Skip to main content

Policy Implications of Leaving the EU

Volume 613: debated on Monday 11 July 2016

5. What assessment he has made of the potential policy implications for his Department of the UK leaving the EU. (905753)

12. What assessment he has made of the potential policy implications for his Department of the UK leaving the EU. (905761)

21. What assessment he has made of the potential policy implications for his Department of the UK leaving the EU. (905770)

22. What assessment he has made of the potential effect of the outcome of the EU referendum on welfare spending. (905771)

The British people have voted to leave the European Union, and the referendum decision must be respected and delivered. My Department is working closely with the EU unit that has been set up in the Cabinet Office, and we will be working with the next Prime Minister and the rest of the Cabinet as we forge a new path for the country.

The European Union has provided a number of legal protections involving equality and human rights for disabled people. Given the delay in the publication of the Green Paper on the Work and Health programme, what plans has the Department to protect those rights following Brexit?

No one with a disability or a long-term health condition should have any fear whatsoever about what will happen in the coming months and years as we negotiate Britain’s exit from the European Union. We are absolutely committed to protecting rights for disabled people in this country, and the Green Paper, which we will publish in the autumn, will outline our proposals for reforming systems in order to give better support to people with disabilities and long-term health conditions.

Last week the Under-Secretary of State for disabled people confirmed that the Green Paper and the long-promised Work and Health programme for disabled people remained a priority for the Government. In the light of the current uncertainty, will the Secretary of State give us an assurance and a clear commitment that sufficient funds for that support are ring-fenced and the programme is guaranteed?

The money has already been announced by the Chancellor on successive occasions, and it is there, waiting to be used. When the hon. Lady reads the Green Paper, which we hope to publish later this year, she will see how we will use it to develop longer-term reform options to provide better support for people with disabilities and close the disability employment gap. I think there is cross-party support for that in the House.

Cuts in support for people who have been placed in the employment and support allowance work-related activity group from April 2017 will leave many sick and disabled people in the dark, and potentially without the protections provided by the European Union. Will the Secretary of State, unlike the Brexiteers, give us some assurance that the Government actually have a plan for the Green Paper to give back, so that those who are affected by these changes are accurately assessed and are recognised and valued by the state?

I entirely agree with the hon. Gentleman about the need to recognise and protect people with these health conditions, and we are absolutely committed to doing that. I do not want to repeat the answer that I gave earlier, but we have money set aside, and we will publish the Green Paper later this year. It will set out clear reform options which I hope will command support from Members on both sides of the House, and also from disability organisations.

Does my right hon. Friend agree that one of the most important policy developments is the fact that, once we have left the EU, decisions by his Department relating to eligibility for benefits will no longer be at risk of being overturned by the European Court of Justice?

My hon. Friend is absolutely right: there will be that freedom in the future, but there are more options we can develop right now, even while we are still in the EU, for further ensuring that we have a fair benefits system that does not act as an unnatural draw for more migrants. We want people to come here, work and bring their talents, but we do not want the benefits system inflating those migration numbers.

The impact of uncertainty on the economy following the Brexit vote is already being felt and ultimately will affect jobs, tax revenues and public spending. Before the referendum, the Government predicted that 500,000 jobs might be at risk, so what is the Secretary of State doing to protect these jobs and what is his estimate of the impact on social security spending?

It is important that none of us talks up the risks and dangers to the economy. We need to be clear-sighted about the risks and challenges, but we should not be doing anything at the moment to talk down the British economy. The truth is that our economy is fundamentally strong: we have record numbers of people in work and, as we have seen from the announcement by Boeing today, continued investment in creating new jobs in our economy.

The lack of planning by this Government post-Brexit is complacency verging on neglect. The FTSE 250 has already lost 10% of its value since the referendum outcome and that will impact on pension funds. Given that 5,000 of the 6,000 defined benefit pension schemes are currently in deficit and that the pensions regulator has raised concerns of additional risks to these schemes following the Brexit decision, what is the Secretary of State doing to protect the pensions of the millions of people who will be affected?

Nothing fundamentally has changed since the outcome of the referendum: the economy continues to perform well and, as I said, we need to be careful that we do not do our bit in talking down the economy at the moment. I agree with the hon. Lady that there is a very real systemic issue with DB pension schemes that we need to look at, and my Department will be discussing it further in the months ahead.

One thing that we do know has happened is the fall in the pound. That has resulted in making our exports much cheaper and imports more expensive. Employers have already said that that will lead to more business and jobs. Does the Minister agree that that would be helpful to him in reducing the number of unemployed?

The truth is that right in front of us now, since the outcome of the referendum, we have a mixture of opportunities and challenges. It is incumbent upon us to turn those challenges into opportunities, and we are determined as a Government to do so. If the Opposition want to do their bit, they can stand up and not talk down the British economy at this time.

Already during this Parliament the Government’s austerity cuts have taken more than £12 billion out of the pockets of low-income households, mostly through changes initiated by the DWP. With many economists predicting a further recession as a consequence of Brexit, and the pound now less stable than Bitcoin, will the Secretary of State assure me that he will not allow those on low and middle incomes to bear the brunt of further economic downturn?

On previous occasions I have set out the broad approach I take to welfare reform. With regard to issues in Scotland, with which I know the hon. Lady is primarily concerned, she should be aware that I had a very constructive meeting last week with her colleague Angela Constance, the welfare Minister in the Scottish Parliament. We remain absolutely committed to giving the Scottish Government the new welfare powers agreed to in the Scotland Act 2016.

In the past week, for the fourth year in a row, the Infrastructure and Projects Authority has given the roll-out of personal independence payments an “amber/red” rating, indicating that

“successful delivery of the project/programme is in doubt with major risks apparent in a number of key areas”

and adding that “urgent action” is needed to address the problems. What is the Secretary of State going to do to fix these problems, and how does he intend to protect his Department’s projects from the impending doom of a Cabinet full of Brexiteers?

Any big project, whether it is the introduction of universal credit or the roll-out of PIP, carries substantial risks, and I think the IPA report recognised that fact. In the past four months, since I have been in the Department, I have been committed to driving through improvements to the PIP process. PIP still commands broad support across disability organisations, which recognise that it is a much better benefit than the old-style disability living allowance.

On the one hand, Lush cosmetics has just announced that it is going to move most of its production overseas, because it says that its workers do not feel welcome here, while on the other hand there are those in the food and farming sector, 38% of whose workforce comes from overseas, who are saying that they could go out of business because they will not be able to find people to employ. What is the Department doing to protect jobs in the south-west in the wake of the Brexit vote?

The Department has clear plans in place for any significant increase in unemployment, whether in a particular local region or right across the UK. We have contingency plans for dealing with up-ticks in unemployment. However, we need to be really careful that we do not exaggerate the bad news that the hon. Lady might think is out there. There are opportunities for this country in terms of trade deals and of securing new investment, such as the investment from Boeing that was announced today. There are also serious risks and challenges, and we need to be clear-sighted and prepared for those.