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Spending Review 2020

Volume 685: debated on Monday 30 November 2020

What assessment she has made of the implications for her Department’s policies of the spending review 2020. (909448)

What assessment she has made of the implications for her Department’s policies of the spending review 2020. (909451)

What assessment she has made of the implications for her Department’s policies of the spending review 2020. (909460)

The further funding for our plan for jobs—particularly the £2.9 billion for the restart programme that is focusing on those at risk of long-term unemployment —as well as ongoing support for our other schemes and work coaches shows our focus on helping people to get back into work. Through Barnett consequentials, £36 million of funding will be available for equivalent measures in Scotland next year. Other elements, such as the record increase in defence spending and the 10-point plan for a green industrial revolution, will help to create new jobs that will positively impact Scotland and the wider UK.

That will be news to my constituents in Glasgow North, who have had to cope with the closure of their jobcentre. That decision, along with the closure of 200 other jobcentres since 2010, is starting to look a little bit short-sighted. The Chancellor says that he will do everything it takes to support the estimated 2.6 million people who will be unemployed next year, so where exactly are these job coaches going to be based, and will the Government prioritise the places that have already suffered from the closure of local jobcentres?

I think it is the situation in Glasgow that a number of jobcentres were consolidated into one area. I am a great believer that, instead of necessarily investing money in bricks and mortar, we should invest in the people who will provide that support. In Scotland more broadly, we are aiming to hire over 800 new work coaches; 400 have already been recruited to date, and I know that some of those are in Glasgow.

The Chancellor could have made the £20 uplift to universal credit permanent, but instead he has left households deeply concerned as they face the prospect of a cut to this vital lifeline in spring. We in the Scottish National party have pressed UK Ministers on this matter countless times. Will the Secretary of State tell the House whether she discussed extending the universal credit uplift with the Chancellor prior to the spending review, and whether she believes that this extension should have been included?

The hon. Lady will be aware that the temporary extension of the £20 universal credit uplift was made in line with the fiscal measures made earlier this year. With regard to the benefit uprating, I put that through as that is the normal process that we go through, but, as has been indicated, we will continue to look at this matter again in the new year.

For the last eight months, around 2 million disabled people and others on legacy benefits have been discriminated against through being excluded from the £20 uplift granted to those receiving universal credit. The Chancellor’s failure to extend the £20 uplift to them is another humiliating insult to the most disadvantaged and vulnerable in our society, and only granting them an additional 37p a week from next April is nothing short of abhorrent. Does the Secretary of State think it is acceptable that people on legacy benefits are now facing a second year without sufficient financial support from this Government?

Last year we actually increased benefits by inflation, and we have made sure that that has happened again so that there are no cuts in that regard. I am keen to continue to do what we can to encourage people to move across to universal credit. There is only one group of claimants who are effectively barred from doing that, and that will change in January next year. I genuinely want to put across how important it is; by using things such as Help to Claim and getting support directly, people can often see that they will be considerably better off under universal credit.

The Secretary of State announced that the local housing allowance would again be frozen in cash terms in 2021, having only moved out of the previous freeze in March. That means, as the Office for Budget Responsibility has pointed out, that LHA rates will fall back below the 30th percentile. The Government have cut local housing allowance consistently since 2010-11, including freezing it from 2016 to this year. Will the Secretary of State tell us what estimate the Department has made of the effect on children in poverty of pushing the LHA back below the 30th percentile?

The decision made last year was to increase to the 30th percentile in cash terms—that is around £1 billion of welfare support that has been added. On consideration, we felt it was right to continue the cash freeze as we recognise that around the country we are seeing rents potentially going down, although I recognise that in some places they may continue to rise. Overall, people have certainty in the amount of cash that they have. It is certainly not going back but about making sure that this is a permanent change and was not just a temporary one.

The fact is that the number of children in poverty in the private rented sector rose by half a million between 2010 and 2019, so whatever uplift has been put in over the past year is in that context and we will see more children plunged into poverty as a result. Will the Secretary of State tell us exactly what steps she will take to ensure that more children do not fall into poverty as a result of the re-freezing of housing allowances?

I think I have already answered the hon. Lady. We have not reduced the LHA back to pre-covid arrangements; we decided to make that change a permanent fixture but to freeze it at cash levels, recognising that, as I said, nearly £1 billion had been injected into welfare support. We will continue to work on this issue throughout the country and I am keen to see what we can do on aspects of housing, which is why I am in regular conversation with the Ministry of Housing, Communities and Local Government about how we do things such as bring empty homes back into use as accommodation. I want to make sure that people have as much affordable housing as possible, and the increase to LHA of nearly £1 billion is one way to achieve that.

Shortly, Nicola Sturgeon will outline in her conference speech plans to pay families who receive free school meals a £100 grant to help them through winter till the new, game-changing Scottish child payment starts in the new year. The Secretary of State’s Government could have matched the Scottish Government’s anti-poverty ambition at the spending review, but they failed even to make the UC uplift permanent or extend it to legacy benefits. Can she point to anything in the spending review that is there to address poverty?

The best way to get out of poverty is to get into work. I am very conscious that there are real challenges right now, as we see an increasing number of unemployed people. There are vacancies, but part of the Government’s job is to stimulate interest, which we are doing with a multibillion-pound investment in a variety of schemes, not only to create jobs, with kickstart, but to make sure that people are ready to get back into work. The idea is that we need to try to create confidence within business, and that will be a key part of that. I am sure the hon. Gentleman welcomed the money that came through the Barnett consequentials that will support initiatives that the Scottish Government might wish to undertake.

The Secretary of State talks about jobs, yet just as employment is expected to reach 2.6 million, she plans, shamefully, to cut universal credit. Ahead of the spending review, a petition organised by the Disability Benefits Consortium and signed by 119,000 people was handed in to the Government, calling for the UC uplift to be extended to legacy benefits. Given that living costs have increased dramatically for disabled people during the pandemic, why have the Government not acted? Does that not just summarise perfectly the tale of two Governments: a Scottish Government extending support to those who need it while the UK Government increases disability benefits by a derisory 37p?

Last week I published the benefit uprating statement, which indicated the inflation rise for benefits, as well as the 2.5% for state pensions. I am conscious that a number of different things are going on with benefit spending—my hon. Friend the Minister for Disabled People, Health and Work just reminded me that benefit spending on people with disabilities is up 5%. I think there is a lack of understanding of what the spending review is: it is not about budgetary measures, which tend to come with major fiscal events. As has been indicated before, the decision to consider the temporary uplift to universal credit will be made in the new year.