[Relevant Documents: Fourth Report of the Committee of Public Accounts, Session 2016-17, Entitlement to free early years education and childcare, HC 224, and the Government response, Cm 9351; Forty-ninth Report of the Committee of Public Accounts, Session 2016-17, Financial sustainability of schools, HC 890, and the Government response, Cm 9505; Fifty-Seventh Report of the Committee of Public Accounts, Session 2016-17, Capital funding for schools, HC 961, and the Government response, Cm 9505; Thirteenth Report of the Committee of Public Accounts, Academy schools’ finances, HC 760, and the Government response, Cm 9596; Seventeenth Report of the Committee of Public Accounts, Retaining and developing the teaching workforce, HC 460 and the Government response, Cm 9596; Forty-fifth Report of the Committee of Public Accounts, The higher education market, HC 693, and the Government response, Cm 9702; Fifty-second Report of the Committee of Public Accounts, Converting schools to academies, HC 697, and the Government response, Cm 9702; Sixtieth Report of the Committee of Public Accounts, Ofsted’s inspection, HC 1029, and the Government response, Cm 9740; Sixty-ninth Report of the Committee of Public Accounts, Sale of student loans, HC 1527; Seventy-third Report of the Committee of Public Accounts, Academy accounts and performance, HC 1597.]
Motion made, and Question proposed,
That, for the year ending with 31 March 2019, for expenditure by the Department for Education—
(1) further resources, not exceeding £13,388,055,000 be authorised for use for current purposes as set out in HC 1966,
(2) further resources, not exceeding £4,460,127,000 be authorised for use for capital purposes as so set out, and
(3) a further sum, not exceeding £4,775,855,000 be granted to Her Majesty to be issued by the Treasury out of the Consolidated Fund and applied for expenditure on the use of resources authorised by Parliament.—(Anne Milton.)
Let me put on record my thanks to the Backbench Business Committee for granting this important debate. For some newer Members of this House who may not realise this, thanks is also owed to the Procedure Committee. When I first arrived in Parliament, it was impossible to debate proper facts, figures and the Budget in the estimates debate without being ruled out of order. The Chair of the Procedure Committee and I decided that that was not good enough and we worked together to try to make sure that we could get these debates, which are now granted by the Backbench Business Committee. I warn the Minister that we are well prepared to go through the numbers in her budget. I am sure that, as an assiduous Minister, she is well prepared to take on board our concerns and to answer them. We have worked closely with the National Audit Office in preparing for today’s debate so that we can focus on the actual figures. I know the Minister is assiduous and will not try to give us smoke and mirrors in her answers. Hopefully, she will answer not in slogans, but in actual figures.
Today, I plan to discuss the overall schools budget. I know that the Chair of the Education Committee, the right hon. Member for Harlow (Robert Halfon), will also pick up on some of these issues. Other colleagues will be highlighting concerns around the spending on academies and multi-academy trusts, which, of course, report directly to the Department, teacher recruitment and retention, potentially the student loan book sales—although I see that the Member concerned is held up in a Statutory Instrument Committee—funding for Ofsted and the inspection regime; further education and higher education; and early years and special educational needs. The Minister will have her work cut out to make sure that she is over the detail, as I am sure that she is.
One reason why we wanted this debate is that the Government often repeat that more money is going into schools than ever before. In March 2017—on one of many occasions—the Public Accounts Committee looked at the sustainability of school funding. This was at the point when schools were already implementing a Government set target of £3 billion of efficiency savings—£1.7 billion of which was through more efficient use of staff, and £1.3 billion through more efficient procurement.
The House would expect the Public Accounts Committee, which I have the privilege of chairing, to be absolutely on board with the idea that schools should be as efficient as they can be, certainly with regard to procurement—where schools buy their paper or their electricity from. It is quite right that schools should be encouraged and supported to find the money that can be put into frontline teaching. We were concerned, however, that the Department did not really have a grip on what the impact of those efficiency savings would be, particularly on staff. It did not know what the impact would be in the classrooms and on the teaching in schools that had already found those efficiency savings, or on the outcomes for children.
I am delighted to see that the Secretary of State is in his place. I know that he feels passionately about the need to make sure that children are getting everything that they can from our schools. It is therefore important and incumbent on him and his Department to make sure that, when they are setting the budget or implementing efficiency savings or cuts, they understand what the impact is on school attainment. While we are discussing the budget, we must understand that, in the end, the education budget is for that range of services provided through his Department to support young people in our country.
We concluded that the Government had not done a proper assessment. It was also concerning to hear from headteachers on the frontline about the challenge of squeezing out that money in certain schools, particularly in small schools where a small percentage saving is a big chunk and could mean losing a whole member of staff even if it is not equivalent to a whole member of staff’s salary.
During the general election of 2017, I was absolutely amazed and heartened by parents in my constituency and up and down the country—not political activists and not driven by political parties—talking about the impact in their child’s classrooms of the squeeze on school funding.
