Bill Committee, with its much narrower remit of considering employment and social security reforms, the vital focus on child well-being in its broadest sense will not be lost. That is what child poverty measures are fundamentally intended to address and improve.

I agree with the Minister that two central thrusts of the Government’s welfare reform agenda lie at the heart of our ambitions on social mobility. She is right that parental employment is crucial to how we tackle and address child poverty. Unless parents can access employment that genuinely lifts them and their children out of poverty, the child poverty targets cannot be met. She is right, too, to say that the Welfare Reform Bill is an appropriate vehicle for the discussion of child poverty. It is clear that neither child poverty nor social mobility can be addressed unless the right financial support is put in place for families with children. That includes the social security support that the Bill targets directly.

The reason I mention those two points is that there is considerable international evidence that parental earnings have as much impact on social mobility as other factors such as educational opportunity, and that the most socially mobile and equal countries are those with generous, albeit short-term, social security benefits. That is in striking contrast to the position that tends to pertain in this country and the United States, which is very ungenerous social security benefits that people rely on, in many cases, for quite a long time. It is therefore right that we should debate those issues in the context of the Welfare Reform Bill. In that sense, the Minister’s proposition absolutely stands up. However, this debate also gives us the opportunity to highlight the contradictions and inconsistencies in the Government’s agenda.

The meat of the Welfare Reform Bill includes issues such as the benefits cap, which will seriously damage families’ well-being, and the reduction in support for child care—we are still waiting in the Welfare Reform Bill Committee to see exactly what the Government will propose, although I think that the Opposition will have concerns about it—as well as access to the labour market for second earners or potential earners in couples and the disincentives that seem to be emerging in the design of the universal credit. They are all issues crucial to child poverty and social mobility, and it is right that they should lie at the heart of the Bill.

In conclusion, it is right to debate those issues in the context of the Welfare Reform Bill, albeit not just in that context. Doing so gives us an opportunity to remind ourselves that we tackle poverty, inequality and social fluidity not by individualising and pathologising problems, but through the structural solutions that only Governments can provide. Those solutions include ensuring access to education and training, ensuring that parents can access good quality child care, ensuring income adequacy, ensuring the redistribution of income and wealth to reduce the inequality gap, and ensuring the conditions for sustainable, good quality employment that genuinely enables parents to lift their families out of poverty.

The Government need to be aware that they have at least the beginnings of a credibility problem with those outside this House who are watching and monitoring closely their commitment genuinely to improving the well-being of children and lifting them out of poverty, as the coalition parties, in common with all other parties, last year signed up to do. I very much hope that what we are seeing this evening is not a proposition to marginalise or downplay hard-won gains in securing understanding of the inter-connectedness of poverty, inequality and social fluidity, and, at their heart, the importance of family incomes.

I am not as cynical as the hon. Member for Stretford and Urmston (Kate Green)—I am sure that she does not mind my saying that—although I appreciate that the motion before us is limited and should not be broadened into a big debate about child poverty. There is a great deal of cross-party agreement that tackling child poverty and social mobility is extremely important. There is also cross-party agreement that child poverty levels in the UK are still worrying and that much work remains to be done to improve the situation. Those are areas about which I am sure we will have much more extended arguments in the Welfare Reform Bill Committee. I look forward to having those debates in the next few weeks.

We have learned that if we are really to tackle child poverty, we need to tackle social mobility at the same time. The two are so completely interrelated that working in silos will not be effective in the long term. It is not enough just to tackle the income coming into families; we also need to look much more broadly, including at the education and work opportunities available to the parents. The hon. Lady made the point about income levels in families, but we know that if children and their families really are to be lifted out of poverty, we need to talk about a lot more than that. I therefore welcome the fact that the Government plan to look at the issues in the round, combining the two areas together.

I agree entirely that bringing child poverty and social issues together is important. However, the Child Poverty Act 2010 does not apply in Wales, so we also need certainty that the social mobility elements will be looked at carefully in the Welsh context.

