I inform the House that I have selected the amendment in the name of the Prime Minister. I also take this opportunity to remind the House that this debate can run only until 8 o’clock. There are 17 colleagues wishing to speak from the Back Benches, and I know that those speaking from the Front Bench will jealously guard the rights and interests of those who wish to speak from the Back. Therefore, the Front Benchers should absolutely not exceed 10 minutes each in their speeches, and if they can speak for less time than that, they will be addressing a grateful nation.
I beg to move,
That this House is concerned at the impact of policies pursued by the Department for Work and Pensions upon low-income households; notes the negative impact on those with low-incomes disclosed in the roll-out of Universal Credit; expresses concerns about cuts to Work Allowances under Universal Credit; believes that the closure of JobCentre offices in Glasgow and other areas will create difficulties for many people in accessing services; and calls on that Department to suspend the roll-out of Universal Credit and the JobCentre closure programme.
According to the UK Government, universal credit was supposed to bring fairness and simplicity, and I ask hon. Members to hold that thought when I share the experiences of some of my constituents, of people trying to help them and even of Department for Work and Pensions staff trying to navigate them through universal credit. Inverness was a pilot area for the roll-out, meaning that we were suffering the bitter effects and chaos of the full service earlier than other areas. Universal credit is hurting the people who need help the most. I know that if Government Members could see at first hand the grief that it causes, they would understand why I am so passionate about it.
Before I share some of my constituents’ experiences, I shall tell Members of my recent meetings with citizens advice bureau officers Leslie Newton and Elaine Donnelly. They have, respectively, 40 and 17 years’ experience of dealing with some of the most challenging situations we could imagine—folk at the end of their tethers, and sometimes even at the end of their lives. They have seen it all and had to deal with it. When I met them last week, they were moved to tears telling me about their universal credit case load. They told me about the suffering they were witnessing. They told me that the roll-out is a shambles, and that nobody in the system communicates with each other. They told me that the process simply does not work. They see neither fairness nor simplicity.
The transitional protection is limited and will not protect new claimants. It will be lost if the household undergoes changes in circumstances, and it does not protect people against the anguish and suffering that lengthy delays are causing them. Again, the disabled are some of the hardest hit by the move to universal credit.
I am going to make some progress because other Members wish to take part.
The loss of the severe disability premium has taken nearly £62 a week out of the pockets of the most critically disabled. Cuts to the disabled child addition mean that 100,000 disabled children stand to lose up to £29 a week. Cuts to the severe disability premium mean that disabled lone parents with young carers stand to lose £58 a week. Those in the work-related activity group who receive employment and support allowance will lose around £30 a week.
Does my hon. Friend share my concern about the lack of information and data that the Department for Work and Pensions has on its own activities, particularly when it comes to the most vulnerable claimants? On 10 January, I asked the Department to provide me with the number of people who had had their benefits withdrawn or suspended in the process of transferring from disability living allowance to personal independence payment. It wrote back on 13 January to say that it did not know; is that not shocking?
It is shocking.
Disabled people who have been found unfit for work by the work capability assessment are still expected to take steps towards finding work. That group includes those who have suffered serious injuries, those in the early stages of progressive conditions such as multiple sclerosis, and those with learning disabilities. Disability unemployment is a long-standing, unique issue, and the universal credit process is creating more barriers for the disabled people in the workplace.
The Prime Minister has been talking about JAM—the so-called “just about managing”—but thanks to universal credit, many families’ income is about to be toast. I suggest the Prime Minister comes to Inverness and talks to my constituents about her shared society—to those families with children who will be up to £2,630 per year worse off, according to the Children’s Society; to the lone parents and people with limited capability for work under the age of 25 who will lose £15 a week; and to the young people and their families who will be pushed further into poverty because of reductions in standard allowances. The four-year freeze on support for children will see the value of key children’s benefits cut by 12% by the end of the decade. Universal credit will not only fail to lift children out of poverty; it will push them further into poverty.
Citizens Advice has said:
“Universal Credit is failing to live up to its promise…from the outset people have experienced problems…delays to claims and errors in their payments.”
The Public Accounts Committee found that the systems were “underdeveloped”, and said there was increasing pressure on DWP staff. My team and I see it every day, day in, day out. Only yesterday, a constituent, Laura Shepherd, got in touch. She was at the end of her tether. Her 20-year-old son, Douglas, has severe autism, and has been on the waiting list for a work capability assessment since the end of September. During this time, they have had no disability support, just the minimum level of universal credit of just over £200 a month. Quite understandably, the family are trying to get this sorted out—they want their claim backdated to cover a period when they were incorrectly given child tax credits instead of universal credit. The universal credit team cannot even give Laura any dates for a disability work assessment for her son, because assessments of that nature are done by an external contractor. The team actually told her in writing to contact me, as her MP, because they were at a loss as to what to do.
The wife of an officer serving in our Army has now been waiting five months for assistance with childcare costs—she has had no payments for five months—and has suffered a catalogue of errors and very sporadic communication. She could not get her problem sorted out because even DWP staff working on universal credit are not allowed to talk to the service centre or claims manager. Everything has to be duplicated by email, leading to confusion and lost information.
Then there is this so-called helpline. Who on earth thought that it was a great idea to make it a premium call line? It is shameful that people with no money are being made to spend their last pennies on premium lines. What do they do if they have no credit on their mobile phones—that is if the phone has not had to be pawned to make up for the money that they are not getting through waiting for their payments? Many constituents have come to my office to call the helpline because they have no money. When they do call, they are left on hold while DWP staff try to sort out errors for more than 20 minutes. We asked CAB to monitor calls, and it found that none was under the Government’s stated waiting time of three minutes 27 seconds. In fact, all 36 that it logged were for longer than that. The longest was a staggering 54 minutes and 17 seconds. Sometimes, people are offered a call back. If it happens and they get to their phone in time, they are lucky. They only get one shot at that. It is like a universal credit version of Catch 22. The transfer of universal credit to full digital has already been halted, and the halfway house that has emerged is ripe for confusion.
People are required to make some online claims, yet need to take the original copy of letters to the jobcentre at their own cost. A report detailing the impact of the controversial new scheme in Glasgow shows not only that claimants are struggling, but that services and jobs are being put at risk. There is a lack of understanding and explanation of the general requirements of a claim, and those who have special needs are often left to struggle and to face the sanctions that follow. Where is the fairness or the simplicity?
The system is manufacturing debt and despondency. In Highland, the council has a framework agreement for the temporary homeless accommodation services. It is £25 a night or £175 a week. One of my constituents, Gavin, has been living in homeless accommodation. Under the old system, he would have been awarded £168 housing benefit, leaving him a small difference of £7 a week to pay out of his other entitlements. Under universal credit, he has the same housing costs, but gets only £60 a week, which means that he has to pay £115 a week out of his other allowances—but he does not get £115 a week. Even if he gave up food, heat, light and everything else and spent every single penny he would still be short. Gavin and others will always be in arrears. The system is flawed by design.
Does the hon. Gentleman not agree that the latest rise in UK inflation will hit poorest families hardest? Surely the Government should be doing much to counteract its effect given that it is a direct result of the fall in sterling following the Brexit strategy.
I absolutely agree, and there is more to come.
It is not just the homeless who are affected, but families in private rented accommodation who have been waiting for three months for universal credit claims. There is no fairness there. The only simplicity is that it is simply nuts. Highland Council is left carrying the debt of the money that Gavin and others simply do not have. It has already accrued an additional debt of more than £180,000 as a direct result of universal credit. According to a report by Glasgow Council, a total of 73 homeless people in Glasgow are now on the benefit, and have racked up £144,000 in arrears between them.
The National Federation of ALMOs—arm’s length management organisations—and the Association of Retained Council Housing, which together represent more than 1 million council homes in England, found that the percentage of council home tenants in receipt of universal credit who are in rent arrears has increased by seven percentage points—it was up to 86% in March last year. That compares with 39% of tenants in arrears who do not receive universal credit. The average arrears total has also increased, from £321 to £616.
The SNP Scottish Government have consistently done everything they can to mitigate the worst impacts of Tory welfare cuts, and new devolved powers over social security and employment support will include disability benefits, carer’s allowance and the winter fuel allowance. With these limited new powers, we will seek to build a Scottish social security system with dignity and respect at its heart—
I am going to finish up.
It is wrong that the Scottish Government and the council should foot the bill for UK Government cuts. It is also true that the proposal to cut 50% of jobcentres in Glasgow—a subject I know my colleagues will speak on shortly—is a bad idea. Let us not forget that these proposals come on the back of last year’s announcement of the closure of 137 HMRC offices across the UK, with potentially thousands of job losses in Scotland.