I did a survey just before and after the 2017 general election. Out of 103 schools in Coventry, 102 were finding increases in class sizes. The cuts measured pupil by pupil amounted to £295. We had a debate yesterday about sex education in schools. Does my hon. Friend agree that that is another burden being loaded on to our schools? We have a situation in Coventry where schools badly need additional funding regardless of what the Government were going to allow because they are starting from a very low basis. In other words, the Government owe education £3.5 billion, despite the fact that they put in £1.5 billion.
My hon. Friend tees me up for my next point. He also raises an important point. It is a political disease to ask schools to do more all the time and very often assume that it can just be done without the additional funding. It is important that the Secretary of State and his ministerial team watch closely that, while other bits of Government suggest that schools do things, there is the funding in place for that and for the core of what they should be delivering. It was after the general election and as a result of that campaign and that pressure on the Government, who were then elected without a majority, that the Secretary of State announced £1.3 billion of additional funding, which was weighted towards next year. This year, schools are in the throes of receiving the £416 million that was announced for this year and will receive £884 million in aggregate across England for next year. But that—the £3 billion figure—does not even backfill those efficiency demands that were asked for before. It is important that we recognise—in fact, the Government have recognised this—that we need 599,000 school places, which is as a result of the increase between 2010 and 2015. We are very concerned about the pressure on school budgets.
I have often heard Ministers say in justification of restrictions on school budgets that there are large balances. In my own constituency of West Bromwich West, the cumulative shortfall in schools came to nearly £5 million between 2017-18 and 2018-19. The cumulative reserves of all the schools in Sandwell is £3 million. There is now hard evidence that the balances left in schools in local authorities are no longer adequate to meet the year-by-year shortfalls that are taking place in them.
I am going to move on, in particular, to the issue of capital funding where sometimes reserves are built up for capital funding purposes.
Looking at what is happening in schools, I really want to give the lie to the argument that more money is going into schools than ever before. The Government say that, and we can look at it in cash terms, but we need to look at it in terms of per-pupil funding. The Department is estimating that over the 2015 spending review period, pupil numbers will rise by 3.9%, or 174,000, for primary school pupils and 10.3%, or 284,000 for secondary school pupils. Therefore, funding per pupil will, on average, rise only from £5,447 in 2015-16 to £5,519 in 2019-20—next year. That is a real-terms reduction once inflation is taken into account.
The hon. Lady is making a very powerful case. Does she agree that these cuts are often hurting the most vulnerable people most? Headteachers in my constituency are really concerned about teaching for special educational needs, with heartbreaking stories about schools having to lose their SEN teachers because they simply cannot afford them any more. These cuts really are having massive effects on individuals as well.
The hon. Lady raises a significant point. In my own constituency, since 2011, special educational needs provision has been backed up by the local authority through other funds that are now being squeezed because of the other funding caps.
The other point I would make very firmly to the Secretary of State is that so much of what happens in our schools is not just reliant on the Department for Education. If there are cuts in other parts of government or reductions in spending, there is a real squeeze where schools are sometimes expected to fill the gap but without the funding. This needs to be looked at in the round. We on the Committee are repeatedly concerned about what we call cost-shunting, where a saving is made in one area but the costs fall on another. A teacher or a headteacher with children in front of them in a classroom has to deal with the reality of that, and they do so very ably but often with great difficulty.
It is not just the Public Accounts Committee or the National Audit Office that is concerned about per-pupil funding. In 2018, only last year, the Institute for Fiscal Studies concluded:
“Between 2009-10 and 2017-18, total school spending per pupil in England fell by about 8% in real terms”.
In October last year, the UK Statistics Authority wrote to the DFE complaining about its misleading use of statistics on school funding. So I hope that we have nailed the lie about the funding. We need to acknowledge where we are and then we can have a debate about how much we should be funding or schools by.
In the time I have got—I do not want to take up colleagues’ time because I know that they have prepared hard for this debate—I want to touch on capital funding. I congratulate the Department and the permanent secretary on undertaking a stock conditions survey of the school estate. This is the first time that that has properly happened. It is quite shocking, really, that Governments, over time, have not done this. It is quite challenging because schools are under different ownerships. It is a good and welcome step, but of course, as the Secretary of State will know, it will throw up many issues for him. Some 60% of the school estate was built before 1976, which underlines, for those of us thinking of the schools in our constituencies, the amount of work involved. The National Audit Office estimates that £6.7 billion is needed to return all school buildings to satisfactory or better condition. They are not all to be fantastic and “all singing, all dancing” but just to be satisfactory or, in some cases, better. In 2015-16—the beginning of the spending review period—the DFE allocated £4.5 billion to capital funding, about half of which was spent on creating new school places. So there is a significant shortfall in what is needed and the amount of money that is being spent, and that has an ongoing impact.
