I beg to move,
That this House has considered the Ninth Report of the Work and Pensions Committee of Session 2015-16, Support for the bereaved, HC 551, and the Government response, HC 230.
It is a pleasure to debate under your chairmanship, Mr Stringer, not only because of past campaigns that we have joined in together, but because I know you can put aside partial affections and chair our debate properly, fully and impartially. The debate has been called to take note of the Work and Pensions Committee report on bereavement benefits; to give Members an opportunity, from their experiences in their constituencies, to bring the report up to date; and to invite the Minister to tell us, as I hope he will, how Government thinking has progressed. I know that this is not his brief so I, and I am sure all Members who participate in the debate, will be more than happy to have any detailed replies given to us in correspondence afterwards.
Debates such as this give me the opportunity to thank a number of people who are often not thanked. I only too willingly thank the Select Committee staff, on behalf of all the Committee members, for producing a whole series of reports that have tried to influence—and, indeed, are influencing—Government policy and beyond. I am naturally thankful that we have been able to call this debate, which gives us the opportunity to which I have referred. I stress that our Committee’s topics are all decided democratically by Committee members, so this one was not brought down from on high by the Clerks or—heaven forbid—just by me as Chairman.
Yesterday in this Chamber, we debated the nature of poverty in Merseyside. Today, we are debating how one aspect of that operates across the whole of our country. We are talking about how poverty can stab at the most vulnerable when they are at their most vulnerable. I have had examples in my constituency of families being unable to claim the ashes of a family member because they could not complete the payment of the funeral bill, and of bodies being frozen as families club together to try to get the sums that would satisfy the undertaker that a funeral could take place.
As I do, I asked Ed in my office what cases of this harrowing topic had been in this week. He reported on a constituent who lost her husband last September, having left work to care for him in the final year of his life. She had never claimed benefits until she left work, but a period of depression in her husband’s final few months led her to claim employment and support allowance. All her savings were used in those final months, and she has a mortgage to pay.
After my constituent’s husband died, she arranged for the most basic, low-cost funeral to take place. There was never any question of her thinking of having anything else or planning for anything else. She was not informed at any point about bereavement benefits or other sources of support, such as the social fund funeral payments. Even then, she could not afford the low-cost funeral, so her daughter stepped in to pay what she could, but £1,000 is still owed on the funeral bill. The social fund payments are about £700.
It is almost a year to the day since the Select Committee published our report on bereavement benefits, so this debate is opportune not just because of the constant ticking over of similar horror stories from constituents in all of our constituencies, but because, a year on, the Government have been given a real chance to take measure of the proposals we put to them. We were concerned about bereavement benefits and the reforms the Government are making to them, of which we are supportive, as well as social fund funeral payments, which have remained at £700 since they were last reset in 2003.
Before I put questions to the Minister, which is the basis of my contribution, the latest information we have on pauper funerals—although they have been renamed local authority funerals or public health funerals, everyone locally knows they are pauper funerals—shows that on average our local authorities pay £900 to cover them, yet the Department’s grant is of £700 social fund funeral payments, linked to those 2003 prices.
I welcome the Minister and thank him for stepping in at the last moment to respond to the debate for the Government. My questions to him are as follows. One of our recommendations was that the Government should negotiate a reasonable cost for a simple funeral with funeral directors, with the social fund funeral payment reflecting the cost of that total package. We do not think it an unreasonable request for the Government to spearhead those negotiations with the industry. Therefore, what progress have they made in negotiating to get funeral directors and the funeral industry to be much more open and transparent on a decent, average or simple funeral, or whatever euphemism we wish to use for the very minimum of funerals?
Secondly, we recommended that the Department introduce an eligibility checker for social fund funeral payments so that people would quickly know how to make a claim. The Department has said that that is not a road it wishes to go down, but my constituent—the live case I cited from this week that Ed in my office is dealing with—was given no advice about what might be available from either the social fund or, as importantly, bereavement benefits, which she could have claimed in addition to her ESA payments. Has any progress at all been made in giving legs to the idea of some simple tracker mechanism, so that people can quickly see what they are eligible for?
I stress again the important point—I know I do not have to do this for the Minister or for anyone else in the Chamber—that as soon as the phone is picked up to the funeral director, the clock starts ticking on what will be charged to the family. Often, it is quite a long way down the road before they realise the expenditure to which they are already committed and whether they would have faced that expenditure had they known what help—if any—was available.
A third recommendation was to take a leaf out of the Scottish Government’s book and see what could come from the Government conducting a cross- departmental review of burials, cremations and funerals. What information out there could we use to simplify this complicated world that families have to negotiate at a time when the vast majority of them are at their most vulnerable?
The Select Committee noted the lack of protection in the funeral market for bereaved customers, particularly for poor families in our constituencies. We heard evidence that funeral directors’ fees vary dramatically, and that many funeral directors are reluctant to display their funeral prices without it being shoehorned out of them. It is not good enough to have huge variations in the price of a basic funeral—of 200% or even 300% between providers in different areas and regions—and for there to be no way of getting that information to vulnerable families.
The Committee also made recommendations on bereavement benefits. We welcomed enormously the Government’s changes on that and thought they were absolutely the right moves. We made two recommendations in particular. The Government accepted one, which was that bereavement payments should not cease one year after the death of the person whose death triggered the eligibility, but should go on for at least 18 months. I very much welcome the Government’s decision to adopt that recommendation.
The Government said that they did not intend to make money from the reform, but that the package of reforms will save in the region of £100 million. Why is it then that they have not agreed to our second recommendation on bereavement benefits? Why have the Government not used some of those savings, which they said they never intended to make, to deliver an extension of bereavement benefits to people in similar situations to marriage, such as those in civil partnerships or who are cohabiting? That would make the benefit more broadly and, I would argue, more accurately reflect everyday life in our constituencies. People’s lives are not in old-fashioned, neat little boxes, but come differently. It is a pity that the Government have not used this once-in-a-generation reform of bereavement benefits to bring their eligibility on a par with how people live their lives today.
To conclude, I will again pile the questions on to the Minister. As I said at the beginning, given the circumstances under which he appears before us, we will be happy with written replies if the answers we want cannot be provided now. Do the Government have any plans to extend bereavement benefits to what the rest of us would call “families”, even though they do not fit the legal requirement of being married? What plans do the Government have to update the value of, and access to, social fund funeral payments? Are the Government satisfied that a pauper’s funeral—for people whose family cannot begin to bury them, who have been deserted or who have no one to bury them—now costs more than what the Government offer through social fund funeral payments? Is that acceptable, particularly when the reforms are making money?