There is a damning litany of failure, confusion, heartache and indignity and a crushing drive towards increased poverty in the universal credit system. Long delays to payments, short payments, lost sick notes, misplaced documents, failure to respond, confusion between departments, crushed morale for the poor Jobcentre Plus staff and an inability to respond to common sense are rife in universal credit. It is time to halt this tragic experiment—the bad IDS idea—and think about how we provide for those who need our help, rather than those few who stand to profit from austerity.
I beg to move an amendment, to leave out from “House” to the end of the Question and add:
“welcomes last week’s Official Statistics showing that the poorest households saw the biggest income growth of £700 in the last year; further welcomes the impact of this Government’s welfare reforms in supporting low-income households to find work, with over 2.7 million more people in work and 865,000 fewer workless households than in 2010; recognises the role of Universal Credit in supporting people into work and increasing their earnings in work by ensuring it always pays to work; welcomes the recent announcement of a reduction in the taper rate to 63 per cent; believes that the Government’s reforms have given taxpayers confidence in an affordable and sustainable welfare system that ensures value for money and responds to the needs of claimants, with 86.6 per cent of Universal Credit claims currently being made online; and notes that the Scottish Government has asked for an extended timetable for the full transfer of the extensive welfare powers devolved under the Scotland Act 2016.”
As the Prime Minister has made clear, this Government are committed to building a country that works for everyone, not just the privileged few. The support that the Department for Work and Pensions offers through universal credit and Jobcentre Plus has a key role to play in delivering this.
Since 2010, we have made great progress in delivering a modern and effective welfare system. Our work coaches are providing professional and tailored support, exploiting the opportunities offered by digital channels, and for those hundreds of thousands of people already in receipt of universal credit we have ensured that work and progressing in work will always pay. Although we have had to make difficult decisions on welfare spending, we have never lost sight of the fact that the most sustainable routes out of poverty and just managing are to get into work and to progress in work, and universal credit lies at the heart of that, transforming the welfare system to ensure that work always pays—that it pays to participate, that it pays to progress. This is in contrast to the pre-2010 system; in-work poverty increased by 20% between 1998 and 2010, despite welfare spending on those in work increasing by some £28 billion.
We are building a fairer system that will mirror the world of work and we are eradicating the complexities and disincentives of the old system. There are no hours rules or cliff edges in universal credit, as there are in tax credits and other legacy benefits and which have historically, on occasion, provided the disincentive to work or to earn more. Universal credit also removes the need to switch between benefits as claimants move into and on in work, simplifying the system and ensuring continuity for claimants.
Our approach is working. The claimant count has dropped from almost 1.5 million in 2010 to about 800,000 now. Unemployment is down 894,000 since 2010, with near record levels of employment around the country. Once it is fully rolled out, we estimate that universal credit will generate about £7 billion in economic benefit every year and boost employment by up to 300,000, but we are not done yet. We believe that making work pay and opening up opportunities for people to realise their potential are central to building an economy that works for all. By reducing the universal credit taper rate to 63% we will further improve the incentive, helping up to 3 million households.
It is clear that for many disabled people the barriers to entering work are still too high. We need to continue to review and reform our support based on what we know works. We will build on the success of universal credit and provide more personalised employment support by consulting on further reform of the work capability assessment. Our Green Paper on health and work makes proposals that go further, marking a new era in joint working between the welfare and health systems.
Our change to the work-related activity component is designed to encourage and support claimants to return to work. We have allocated a total of £330 million for new employment support for people with limited capability for work over four years, starting from April 2017, and an extra £15 million for a top-up to the flexible support fund in both 2017-18 and 2018-19. It is also important to note that it will apply only to new claims and there will be no cash losers among those already in receipt of ESA.
However, looking at our benefit reforms in isolation fails to appreciate the Government’s wider work in providing support for those on low incomes. The single most important thing has been our stewardship of the economy and the strong growth that it has facilitated. People are sharing in the proceeds. Average household incomes are at an all-time high, income inequality has fallen and pay for the bottom 5% in society is up by 6.2% year on year, the highest rise since the series began in 1997.
I do not have time to list all the other advances we have made—the hour is late, time is short and many colleagues wish to speak—but it is important to acknowledge some of the most transformational. We have introduced the national living wage. We have increased the personal tax allowance to £11,000, so the typical taxpayer now pays £905 less tax per annum than they did in 2010. We have introduced the triple lock so that pensioners with a full basic state pension receive over £1,100 a year more than they did at the start of the last Parliament. We are extending free childcare—it will be interesting to hear what SNP Members feel about this—for three and four-year-olds from 15 hours to 30 hours, as well as introducing 15 hours of free childcare for disadvantaged two-year-olds and free school meals for all infants.
Tackling child poverty and disadvantage, delivering real social reform, is the key priority for this Government. Only by tackling the root causes of poverty, not just the symptoms, will we make a meaningful difference to the lives of society’s most disadvantaged children and families. It is for that reason that we introduced two new statutory measures, to drive real action on parental worklessness and children’s educational attainment, the two areas that we know can make the biggest difference to disadvantaged children. The forthcoming social justice Green Paper will build on those measures and set out how we identify and tackle the root causes of poverty.
Alongside our policies targeted at helping people to progress in work and fulfil their potential, we are also committed to continuing to modernise and professionalise the services and support that our jobcentres offer. If we are to deliver a service fit for the 21st century, we must make the most of the opportunities offered by new technology and recent shifts in demand. I am pleased that the motion refers to our plans for the jobcentre estate, as they are one of the best examples of how we are in fact doing that. After 20 years, Labour’s private finance initiative contract, which covers many DWP offices, is nearing an end—it expires at the end of March 2018. That gives us an opportunity to review how the Department delivers modern services and ensure that it gets the best deal. As I have already mentioned, reforms such as universal credit are revolutionising the relationship between claimants and work coaches, ensuring that the support we offer is more personalised and better suited to the needs of claimants.
Will the Minister comment on the disability employment gap? Surely closing jobcentres will make attaining employment less accessible for people with a disability and increase the hurdles they face in doing so.
As the House knows, narrowing the disability employment gap is an absolutely priority for this Government, and I am pleased to say that we are now making progress on that, but there is a great deal more to be done—nobody denies that. We must ensure that there are more opportunities available to people with disabilities, including through our jobcentre network, but part of that is making sure that the right services are available and that we have the resources in place to be able to afford the people, facilities and courses that can help support those people.
The claimant count has dropped from almost 1.5 million in 2010 to around 800,000 now. In some cases we are using only 25% of the floor space in sites we are renting. That is 25% of the value for 100% of the rent. Every penny that we spend on space under Labour’s PFI is money that could be going back into the public purse, helping to protect vital services.
I am going to have to ask the hon. Gentleman for his forgiveness.
Those services and support include our own, because we are expanding what we do. In fact, we expect to have over 2,000 more work coaches in 2018 than we have today. In deciding what changes it is reasonable to make to the estate, we have carefully considered the impact on claimants, including travel times. We think that it is reasonable to ask somebody to attend a new jobcentre that is either less than three miles away from their existing jobcentre, or 20 minutes away by public transport. Of course, many claimants, including constituents of many Members on the Opposition Benches, travel considerably further than that, as of course do many people in work.
The UK Government have devolved powers for existing benefits worth some £2.7 billion to the Scottish Government. Scotland can also top up benefits and create new benefits. With that, of course, comes the corresponding responsibility and accountability. I was interested to note that the Scottish Government are returning to fortnightly payments and direct payments to landlords. We firmly believe that we should minimise the difference between the out-of-work welfare support system and the world of work to facilitate people’s transition into work. Few employers pay fortnightly and even fewer have a direct relationship with their employees’ landlords. We believe that our system, which still allows for alternative payment arrangements when required for vulnerable customers, is the right approach, but we appreciate that the Scottish Government have a different view. It will be interesting to see how the two approaches deliver. We shall see.
This Government’s record speaks for itself. Poverty is down, child poverty is down and the deficit is down. We had the fastest-growing G7 economy in 2016 and 2.8 million more people are now in work. We are all about a strong economy and a supportive, effective welfare system with work for those who can, help for those who could and care for those who cannot. Taken together, universal credit and our continued reform of Jobcentre Plus will provide the modern, effective and compassionate welfare system we need to continue to deliver on this promise: an economy and a society that work for all.