Then there is the free schools agenda, where the Secretary of State is wedded to his manifesto commitment of 500 new free schools by 2020 from the 2017 base. I think that that there will be just over 850 if that target is reached. We are concerned that those buildings are often not the best. Asbestos surveys are not often done. Local government treasurers tell me that they know of buildings in their own areas that have been sold at well over the odds. It is as though people see a blank cheque when the Government come along with their cheque book for a free school site: the price goes up. That is not good value for money, and it really does need looking at. I do not think that even those most wedded to the free schools principle would want to see money wasted. In my own constituency, where many secondary schools were rebuilt under the academies programme and we have fantastic buildings, it breaks my heart to see new schools opening in inadequate buildings without sports facilities, without proper access, and often with very little in the way of playground facilities. I do not have to time to go into all that, but I recommend to the Department the reports we have done on this, because it is a very big concern.
The biggest concern for me on capital funding is about asbestos. I have a very strong constituency link here. I have a constituent, Lucie Stephens, whose mother was a primary schoolteacher for 30 years and died from mesothelioma—the cancer that comes from exposure to asbestos. She should have been enjoying her retirement now, but instead she is not because she caught this disease from working in a school that had asbestos in it. We looked at this on the Public Accounts Committee. The Department for Education has reported that over 80% of the schools that have now responded to its survey have asbestos. It has estimated that it would cost at least £100 billion to replace the entire school estate—the only way, really, to eradicate asbestos from our school buildings—but in January this year, we found that nearly a quarter of schools had still not provided the information that the Department needs to understand the extent of asbestos in school buildings and how the risks will be managed. Three times now, the Department has had to go back with a different deadline to get those schools responding. The last deadline was 15 February—just over a week ago. Does the Minister have an update on that? We have suggested that it is perhaps time to name and shame those schools. I do not say that lightly, but it is a very serious issue for those concerned.
My big concern is that there is no real incentive for schools to acknowledge their asbestos and get the expensive surveys done without some understanding of where the money will then come from to resolve it. It is not something that will be urgent in every school, and some schools will last a bit longer without it. Clearly, there needs to be a long-term plan and everyone needs to know what it is. There must be a clear plan from central Government with a pot of funding that schools can bid for. As we have heard, reserves and capital funding are very squeezed—squeezed to nothing in many cases, and certainly not enough to pay for asbestos removal or for a new school building. I urge the Secretary of State to be the one who finally upgrades our school buildings so that they are all as good as those in my constituency and the one who does not allow bad free schools to open.
As I said, there are many other issues that many colleagues in all parts of the House will be raising—everything from early years through to higher education—and I look forward to hearing the Minister’s response. There is a real issue about how we debate school funding, particularly in how we talk about the numbers. We need to make sure that we are actually talking about the same numbers, and then we can move on to a discussion about policy. Unless we get the maths right, we are talking at cross-purposes.
Order. As colleagues can see, a number of speakers wish to contribute to this debate and to the debate after it. They are both very well subscribed. I am therefore going to impose a seven-minute time limit. I was able to warn the next speaker that that would happen.
I thank the hon. Members for Hackney South and Shoreditch (Meg Hillier) and for Oxford West and Abingdon (Layla Moran) for going to the Backbench Committee together to request this debate.
I want to concentrate my remarks on the Department’s expenditure on schools and colleges, into which we are currently conducting an inquiry. The Education Committee wants to support the DFE in making the strongest possible representation to the Treasury as part of the spending review. Last year we launched our inquiry to look at the Department’s plans to introduce a national funding formula for schools and the role of targeted support for disadvantaged pupils alongside the influence of the spending review process. Our initial concern was that the three-to-four-year spending review period had far too little in common with the educational experience of young people who start primary school at around five and now participate in some form of education or training until they are 18. School and college funding is inextricably linked to both social justice and productivity, as I will set out in this short contribution.
It is not at all clear that the Department or the Treasury takes a sufficiently strategic approach. The last spending review settlement failed to foresee the cumulative impact of rising pupil numbers and several smaller factors—some of them explicit policy initiatives—that led to the 8% of unmet cost pressures on school budgets over the following year or so. It is also deeply regrettable that the debate around school and college funding has become so polarised. Schools are under pressure, but, as we heard this morning from Andreas Schleicher from the OECD, simply asking for more money will not necessarily lead to better educational outcomes. The debate on education funding needs to move away from one about an abstract concept of equity—the principle underpinning fair funding—towards one of sufficiency, where schools and colleges have the money they need to do the job asked of them.
I am listening with great interest to my right hon. Friend’s analysis. Does he agree that this Government have a proud record on education spending and achievement and should be congratulated? However, there are particular areas where we would like to raise issues, as he is doing. In addition to what he is saying about utilising resources, I advise him that in the Borough of Bexley, we saw an increase in the number of education, health and care plans of 14% between 2017 and 2018, and yet there has been only a 1.9% increase in the high needs block allocation this year.
My right hon. Friend is right. As he will hear in my remarks, I agree with much of what he says. We have to praise the Government for the good things that have happened but identify the funding problems.
I am grateful to the right hon. Gentleman for giving way, and I commend his Committee’s decision to launch the inquiry that he just referenced. Can he ensure that the inquiry takes a brief but particular look at the plight facing Catholic sixth-form colleges? Many do not see themselves as having sufficient funding in the long run, as is the case for many other further education colleges, but they do not have the option of converting to an academy—a route that there are incentives to take—because of their religious character. There is not yet a solution other than to increase funding for all. Will he particularly reference the plight of those 17 English Catholic sixth-form colleges?