After interviewing a range of funeral directors with the Select Committee, I do not underestimate for one moment the difficulty for the Government in trying to get agreement among funeral directors on what a simple or basic funeral could or should consist of, and what to charge for that around the country. I know that is an immensely difficult task. The Committee has powers of compulsion to bring people together. I know that the Government do not have to use such powers, but I do not underrate the difficulty of getting the industry to meet and to be transparent about their costs and about how, sadly, a number of them rip off our most vulnerable constituents when they are least likely to have the mental energy to fight back.
My final point to the Government is that our report made a strong plea for families to be able to know very quickly whether they are eligible for the social fund funeral payment and, equally importantly, what that payment will and will not cover. In those circumstances, every family wants the very best for the loved ones they are burying or cremating, but one cautionary note ought to be made: while families will strive for the best and will club together and do all sorts of things, they ought to be clear very early on what the social fund funeral payment pays for and what it does not.
I am grateful for the opportunity to present our bereavement report; it has given me the opportunity to update the Select Committee’s thinking and present it to the House. I also welcome other hon. Members, who clearly have a passion for what is happening in their constituency, and I welcome the Minister, who will reply and say where the Government’s thinking has got to.
I am delighted to take part in the debate. I would normally have been in the Chamber for the debate on International Women’s Day, but I am here to speak about widowed parent’s allowance on behalf of two of my constituents in particular. They are here today, and their voices need to be heard in debates such as this.
Theirs are the voices of women who never wanted to be in the position they are in and who never expected to claim widowed parent’s allowance—one is not, which I will come to. Tragedy struck their families in the most cruel and horrific way, and their partners were taken from them. The strength and courage they have shown in campaigning on the issue has inspired me as their MP, so I am proud to be here to talk about their experiences and why they should be heard, instead of taking part in the debate on International Women’s Day. There are so many challenges when it comes to inequality and we must fight them all. What is happening with widowed parent’s allowance feels to me like one of the most basic examples of that and of the unintended consequences of the Minister’s and the Government’s thinking. In reading into the record some of my constituents’ experiences, I hope the Minister will think again about some of the choices the Government have made and the devastating consequences they are likely to have.
I will talk first about Ros. Her husband sadly died in 2014. He had been ill for some time before that, so Ros had given up work to support her children as their father deteriorated. That is an horrific experience for anyone to deal with at a young age. To then have to deal with the financial consequences only compounded her family’s grief. Ros suddenly became a single parent to two children and found that widowed parent’s allowance was, as she described it to me, a lifeline. The work that she did, in the theatre, was not easy to combine with being a full-time carer for her young children, and she was struggling with the grief of losing her husband.
Ros has done the calculations for what the Government’s proposed changes in the scheme would have meant for her and her family. The Minister claims that this is not about making money, but is a fair change in the system. When I look at the figures and how Ros is affected, I do not think that that is the case. I think this is clearly a cut in the budget designed to save the Government money, but it is a short-term saving with a long-term loss.
Ros and her family would, under the new scheme, have lost out on more than £100,000 over the lifetime of her children. That money allows her to look after her children, keep her family and household going, be a mother to two children who are grieving for their father and start to put her family’s life back together again. When she looks at what the new scheme would mean, she points out that the new lump sum would probably have been taken up by the funeral costs straight away. That is not a more welcome situation.
The pressure of not having a consistent income and worrying about what would happen after 18 months would have consumed her. As she says, after six months she was still drowning in paperwork relating to the death of her husband and trying to cope with the impact on her children. Grieving does not stop at 18 months, so why should the support that we offer to families affected by this sort of tragedy?
As Ros points out, these payments are a recognition of the contribution her husband made to the system when he was alive, through his national insurance payments. Indeed, as she points out, that creates quirks; a friend who has four children gets £50 less a week than Ros because her husband was 10 years younger. If we accept the principle that these payments are based on what the partner has paid into the system, surely what matters is whether those payments have been made and whether the partner was part of that relationship.
My right hon. Friend the Member for Birkenhead (Frank Field) supports terminating the support at 18 months. I disagree with him. I do not understand why 18 months is an appropriate cut-off date.
I understand that. I hope to make the case that we should support families who are in grief. We should not ask them to take on poverty and possible debt on top of dealing with grief, and we should not put a time limit on grief in these sorts of cases. We are not talking about hundreds of thousands of families, but we are talking about families facing one of the most horrific, soul-destroying experiences one can have. I agree with my right hon. Friend about the need to update the way in which our welfare system works.
The second case I want to talk about is, I hope, familiar, because I have written to the Minister before about this lady. Joanna has two beautiful young girls. I am lucky enough to see their pictures on Facebook and feel as if I am watching them grow up vicariously. One of her daughters was born, sadly, after her partner suddenly died. Joanna had to fight to get her partner’s name, David, on to the baby’s birth certificate because they were not married. They were clearly in a loving relationship. They had been together for a long period and had chosen not to be married. That should surely be their choice. The state should not use that to penalise Joanna and her family yet, as far as I can see, over the past couple of years we have penalised Joanna in many different ways. She had to pay £1,500 for a DNA test to prove that this gentleman was the father of her daughter and to have his name on the birth certificate. She does not receive a penny in widowed parent’s allowance, despite her partner paying into the system, just as Ros’s partner did. They are no less a family because they do not have a piece of paper.
In 2017, surely we should recognise those children’s need for the support that widowed parent’s allowance would provide to their family. That money would help not only to keep a roof above their head but to remove the pressure of debt, so that Joanna could be a mum to her two lovely daughters and start to put their lives back together following the sudden death of their father. It is those sorts of real issues and real people that our welfare system has to be able to work with. The cuts that the Government are making, particularly when it comes to widowed parent’s allowance, make no sense to me at all because they do not see the people behind these cases.
I have been lucky enough, through the organisation Widowed & Young, to see other examples that are similar to the stories of my two constituents, Ros and Joanna. Their cases are no less compelling. Will the Minister reconsider this 18-month bar and look again at the actual people behind the statistics by meeting them and hearing their stories, to understand the reality of being widowed at a young age and what impact that has on a family? Will the Minister ask again how we can do what we all want the welfare system to do—to support people and be a lifeline at a critical time, to help get these families back on their feet?