There are issues with child poverty in Wales. The hon. Gentleman and I represent Welsh constituencies. Child poverty levels in Wales are, I believe, higher than in other parts of the UK, just as incomes are much lower. If we are going to tackle the issue in Wales, just as in England and in Scotland, we need to look not just at welfare packages but more broadly at the opportunities available to children and young people, as well as their parents, so that they get the best opportunities. I hope that the Minister will say what she is doing with the Welsh Assembly Government and the Scottish Parliament. We need a lot of co-ordination with the devolved Administrations, because many issues affecting social mobility are devolved matters such as education. If we are to take the issue seriously, we need to ensure good communication and liaison between the devolved Administrations and Departments in Whitehall.

I look forward to debating the issue further in Committee, but I would be grateful if the Minister responded to a couple of issues this evening. First, can she let us know more about why she feels that combining the expansion of the commission with the proposed change in its remit will increase accountability or ensure that the Government achieve their objectives? For many years Governments have talked the talk, but they have not necessarily walked the walk. I would like the Minister to say more about why she thinks the change will make a difference by delivering good progress on tackling child poverty. I would also be grateful if she gave more detail about the timing of the child poverty and social mobility strategies, how they will interact with the establishment of the new commission and how the process will work.

I welcome today’s proposal and look forward to debating it in Committee in the coming weeks, in what I am sure will be significantly more depth.

Let me add two brief comments to our debate today. The first is directed towards the Liberal Democrats, as I read in the papers that social mobility is an issue that the Deputy Prime Minister is going to take under his wing. I feel in a good mood, so may I offer them some advice? We in this House might know what social mobility means, but if my constituents are anything to go by, nobody out there knows what the hell the Government or the Liberal Democrats are going on about when they talk about social mobility. My constituents all understand the phrase “life chances” and whether the Government have a strategy in place to ensure that every child in this country has a chance to get a better job than their parents, but if we continue to talk about social mobility, they turn the volume down or switch off. Although I do not mind facing the electorate in such circumstances, the policy is too important to allow the Government or the Liberal Democrats to continue to go over the top, shouting language that neither supporters nor enemies can understand.

I completely understand what the right hon. Gentleman is saying. We would all agree that the phrase does not mean very much to most people, but given that it is the jargon that has been used for many years by Governments of all colours, can he suggest a phrase that would be more helpful and productive and that people would understand?

Quite honestly, when we resume debate on the Bill, I would favour the phrase “life chances and poverty” or calling the commission the poverty and life chances commission, because poverty is the aspect that we are trying to break.

That brings me to the second, perhaps slightly more substantial point that I would like to contribute to today’s debate. When the Prime Minister asked me to conduct and submit a report to him about the foundation years, there was concern on the Opposition Benches that the huge intellectual and political efforts and the resources that the Labour Government had put into trying to tackle and finally abolish child poverty might somehow be dissipated, as though that report would be used as some terrible smokescreen. What is so good about today’s debate is that the discussion has moved on from there. I cannot emphasise enough how much I welcome that. However, I want to suggest that building up the foundation years should become a goal, so that a first building block in any strategy would be for many more children to start their first day of education better able to benefit from that education, rather than have primary schools spending most of their efforts doing rescue work. That has not occurred before. If the Government are concerned with that objective, and also with Labour’s commitment to abolishing child poverty by 2020, initially, in the short run, there is no conflict.

I draw the House’s attention to a report commissioned by the Joseph Rowntree Foundation that was published a couple of years ago. It looked at what ways are open to the Government if they are serious about reducing the number of children in child poverty as Labour defined that in the 2010 Act. There is a medley of ways, but the one that held the greatest prospect for the quickest advances was building up high-quality child care. As my hon. Friend the Member for Stretford and Urmston (Kate Green) said, if that were in place, many more parents would make the effort to take themselves out of poverty.

In a not-so-recent letter to the Chancellor, I asked him whether he will make a decision soon on the recommendation in my report. I asked him not to increase automatically benefit rates for children, but to see whether some of that money, in some years, could be better spent on building up the foundation years, as we call them in my report. Clearly, if some of that money were transferred from future years into building up high-quality child care, and if we avoided cutting such provision, as my hon. Friend the Member for Stretford and Urmston said, more children might be ready to benefit from their full-time education from their first day of school onwards. That is the best move the Government can make to reduce the number of children in poverty, year by year.