The inquiry covers schools and colleges, so that issue will form part of it. I note the hon. Gentleman’s point and will ensure that we address it in some way or another in our Committee.
We should welcome the introduction of a national formula as the latest step in almost 20 years of reform in education funding. There are serious problems with the way that schools are expected to budget, not least being asked to do so over three years without the information to make reliable forecasts more than a year ahead. I hope the House will forgive me if I take the opportunity to give my strongest support to the plight of further education. I know that the Minister for Apprenticeships and Skills is passionate in her support and is lobbying the Treasury for more FE funding.
FE has for too long been the poor relation between secondary and higher education. By 2020, we will be spending the same amount in real terms to educate and train 16 to 18-year-olds as we were in 1990. I was shocked to discover that that is not an accident of history, but the result of a conscious policy choice of almost a decade ago. FE is a great example of why a national funding formula in and of itself is not a panacea. Without enough money to go around, it does not matter.
The time has come for a completely different approach to how we think of schools and colleges in this country. Rather than the Department for Education being one of many Departments scrapping it out every few years for the meagre rewards of the political cycle, Ministers need to take a leaf from the book of the Department of Health and Social Care and NHS England and make a bold bid for a 10-year long-term plan that starts to close the gap between inputs—broadly, in this context, the money—and outcomes at both an individual level, in the form of emerging from school a well-rounded person with prospects, and the wider economic level of having young people ready and able to fulfil the productivity part of the picture. We do not fully recognise the potential value of getting our education system right, and the DFE should make as much as it can of that in its negotiations with the Treasury. As a country, we have recognised the long-term necessity of funding the national health service, but without, it seems, the prior necessity of getting school and college funding right as a vital public service.
What would that mean in practice? For a start, we have to move beyond the rhetoric of school cuts versus more money than ever going into schools. That was the starting point of our inquiry and will be an important starting point for our report this year. The truth is that both characterisations are only very partial accounts and keep us talking about inputs rather than outcomes. The relationship between those inputs and outcomes is not simple and causal, as Mr Schleicher told the Committee this morning, but that is emphatically not the same as saying that schools can magically deliver world-beating results at the same time as moving from savings in their non-staff budgets to savings in their staff budgets. When we learn that students in Poland perform at the same level at age 15 as those in the United States, but with per student expenditure that is around 40% lower than in the United States, we need to consider whether simply asking for more money without a plan will get us where we want to be.
We need to take a long, hard look at some flagship policies and be open to questioning whether they are delivering against our stated policy objectives, especially when they engage social justice. Disadvantaged pupils perform a lot worse at school. Just 33% of pupils on free school meals get five good GCSEs, including English and maths, compared with 61% of their better-off peers. The Committee has already expressed its concern that the Government’s policy of funded childcare for three and four-year-olds is entrenching disadvantage and preventing the closure of the attainment gap between disadvantaged pupils and their peers from better-off backgrounds. I know that the Under-Secretary of State for Education, my hon. Friend the Member for Stratford-on-Avon (Nadhim Zahawi), is passionately supportive of our maintained nurseries and is working incredibly hard to persuade the Treasury to guarantee the transition funding that maintained nurseries desperately need.
The consequences of not making the most of the time for which a child is at school last a lifetime, and the pieces are picked up by many other Departments across Government. If schools are increasingly being looked at to prevent some of these problems from occurring, it seems only right that schools receive the resources necessary to do so. I hope that Ministers will use the support in this House for a 10-year, truly long-term plan to secure the best possible deal from the spending review. The logic is inescapable—if the NHS can have a 10-year plan, why cannot education too?
I hope that this will be the start of a different sort of planning for schools and colleges. If education really is to be a ladder of opportunity for everyone, so that people can get the education, skills and training to climb to the top and get the jobs, skills and prosperity that they and our country need, surely there should be proper strategic overview and a long-term plan to ensure that everyone has the tools and support necessary to climb that ladder.
It is a great pleasure to speak in this debate. One of the reasons I decided to go into politics was that I saw in our country that inequalities later in life stem from the fact that a child from a poor background is less likely to go on and do well in school than one from a richer background. I will reiterate some of the figures that the right hon. Member for Harlow (Robert Halfon) used about that. Some families in our country are able to spend more on school fees for their children per year than many people earn in salaries. I know that many Members speaking in this debate are motivated by the same thing—they want to improve education across the board, but particularly for children from deprived backgrounds. That is why I want to start with the point made powerfully by the Chairman of the Education Committee—we are lucky to have him—about FE funding, because it is often overlooked in these debates.
We talk about schools and we talk about early years, and I want to talk about those two things as well, but I want to start with FE funding. The Institute for Fiscal Studies recently produced a report saying that further education was the “biggest loser” in the cuts to education. I know that the Secretary of State is very passionate about learning from other countries, such as Germany, but if we are serious about putting our mainstream education and our vocational education on the same footing and valuing both equally, we really need to look again at further education funding.