The changes that the Government are making, I fear, will not simply not help; they could actually make things worse for these families. They could bring debt, because the fear of what will happen will force people who are still grieving after a mere 18 months to make decisions that may be against the best interests of their family because they are short of cash.
As Ros said, this money has been a lifeline for her. She is one of the lucky ones because she qualified under the old scheme, but none of these people are lucky, because after all, they have lost a loved one. That is what we are trying to get at here. Ros, Joanna and all the women and men involved in this campaign deserve better from us. I hope that the Minister will at least commit today to meet them, to understand better the situation they will be in when these changes are introduced.
I want to begin by thanking the right hon. Member for Birkenhead (Frank Field) for securing this debate. I know, and very much appreciate the fact, that he has a long-standing interest in this issue.
It is quite easy for me to sum up today, because unfortunately we have not had many speakers. The reason I wanted to become involved in this debate is that I grew up the youngest of eight children, and my father died when I was a baby; I was nine months old. My mother was widowed with no support whatsoever. That was partly because her and my father had come over from Ireland in the 1950s, and she had no knowledge or awareness of the benefits system. Even if she had, she probably would have assumed it was not for people like her, because at that time the UK was not a place that was always very welcoming to immigrants—even Irish ones. She would no doubt have assumed that such a system excluded people like her.
I am not saying, “Woe is me!” When I was growing up, I had no idea that we were poor, and that is a huge testament to my mother. Everybody around me was poor, but because of that, nobody realised they were poor. It was not until I went to university in Glasgow and met different kinds of people from different backgrounds that I appreciated, in hindsight, the difficulties and the struggles that my mother had gone through and how very poor indeed we were, but I had no sense of it growing up.
Today, unfortunately, the world is much smaller, and when people are poor, they are profoundly aware of their poverty, even as children. Looking at this issue objectively, we can understand as human beings, even if we have not experienced the loss of a spouse, how frightening and how lonely that must be. We do not need to experience it to understand it. We do not even need to have children to imagine what it is like for the bereaved who have children.
We can appreciate how difficult and challenging it is for someone who has children and is bereaved, often suddenly and unexpectedly. Every single day, despite the awful event and the despair, terror, uncertainty and instability, they have to keep putting one foot in front of the other to make life as normal as possible for them and their children after such a tragic loss. That was set out for us in very human terms by the hon. Member for Walthamstow (Stella Creasy), who told us about her constituents Ros and Joanna.
The hard-headed reality is that when such a loss occurs, the bills still come in. The rent or mortgage still has to be paid. When everything else in the family or household has been thrown into confusion and up- ended in the most profound way imaginable, especially in cases of sudden loss, financial stability—strangely enough, despite the grief—becomes more important than ever.
The right hon. Member for Birkenhead pointed out that the Scottish Government have done much work to assist those most in need with regard to funeral costs, but that is really only the beginning, even though meeting those costs is a struggle for so many people. I wrote to the Secretary of State about my concerns over the proposed changes to payments for the bereaved. I am quite alarmed at the so-called streamlining of those benefits, because we know that that will hit families hardest. Disappointingly, the Secretary of State’s response has not allayed my concerns at all. In fact, the letter, detailed though it was, merely restated Government policy.
The fact is that those who are grieving need support, and unless that support is adequate, the social fallout could be quite significant. I would like the Minister to consider the consequences for children—the potential detrimental consequences for their emotional and mental wellbeing, as well as their educational outcomes. There is little point in trying to be penny wise and pound foolish. The bereaved need time, which varies from person to person, to emerge from the fog of bewilderment, shock and disbelief, as well as the pain of grief, that the loss of a loved one brings with it, and how much worse is that for children? With cash payments being limited to 18 months, grief has been given a sell-by date. If only grief were like that.
At such times, parents need to be around to support, listen to and help their children to make some sense of the irreplaceable loss that they have suffered. That is where bereaved parents want and ought to be—not stuck in the office or on the shop floor, having to put in extra hours to make up the income shortfall due to the death of their spouse, and hoping that friends and neighbours will step in.
Make no mistake: the new bereavement support payment regime will disproportionately affect women. Working-age women are more likely to claim bereavement allowance, with 70% of claimants in 2014 being female. Despite bereavement being one of the main causes of financial difficulty, according to research, that support is to be cut. That will directly affect thousands of people throughout the United Kingdom and 40 to 50 newly widowed parents in North Ayrshire in my constituency next year.
Those with children will be hardest hit by the changes, and some families could lose up to £12,000 a year. A working-age parent with children could lose even more—approximately £23,500 on average. Let us imagine the impact that such a financial loss will have on those suffering, and living with, grief. The Government insist that the changes are not about saving money, but the Department for Work and Pensions forecasts savings of £100 million a year because of them. If the changes are not about saving money, why not redistribute those savings to ensure that fewer families are worse off? Currently under the changes, 75% of families will be worse off.
Another concern is that the link between bereavement payments and inflation will be broken, despite the benefit being intended to support people with the additional costs of bereavement. That cannot happen if it gradually loses its value over time. I feel strongly about this issue and urge hon. Members present to sign my early-day motion 959, because it is important to express our alarm in whatever way we can.
Let us not forget—this was mentioned by the hon. Member for Walthamstow and the right hon. Member for Birkenhead—that unmarried, cohabiting couples are not recognised by the DWP, although 21% of couples with children are unmarried, according to the Office for National Statistics in 2016. Not to recognise cohabiting couples is short-sighted and illogical. Children will lose out financially because their parents decided, as they had every right to do, not to marry. There is a problem, because the state treats unmarried parents as a couple for other means-tested benefits or tax credits when both parents are alive. Perhaps the Government can explain why such relationships are dismissed when one of the cohabiting parents happens to die. I would be most interested to know why that distinction has been drawn in this case.
I will end by simply saying that bereavement support is not a benefit that anyone wants or expects to claim, but when these circumstances arise, it is necessary and extremely important. The savings that the Government expect to make are not worth the misery and the appalling sell-by date that they stamp on grief and cannot be worth the way they punish those in the throes of grief or the potential social fallout that they inflict on families and society. Of course I welcome the simplification of the system, but there are wider concerns, as the right hon. Gentleman and the hon. Lady so eloquently pointed out. I urge the UK Government to look at this matter again and to listen to the concerns expressed by so many in this Chamber and so many more outside it. There is concern about the impact on grieving spouses and on families and concern about the lack of financial recognition for bereaved parents who chose not to marry. I urge the Government to listen.