Just before I call the Labour spokesperson, I inform the House formally, as colleagues who are due to speak have been notified privately, that there will be a time limit of three minutes on Back-Bench speeches in my attempt to ensure—[Interruption.] Order. If the hon. Member for Glasgow South (Stewart Malcolm McDonald) listens, he will learn. The time limit is my attempt to ensure that everybody who sought to speak has the opportunity to do so. Fairness and equality, Mr McDonald.
The Minister paints such a rosy picture, yet the SNP spokesman, the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry), gave examples of cases that he has experienced. I could also give examples, and I am sure that Government Members have examples of cases they have dealt with regarding the work capability assessment or other cuts. It is absolutely right that we debate this very important matter.
The Minister started by expressing the Prime Minister’s commitment about having
“a country that works for everyone.”
We need to scrutinise those words and, more to the point, work out whether they are actually true, particularly in relation to social security policies and their impact on low-income households.
To understand why the Government’s attacks on the poor are so damaging not just to the people who experience those attacks, but to the whole country, we need to understand the situation in the context of inequalities. I worked on this for more than 20 years before I entered this House six years ago, and I focused on the effects of inequalities in income and wealth on our health. Overwhelming evidence over the past 30 years shows that the risk of poorer health and lower life expectancy increases from high-income to low-income groups. My dear friend, the former Health Secretary, Frank Dobson, said:
“There is no more serious inequality than knowing that you’ll die sooner because you’re badly off.”
This pattern of illness and disease is systemic, socially produced and universal. It is not about the individual or biological factors. It is about inherent, systemic, socially reproduced inequalities. They are not inevitable. They can be changed, so we should all have hope.
The pioneering work of Professors Richard Wilkinson and Kate Pickett published in “The Spirit Level” a few years ago showed that socioeconomic inequalities do not affect just life expectancy, but educational attainment, social mobility, crime levels, mental health, happiness, and even trust within and between communities. The simple truth is that the smaller the gap between rich and poor, the better we all do.
When the Prime Minister claims she wants to tackle these burning injustices, I have to ask her where she has been. These injustices were burning while she was a senior member of the Government. Now that she is Prime Minister, what is she doing to address them? Again, I am going to go on to show that it is not a lot.
This week, as the World Economic Forum gets under way in Davos, we hear the same warning we heard from the IMF in 2015—that widening inequality is the most defining challenge of our time. Last week, we heard yet again about obscene pay ratios, with top executives now earning 130 times more than the average employee. Yesterday, Oxfam published the breathtaking figure that eight individuals have the same combined wealth as half the world’s population—just eight people.
Last Friday, the Institute for Fiscal Studies published its analysis of inequality in the UK, which showed that the inequality in pre-tax pay between high and low earners has risen. Since 2010, working people on low incomes—particularly families with children—have lost proportionately more of their income than any other group, as the net result of tax and social security changes.
The Government have glossed over this problem with divisive rhetoric. Repeatedly, they have said that poverty and inequality are a pathology of the individual rather than the result of the structural flaws of their economic and public policies—particularly their social security policies.
We have just heard from the Minister that work is the route out of poverty, but why is it that, contrary to the Government’s divisive narrative, more people in work— 7.4 million people—are in poverty than ever before? Three million children of the 4 million living in poverty are living in families where someone is working. How can that be a success story of the Government? When will they start to look at the structural issues in the labour market and at the productivity crisis rather than victimising the poorest? Four out of five people on low incomes now will still be on low incomes in 10 years. What have the Government done about that?
The motion raises some of the important questions hanging over the Government’s flagship programme, universal credit. We supported the original principles of universal credit—to make sure that work always pays, by allowing people to work more hours without the fear of being made worse off. Universal credit had the potential to address inequality, by targeting employment support to those on low pay, reducing the cliff edge associated with other support, such as tax credits, as the Minister said.
However, we are a world away from the project initially lauded by the Government. We have been through seven delays in implementation, a reset by the Major Projects Authority, criticism from the National Audit Office and costs spiralling out of control. The many practical issues with the programme have yet to be sorted out, and a full working delivery is still a distant prospect. Fundamentally, there are key flaws in the design of UC.
Take, for example, the issue of four-weekly payments, with people being paid twice during one universal credit assessment period and expected to re-apply for support the following month. As hon. Members can imagine, many people do not know they have to reapply, so it comes as a rather unpleasant surprise when the Department refuses them support. Will the Minister please update us on progress in dealing with four-weekly payments?
Or perhaps we should look at the impact of universal credit’s so-called long hello. Last year, a report by The Guardian showed that the shocking 42-day wait to receive the first payment had sent claimants’ food bank use and rent arrears spiralling. One survey of landlords responsible for 3,000 households on universal credit found that eight out of 10 tenants were in arrears. Will the Minister commit to immediately reducing that waiting time and to providing immediate access to hardship funds so that people do not have the current two-week delay?
On sanctions, I am pleased that the Government are finally seeing the evidence of how damaging the system is and its impact on getting people off flow. We cannot underestimate the impact of sanctions when it comes to the rosy picture of falling claimant counts. Under the UC regulations of 2014, the Government are able to sanction people who are in work on low pay. We are now starting to see more people who are already working—doing the right thing—being sanctioned because they are not working hard enough. One million people on zero-hours contracts are potentially under threat from this Government.
I am sorry but I will not; otherwise, people are going to miss out. [Interruption.] I am happy to take it outside, gentlemen.
Most important for low-income families has been this Government’s slashing of the programme’s budgets, significantly undermining the principle that work will always pay under the scheme. Cuts to the work allowances of universal credit will mean that, on average, claimants receive £2,100 a year less than if they were on UC. The autumn statement had no impact on this.
The hon. Member for Inverness, Nairn, Badenoch and Strathspey mentioned the impact of this Government’s horrendous cuts on disabled people. With nearly £30 billion of cuts to 3.7 million people, we are definitely going to see more than 5 million disabled people pushed into poverty. We also heard about the jobcentre closures. It seems that the universal credit programme will no longer make work pay. It was built by a Government who believe that the best way to help people into work is by shutting jobcentres. We believe that, like our NHS, the social security system should be based on principles of dignity, inclusion and support, and Labour will do this.
As I have only three minutes, I will not take any interventions. I stood on a platform of getting Britain working again and reforming a welfare system that was failing some of the most vulnerable people in my country and my constituency. For too long, people went on welfare and remained there. It is worth noting that long-term unemployment doubled between 2008 and 2010. Major changes that so directly affect people in their day-to-day lives are never easy and are not necessarily popular, but our welfare system needed changing, and I am delighted that our Government are taking that so seriously. We are determined to make sure that those who want work, and those who cannot work, are supported when they need it. That help is at hand from this Government.
So far, we have seen monumental change, and it is not easy. As a former member of the Work and Pensions Committee, I have always welcomed the Department’s attitude to universal credit—rolling it out; considering the changes and seeing the impact; and then changing and adapting, and rolling it out again. I welcome the pace of delivery of universal credit. We are listening, looking at the evidence, and reforming as we go. That is the correct way to do it.
The single best thing that any Government can do for low-income families is ensure that we have a strong economy. I am delighted that since the 2010 election this Government have put that at the heart of what we are doing. Unemployment is at its joint lowest rate—4.8%—for 10 years; there have been 2.7 million more people in work over the past six years; and there are more women, older workers and ethnic minorities in work than ever before. The annual average income of the poorest fifth of households has risen by £700 in real terms since 2007-08. This House has heard on many occasions about the benefits of work: an improved outlook and social networks, better connections with the community, increased happiness and better health.
I am proud of the Government’s achievement in getting more people into work. This stands in stark contrast with the rhetoric of the Opposition. Under universal credit, the biggest change in welfare in this country for a generation, claimants are much more likely to move into work than under jobseeker’s allowance. Analysis has shown that working-age adults in non-working families are almost four times more likely to be living on a low income. The 2015 report, “Child poverty transitions”, found that 74% of workless families who moved into full employment exited poverty, and that is terrific.
Debate interrupted (Standing Order No. 9(3)).
Motion made, and Question put forthwith (Standing Order Nos. 15 and 41A(3)),
That at this day’s sitting—
(a) the Motion in the name of Angus Robertson may be proceeded with, though opposed, until 8.00pm, and Standing Order No. 41A (Deferred divisions) shall not apply; and
(b) the Second Reading of the Intellectual Property (Unjustified Threats) Bill [Lords] may be proceeded with, though opposed, until any hour.—(Guy Opperman.)
Question agreed to.
Question again proposed.
That sounds way above my pay grade, Mr Speaker, but thank you none the less.