The principal of the City of Wolverhampton College tells me about the funding pressures he is under, as are the other Black Country Colleges in Dudley and Walsall. We have some really fantastic colleges in our region, but we know that their funding has been frozen for far too long. National funding rates for 16 and 17-year-olds have stayed at £4,000 per pupil since 2014; they have not increased in line with inflation. For 18-year-olds, the rate has been frozen at £3,300 per pupil.
I say this because I think the Ministers sitting on the Treasury Bench know about the cost pressures. I served in a Committee on a statutory instrument with the Minister for Apprenticeships and Skills, where we talked about how we could make provision for colleges that find themselves in a position of insolvency. Well, that tells us everything, doesn’t it? We have not had that until now, but the Government have felt they had to make provision for it. I really think we need to think again about the funding for these colleges.
I know that many of my constituents feel they do not want to stay at school, but want to go to college and perhaps study a more vocational course, and Wolverhampton college has some fantastic vocational courses. However, even though there are cost pressures on schools—the Chair of the Public Accounts Committee, my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier), set those out very eloquently—they are nothing compared with the cost pressures on further education colleges. I am trying to strengthen the arm of Ministers, and I implore them to put more pressure on the Treasury and to make some different decisions about the amount of money going to these colleges.
My second point—I have in a way done this the wrong way around by starting off with the older category—is just to urge the Government for some clarity on the funding for maintained nursery schools. I have three maintained nursery schools in my constituency, and I am lucky that I have so many. They provide outstanding and good education, and they are a trailblazer for the rest of early years provision in my area. They can help children with special needs in a way that other early years provision is not able to do. I have seen at first hand some of the work they do with some of the most deprived children, and also with some of the children who have the most acute needs in my constituency.
It pains me to hear from those maintained nurseries that, because their teachers do not know what is going to happen beyond 2020, there is a real concern that some of the staff may well leave, as they have mortgages and things in their own lives they have to plan for. I really implore Ministers to hurry up with the assessment that I understand the Government are doing on the value for money of maintained nurseries. I can tell them that, in my own constituency, they are great value for money, and they will hear that from other Members across the House. Maintained nurseries need clarity, and they need it sooner rather than later. I hope that, at some point in the next few weeks or months, we will get that clarity.
My final point is about school funding. I am concerned about the real-terms cuts in school funding. I understand the Chair of the Education Committee when he says that we just argue to and fro, which I do not want to do, about figures and whether schools are really that badly off or not. I was very interested to hear his comparison with the NHS plan. I would certainly welcome a more long-term plan for schools in our country. Some primary schools in my constituency are telling me they are having to lay off teaching assistants and, in some cases, teachers because of pressures on their budgets.
I urge Ministers to look at this again, because unless we can provide a world-class education for our young children, we will not only fail to close the inequalities in our society; we will not thrive as a country because, as has already been said in this debate, this issue relates to productivity, to how we attract investment and to our overall prosperity.
I am delighted to have the opportunity to speak in this very important estimates debate.
I would like to start where the Chair of the Education Committee, my right hon. Friend the Member for Harlow (Robert Halfon), who made an excellent speech, finished. Every child in this country deserves a fair chance to get on the ladder of opportunity to the best of his or her abilities. While I warmly welcome the record funding that is going into education in this country at the moment, the problem is that, in some areas on the ground in our constituencies, it does not feel like that. I want to concentrate on those areas, particularly the funding of schools and further education colleges.
I welcome this debate and the increase in the departmental expenditure limit, up from £66.4 billion to £77.9 billion, although most of the increase is to cover the write-off of student loans. I also welcome the introduction of the new funding formula’s money for schools in April 2018, which should provide £4,800 per secondary pupil and £3,500 per primary pupil. The problem, as my right hon. and hon. Friends on the Front Bench know, is that the local authority distributes this money, which means that quite a number of schools in my constituency do not even receive that amount.
I am grateful to follow my friend the hon. Member for Hackney South and Shoreditch (Meg Hillier), who chairs the Public Accounts Committee, on which I serve as deputy Chair. Secondary schools in her constituency—I do not mean this in any personal or political way; her constituency just happens to be at the top of the league—receive on average £7,840 per pupil, which is a 64% increase on schools in my constituency. I ask my colleagues on the Front Bench whether that is really fair. In addition to that 64% increase, quite a lot of the schools in her constituency get the pupil premium money. One wonders, given the funding streams in this country, whether there is an element of double counting.
Of course school costs will be higher in a central London constituency, but even in Gloucestershire, costs such as the national teachers’ pay award increase in 2018, the apprenticeship levy imposition, additional HR costs, increased pension costs, higher levels of special needs and higher rural bus costs, all of which are imposed by Government, amount to about 6%. Therefore, if the Government increase their cash amount this year by 1%, it is effectively a 5% budget cut, which has to be met by efficiencies. Things have been pared down over a number of years.
Mr Will Morgan, the excellent head teacher of the excellent Cotswold School in Bourton-on-the-Water, recently wrote to me to say:
“Over recent years we have made many savings—class sizes, teacher contact time, TA support, service costs, reducing leadership, etc. Despite this, if finances continue as they are and we do nothing, we will be in deficit as a school at some point in the 2021-22 academic year.