It is a pleasure to serve under your chairmanship, Mr Stringer. I congratulate my right hon. Friend the Member for Birkenhead (Frank Field) on securing this important debate. I also thank the people who have come down to Westminster today to make the case and, in particular, the Childhood Bereavement Network, Widowed & Young and the Good Grief Trust for the work that they do to raise awareness. They do so not for themselves, but for the people who come after them, so it is particularly worth while that they would do that.
My right hon. Friend made a very clear speech and asked specific questions. I hope that the Minister can respond to them all. My right hon. Friend spoke about the real hardship that people go through and described the shortfall between the average cost of a pauper’s funeral paid for by a local authority and the social fund funeral payments—a difference of £200.
My hon. Friend the Member for Walthamstow (Stella Creasy) spoke with real passion on behalf of two of her constituents in particular. Ros had described receiving the widowed parent’s allowance as an absolute lifeline. My hon. Friend also talked about the injustice that Joanna had suffered; she spoke about the difficulty that Joanna had experienced in getting her deceased partner’s name on the birth certificate and the injustice of unmarried couples being treated differently from married couples.
The hon. Member for North Ayrshire and Arran (Patricia Gibson) told her personal story and spoke compellingly about the human costs of what we are discussing. She also spoke about the illogicality of the Government’s position in not recognising people who cohabit in the same way as they do those who are married.
The Work and Pensions Committee report, published back in March 2016, raised a number of important issues and made considered recommendations. In June 2016, the Government responded to the report, with commitments to look at some of the recommendations more closely. Many months have passed since the Government responded, and six weeks ago we saw a written statement from the Under-Secretary of State for Welfare Delivery, in which the Government committed to laying regulations to introduce the bereavement support payment. It is therefore vital that we are having this debate today to clarify whether the Government have progressed that agenda and what exactly their plans are for the future.
The Work and Pensions Committee report raises a number of issues regarding social security support in the event of a bereavement that I would like to address. If I may, I shall use my contribution to focus on the adequacy of the social fund funeral payment, the new bereavement support benefit and the need for a strategy to improve the operation of the market.
First, the Select Committee rightly pointed to the increasing gap between the average cost of providing a simple funeral and the support available from the state to do so. The report “Cost of Dying 2014” by the insurer SunLife found that the average cost of a funeral now stands at £3,500. However, figures from the Department for Work and Pensions show that the average award made through the social fund to help to meet the costs of a funeral during 2015-16 was £1,400.
The entitlements available through the social fund funeral payments include provision for meeting the full cost of some services, such as burial and cremation, with other expenses, such as funeral directors’ fees and the cost of a coffin, being met up to a capped limit of £700. The capped limit for funeral costs has been fixed at £700 since 2003, as my right hon. Friend the Member for Birkenhead explained, and has therefore been significantly eroded by inflation over the more than 10 years since then.
With the average award now running at less than 40% of the average cost of a funeral, it is clear that the adequacy of the support provided by the social fund now requires urgent review if we are to act to reduce funeral poverty. That has been raised repeatedly in the exceptional campaigning by my hon. Friend the Member for Swansea East (Carolyn Harris), who has courageously shared her own experience.
The Select Committee recommends that the Government revalue the assumptions that underpin the cap, which should then rise with inflation. That appears to be a very sensible approach and is in line with the usual practice in the wider social security system. The Government responded to that proposal by suggesting that they should not prescribe
“what a claimant should expect as part of a funeral”.
That is a deceptive answer and it does not address the issue directly. The point is that the cap is now insufficient for even the most basic of funerals. This is not a question of choice or expectation as the Government imply; it is about respect for those who have passed away through the provision of a simple ceremony and proper burial or cremation. Will the Minister agree to look again at the question of cost and indexation, given the overwhelming evidence of there being insufficient support?
There is, of course, the question of the operation of the market that underpins the adequacy of social security support to meet funeral costs. Sensibly, the Work and Pensions Committee suggested that the Government look at the issue through a cross-departmental review of the inflation of funeral costs. The Committee has also sent its evidence to the Competition and Markets Authority in the hope of pursuing that proposal. The Government suggested that they would “consider this recommendation” in the context of discussions they were already having with stakeholders. Will the Minister update us on whether a review will be brought forward? If the Government are now planning a belated review, perhaps they will state when it is scheduled and outline the terms of reference.
Clearly, one issue with the market for funerals is that people suffering a bereavement are often in a vulnerable position and can therefore find it more difficult to take the sort of steps necessary to take fully informed decisions, as they might under other circumstances. That is currently exacerbated by the Government’s numerous failures to provide clear and accessible information in that regard. The Committee made a number of recommendations, including an online eligibility checker, signposting to funeral homes accredited as part of a fair funerals scheme, clearer information on application forms and Government leaflets being distributed more widely. The Government seem strangely reticent about providing people suffering a bereavement with clear and helpful information about how to access funeral provision.
I was particularly shocked to see the Government’s claim that an online eligibility checker could only supplement a telephone or paper application and never act as an application in itself. Surely our Government, which placed so much emphasis on “digital by default”, must be technologically advanced enough to build a system under which an eligibility check can contribute to an online application? After all, that is possible in almost any other aspect of life. Can the Minister please clarify that?
I turn now to the bereavement support payment. In her written ministerial statement, the Under-Secretary of State for Welfare Delivery announced regulations providing for a single, new payment to replace bereavement payment, bereavement allowance and widowed parent’s allowance for those whose spouse or civil partner dies on or after 6 April this year. The Government argue that it will increase simplicity for those who are bereaved and seeking support. We do not support the reforms, which amount to a cut for bereaved children.
Although the Government have responded to criticism from the Social Security Advisory Committee and the Work and Pensions Committee by extending the period in which the bereavement support payment can be accessed from 12 to 18 months, that is still much less than the period of eligibility available under the current system. We therefore have serious concerns about whether it is long enough. Analysis by the Childhood Bereavement Network, for example, suggests that 91% of widows will be supported for a shorter period under the bereavement support payment than under the current system. That really is not acceptable. The network also suggests that 75% of parents bereaved after April will be worse off in cash terms under the new system, some by as much as £17,000. A study by J. William Worden, which is considered the most robust longitudinal survey available, found that the availability and consistent, nurturing presence of the surviving parent was one of the strongest predictors of bereaved children’s emotional health and behaviour.