I take my hat off to the Minister and his colleagues at the Department for Work and Pensions, because he has managed to do something I never thought possible: unite Scottish Labour politicians and Scottish National party politicians against his jobcentres closure plan. That will be the focus of my remarks, and if he will listen, I will educate him.
The Minister’s plan has gone down like a bucket of cold sick among not just my constituents, but trade unions, the Catholic Church, the Church of Scotland and Glasgow City Council. Glasgow, the city I represent, has the highest unemployment rate in Scotland, and that shames me—I am not proud of that badge—and I would want to work with the Minister to improve on that, but I do not see how we can do so by reducing the number of jobcentres from 16 to eight. That is a 50% cut against what is supposed to be a 20% reduction elsewhere.
Glasgow is being targeted by the Tories yet again. [Interruption.] I will take no muttering from Back-Bench Tories. I invite each and every one of them who votes for the Government amendment tonight to come to Castlemilk to meet my constituents who are expected to do an 8-mile round trip, using up to three buses. Ministers would not know about any of that, because they relied on Google Maps in putting the proposal together. Government by Google is not the new Britannic isolation I had expected.
Where is the Scottish Secretary on these plans? Why have we not heard anything from our Secretary of State about fighting for Glasgow and standing up for Scotland against these proposals? [Interruption.] Let me say to the hon. Member for Lewes (Maria Caulfield), who is muttering from a sedentary position, that I asked Ministers how many people in Langside and Castlemilk jobcentres in my constituency claim disability living allowance. The answer was that they do not know. On jobseeker’s allowance, they do not know. They were asked how many people who are disabled use Glasgow jobcentres across the city; they do not know. What about the public sector equality duty? How confident is the Minister that he will not breach his obligations under the Equality Act 2010, because we still have not had an equality impact assessment? The plans are so ridiculous and so ill thought out that it is almost a schoolboy howler. I invite Members to look through the written answers from the Minister to questions asked by me and Glasgow colleagues; if they do not make hon. Members laugh, they will certainly make them cry.
I speak as a former member of the Work and Pensions Committee, which, during the previous Parliament, investigated the roll-out of universal credit. There was a lot of negativism on the Opposition Front Bench then, as there is in this Parliament. Perhaps the English Jobcentre Pluses that have introduced and rolled out universal credit could help their Scottish counterparts to enable SNP Members’ constituents to get into work.
The Scottish Government—the SNP has a majority in the Scottish Parliament—have the power to provide discretionary payments in any area of welfare, including to top up reserved benefits, as well as to create new benefits in reserved areas. If SNP Members really want to change welfare in Scotland, they would be better off speaking to their colleagues in the Scottish Government.
Conservative Members know that the way out of poverty is work, not welfare. Since 2010, 2.7 million more people are in employment, with more than 1,000 jobs created every day under the Conservative Government. We have introduced a new national living wage, giving people on low wages a pay rise, and lifted 4 million people—and rising—out of income tax altogether.
Every one of our welfare reforms was designed with the aim of supporting people into employment, and universal credit is a revolutionary part of that. Jobcentre staff in my constituency tell me that 71% of universal credit claimants moved into work in the first nine months of their claim, compared with 63% of comparable JSA claimants.
The SNP motion completely fails to acknowledge the reduction in the universal credit taper to 63p in the pound, announced in the autumn statement last year. This will target support on those on lower incomes, allowing people to keep more of what they earn. Under universal credit, 86% of people were actively looking to increase their hours, compared to just 38% on JSA. We now have a welfare system that rewards hard work and enterprise.
Official statistics show that the poorest households saw the biggest income growth, of £700, in the last year, and there are 500,000 fewer people living in absolute poverty since 2010. The benefit system has to be fair for those who are in receipt of welfare, but equally it has to be fair to the hard-working taxpayers who pay for it.
As of November 2016, there were about 1,130 universal credit claimants in my constituency, of whom 450 were in employment and 680 were not in employment. At my local surgeries, my team and I have spoken directly to and assisted those in my community who have been adversely affected. They have been scathing in their views of this policy.
The views of my constituents add to the overwhelming evidence from Opposition Members and organisations such as the Institute for Government and the Resolution Foundation. It is clear that universal credit has failed and that urgent action is needed from the United Kingdom Government, which is why I fully support my colleagues in their call for the roll-out to be suspended. It is obvious from the lessons not learned from the pilot scheme that the roll-out policy has stumbled from disaster to crisis at every step. The Resolution Foundation is scathing in its view of the policy, with the think-tank arguing that universal credit has serious design flaws and has veered off track.
This attitude is laid bare when looking at the implementation of the policy. When universal credit came into effect, the first £111 of a person’s wage was disregarded where the claimant was working and universal credit was topping up a low income. However, the UK Government, through the Department for Work and Pensions, scrapped that in April 2016 with no notification to claimants. Will the Minister deny that?
There are also serious problems with staffing. It is clear that staff are being overworked. Before Christmas, it was reported that a whistleblower in the DWP from Northgate benefit centre in Glasgow had revealed that staff were overwhelmed by the number of decisions they were being asked to process, and that managers had ordered them to prioritise sanctions over appeals in order to meet their targets—a wholly unacceptable situation. I hope the Minister can deny that.
Added to the problem is a huge backlog of what is known in the Department as “tasks”, many of which are computer generated and unnecessary. This leads to double-handling, where more than one account developer is dealing with one claim. Staff in Bolton, Glasgow or Dundee could all be clearing tasks from the same claim on the same day. Will the Minister deny it? Staff have been instructed to check their buckets every day for tasks. In practice, this means claimants are in the lobster pot when claiming universal credit: once they are in universal credit, there is no chance of them getting out or reverting to another benefit. Will the Minister deny it?
The UK Government have failed to ensure that DWP staff are prepared for the roll-out. This has only led to the delays and errors that are resulting in a crisis, not just for those in the benefit system, but for those seeking to deliver it on behalf of the British Government.
I thought the title of the motion was supposed to centre on the impact of Government policies on helping low-income households, but all Scottish National party and Labour Members have focused on is benefit provision. Not one of them has mentioned getting people into work and increasing the wages they earn once they are in work. As my hon. Friend the Member for Cardiff North (Craig Williams) said, the “Child poverty transitions” report showed that 74% of workless families that went into work exited poverty. This has to be the focus of the Government’s agenda.
The Government have done more than any other Government in living memory to help low-paid workers, through measures such as those my hon. Friend the Member for Weaver Vale (Graham Evans) mentioned: the national living wage; giving a pay rise to more than 6 million people; and enabling people to keep more of the money they earn by lifting 4 million out of tax altogether. I disagree with the shadow Minister that the jobs created are on short-term contracts; some 70% of all new jobs are full time, so people can earn more and be in work for longer.
The Institute for Fiscal Studies has said that ours is the fastest-growing economy in the G7, which means that businesses up and down the country have been able to give workers a pay rise of 2.6% in the last year. It is this Government who are helping low-paid workers. The way out of poverty is through work, not benefits. As has been mentioned, research shows that if someone is on benefits, their life chances are increasingly suppressed, that they will live 15 years fewer than someone in work and earning a good wage, and that they will have more health problems, as will their children after them.
The route out of poverty is through work. The Government are helping people not only to get into work, but to earn more while they are in work and to keep more of the money they earn by reducing the amount of tax they pay. They are helping people into work by creating full-time jobs and transferring them to universal credit, which has seen an 8% increase in the number of people finding work. The Scotland Act 2016 gave the Scottish Parliament powers to ensure that welfare provision could be tailored to local needs. The SNP should get on and use the powers it has, instead of blaming the UK Government for Scotland’s benefit problems.
It is interesting to follow the hon. Member for Lewes (Maria Caulfield), because the Government’s current policies have little to do with getting people into employment and everything to do with aggressively targeting the people who most need support. I want to mention three groups currently affected. Last year, I visited Emmaus, a charity working with homeless people across Glasgow, building their confidence through local employment projects. Everybody living in Emmaus accommodation signs off primary benefits except housing benefit and works full time within the community. If they are forced to move to universal credit, they will potentially have to take part in jobseeking schemes for which many of these vulnerable people are simply not ready.
I also want to mention recently graduated students and the barriers they face when trying to claim universal credit. The eligibility criteria state that a claimant must
“have lived in the UK for the last two years and not have been abroad for more than four weeks continuously during that time”.
This means that anyone who has worked or travelled abroad, as many students do—for language students, it is a compulsory part of their course—is ineligible for universal credit.