I rose to welcome the measure, which takes the debate forward. Hon. Members can get excited about it, but if the Government are serious about talking to our voters, they need to drop the term “social mobility” and come up with a phrase that we can all understand.

I welcome the proposed instruction to the Committee, on the same basis that my right hon. Friend the Member for Birkenhead (Mr Field) welcomes it. A wider debate on life chances will assist in the tackling of child poverty. I also agree with him on early years provision, although, frankly, we disagree on the method of funding.

I support the concept of commissions, which was begun by previous Governments. The last one in particular sought to establish a number of standing commissions, and I am glad this Government are doing likewise. I welcome the idea of a standing commission of experts who are free to comment at will—critically at times, but on the basis of objective analysis. That helps the Government, whichever party is in power.

In its representations, Save the Children raised three anxieties on the commission, and I would welcome a Government response to them—I am sure they will respond positively. First, Save the Children says that it is concerned that the commission could have its powers watered down, particularly in relation to commissioning research and consulting relevant experts and groups. It would be worth while reassuring Save the Children that that will not occur.

Secondly, Save the Children says that the commission has an important role to play in maintaining the profile of child poverty as an issue. Therefore, it is essential that the commission’s ability to advise and inform the public debate on child poverty remains within its broader remit. Once again, it would be worth while Ministers giving that assurance to Save the Children. Will there be full publication and openness and transparency? Will the commission have the ability to publish independently, without Government interference?

Thirdly, on life chances and social mobility, Save the Children would like us to examine and explore the Government’s thinking on the expertise they will seek to bring on to the commission. Once again, the Government could reassure the poverty lobby on that. If the proposals are amended in that way, the commission will undertake a worthwhile exercise, be open and transparent, and contribute to and heighten the profile of the wider debate on child poverty.

I agree with my hon. Friend the Member for Stretford and Urmston (Kate Green) about the Government’s solutions to the problem, because some Government policies are driving more children into poverty, but at least we can agree that we need a commission that will provide research and independent advice so that we can have an informed debate. On that basis, I welcome the instruction.

With the leave of the House, Mr Deputy Speaker, may I make one or two comments in response to the debate, and thank hon. Members for their contributions? I will not go through them all, because I might overstretch my opportunity.

My hon. Friend the Member for Stretford and Urmston (Kate Green) made the important point that connecting welfare and welfare measures is at the heart of tackling child poverty. I hope that when we get to the substance of the debate we examine the proposals for universal credit, which are a substantial change in the welfare system.

I always listen to my right hon. Friend the Member for Birkenhead (Mr Field) on these matters, and I will continue to do so. He commented on the centrality of child care, the child care proposals, and the impact of the introduction of universal credit, which is enormously significant. Regrettably, the Government have not fully clarified what will happen in respect of child care, which goes to the heart of the commission’s work. I hope that the commission examines that aspect as well.

Finally, in response to a number of points, I understand the arguments, but we cannot lose sight of the fact that defeating the scourge of child poverty is a central part of Government work. We cannot afford to lose that focus. I take the point made by the hon. Member for Cardiff Central (Jenny Willott) on the consensus that has been established to deal with that scourge. Let us not lose that. Irrespective of other matters, we must target, measure and take action to tackle child poverty. I hope the widening of the commission’s scope will not dilute that, and I look forward to substantial and lively debates in Committee.

With the leave of the House, Mr Deputy Speaker, I should like to respond to some of the comments made in the debate, and first of all to thank the hon. Member for Glasgow East (Margaret Curran) for her support for the motion. It was interesting and useful to hear the comments of right hon. and hon. Members in this debate, and I am grateful for the points that they have raised.

The right hon. Member for Birkenhead (Mr Field) raised an important point on the language that we use to describe such issues to people who perhaps do not live and breathe them in the same way that we do. That is important, but it is not, along with a number of issues raised by hon. Members, fully within the scope of today’s debate. We should debate such things in Committee, on Report or on Third Reading.