Under the current system, the median claim is between five and six years. What evidence have the Government drawn upon to find that 18 months is suddenly sufficient? Would it not be better for the length of potential provision to be extended to ensure the best possible outcome for the child in such a tragic and distressing situation? Is it not the case that the current system is more comprehensive in that regard? I await the Minister’s response to that point.
Parents who are not married or in a civil partnership are not eligible for the old widowed parent’s allowance or the new bereavement support payment, meaning that children lose out on support because of their parents’ marital status. We believe that that is unjust and a relic from a past society that, thankfully, we have progressed beyond. It is also the case that those with young children will be disproportionately affected, as they can currently claim for longer. That means that young children are being hit hardest by this cut in the tragic event of the death of a parent.
Finally, for some seemingly unjustifiable reason the Government have decided that bereavement support will not be uprated in line with inflation. That can only be a further way of saving money at the expense of the bereaved, just as we have seen with the social fund funeral payment that I described earlier. What possible justification can the Government have not to uprate this measure, as is standard practice across most of the social security system? This reform appears simply to cut support to those grieving the loss of a loved one; it is, in effect, an attack on those who are already suffering quite unimaginably. Will the Minister commit to publishing a regular, fully updated impact assessment of the changes being made or, better still, follow Labour’s lead and commit to scrapping this reform and establishing an independent review of the sufficiency of support for the bereaved?
To conclude, the Government’s inaction in supporting the bereaved has gone on for too long, and what little action there has been appears to be to those people’s detriment. So far, their action has amounted to a cut in the support on offer to the bereaved—a really horrendous attack that we stand against. I do not envy the Minister the task of trying to justify this so-called reform, so I urge him and the Government to think again about the plans.
As ever, it is a pleasure to serve under your chairmanship, Mr Stringer. I thank the right hon. Member for Birkenhead (Frank Field) for securing this debate; it is not the first debate he has instigated that I have answered on behalf of the Government this week, but as usual the comments in his speech, together with those in the Select Committee report, were very serious and well-reasoned. I also thank the other speakers: the hon. Member for Walthamstow (Stella Creasy); the hon. Member for Wirral West (Margaret Greenwood), who spoke for the Opposition; and the hon. Member for North Ayrshire and Arran (Patricia Gibson), who spoke on behalf of the Scottish National party. I would like to make it clear that I listened very carefully to everything that they said, and my remarks may be quite long as a result of that. If they feel that their questions have not been adequately answered, as the right hon. Member for Birkenhead said, I will be able to write to them.
I want to pass on the apologies of the Under-Secretary of State for Welfare Delivery. Ironically, she is not here today because she is attending a funeral. I have attended many meetings on this subject and agreed to step in for this debate. I thought I would make that clear just once; that is the reason why she is not here and I hope that hon. Members, together with the people in the Public Gallery, will accept that.
The Government are very aware—as any of us are as constituency MPs, or just as human beings with our own family and friends—that bereavement is a very difficult time. It is probably one of the toughest experiences we face. Many of these points have been responded to because the same issue was discussed here in Westminster Hall last September. It is perfectly correct that we return once more to this debate, which is about how Government can best support vulnerable people going through bereavement with the practical challenges it can create.
The hon. Member for Walthamstow specifically referred to two of her constituents. I will respond to the other points that she made, but I would certainly be very prepared to meet those two constituents, and I know that I can say on behalf of my hon. Friend the Under-Secretary of State for Welfare Delivery that she, too, would be prepared to meet them. We can arrange that as soon as possible after this meeting if the hon. Lady contacts us, or I will happily contact her office.
All of us have seen the vital support that funeral expenses payments provide; therefore I fully understand, personally as a constituency MP as well as on behalf of the Government, the importance of providing the right support at the right time. Since the debate last September, a lot of work has taken place on funeral payments and support for the bereaved. In responding to hon. Members’ points, I hope also to outline what we have been doing. I will mix responses to their points with a general response on the developments since then.
First, on funeral expenses payments, I wish to put on the record the support that my Department provides for vulnerable people at a difficult time. We make a significant contribution to the costs of a simple, respectful funeral for loved ones of applicants in receipt of qualifying income-related benefits. We meet the full, necessary costs of a burial or cremation, which we know can vary, including the purchase of a grave, necessary burial or cremation fees, the cost of any medical references or the removal of active implanted medical devices for cremations, reasonable costs if a body has to be moved for more than 50 miles and travel costs for the applicant to arrange and attend the funeral. In addition, as has been mentioned, we meet other costs up to a maximum of £700.
In 2015-16, nearly 29,000 funeral expenses payments awards were made—worth more than £40 million—in Great Britain. The average payment has increased by just under 40%—from £1,019 in 2003-04 to £1,410 in 2015-16—reflecting the rise in necessary costs, but not in discretionary costs. That is why in 2012 the Department made interest-free social fund budgeting loans available for funeral costs, in addition to the funeral expenses payments. Last year the average award for all budgeting loans was £418. It is important to emphasise that we made those payments available in 2012, and that they are interest-free. Those loans are crucial for supporting people at a difficult time by removing the need for bereaved families to turn to high-cost lenders and the worry of meeting a funeral director’s bill.
Furthermore, it is worth noting that we provide the most generous support for funeral expenses when we are compared with other European countries—we can still compare ourselves with them for the moment, but that is another debate. Providers of funeral services, including the church, funeral directors, local authorities and crematorium owners, all play a role in ensuring that funerals are accessible to everyone. The Government believe that when a family can take part or all the responsibility for the cost of funeral arrangements, they should. However, there are obviously times when state support is appropriate, and we know that we can do more. Having taken time to set out the facts of what we do, I will turn now to the issues that have been raised during the debate.
On costs and claims, when considering the level of support for other costs, a balance needs to be struck. We do not want the funeral expenses scheme to influence or inflate the prices charged by the funeral industry for a simple funeral, and it must not undermine personal and family responsibility for meeting funeral costs. We have to ensure that the system not only is fair to taxpayers but supports the most vulnerable people. We have been working closely with the funeral industry to discuss how it can improve the transparency of its information about costs and choices. That would help people to make more informed choices and encourage competition within the industry. We remain committed to listening to our stakeholders, as we have been, and to working together to find solutions that are in the interests of the most vulnerable.