One of our strategies to try to alleviate this ‘cliff edge’ is to ask parents to donate—for many, including myself, this goes against what we should be doing”.
That is what is happening on the ground. We need to fund our schools at a level at which they can operate properly.
When I have discussed this with various Schools Ministers in recent years, they have always told me that their Department was going to do some work on what it really costs to run a secondary school and a primary school. There are certainly inescapable costs: the teachers have to be paid, the buildings have to be maintained and kept warm, and there has to be an administration function. Let us find out what it really costs and ensure that no school anywhere in the country goes below that level. As others have said before, if we go below that level, schools have to make cuts, either in teachers or in curriculum subjects.
I congratulate the hon. Gentleman on his significant speech, and I concur with the point he has just made. In the London Borough of Lewisham, 71 of 73 schools are facing cuts, and are losing £8.8 million between 2015 and 2020.
I am grateful to the hon. Lady for that intervention. Nobody wants to see any schools having to make cuts; they want to see every school trying to attain outstanding Ofsted reports, to be able to educate all their children and pupils to the best possible standard according to their abilities.
I say to my colleagues on the Front Bench that I believe the maxim should be that similar schools with similar demographics, wherever they are in the UK, should receive similar funding. Unfortunately, I was unable to find an example in the time available. I ask my hon. Friends on the Treasury Bench how they intend to address that problem, and bring to their attention two other problems in the primary and secondary sector. Gloucestershire is a well-run local authority. At the moment, it does not run a deficit in its education funding, but a number of local education authorities do. However, we have two serious emerging problems in Gloucestershire, which I hope my hon. Friends on the Front Bench will listen to seriously.
The first relates to the higher needs block. In Gloucestershire, the higher needs block has increased by 40% over three years. We were incredibly grateful when the Minister announced an extra £1.3 million over two years. That will be helpful over the next two or three years, but we have to address the structural problem. We have to work out why it is that in Gloucestershire schools—I believe Gloucestershire is not alone—there is a very large increase in special needs. I am sure it is all to do with the education and healthcare plans. How they are granted and funded, in particular for out-of-county placements, place a very high burden on the budget.
The second point I would like to bring to the attention of my hon. Friends is the significant increase in the number of exclusions in some schools, so that they do not have to bear the costs and difficulty of dealing with difficult pupils. It does seem—I ask my hon. Friends to do some work on this—that certain schools have consistently higher exclusions than others. That must be to do with a school’s policy, rather than a policy that suits the individual pupil. That cannot be right. I would like to know what happens to those excluded pupils. Some return to school and that is good. Some are withdrawn from the register entirely and may be home educated, where they receive pretty scant attention from the state. Some will be educated excellently at home, but I suspect some will receive little education at home. Some will be looked after by social services. Sadly, some will end up in the criminal justice system. That cannot be right.
Finally, in the last minute available to me, I would like to talk about further education. The principal of Cirencester College, the only college to trial T-levels in Gloucestershire at the moment, contacted me the other day to say that rather than the £4,800 per pupil it would get in the national funding formula, he is receiving between £3,600 and £4,000 per pupil. That amount has been constant for five years, despite increased costs. He says he has had to reduce subjects, teachers and mental health services, and that the funding is half of what a university student receives. He says his funding for doing the same job should, in all fairness, be the same as if his pupils were receiving A-level education in sixth form. He has higher costs in a rural area and says rurality should be one of the factors in the formula. That would help schools in rural areas like his.
It is a pleasure to speak in this debate. I would like to put on the record my thanks to the Backbench Business Committee, the hon. Member for Hackney South and Shoreditch (Meg Hillier), who leads the Public Accounts Committee so well, and the National Audit Office. It is fair to say that I rely heavily on the reports the NAO produces and I think it does a wonderful job. I would also like to give a shout out to Botley Primary School—I am a governor—because it got the call from Ofsted yesterday and is in the thick of it. Given that the first thing I am going to talk about is Ofsted, it would be fair to wish the school good luck today. I know they will do us all very proud.
As governors, we focus heavily on school funding. In my local area, a school recently wrote to parents to ask for pencils and pens because it cannot afford them. Another school—I will not mention which one—is consulting, quietly and behind the scenes, on going down to a four-day week, because it cannot afford to keep its teachers at full-time level; if it did, it would have to start going into severe deficits. In the context of the estimates, what we want to know is this: if there are funding pressures, are they affecting outcomes? In the end, that is what it is about. Are they affecting outcomes? Are they driving value for money or not? What are the outcomes of the policy decisions themselves? Today is not about party political speeches, but looking at the evidence in front of us.