Tonight’s motion is on extending the scope of the Bill to enable that debate, and I am glad that so many hon. Members agree that the measure is appropriate. The right hon. Member for Birkenhead spoke of the importance of child care and getting full responses to his report, particularly on the early years. I remind him and hon. Members that we are committed to consulting on various options on child care and universal credit, although I am asking your indulgence, Mr Deputy Speaker, in straying that far.

The hon. Member for Glasgow East made a number of points, and I hope to cover a few of them. I point her and other hon. Members who commented on the broadening of the commission’s role to our consultation on the various ideas in our child poverty strategy. I remind them that we received 280 responses to that consultation, which was more than those received to the consultation on the original Child Poverty Act 2010. Only around 6% of people who responded felt that broadening the commission’s role was inappropriate. That shows that people understand the value of broadening the issues that are examined when we address child poverty, and that we cannot view children in isolation from either their communities or their families. Hopefully, hon. Members understand and agree with that.

The hon. Member for Stretford and Urmston (Kate Green) made a number of important points. She asked whether the Government remain committed to the 2010 Act. I should like to say a very clear, loud yes to that. The Government are clearly committed to the income targets in the Act, but as I outlined and as I am sure she will agree, tackling child poverty is not just about lifting people above an arbitrary income line; it is about ensuring that they have the support, incentives and skills necessary to create a better life for themselves. I hope that she would also agree on the importance of incorporating that principle into the commission’s work. We are looking at the root causes of poverty, not simply dealing with its symptoms and moving finances and moneys about.

My hon. Friend the Member for Cardiff Central (Jenny Willott) raised a number of issues, but I would particularly like to pick up on the one about how tackling child poverty is about more than income. She has my wholehearted support for her sentiments. Using targets in isolation has in the past focused policy on short-term solutions, leading to vast sums of money being spent on financial support without fundamentally changing the causes of poverty. I welcome her support for our approach and the opportunity that will no doubt be afforded by her membership of the Welfare Reform Bill Committee to debate the detail and substance of some of the issues she raised.

The hon. Member for Glasgow East talked about the broadening of the commission—in fact, this was also raised by the hon. Member for Hayes and Harlington (John McDonnell)—and was worried that we were diluting the powers of the commission. I would challenge that; we are doing quite the opposite. We are actually reinforcing the commission’s powers by giving it the opportunity to range more broadly over those issues that really affect the life chances of young people in this country. The commission’s duty to report annually on progress towards reducing child poverty will ensure that the issue remains high on the Government’s agenda, and I am sure that nobody needs reminding that it is also in our coalition agreement.

The hon. Member for Hayes and Harlington mentioned the expertise on the commission, which might be an issue that we can discuss in Committee or perhaps on the Floor of the House on Report. One reason we believed that it was important to move to a child poverty and social mobility commission, rather than simply remaining with the legislation as it was, was precisely the one he raised: we wanted to ensure that that broader expertise was put in place.

Many other issues have been raised today, but I want to touch on just one more before I close. Hon. Members asked why we believed that the reformed child poverty commission would be more powerful, and why it mattered that instead of having an advisory function, its role should be to hold the Government to account. We believe fundamentally that Ministers are responsible for the strategies put forward. However, section 10 of the 2010 Act clearly allows the Secretary of State to devolve to the commission responsibility for establishing a strategy or to act on advice in a way that could place on it responsibility for that strategy. This is really important and is at the heart of the coalition Government’s approach to ministerial responsibility. We do not believe that the commission should be responsible for the strategy; that is the role of Ministers. That is one of the fundamental changes that we are making, and it will ensure that the role of the commission is to hold us to account for the work we are doing. We do not want to defer responsibility to a commission that after all is not accountable at the ballot box. That is one of the important changes we have made.

In conclusion, we believe that these changes will ensure that the commission is an effective and efficient public body with the necessary powers to fulfil its duties and to hold Government properly to account. Moreover, they will remove the requirement on the commission as currently defined. It is a public body that cannot provide the taxpayer with value for money. There will be further opportunities to debate the content and detail of some of the issues raised today as we move through the various stages of the Bill. However, I hope that I have reassured hon. Members that allowing these changes is both necessary and beneficial to the cause of tackling child poverty, and I commend the motion to the House.

Question put and agreed to.