For that reason, my hon. Friend the Under-Secretary of State for Welfare Delivery convened a ministerial round table earlier this year, with stakeholders such as the National Association of Funeral Directors, the National Society of Allied and Independent Funeral Directors, representatives from different faith groups and organisations representing bereaved people—in fact, my hon. Friend the Member for Rugby (Mark Pawsey) was also present. A lot of topics that are relevant to issues raised today were covered, including transparency and the costs of funerals in the industry. The Under-Secretary of State asked stakeholders to share news and good practice about how they plan to be more open with their online pricing to support vulnerable claimants, and how they can support the rest of the industry to do the same.
We are carrying out a thorough review of the social fund expenses payments and have created a small working group of stakeholders to work with us to identify where regulation can be amended to help to address and tackle funeral poverty issues. We have also improved information about the scheme so that it is easier for people to understand whether they are eligible. That is available online with the application form, as well as through our dedicated bereavement service telephony line, which hon. Members have mentioned.
We know from research that people prefer to speak to someone on the phone when they have suffered a bereavement, instead of using online tools. We have therefore provided a specialist telephony service with staff who are fully trained to support people sensitively. The service has received positive feedback. It includes an eligibility checker, which has been mentioned—I will come on to that in a moment—and we are taking steps to ensure that claims are processed and that decisions can be made more quickly. Our recent improvements include reviewing all claims on the day that they are received to identify those requiring further evidence; and gathering further evidence by telephoning and texting applicants to speed up the process—[Interruption.]
Yes. Thank you, Mr Stringer. I was able to take a deep breath while the right hon. Member for Birkenhead attended to his electronic device.
Let me get back to the rising cost of funerals. We do not believe that the Government should be mandating or promoting a specific form of funeral provision for benefits claimants. Although my Department does not have responsibility for regulating the funeral industry, we are encouraging it to be more open and transparent in the way that I have explained, because people have to make informed decisions.
A number of low-cost alternative options are emerging in the funeral industry, such as direct cremations and municipal funeral arrangements offered by several local authorities. We recognise that those are not geographically widely available yet, and are not relevant to all religious and cultural practices. However, when it is appropriate, the industry should signpost people to direct cremations schemes and other low-cost alternatives so that bereaved people know they have the choice. We believe that improved pre-planning for funerals is just one way of helping individuals to focus on planning for a life event that is not always considered in advance.
Hon. Members, including the hon. Member for Wirral West, discussed the £700 limit. We know that some people need help with short-term needs, such as funeral expenses. Our priority has been to ensure that the scheme meets the full necessary costs of a cremation or burial for such people. The average payments have increased year on year to meet the necessary costs in full. Although we have had to make difficult choices about welfare spending, we have protected the £700 limit for other funeral costs, and we have continued to give people a choice on how they can spend that money on funeral expenses. However, the majority of funeral cost claims exceed the £700 limit, which is why, as I explained, we make interest-free social fund budgeting loans for funeral costs in addition to the funeral expenses payment.
The online eligibility checker was mentioned by the right hon. Member for Birkenhead—I think in his second question—and by other hon. Members. As I have explained, the dedicated bereavement service telephone line already offers an eligibility check and research shows that that has been well received by callers. We believe—I accept that hon. Members may feel differently—that an online checker could cause confusion. User research has identified that individuals would rather speak to an individual during these times—that is based on user research, not on cost. At these very difficult times—at one of the most traumatic times in their lives—they would rather speak to a well-trained human being than deal with a website.
We have been working closely with the bereavement service to ensure that the scripts and messaging are incorporated and updated for funeral expenses payments and to ensure that the staff can adequately offer support to a bereaved person or funeral provider when they access our services.
I hope it will satisfy the hon. Lady to know that I will. I apologise if I have been going into too much detail about other things, but it is important for hon. Members, and others throughout the country and here today, to understand generally what the Government are doing about these issues, in response to the Select Committee’s report. Please be patient with me; I will do my best to answer her questions. If not, I know that she will question me afterwards, but I hope that that will not be necessary.
The right hon. Member for Birkenhead raised the issue of increasing awareness of the scheme. Information on the eligibility criteria is clearly presented and detailed on the gov.uk website and in the information accompanying a funeral payment application form. The current eligibility criteria ensure that the scheme is administered quickly without additional complex means testing and used solely for funeral expenses payment purposes.
We have received positive feedback from industry representatives on how helpful the bereavement service telephone line is in guiding callers through the application process and their eligibility, and on changes that we are introducing to the application form. We are discussing with third parties such as registrars and funeral directors how we can improve the way in which the Government engage with the bereaved to ensure that information is in the right place and in the right form.
The right hon. Gentleman asked what we were doing to negotiate a reasonable cost for a simple funeral with the funeral industry, as his Committee recommended in its report. We have been engaging with the industry and different lobbies, as I have explained, on how they can make costs more transparent, but we do not believe that the Government should mandate or promote a specific form of funeral provision for benefit claimants. We have encouraged the industry to be more open and transparent about its pricing structure so that individuals can make informed decisions and shop around.
We have engaged with stakeholders to build strong links so that we have the relevant expertise at hand for the first phase of the review, which will visit what parts of the social fund regulations can be amended to help address and tackle funeral poverty issues. We also continue to improve, review and monitor the application process. All that work is being done with the funeral industry and groups that advise bereaved people. In November last year, as I explained, we launched the shorter application form, and we are open to ideas about how we can review the system, in particular the application form for the social fund funeral expenses payment. It has been simplified as much as possible.
On support for child funerals and bereaved parents, I pay tribute to the efforts of the hon. Member for Swansea East (Carolyn Harris), who is not here; I suspect, knowing her, that she is at the debate in the main Chamber. I speak to her regularly, and she put on record her views on the subject in an Adjournment debate, as I recall, on children’s funerals.
I was absolutely certain of it, as the right hon. Gentleman knows.