Finally, I want to talk about a new source of anxiety for many of my constituents: the news of the closure of half of Glasgow’s jobcentres. I spoke to several constituents outside Anniesland jobcentre on Friday, including a lady in her mid-50s who had worked all her life, until she suffered a stroke two years ago that left her paralysed down one side. She has been declared fit for work because her speech is unaffected, but due to a lack of mobility, her quarter-mile walk to the jobcentre takes her over an hour each way. Public transport is impossible because she does not have the mobility, and if it moves when she is standing, she could be on the floor, while a taxi is completely out of the question because of the expense. Under this sham of centralisation, her services are being moved to Partick, over two miles away.
None of the people I have mentioned are layabouts or scroungers; all of them strive for a better life and want to contribute fully to society. If we judge a society by how it treats its most vulnerable, I have no doubt how history will judge this Tory Government.
This Government have never hidden their aims to have a high-wage, low-unemployment economy, in which people have the satisfaction of bringing home a wage for their family. We only have to look across the channel to see the really damaging effects that long-term unemployment, particularly among young people, can bring. The changes that the coalition Government and this Government have brought about have been successful. As other hon. Members have said, we now have 2.7 million more people in employment than in 2010. The claimant count is at its lowest since 1975.
Universal credit was an ambitious aim, and it has at its heart the objective that low-income families will not find themselves better off on benefits than if they went out to work. That was the perverse situation that persisted under the labyrinthine system that preceded it. This system was unfair, as my hon. Friend the Member for Weaver Vale (Graham Evans) said, to those who were trapped on benefits and to the taxpayers who paid for it. In South Ribble, my constituents support a system that is fair on everybody.
I would like to pay tribute to DWP employees who worked really hard on the roll-out of universal credit. There have been some hiccups, but I think they are being looked at. When the Minister sums up, will she explain what systems are in place for monitoring the ongoing roll-out of universal credit?
There is a feeling of unfairness for some families that are in work and doing the right thing, but still find it difficult to make ends meet. To that end, I am pleased about the introduction of the national living wage and the extended hours of free childcare. I particularly welcome the “Child poverty transitions” report, which my hon. Friend the Member for Cardiff North (Craig Williams) mentioned. I shall not repeat what he said, because I know many hon. Members still wish to speak.
Let me finally address the closure of jobcentres in Glasgow. I read with interest the Westminster Hall debate led by the hon. Member for Glasgow South (Stewart Malcolm McDonald) on this specific issue. I fear that SNP Members might be politicking. When I read the summing up by the Minister for Employment, I found that he made very clear both his personal and his Department’s commitment to getting people into work. He said that at some of the smaller jobcentres, only 25% of the floor space was actually being used, while also making it clear that he is committed to getting people into work. There is too much clinging on to bricks and mortar when the real questions should be what works and what will get more people into work.
I feel as if we are going round in circles and not getting anywhere with this Government. We are not getting the answers that the people of Glasgow deserve when it comes to the jobcentre closures. My colleagues and I have asked for answers, tabling a whole range of parliamentary questions, but what we have found out is that this Government know nothing.
The Government cannot tell us how long the bus journey will take, because they have never done it. There is no record of any Government Minister ever having visited Bridgeton jobcentre. The Government do not know how many employment and support allowance claimants there are, and they do not know the number of income support claimants, because they cannot provide the data. They have said that there are 253 universal credit claimants, but that appears to be the depth of their knowledge on this issue.
The Government cannot tell us what the catchment area is for the jobcentres in Glasgow, which is a crucial point. It is not the distance between two jobcentres that counts; it is the distance between where somebody lives and how they actually get to Shettleston. Lots of people will find that incredibly difficult. If they are in Bridgeton, it means two buses, but if they are in other parts, the journey will be even further and the buses will be even more infrequent. This will impact on people’s ability to get to the jobcentre and it will impact on sanctions. Can the Minister tell me whether the time that people have to travel will be taken into account in the claimant commitment, or will it not count as time when they are seeking jobs?
I have campaigned on another issue since it was announced in the summer Budget of 2015. The Government do not know how the two-child policy, which will come into force for universal credit claimants in April, will work. They expect vulnerable women to confess to DWP employees that their third child has been the result of rape, but they do not know how it will work. The consultation on this matter closed on 27 November, but from the DWP there has been not a peep since. We do not know how it will work. Parliamentary questions that I have lodged indicate that they have not even spoken to the trade unions about this issue and how their members will be asked to implement a very sensitive, difficult, personal and traumatic policy that will impact on the dignity of women’s lives. The Government do not know how that will work.
The Government do not know the impact of their policies, because they refuse to admit the truth. They refuse to admit that benefit delays are causing people to go hungry, and causing people to go to food banks. On Friday, I visited the fuel bank at the Glasgow SE—South East—foodbank. People do not even have fuel. They do not have electricity in their houses, because they have no money as a result of those benefit delays, but the Government will not admit that that is the truth of the situation. They are also in denial if they think that the national living wage is for everyone: it is not for those aged under 25. Under-25s have the same outgoings as everyone else, but they are not entitled to the same wage. It is disgraceful.
This is not a Government who work for everyone, and they should listen to the people who are actually affected.
It is a pleasure to follow the hon. Member for Glasgow Central (Alison Thewliss). I have to say, however, that although she said that she was not getting answers from the Government, I know—having read the reports of Westminster Hall debates—that not only are she and her constituents getting answers, but, more important, her constituents are getting jobs as a result of the Government’s policies, as are constituents of Members on both sides of the House.
Welfare reform was a central plank of the election manifesto on which Conservative Members were elected, but building a system that works for all and a country that works for all, and reforming welfare, are part of a bigger package of measures, including increased childcare, the lifting of those on the lowest wages out of income tax, and the introduction of a national living wage. Most important of all, a record number of people are in work as a result of the policies of this Government. As we have heard from Conservative Members, getting people into work is central to improving their life chances and those of their families, and essential to achieving greater social justice. I am a considerable fan of the shadow Minister, the hon. Member for Oldham East and Saddleworth (Debbie Abrahams), for whom I have a great deal of respect, but I was disappointed that she did not focus on that simple, single most important factor: the increased number of jobs that the Government have delivered, which, as I have said, are central to the improvement of life chances.
Welfare reform, of which universal credit forms a key part, is also central to the delivery of our vision of a country that works for all. It is reform that will help to ensure that work always pays more than benefits. It is reform that will help to ensure that our welfare system is financially sustainable and delivers a fair outcome, not just for those who use the system but for those who pay into it. It is reform that helps to simplify what was, as we heard from my hon. Friend the Member for South Ribble (Seema Kennedy), a byzantine and opaque welfare system. There is more to be done, but this reform takes us a long way down the route, and it is reform that still places care and support for those most in need of it at the heart of this country’s welfare system.
Key to the delivery of reform will, of course, be implementation. Having read reports of debates and listened to Ministers on previous occasions, I have every confidence that the design of this system, and the graduated roll-out, are exactly what we need to ensure that we get it right, and do not repeat the tax credit debacle that we saw under the last Government. This policy has my wholehearted support—and we will get it right.
As always, it is a pleasure to follow the hon. Member for Charnwood (Edward Argar), but he made the same mistake as many of his colleagues who have spoken today. They have merged the Orwellian with the Dickensian. Let me say to the Thatcherites among them that St Francis of Assisi has not had a look in. Marie Antoinette was a philanthropist in comparison with this Government.
I want to raise two issues, because I do not want them to be swept under the Axminster before the debate ends. I refer to the telephone tax, which my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) mentioned. Those who need to phone the Department for Work and Pensions must pay 45p a minute, and, as my hon. Friend said—this is also the experience of my constituents—it costs them between £9 and £16 to make calls just to gain access to the money to which they are entitled because they have not been paid on time. It really is time that that tax ended.
Why did the Government ignore the clear advice of their own Social Security Advisory Committee, which told them that it would be best to make those numbers 0800 numbers so that the calls would be free? I was told that that would cost £7 million and that the telephony system was being upgraded to include the option of advice on potential wait times for customers. We should picture the scene: someone who is spending 45p a minute on a phone call being told, “You will be answered in 45 minutes.”
I was amazed to hear that, according to Government Members, closing Glasgow’s jobcentres is a good thing. They said that we have not talked about people getting into work. How are people going to get back into work if 50% of the jobcentres in Glasgow are closed? Why has there only been an announcement of jobcentre closures in Glasgow? Glasgow should not be the guinea pig for the Government’s experiment. Why has there not been an equality impact assessment? Why are we not measuring the impact this will have on the disabled or on women with childcare responsibilities, for instance? No consideration at all is being given to the cost impact on people living off the minimum that the Government provide for day-to-day survival.