The Public Accounts Committee has been looking at a whole host of issues, including school accountability and governance. When, with the Department for Education, governors and parents, we have explored where the buck stops on school accountability, the picture is, unfortunately, quite muddled. No one can tell us empirically where the buck is meant to stop. The Department for Education says that it is up to the multi-academy trusts or local authorities, who say that it is down to the governors, who rely very heavily on Ofsted to be able to say whether or not these funding pressures are leading to lower or higher outcomes. In fact, I think Amanda Spielman slightly overstepped her initial remit—but quite rightly—in saying that there are definitely outcome failures in the FE sector as a result of the financial pressures that many Members have mentioned today. She said that we do not empirically know whether that is happening in schools or not, but our argument is that if we had the proper data, we could probably get a better idea of what is going on.
This is at a time when Ofsted’s own budget is under pressure. Its remit has expanded significantly since 2000, with successive Governments of all colours having asked it to do more and more. As well as schools, its remit now covers other sectors including children’s social care, early years and childcare, further education and skills providers. Meanwhile, its budget has had a decrease—a cut—of 40%. I will go on to talk about more things that I wish Ofsted would do, but the better question may be: what is our mechanism for school improvement and accountability? Is Ofsted the right provider to be able to do this? I know that the Department is consulting on the new Ofsted inspection framework, which we absolutely welcome, but as part of that, we need to carefully consider whether introducing even more into Ofsted’s budget is the right thing to do or whether it is time to have another body altogether.
Passing the buck is more than just a financial matter and more than just about data and numbers; it is also a matter for the community and its parents. One of the more striking sessions in the Public Accounts Committee was when we had campaigners from Whitehaven Academy, whose community shouted from the rooftops about the financial mismanagement and irregularities that were happening in that school. One of the questions that we asked was, “What does it take to get these things looked at?” It took two MPs of different parties, one of whom was forcibly removed from the premises when they visited the school. There was a “Panorama” investigation and we still do not fully know the outcome of what has happened in Whitehaven. This continues to drag on and my Twitter feed is full of parents who are shouting yet again from the rooftops, “Where does the buck stop?”
Meanwhile, we have the Durand Academy, whose school was transferred to the Dunraven Educational Trust. The first canaries in this case were back in 2014. The Public Accounts Committee had a hearing on this issue in January 2015 and in it identified a
“lack of clarity about who ultimately owned assets”,
governance arrangements that were “overly complex and opaque”, a
“lack of effective timely intervention by the”
Department for Education and the FSA, and that the
“lack of an appropriate fit and proper persons test”,
had allowed directors to run the trust who developed “inappropriate business interests”. How on earth did it take until August 2018 for the funding to finally be cut? It is extraordinary.
Our argument is that this is partly because we now have a muddled twin-track system of schooling, where there are local authority-maintained schools of the older style with this new academies system. It has really been only this year—the first time was last year, and now this year—that we have seen the accounts, so that we can properly assess how this system is working alongside the other. We know, for example, that it takes a certain amount of money to convert schools into academies. In fact, in 2017-18 the Department for Education spent £59 million on conversion and re-brokering, but what about the extra costs to local authorities in doing that? What about the hollowing out of local authorities’ ability to support maintained schools? That was an area that the Public Accounts Committee was concerned about. It is an example of cost-shunting by removing an aspect of the system in one part of schools. As far as kids are concerned, they do not care whether they are in academies, free schools or maintained schools.
In my constituency, schools are now almost completely responsible for funding support services. Currently, local schools are covering a shortfall of £2.3 million for higher needs schools. Does my hon. Friend agree that this represents a total failure of the Government to invest in the future of our children?
Indeed, we have heard about the higher needs block; that is yet another area where there is cost-shunting.
On the twin-track system, what we need to do is look beyond: is one system better than the other? Actually, we have a lot to learn from the sorts of innovations that we are seeing in schools, but I am not convinced from the evidence we have seen in the Public Accounts Committee that we have a handle on the data. In our recommendations to the Department we have asked it to look at, for example, different types of multi-academy trusts—is there a difference between those that are locally based and those that are spread out or between the rural and the urban? Is there a north-south divide when it comes to academy trusts? What can we learn from the data? At the moment, when the accounts are produced, we do not have that data.
I very much echo what the right hon. Member for Harlow (Robert Halfon) was saying earlier. I firmly believe that this is not just a question of more money for schools. More money is welcome to get them working as they hope to now, but the issue is also about driving efficiency and spreading best practice. Without the data, how will we know what is working best?
Order. I gently remind colleagues that if they are going to intervene, it is important that they should have been in the Chamber for the whole speech and a little bit of the debate as well.
Some years before I came to this place, I chaired something called the Grant Maintained Schools Advisory Committee. For many years, we fought for a national funding formula. We failed because the civil servants kept saying that there would always be winners and losers—well, there are winners and losers now.
When the Minister for School Standards, my right hon. Friend the Member for Bognor Regis and Littlehampton (Nick Gibb), came up with a proposed national funding formula a few years ago, I was really excited because I thought that we were going to crack the nut. When he came up with the proposal, most of my schools were going to be winners; now, they are all—or nearly all—losers. We are not doing well in my area. I am really disappointed that the national funding formula really has not benefited my area at all. There are two local authorities: a unitary one in Derby city, and Derbyshire County Council. There is very little difference between the two.