I confirm that we assign priority to applications received for children’s funerals and aim to process them without delay. We have listened to stakeholders’ concerns about the need to support bereaved parents of children, and we are currently considering how we can introduce a separate application form and system to help simplify the process in those tragic circumstances. We are keen to know how else to support individuals who require support for children’s funerals. The view of most funeral industry representatives at the round table that I mentioned was that the vast majority of funeral directors already waive fees or offer significant discounts for child funerals, although there are no industry-wide arrangements and there is no guidance in place. The National Association of Funeral Directors offered to do a survey of its members on current practice.
Moving on to bereavement support payments, I will respond to the points made by the right hon. Gentleman and others. As has been stated, both Houses of Parliament have approved, under the affirmative procedure, the Bereavement Support Payment Regulations 2017. The new bereavement support payment, which is due to be launched in April 2017, will replace three current bereavement benefits: the bereavement payment, bereavement allowance and widowed parent’s allowance.
Losing a spouse or civil partner is obviously tragic, and bereavement benefits provide vital support during this distressing time. Previous reforms have tended to be limited and made in response to specific pressures. No one had really considered how bereavement support fitted in with wider changes to the benefits system, and indeed to the social landscape as a whole. The aim is to provide targeted financial support at the time when it is needed most, without affecting access to additional forms of support that are available through other parts of the welfare system.
The Minister just said that the reforms are designed to provide targeted help when it is needed most. On what evidence has the concept of “most” been based, in his calculations? What does he define as a time when less help might be needed, as opposed to the most help? It would be helpful to understand the Government’s thinking.
The hon. Lady makes a good point. I used the word “most” to refer to the most critical short-term time, which is what I was discussing, but I am prepared to accept her point, without getting into a competition about when “most” is most. It is all the time, and I am happy to say that, but that is not the context that I was referring to.
I hope the hon. Lady will agree that the old system could be unfair and complex, and could act as a trap preventing people from readjusting. Reform is essential to simplify and modernise the system. The history of bereavement benefits is rooted in the Widows’, Orphans’ and Old Age Contributory Pensions Act 1925. The way that people thought in those days was that most women were wholly dependent on their husband’s income. If a woman was widowed, her sole source of income would disappear completely, so it was considered necessary to provide a replacement income for her to survive.
Today, women as well as men actively participate in the workforce, and many households now benefit from dual careers and dual incomes. That is why we are modernising bereavement support into a simple, uniform and easy-to-understand benefit that better reflects society. We listened to the recommendation of the Work and Pensions Committee that there was merit in considering the length of the new bereavement support payment. For that reason, the bereavement support payment is now payable over 18 months.
The Government have said that this is not about saving money but about, as the Minister has said, rationalising the system, bringing it into the modern era and so on. However, the Work and Pensions Committee told us that the changes to bereavement support payments will save £100 million. If this is not about saving money, will that £100 million be reinvested in helping the 75% of people who will lose out under the new measures?
If the hon. Lady will be patient with me a little longer, I will mention the financial point that she has made. I am sure that she will intervene to castigate me if I do not.
The new bereavement support payment restores fairness to the system and focuses support during the 18-month period after a loved one dies, when people need it the most. I accept the view of the hon. Member for Walthamstow that “most” can mean a lot of things. If I said “when people need it” without “the most”, it would still mean the same thing. People need it in those 18 months. The support is not taxed and is subject to a disregard for income-related benefits. The idea is, hopefully, to help those on the lowest incomes. Those who are least well off will gain the most, as for the first time they will be able to receive payments of bereavement benefit in full alongside any other benefit entitlements.
In her case studies, the hon. Member for Walthamstow mentioned the duration of payment and interactions with universal credit. We do not believe that the period of payment could or should be equivalent to the period of grief following spousal bereavement. As I know from the experience of many people known to me, grief can go on for one’s whole life. The payment is not designed for that; it is designed to support people with the additional costs associated with bereavement, rather than providing an income replacement. That is probably the contradiction with the points that she made.
I thank the Minister for trying to clarify the Government’s thinking, but as he goes along, he is making rather a different case. He says that the changes needed to happen because women are now entering the workforce. The old system was taxed, so if he is concerned that women might have additional income, continuing the old system might deal with that challenge better.
The Minister talks as well about people needing it most, but surely he recognises that although the loss of a partner is emotionally difficult, the practical financial concerns are paramount here. Does he recognise that the picture that he is painting of the issues is slightly askew from the reality of what the issues are for these women?
Obviously I do not agree with the hon. Lady’s subjective point that I do not recognise the reality of the situation. We are not trying to replicate the period of grief with this benefit. As I have said, it is designed to support people with the additional cost associated with bereavement, rather than providing an income replacement. Her view, from what she has said, is that the support should be an alternative to the other income support systems.
Let me be absolutely clear: the support is predicated on the contributions that the partner will have paid into the national insurance system, just as they might get a pension from their partner. We are talking about fairness to the children so that they benefit from the contributions that their father made and about the impact on the family’s income. Actually, it is not about replacing income support; it is about the fact that the father has paid in a contribution that should be recognised to the children’s benefit.
What the hon. Lady talks about is not really what I am talking about, but I accept what she has said. I was actually talking about the bereavement support payment, which is a lump sum payment.
We believe that income-based benefits are more suited to providing longer-term assistance with everyday living costs. Unlike bereavement allowance and widowed parent’s allowance, bereavement support payment will be paid in addition to any other benefits the recipient is entitled to, thus ensuring that the least well off receive the extra cash in their pocket to help with those extra financial strains brought about by the unexpected loss of a spouse or civil partner of working age. Long-term ongoing income-related support will be provided through universal credit, which better targets support to those with the greatest need.
The regulations make no changes to conditionality, which has been mentioned. Like the bereavement benefits it replaces, the bereavement support payment sets no work-related conditions. Any obligation to participate in any work-related activity will come from claiming other benefits. That said, it is well known that long periods out of work can have a negative effect on an individual’s prospects of future employment. That is why the Government think it is important that people are encouraged to maintain, as much as they can, a link with the labour market.
Recipients of bereavement support payment who also receive universal credit will therefore be able to access Jobcentre Plus support on a voluntary basis from three months after bereavement. They will then not be subject to conditionality for a further three months. Those exemptions from conditionality will also apply after the death of a child or partner, even where there is no entitlement to the bereavement support payment. At the end of the six months, advisers will use their discretion to ensure individuals’ capability and requirements are taken into account. That is the best way of ensuring that the support we give is tailored to the individual.