I urge all Members to support the motion.
It is always a pleasure to follow the hon. Member for Glasgow South West (Chris Stephens), and I also always welcome being in the Chamber debating policies around low-income households and families; whatever our political bent, it is useful to have that attention on them. I came here hoping we might have a debate about different ideas, proposals and alternatives, however, and while we have heard a lot of anger from the shadow Front Bench and the SNP, we certainly did not hear any policies, examples or detailed plans of what they wish to do.
That is particularly the case in Scotland. Greater powers have been given to ensure welfare provision in Scotland is tailored to the needs of Scotland, yet no proposals have been made, and the Scottish Government have in fact asked for a delay in the transfer of Executive powers until April 2020. I did not realise the SNP was quite such a fan of the Union.
We heard in the previous debate how the SNP wanted to see more of Labour, but in this debate we have seen a lot less. It is extraordinary that not a single Labour Back Bencher has joined us to make a contribution to the debate.
On the substantive issue before us, universal credit is coming in and nobody would argue with the theory behind it: we should remove the complexity of a benefits system was split between the Department for Work and Pensions and local authorities with people having to prove the same information several times. However, as this complicated system dealt with many millions of people, it is also right to phase this change in, and it was inevitable that during that period issues with the new system would come to light.
We need to look at this in its wider context, however. We are seeing more people getting back into work. It is a truism that a Labour Government always leave unemployment higher than when they came to office, and that was very true in 2010. However, we know that by the end of the last Parliament, and certainly by the end of this Parliament, it will be a lot lower than when we came to office in 2010.
It is remarkable that the impact of the national living wage, which results in millions of low earners getting a pay rise, has been ignored. That makes a huge difference and for many people gives a real value to work, particularly in areas like Torbay where we have many tourism and social care jobs. [Interruption.] Many people are now getting a wage that better reflects the work they do. [Interruption.] There is heckling from the Opposition Front Bench; it says it all that they have been reduced to heckling a pay rise for lower income workers.
The amendment is a far better representation of the real situation than the motion. That is why I support it and urge the House to reject the politics of anger but with no alternative.
The hon. Member for Torbay (Kevin Foster) asks what we are doing to protect jobs in Scotland. We are opposing the withdrawal from the single market, which the Fraser of Allander Institute reckons will cost 80,000 jobs in Scotland. He asks about the delays in the Scottish Government introducing their welfare reforms. That is happening because they want to put dignity, respect and the voice of the user at the heart of the system. That is why they are taking their time to ensure that they get things right.
As the international development spokesperson for the Scottish National party, I will not pretend to understand all the depths and complexities of the social security system in this country, but it is the lived reality for many of my constituents. Those constituents, especially those from low-income families, have as much right as any of the people I refer to when I talk about developing countries to live their lives free from poverty. This Government are committed to the sustainable development goals, which state that we must eradicate poverty in all its forms everywhere, yet, as we have heard, there are people in this rich, modern, 21st-century country who are going to bed at night hungry because of this Government’s policies, particularly the hated sanctions regime. That regime was condemned by the United Nations Committee on Economic, Social and Cultural Rights in June 2016 as being effectively a breach of the UK Government’s international human rights obligations.
If the case studies that Members on both sides of the House see on a day-to-day basis in their constituency surgeries are not enough to convince them, I encourage them to read the study entitled “Welfare Conditionality: sanctions, support and behaviour change”, a major initiative by six English and Scottish universities to inform policy and practice by listening to people’s day-to-day lived experiences. The study has found that
“the impacts of benefit sanctions are universally reported by welfare service users as profoundly negative. Routinely, sanctions have had severely detrimental financial, material, emotional and health impacts on those subject to them. There was evidence of certain individuals disengaging from services or being pushed toward ‘survival crime’…There is limited evidence to date of welfare conditionality bringing about positive behaviour change.”
The perniciousness of the UK Government’s welfare policy is there for all to see, and it is encapsulated in the jobcentre closures that we have been discussing. We will find out on Thursday, when the Scottish Parliament debates this issue on a cross-party and cross-civil society basis, whether Glasgow’s Tory MSPs have the guts to stand up and oppose the closures. We have heard time and again from service users about the reality that this is going to happen, and we have heard case studies from other Members today, but despite the spirit of the Smith agreement, no UK Government Minister has yet met their Scottish Government counterpart to discuss the impact of those jobcentre closures. That will have to happen sooner rather than later.
Why have no other jobcentre closures been announced? I think it is because the UK Government are beginning to realise that they have bitten off more than they can chew. They might find it easy to ignore those of us from north of the border where they do not have any constituencies, but just wait until these policies start to bite in places where their own Back Benchers have a vested interest.
Madam Deputy Speaker, you would not know from the speeches made by Scottish National party Members this evening that welfare spending in the United Kingdom was £264 billion in 2015-16. That made up 35% of public spending and 14% of GDP. All those figures are higher than they were in 2010. We rose from being 20th in the world in terms of welfare spending in 2000 to 13th in the world by 2013, yet there are some who think that we should be spending still more. I say to the Members from Glasgow who have spoken today, and to the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry), that if their constituents are struggling to afford telephone calls to their Jobcentre Plus, why does their party in Scotland not pay for the calls instead of spending £6 million a year on baby boxes for every child born in Scotland? The Scotsman has said that
“for the vast majority of the four in five Scottish children who are not living in poverty, it seems to be an indulgent use of state cash.”
In contrast, our Government have focused on opportunity, education, skills and jobs, doubling free childcare, providing far more outstanding schools and 2.5 million apprenticeships and creating more jobs than in the whole of the rest of the EU put together. The result is that unemployment is down from 7.9% to 4.8% while free allowances for the lowest paid have almost doubled and salaries under the new national living wage have gone up by more than 6% in the past year alone.
There are parties that believe in the hand up, and there are those that focus entirely on the handout. Every party must decide where it stands. When Beveridge wrote his great report in 1942, he said:
“The State in organising security should not stifle incentive, opportunity, responsibility…it should leave room and encouragement for voluntary action by each individual to provide more than the minimum”.
That was the right balance then, and it is the right balance today. Let me finish with these wise words:
“If you let yourself be put in the ‘soft’ box on welfare, then it’s almost impossible to do anything to tackle disadvantage and unfairness—because it will always be more grist to the mill of those who want to caricature you as weak and interested only in spending more taxpayers’ money and undermining the work ethic upon which so much depends.”
Those wise words were written by an enlightened Labour Secretary of State for Work and Pensions, John Hutton. It is a message and a warning that the hon. Member for Inverness, Nairn, Badenoch and Strathspey, and all his colleagues, should heed as they gallop along the road of irresponsible spending.
My breath has been quite taken away by the insensitive, ruthless and, frankly, ill-informed approach of Government Members. They have demonstrated this evening that they are detached from the lives of ordinary people—an expression that one of them has used—which is perhaps why the Tory vote in Scotland is lower now than it was in the 1980s under Thatcher.
Like so many of my constituents in North Ayrshire and Arran, I am deeply concerned about universal credit, of which much has been said this evening. The stated aim of the UK Government in introducing universal credit is to improve work incentives, simplify the benefits system and reduce fraud and error. Of course, anybody would welcome a system that is simpler and provides better incentives to low-income families to move into sustainable employment, but universal credit does not do that and has been plagued by errors, delays and computer crashes.
As for the vision of a fairer society outlined by the Prime Minister, how hollow do hon. Members think those words will ring to the average working family in receipt of universal credit? That family will be more than £1,000 a year worse off by 2020, with some families being up to £2,500 a year worse off. Transitional protection, which is limited, simply will not suffice.
What about those who are just about managing, about whom the Government like to talk? Do the Government not realise that many of those who are just about managing will rely on universal credit to make ends meet? What about child poverty? Child poverty is set to rise dramatically over the next three years, according to the Institute for Fiscal Studies. There is simply no evidence for the UK Government’s assertion that reducing benefit support incentivises work. The impact assessment of the Welfare Reform and Work Act 2016 contained no evidence for that.
It is time to ditch universal credit, which is a failed experiment. It is time to abandon it. It fails those on low pay, it fails the sick, it fails the disabled and it fails to incentivise work. It fails to address inequality, and to continue it shows a failure to understand the lives of those who must suffer its indignities.
It is a pleasure to follow the hon. Member for North Ayrshire and Arran (Patricia Gibson), with whom I had many dealings in my former role as a Minister, although I am somewhat surprised that she seems to advocate bringing back Margaret Thatcher for Scotland—we would probably cheer for that.
