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Welfare Support

Volume 656: debated on Monday 18 March 2019

1. What comparative assessment her Department has made of the levels of financial support available through (a) universal credit and (b) the legacy system. (909829)

3. What comparative assessment her Department has made of the levels of financial support available through (a) universal credit and (b) the legacy system. (909831)

23. What comparative assessment her Department has made of the levels of financial support available through (a) universal credit and (b) the legacy system. (909851)

When fully rolled out, universal credit will be £2 billion per year more generous than the support it replaces. As a single system that integrates six legacy benefits, universal credit will enable 700,000 households to access approximately £2.4 billion of welfare that previously went unclaimed. Our welfare reforms are about targeting support at those who need it most.

At the Budget, additional funds, which are to come into effect in the new financial year, were allocated to pay for work allowances,. Will my right hon. Friend update the House on when those work allowances will come in, how much they will be, and how much extra the working people in my constituency who receive universal credit can expect to receive each week?

My hon. Friend is right that an extra £1.7 billion a year will be put into work allowances to increase them by £1,000 from April 2019. That will provide a boost to the incomes of the lowest paid that will result in 2.4 million families keeping an extra £630 per year of what they earn.

It is not just the financial support that is key, but the support provided by jobcentres in getting people work-ready. One of my constituents was languishing on benefits for a decade with no interventions. Now, under universal credit, she is being helped and supported to become job-ready. Will my right hon. Friend ensure that we continue this approach, and that we reach out and support the work coaches in jobcentres?

I thank my hon. Friend and near parliamentary neighbour for pointing out the excellent work done by work coaches. The defining difference between universal credit and the legacy benefits that it replaces is that tailored, personal approach, which really helps individuals to get back into work.

What support is being given, through not only universal credit but schemes such as Access to Work, to those who experience mental ill health?

I thank my hon. Friend for pointing out this important element of universal credit. We are determined to make sure that universal credit really supports the most vulnerable. We are piloting a new scheme in Milton Keynes in which people with mental health difficulties are given an early referral to make sure that their needs are dealt with early on, so that they can be given the appropriate, personal, supportive care that they need.

The five-week wait for universal credit assumed that everybody would have their last month’s pay cheque in the bank, but reality is not like that. Most claimants have to take an advance—a debt to the Department—the repayment of which often forces people to use food banks, as the Secretary of State has rightly acknowledged, or go into rent arrears. Will she scrap the five-week delay?

I thank the right hon. Gentleman for raising this important issue; we have addressed concerns about the five-week wait by putting in additional measures. One measure now in place relates to the receipt of legacy housing benefit over two weeks. All universal credit applicants can get an advance, and we now find that 60% of applicants take up that opportunity. That obviates the need for concerns about the early amount of cash that people get.

I spent most of Saturday collecting a third of a tonne of food for our local food banks as part of our Winter of Compassion campaign. It is already clear that we will have to run such food-bank collections all year round. When will the Secretary of State join us in Birmingham to help collect the food needed to end the hunger that her policies are causing?

I totally reject the right hon. Gentleman’s assumption and comments. The issue with food banks is partly that the early roll-out of universal credit had some difficulties. We now know that 85% of applications for universal credit are paid on time and, as I said in answer to an earlier question, 60% of people get advances. I hope that that combination will enable people to access the cash that they need straight away.

Despite the recent funding, the levels of work allowances have still not recovered from the cruel cuts made to them back in 2015. Does the Secretary of State recognise that although the principle of simplicity behind universal credit is a good one, if universal credit is to have credibility, it needs to be funded properly?

It is because universal credit needs to be funded properly that my right hon. Friend the Chancellor has, since 2016, put another £10 billion into different areas of it, to ensure that it does what it sets out to do, which is support the most vulnerable and help others into work.

The UK Government have removed the higher rates in universal credit for lone parents under 25. In answer to a question from my hon. Friend the Member for Airdrie and Shotts (Neil Gray), the Minister for Employment had the audacity to claim that under-25s have lower living costs, and that

“this reflects the lower wages that younger workers typically receive”

as a result of state-sanctioned age discrimination, including through this Government. Will the Secretary of State tell me in what way it costs a 24-year-old less to be a single parent than it costs a 26-year-old?

I point out to the hon. Lady that we have made available more childcare that is both better and lower-cost. A person can now have 85% of their childcare costs paid under universal credit. We have also made sure, as I said in a recent announcement, that work coaches have the wherewithal, through the flexible support grant, to give that money to people who need it early on in the process.

Ministers may like to claim that nobody will be worse off on universal credit, but people transferring through natural migration get no protection against loss of income, even though they may just have moved home. Will the Secretary of State tell the House what the Government will do to ensure that nobody is left worse off?

I ask the hon. Gentleman to engage with the change that is universal credit. People were left to languish on previous legacy benefits, and were not helped into work at all. We now have a system where the money is focused on trying to help people into work. That is why we have seen the changes with the work allowance, and why we have seen additional support from the Chancellor. It is a different system from that point of view.