The right hon. Member for Birkenhead and others mentioned the extension of the bereavement support payment to cohabitees. That was discussed in detail during the passage of the Pensions Act 2014. Marriage and civil partnerships are legal arrangements that are associated with certain rights, including inheritance and recognition in the tax system. Extending eligibility to cohabitees would not only increase spend, but be complex to administer. Having to prove cohabitation could be a lengthy, complex process, which could cause distress at a time of bereavement.
Many critics have suggested that it is unfair that those who choose not to formalise their relationship are treated as a couple for income-related benefits, but not for contributory benefits. Income-related benefits serve a different purpose, however: they are for the ongoing day-to-day needs of a household, irrespective of whether the relationship is formal. When assessing entitlement to income-related benefit payments, the state rightly assumes that couples, whatever the legal status of their relationship, have joint outgoings and share resources such as earnings or other income.
The position with bereavement benefits is different, because they are contributory. The founding principle of the contributory benefit system is that all rights to inheritable benefits derive from another person’s contributions. That is based on the concept of legal marriage, which has extended to civil partnership in recent times. Unmarried or non-civil partnership couples will, of course, have access to a full range of income-related benefits and will benefit from the removal of conditionality requirements in exactly the same way as those in a legal marriage or civil partnership.
I was simply going to ask whether the Minister will clarify whether he considers children to be a joint outgoing. If he does, the contributions that a partner would make to a household would also be eligible. The idea that if people are not married, their relationship to those joint outgoings somehow stops at their death seems rather misplaced, does it not? I have certainly heard that children are expensive.
I can personally verify the latter part of the hon. Lady’s comments on the expense.
The new bereavement support payment restores fairness to the system and focuses support just on that 18-month period after a loved one dies, when it is most needed. It is not taxed and will be subject to a disregard for income-related benefits, helping those on the lowest incomes the most. Widowed parents will no longer lose their benefits if they decide to remarry or repartner. We do not believe that the period of payment could or should be equivalent to the recovery period following spousal bereavement. I am sure most people would agree that that is a totally different amount of time.
Unlike with the widowed parent’s allowance, claimants of the bereavement support payment will be entitled to receive all the other benefits at the same time. Disregarding bereavement support payment in the calculation of other benefits will ensure that the immediate additional costs of bereavement are met. Those requiring support will be able to obtain it from other areas of the welfare system, and I cannot stress that enough. Its purpose is better placed to provide longer-term, means-tested financial assistance.
The right hon. Member for Birkenhead, the hon. Member for Walthamstow and other Members made a reasonably cynical, but well-made point about the changes to the bereavement benefit. They basically said that it was just an austerity measure, delivering savings of £100 million to the Treasury after two years. Over the first two years of the reform, we will actually spend an additional £45 million, but any savings, like in anything else in the public finances, will be for future Governments to reinvest as they choose. I therefore cannot undertake, as I have been asked, to ensure that savings are reinvested in this field.
It is important to emphasise for the record that nobody in receipt of the current bereavement benefit stands to lose out as a result of the reforms. Recipients of the current benefit will continue to receive it for the natural lifetime of their award. Furthermore, households with dependent children will receive higher payments in recognition of that fact. Analysis shows that more people stand to gain than to lose from the changes. That is particularly so for the least well off, because—I have made this point several times—bereavement support will be paid on top of any income-related benefits that the household receives.
The Government have been asked here and elsewhere to extend the duration to three years and make the BSP cost-neutral. If we did that, we would have to fund it by reducing other elements of the payments. There seems to be little rationale for reducing the monthly payments for parents to make extending the duration cost-neutral. It would reduce payments to a token amount, which would not meet the intention of dealing with the immediate costs relating to bereavement.
With the introduction of the bereavement support payment, short-term financial support will be provided based on six months of national insurance contributions. The amount and duration of the award will be clear from the outset, allowing people time to plan ahead. Those requiring further support will be able to obtain it from other areas of the welfare system that are better placed to provide longer-term, means-tested financial assistance.
The hon. Member for North Ayrshire and Arran made a point on uprating. Any decisions on future changes will be taken as part of the annual process in the context of the wider public finances. I cannot say much more on that, other than that section 150 of the Social Security Administration Act 1992 provides for the rate of BSP to be reviewed annually. The Government committed to review the bereavement support payment reform in the impact assessment of 2013, but we cannot do that until sufficient evidence is available to assess all aspects of the policy, including its effectiveness and the impact on different groups of claimants.
The hon. Lady also made a point about the consequences for children of bereavement support payments. She said that, as a result of the shorter duration of payments, 75% of new claimants with children will be worse off. No one in receipt of the current bereavement benefits stands to lose out as a result of these reforms. As I said, recipients of the current benefits will continue to receive them for the natural lifetime of their award. Furthermore, for those households where there are dependent children, a higher level of payments will be made in recognition of that fact.
In conclusion, let me reassure hon. Members that the Government are absolutely committed to supporting the bereaved and ensuring that individuals have the opportunity to access the funeral expenses payment scheme. Our priorities remain to improve the funeral expenses scheme, to raise awareness of the scheme and to ensure that we are doing what we can to offer a provision of support for vulnerable claimants.
I am grateful to have had this debate and thank those who have participated. I am also grateful to those who have not participated, but who are a very real part of the debate.
I leave the Minister with one thought. Despite his abilities and his charms, the Government are struggling with this brief. It is simply not good enough for him to say that the promise that the reform would be cost-neutral was made by a previous Government—it was made by a Conservative-dominated coalition Government.
When he reports back to his colleague at a departmental meeting, I plead with him to say that this brief is in some ways easier than others that the Government have. We all assumed that the Government were committed to introducing this reform at nil cost. We have heard about how it does not meet needs. I ask the Minister to say that the Government do not wish to present this harsh face to the public; that they have up to £100 million to spend in this area; and that they did not wish to make these changes to save money, but to bring the benefit up to date. I ask that he and his colleagues at some date soon report how that £100 million will be spent, so that the needs of the two heroines that my hon. Friend the Member for Walthamstow (Stella Creasy) raised can be met. We are not asking the Minister to conjure up new money or to take money away from somewhere else. We are just saying that we agree. By all means, let us modernise this benefit, but let us do it in a way that spends the full budget and in a way that meets need most.
Question put and agreed to.
That this House has considered the Ninth Report of the Work and Pensions Committee of Session 2015-16, Support for the bereaved, HC 551, and the Government response, HC 230.