The Government are committed to making a difference to help people fulfil their potential. We have delivered record employment in all regions, with 2.7 million more people benefiting from work—8,100 in Swindon alone. There are 850,000 fewer households in which no one has worked and 500,000 fewer children in workless households.
We are seeing wages rise, on average, by 2.6%, which is well ahead of inflation, and by 6% for the lowest paid. That is in part thanks to the introduction—the right introduction—of the national living wage, which is helping 6 million people, and our lifting of the 4 million lowest earners out of paying any income tax through our personal tax allowance changes. That, in addition to the triple-lock pension and the extension of free childcare, is why income inequality has fallen, with 500,000 fewer people in absolute poverty, a record low.
It is crucial that we help people into work and, by backing business, we have delivered a growing economy that is creating opportunities. To fulfil those opportunities, we are investing in the future, with 1.4 million more children going to good or outstanding schools. And we are expanding the National Citizen Service so that those children can develop real life skills. There is a commitment to 3 million apprenticeships by the end of this Parliament. There is real, direct link with getting people into work.
For those seeking work today, the roll-out of universal credit is vital: it builds on the emphasis that work should always pay; it removes the 16-hour cliff edge, which is an absolute nightmare for people looking to move on from part-time work; and crucially, for the first time, claimants will have a named work coach who can help them to navigate childcare, training, support and the complicated benefits system that confuses so many. Having that person to help allows claimants 50% more time to find work. As we have seen, for every 100 people finding work through JSA 113 are finding work through the universal credit system. For the first time ever—this is the single most important reason why we need universal credit—those who go into work continue to get support. Often they are entering the lowest-paid jobs, but they will continue to be reviewed, supported and given that confidence to ask for additional hours and for promotion, to increase their wages and benefit from a growing economy.
This Government are on the side of hard-working people—on the side of the people trying to do the right thing. We believe in opportunity. Hard-working people want that opportunity to fulfil their potential and we are there for them.
It is a pleasure to bring up the rear this evening, Madam Deputy Speaker. From listening to today’s debate, it is not entirely clear whether this Government’s—or their Back-Benchers’ —arrogance or ignorance on the crucial area of social security is more astounding. MPs, MSPs, devolved Governments, experts, civil society and even the United Nations have collectively warned the Government of the real and negative impact that their policies are having on low-income families, but this Government think they know better than those who live this experience or who help those suffering from it every day. The continued roll-out of a flawed universal credit system, the imposition of morally repugnant cuts to the ESA work-related activity group, the brutal benefit sanctions regime and the ideologically driven closure of half of Glasgow’s jobcentres are testament to that.
Universal credit is riddled with IT problems and will push many of our constituents into hardship. People who have gone through the process have described it as a “nightmare”, and it is reported that 86% of council tenants on universal credit are now in arrears. Since this Government announced devastating cuts of 30% to ESA for people with disabilities, MPs across the House, from both sides, have cited many shocking personal testimonies from our constituents, illustrating why further cuts are disastrous, as they force people with disabilities on low incomes into debt, isolation and even destitution. This is morally repugnant in the 21st century in one of the richest countries in the world.
This House has repeatedly heard of the devastating impact of the sanctions regime on low-income homes. It is clear that sanctions are underpinned by zeal, not evidence; driving people to hardship and desperation, and through the doors of food banks. Just last month, we learned of this Government’s punitive plans earmarking eight job centres in Glasgow—half of all of them—for closure, including those in Easterhouse and Parkhead in my constituency. A third, at Shettleston, is to absorb the services of three jobcentres, trebling its claimant size to become one of the largest jobcentres in the UK, in an area with twice the average unemployment rate, pockets of the lowest life expectancies in the UK and unique challenges relating to territorialism. It is an area that includes almost half of the top 10 most impoverished areas in Scotland. All this has been arrogantly proposed without so much as an equality impact assessment. These ideologically driven plans to rip jobcentres from the people who need them most—from some of the most deprived areas of the country—are so sorely bereft of logic, evidence and compassion it beggars belief. In constituencies such as mine, where deprivation and unemployment are high, the Government should be doing more, not less, to help people find work.
This Tory Government have choices where they say they have none. The choices they make tell us all we need to know about this Government and whom their priorities benefit—it is not Glasgow East, it is not Glasgow and it is not people who are on low incomes or just about managing, whom they profess to represent.
To some extent, the Scottish National party, in its motion and debate tonight, is painting a picture of a very uncaring Government who may be trying to keep people in poverty. From what some sections of the press and Opposition have said, one would think that we have high unemployment, record low wages and benefit claimants at an all-time high, whereas in fact the opposite is the case. I am very proud to support this Government as we continue to turn around our welfare state. Slowly, we are decreasing dependency on the welfare state, getting Britain back to work and giving a pay rise to the lowest paid.
I find it astonishing that there are 2.7 million more people in employment now than when we first assumed office in 2010. No one could have predicted that, and it is an astonishing achievement. My hon. Friend the Member for North Swindon (Justin Tomlinson) mentioned one of the statistics of which I am most proud: we now have the lowest number of children in workless households since records began. We should make no apologies for that.
I pay tribute to the staff at the DWP, and particularly the staff of my local jobcentre on Canvey Island, who show incredible dedication and commitment to getting people back into work. They are using all the levers and measures we have provided to do so.
There are plenty of incredibly innovative and thoughtful schemes that I would like to mention, but I shall raise just one. A young gentleman called Dale was not in work. His adviser discovered that the thing he loved most in life was dogs, so rang up the local dog hydrotherapy company and asked the staff there whether they would consider giving him an apprenticeship. They had never considered giving anyone an apprenticeship, but the jobcentre sorted it all out for them. At the end of the apprenticeship, Dale ended up in a job that he absolutely loves and the company had taken on an employee, and will now take on another. That is incredibly innovative. It has helped a business to expand as well as provide jobs, and I think that is astonishing.
There are many more similar examples of the incredible work that is going on to help people with long-term disabilities back into work. For too long in this country we parked people on long-term disability benefits and gave them a little bit of extra money to salve our conscience. Again and again I have met people who have been out of work with a long-term disability and I hear the same stories from them, which is that they would love to get back into work but need support, because they do not have the confidence or certainty they need, or because they are worried.
I particularly deplore any attack on universal credit, which is a game-changer. The fact that we have named coaches to help people to turn their lives around, and that we have ended the iniquity and stupidity of the perverse incentives that prevented people from having the confidence to work for more hours or to take a promotion or a pay rise, is an absolute game-changer for this country. Universal credit is already working and improving people’s lives.
We have heard today about the working families who stand to be £1,000 a year worse off by 2020—or, indeed, up to £2,500 a year worse off, according to the Resolution Foundation—as a result of cuts to universal credit. The House of Commons Library says that the full brunt of the social security cuts will not be felt until the mid-2020s; by then, overall net savings will be in the region of £40 billion a year, with more than £1 billion lost to Scotland—that is net, so it includes all the more positive steps that have been introduced that could benefit some families in this country. Most worrying is the Institute for Fiscal Studies prediction that child poverty will rise by 50% by 2020 as a result of the cuts. The Child Poverty Action Group in Scotland cites inadequate social security benefits as one of the three main reasons for the rise in child poverty.
It is an old cliché, but politics is all about choices. Austerity is a choice; spending at least £4 billion on renovating this Palace is a choice; spending hundreds of billions of pounds on nuclear weapons is a choice; cutting tax for the highest earners and biggest businesses is a choice; and cutting £12 billion from the Department for Work and Pensions is a choice. But for a family living in a low-income household, seeing their income cut by this Government does not leave many choices.
The exponential rise in the use of food banks and the requirement for emergency food aid has been linked to sanctions and cuts to social security by a series of reports, including those by the Poverty Alliance, the University of Oxford and GoWell in Glasgow. That shows the harm that Tory choices are causing. When the Chancellor sets his Budget during times of austerity, whether it is Osborne’s austerity max or Hammond’s austerity almost max, Tory MPs cannot pretend that it is not a zero-sum game. They cannot claim that Trident does not have an impact on DWP budgets. Even the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith) is calling for the cuts to universal credit work allowances to be reversed. They are the only incentive to work in the universal credit system, and they are being slashed. The Government must look at that again.
The Government must also look again at the cut to employment and support allowance for the work-related activity group. Some £30 a week is being cut for sick and disabled people assessed as unfit for work—a drop in income of a third for sick and disabled people. Then there is the closing of jobcentres, which has been raised repeatedly, passionately and eloquently by my colleagues from Glasgow this evening. It is an aspect of our motion that the Government seek to delete entirely in their amendment—a mark of the level of respect that they show for the people of Glasgow.
