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Universal Credit

Volume 807: debated on Thursday 12 November 2020


Asked by

To ask Her Majesty’s Government what plans they have to maintain the £20 a week increase in Universal Credit (1) for the duration of, and (2) after, the COVID-19 pandemic.

We are having ongoing discussions with the Treasury on the best ways to support people through Covid-19 and beyond. We will of course update Parliament on any future decisions on benefit spending when they are made. Claimants can be assured, though, that the Government are fully committed to supporting those who rely on the welfare system and to ensuring it continues to provide a safety net to those who need it.

My Lords, I thank the Government for extending the £20 universal credit increase and getting behind—even turbocharging —Marcus Rashford’s initiative to feed poorer children, many of whom will be black, Asian or minority ethnic. Does the Minister agree with me and the organisation Action for Children about the urgent need to develop and implement a UK-wide child poverty strategy that sets targets for its reduction and eradication?

The noble Lord’s acknowledgement of the Government’s activities in this field is appreciated. We are very pleased that we have been able to implement our latest package and we acknowledge Marcus Rashford’s passion and commitment, which the Government share. I will need to take the strategy the noble Lord raised back to the department. That is not me trying to avoid the issue; I will do that, and I will come back to the noble Lord in writing.

Families in receipt of legacy benefits, such as employment and support allowance, did not benefit from the very welcome £20 a week uplift in benefits. These people are just as likely to be affected by the financial impact of the Covid-19 pandemic and include many disabled people. Will the Government extend the increase in benefits to include those in receipt of legacy benefits, as recommended by the Joseph Rowntree Foundation’s Keep the Lifeline campaign?

The right revered Prelate raises an issue that many people are raising. The answer I have, in the politest terms, is that we have no plans to increase legacy benefits further. They were increased by 1.7% in April 2020 as part of the annual uprating exercise.

My Lords, in addition to those receiving universal credit, many more are in work but on very low earnings—all credit to them. Are the Government able to give any help to them?

The Government recently increased the national living wage to £8.72 per hour, which means the annual earnings of a full-time worker on the national living wage have increased by nearly £3,700 since 2016. The Spring Budget confirmed a tax cut for 31 million working people, and other tax changes make basic rate taxpayers over £1,200 better off. We have been able to extend the holiday activities and food programme with £220 million, and the Covid winter grant scheme has £170 million, so be in no doubt: the Government do care and do take action.

My Lords, every citizen, whether in paid work or not, deserves an income that allows a decent standard of living. We should not be permitting a system where discomfort and, indeed, poverty are built in. You cannot live on the standard allowance—no one can—and that is apart from delays in payment. How can the Minister possibly defend universal credit, even as a viable safety net, when demand for food banks is at a record high and homelessness is rapidly rising, even with the extra £20 a week?

I understand the noble Earl’s point, but as I said, we have put out a raft of additional support. I could read it out, but it would take the whole 10 minutes, if not longer. I understand his point, but the Government are taking action to make life better for people.

My Lords, I thank the Minister for recognising the important contribution of the £20 a week increase. Does she also recognise that the increase in housing benefit rates has made a significant contribution to reducing poverty? Does she agree that we should recognise the contribution made by the key workers in the DWP? The case managers, job coaches and all the staff have coped with a 600% increase in universal credit claimants since March, of which there are now 8.2 million. We should also recognise the contribution of its chief executive, Neil Couling, who has given dedicated and inspirational leadership to ensure a successful digitalisation programme which enabled the DWP to cope with the massive increase in claimants.

The noble Lord acknowledges the significant increase in universal credit claimants, and I understand the importance of the issues he raises. He also acknowledged the key people at the DWP, not least Neil Couling and the whole executive team that works with him, who have done a sterling job and will continue to do so.

I, like other noble Lords, welcome the retention of the £20 a week increase, which will indeed help many people. However, is the Minister aware of the report by the charity Scope on disability and the coronavirus, which found that many disabled people are feeling forgotten and experiencing isolation, a lack of access to basic essentials, delays in receiving benefits and medical care, and poor access to care and support? Will she assure us that the Government will meet with disability charities to ensure that all people with disabilities, and their families, receive the care and support they need during the coronavirus? Will she report back to Parliament on this?

The noble Baroness is absolutely right to raise the issue of disabled people and the challenges they face. The noble Baroness will also know that my natural way of working is to agree to these things and to report back. The only thing I can offer her today is that I will talk to the Minister for Disabled People and let him know what it is she would like to do. I will report back to her.

My Lords, I too welcome and acknowledge all the support measures the Government have put in place, but can my noble friend say a little more about the evidence base? How are the Government assessing whether the measures they have taken are having the desired impact among families on the lowest incomes?

The noble Baroness raises the important issue of evidence. Analysis shows that the Government’s interventions have supported the poorest working households, as a proportion of February income, the most, with those in the bottom 10% of the income distribution seeing no reduction in their income.

My Lords, because the £20 uplift was not extended to legacy benefits, an adult on universal credit is given £94 a week to live on but her neighbour on JSA or ESA gets just £74 a week. The Minister told the right reverend Prelate the Bishop of Durham that there were no plans to change this, but she did not tell him why. Could she please explain to the House and the 2 million people on JSA and ESA why they do not deserve the same help when their food and bills cost every bit as much as those for people on universal credit?

I note the point that the noble Baroness makes and it is well made, but as I said, the Government’s position is that we have no plans to increase legacy benefits further. People on legacy benefits can transfer to universal credit and they can do a calculation before they transfer to make sure they will be better off.

Like other noble Lords, I congratulate the Government on coming some of the way towards Marcus Rashford’s and other food campaigners’ demands. This weekly increase of £20 does pay for the bulk of a single person’s grocery budget and is one of the things keeping a lot of people out of food banks, although, as my noble friend Lord Clancarty pointed out, these figures continue to rise. It seems extremely ironic that the Government have decided to support food banks and declare that they are an essential part of our system when we should be working to abolish them, yet they are contemplating taking away this small increase of £20 and, as was just mentioned, not affording it to people on JSA or ESA. I come back to my noble friend Lord Woolley of Woodford’s original Question and ask the Minister: what plans do the Government have to keep this increase for the duration of the Covid-19 pandemic and after it? It does make a difference.

As I already said to the noble Lord, Lord Woolley, we are having discussions with the Treasury on the best way to support people both through Covid-19 and beyond. As soon as those decisions are made, Parliament will be advised.