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Benefits System: Working Hours

Volume 631: debated on Monday 13 November 2017

16. What steps he is taking to ensure that the benefits system does not penalise people who wish to increase the number of hours they work. (901851)

Universal credit is transforming and modernising the welfare state, ending complicated rules around employment hours and the cliff edges of the old system. Universal credit has a clear system of allowances and tapers to ensure that claimants know that they are always better off in work.

Does the Secretary of State agree that one of the fundamental flaws of the system that we inherited from Labour is that people who wanted to work more than 16 hours a week could lose 90p of every pound that they earned?

My right hon. Friend is absolutely right, and it was about not only the high marginal deduction rates, which obviously we do not see with universal credit, but the fact that people who moved in and out of work, or whose hours fluctuated, could find themselves moving from one benefit system to another. That created additional hassle and uncertainty for claimants, and discouraged people from taking on additional hours.