Let me turn now to the switch from the disability living allowance to personal independence payment. I wish that I had more time to reflect on some the problems, but I will focus on only a couple of areas. I hope that, in closing, the Minister will expand on the commitments that were given about the scheme on 30 November in Westminster Hall. The Minister for Disabled People, Health and Work, the hon. Member for Portsmouth North (Penny Mordaunt), acknowledged that there is an issue of people returning their Motability cars while delayed appeals are considered. She also said that
“we are exploring options to allow those who are not in receipt of the higher Motability component to have access to the Motability scheme.”—[Official Report, 30 November 2016; Vol. 617, c. 610WH.]
We have not heard or received anything further since. I hope that we can get clarification on both those issues regarding PIP this evening.
I have also written to the Secretary of State on behalf of my constituent, Mr Tom Keatings from Salsburgh, who visited my surgery on Friday. He had been in receipt of PIP for some time, but after having three spinal discs prolapse last year he reapplied to receive the higher Motability rate. He made the application in August, and received a negative response in October. He immediately requested a mandatory reconsideration in October, and has heard nothing, despite being promised that it would take nine weeks to get a reply. He phoned the DWP last week only to be told that not only was the reconsideration not complete, but that it had not even been looked at yet. It is nearly three months since the appeal was sent. I cannot see how Ministers can say that that is in any way acceptable. I hope to hear how the Government are addressing such delays.
Finally, we have heard erroneous claims from Government Members this evening about delays to the Scottish Government’s implementation of the new social security powers. Those claims are not true. There have been announcements just this week. The Scottish Government made a commitment to introduce the new Scottish social security system in the lifetime of the new Scottish Parliament and that is what the Scottish Government will do—it was in our manifesto.
We have also heard that, somehow, the Scottish Government should divert more and more money to mitigate the Tory mess that has been inflicted on social security. It is time Government Members got their own house in order before deciding how the Scottish Government should be spending their money.
I hope that, in closing this debate, the Minister will advise how the Government plan to make this shared society a reality. It is a welcome change in tone. It acknowledges that things are not currently shared out fairly. Tinkering at the edges, as we saw in the autumn statement, will not bring about a society that is working for everyone. Listening to some of the concerns and suggestions expressed by others and working constructively across political parties and between central and devolved Governments would at least be a start.
I wish to reiterate the thanks of the Minister for Employment, my hon. Friend the Member for East Hampshire (Damian Hinds), to those Members who secured today’s important and interesting debate. I also wish to thank all Members who have contributed. I am very conscious that I am somewhat short of time, so if I do not have the opportunity to respond to every point that Members have made in this debate, I will certainly seek to do so in writing.
For Scottish Members present, I am aware that there is another debate tomorrow in Westminster Hall in which we are discussing the DWP estate. I am sure that that will be an opportunity for us to discuss in more detail the proposals in Glasgow.
This Government are committed to building a country that works for everyone, which means taking action to help the most disadvantaged. We know—many Members have mentioned this today—that our approaches need to be joined up across Government to enable us effectively to support and transform the lives of the most vulnerable. That is why we have committed to bringing forward a social justice Green Paper this year, which will identify and address the root causes of poverty and build on the two new statutory indicators brought in through the Welfare Reform and Work Act 2016. That will drive real action on workless households and educational attainment—the two areas that can make the biggest difference to disadvantaged children and their families.
The Green Paper on social justice will demonstrate our commitment to the Prime Minister’s ambition of tackling poverty and disadvantage and delivering real social reform. As my right hon. Friend the Prime Minister said on the steps of Downing Street, she will fight against the injustices that we see in our society. In doing that, we will do everything we can to give people more control over their lives. That is why the Prime Minister has established a new Social Reform Cabinet Committee, bringing together the majority of Government Departments to deliver social reform. The Prime Minister has made it very clear that tackling poverty and disadvantage will be a priority for this Government.
The evidence is clear and we as a Government have been clear that work is the best route out of poverty. Working age adults in non-working families are almost four times more likely to be living on a low income than those who work, which is why the Government’s approach has been about recognising the value and importance of work, making work pay and supporting people into work while protecting the most vulnerable in society. Our reforms are working and transforming lives. The most recent labour market statistics show that we have a near record number of people in work: more than 2.7 million more than in 2010. In the past year we have seen nearly 250,000 more disabled people in work, more than 200,000 more women and more than 150,000 more BME people. That is a record of which we are rightly proud, but we know that there is more to do to realise our ambition of an economy that works for everyone.
I reiterate the comments of my hon. Friend the Minister for Employment: it is vital that universal credit roll-out is delivered safely and securely so that claimants receive the support they need. As he mentioned, reforms such as universal credit are revolutionising relationships between claimants and work coaches, ensuring that the support we offer is more personalised and better suited to the needs of claimants.
There is no doubt that universal credit has been a large and complex programme, which is why we have rolled it out slowly, starting small to begin with and enabling our own DWP staff to be involved in the roll-out through a test-and-learn programme so that we could ensure that as the programme expanded mistakes were ironed out. Our DWP staff are also absolutely crucial to the role of universal credit in encouraging people not just into work but into more work once they have found employment. That is an entirely different relationship.
I have spent the past six months as a Minister visiting Jobcentre Plus centres around the country and speaking with work coaches. Whether in Newcastle, which saw the initial roll-out of full service UC, or in coastal towns such as Eastbourne, I have seen at first hand the value of this approach in transforming lives and I am immensely proud of the commitment I have witnessed from work coaches up and down the country. Indeed, in Oldham I saw some of the most enthusiastic and inspired job coaches that I have seen anywhere in the country, who were absolutely enthusiastic about meeting the claimants and helping them through the journey into more work
The SNP’s call to suspend universal credit, which demonstrates a complete misunderstanding of its transformational benefits, arguably shows a lack of concern for the millions of working households that will benefit from a system that helps people into work, empowering them to transform their own lives rather than leaving them trapped in benefit dependency. As some Members might know, my hon. Friend the Minister for Employment is travelling to Scotland this week to meet MSPs and Ministers in the Scottish Government to discuss with them the issues of the jobcentres in Glasgow.
We have had a lot of discussion about the impact on disability employment, and I am very clear that when a jobcentre closes, that can provide opportunities to enable DWP staff to respond to the personal circumstance of claimants. Work coaches can personalise and tailor the support they provide and can visit claimants in their own home. Claimants do not have to travel to specific jobcentres but can nominate the ones they wish to use. We want a flexible and dynamic welfare state that embraces the new opportunities of technology and the expertise and joined-up services that our local partnership organisations have.
This Government are clear that the best way to help people to pay the rent and live independent lives is to help them into work. With my noble Friend Lord Freud, the former Minister for Welfare Reform, I met arm’s length management organisations to talk about UC and the issues that they raised with us about rent arrears. Our research shows that the majority of UC claimants are comfortable managing their budgets and after four months the proportion of UC claimants we surveyed who were in arrears at the start of their claim had fallen by a third.
To conclude, let me reiterate that the Government’s commitment to an economy and society that works for all is beyond doubt. I want to reassure hon. Members that the Government are committed to fighting against the injustices of society and ensuring that everyone has the right opportunities to fulfil their potential. Households in the lowest income bracket are now much more likely to be in employment than they were at the start of the previous Parliament. In the bottom half of the income distribution, the percentage of families who were in work increased from 60.3% in 2010-11 to 65.7% in 2014-15—
Question put forthwith (Standing Order No. 31(2)), That the proposed words be there added.
The Deputy Speaker declared the main Question, as amended, to be agreed to (Standing Order No. 31(2)).
That this House welcomes last week’s Official Statistics showing that the poorest households saw the biggest income growth of £700 in the last year; further welcomes the impact of this Government’s welfare reforms in support low-income households to find work, with over 2.7 million more people in work and 865,000 fewer workless households than in 2010; recognises the role of Universal Credit in supporting people into work and increasing their earnings in work by ensuring it always pays to work; welcomes the recent announcement of a reduction in the taper rate to 63 per cent; believes that the Government’s reforms have given taxpayers confidence in an affordable and sustainable welfare system that ensures value for money and responds to the needs of claimants, with 86.6 per cent of Universal Credit claims currently being made on line; and notes that the Scottish Government has asked for an extended timetable for the full transfer of the extensive welfare powers devolved under the Scotland Act 2016.