Schools are already benefiting from more money: many schools that have been historically underfunded will attract up to 6% more per pupil compared with 2017-18. The Minister for School Standards said on 24 July last year:
“The formula allocates every local authority more money for every pupil, in every school, in both 2018-19 and 2019-20, compared to their 2017-18 baselines.”—[Official Report, 24 July 2018; Vol. 645, c. 67WS.]
As my right hon. Friend stated, more money than ever before is going to our schools. School funding is at a record high. The core schools budget has increased to £42.4 billion this academic year and is set to rise to £43.5 billion in 2019-20, and that follows the additional £1.3 billion of funding over and above what was promised in the last spending review.
That all sounds really good, and it is good news for Mid Derbyshire in terms of the school block allocation, which has seen a 2.9% increase since 2013. But that is against a backdrop of an average 4.6% increase in the east midlands region; across the UK, there has been a 4.8% increase. Although, the increase is positive, it is disappointing that the increase in Mid Derbyshire is not as significant as in the region as a whole and in England. The lowest allocation for a primary school in my area is £3,300 per pupil; the highest is £5,351. The schools are not markedly different. They do not have a particularly different intake, do not attract a huge pupil premium or need huge special needs provision. I cannot understand why there is such a disparity. The disparity in secondary education is not so marked: the lowest allocation is £4,629 and the highest £4,801.
Since 2013, 22 out of 29 of my primary schools have seen a decrease in funding. Little Eaton Primary School, which is near where I live, has lost £37 per pupil. Morley Primary School has lost £324. Ashbrook Infant and Nursery School has lost £162. Ashbrook Junior School has lost £14. Duffield Meadows Primary School has lost £25. Belper Long Row Primary School has lost £149. Pottery Primary School has lost £7, which is not so bad. Milford Community Primary School has lost £925. Herbert Strutt Primary School has lost £180. Breadsall Church of England VC Primary School has lost £245. St Andrew’s Church of England Primary in Stanley has lost £477. St Elizabeth’s Catholic Primary School has lost £16. William Gilbert Endowed Church of England Primary School has lost £45. Redhill Primary School has lost £105. Portway Infant School has lost £70, and the junior school has lost £146. Asterdale Primary School has lost £648. Springfield Primary School has lost £531. St Werburgh’s Church of England VA Primary School has lost £179. Lawn Primary School has lost £3, which is also not too bad. Borrow Wood Primary School has lost £185. The only secondary school to lose funding is Allestree Woodlands School, which, although it is not in a very different catchment area from the other three secondary schools, has lost £87 per pupil. The others have gained by £50-plus.
Little Eaton Primary School—which, as I have said, is near where I live—is receiving £3,542 per pupil, while in 2013 it was receiving £3,579 and in 2015 the figure rose to £3,730, its highest point, but it has still lost money. I do not understand why there are such disparities in funding, given the national funding formula, given that these are very similar schools with very similar catchment areas and very similar results, with no huge number of pupils with special needs—there are some, but it is a fairly average number—and without a huge amount of deprivation.
I urge the Secretary of State and his Ministers to think again. I do not like being negative, because the Government have done some amazing things for education and I applaud them for everything that they have done, but in this instance, in my constituency, I think that they have gone wrong.
Order. There are still a number of Members who wish to speak, so after the next speaker I will reduce the limit to six minutes.
I congratulate the hon. Member for Mid Derbyshire (Mrs Latham) on a very evidence-based, thought-provoking and powerful speech. The tone of today’s debate has, in fact, been sombre and evidence-based. There is a strong message for Ministers: this is the reality of cuts. We can bandy numbers and arguments across the Dispatch Box all we like, but this is the reality that schools are facing. There are facts, there are figures and there are numbers, and they represent the reality of people’s lives and the reality of the cuts in our constituencies.
The debate is timely for me, because a number of parents have come to my surgeries and expressed great concern about school cuts, and a large number of head teachers and governors have come to me in groups to tell me about the distress that they feel because they cannot continue to deliver the standard of education that they have been used to delivering, and that our children need.
I commend the primary schools in Redcar and Cleveland, which are among the best in the country. I particularly congratulate St Bede’s Catholic Primary School in Marske—and all the parents, staff and children on being named by The Times as the best state primary school in the country. That is a phenomenal achievement, but all the schools in my area, particularly the primaries, are finding it increasingly difficult to deliver the standard that children need against a backdrop of cuts. According to the School Cuts website, Redcar and Cleveland’s budget will have been reduced by £4.3 million in real terms between 2015 and 2020. That is a per-pupil loss of £226.
I hear grumbling about the statistics from the Government Front Bench. Let me set out the reality of what this means to our schools. Teachers and heads in my constituency are going above and beyond to try to ensure that the children are not affected by the scale of the cuts. It epitomises the quality, care and passion of our staff that they are willing to do these things to try to make sure the cuts are absorbed and the children are not affected. In one school a member of staff has suggested that staff should be regraded for one day a week—graded down from their actual worth, value and achievement—to make savings in staffing costs. Two staff members who are eligible to apply to go through the pay threshold suggested they would not apply to do so because they did not want the school budget to increase.
Support staff have had their hours cut by an average of five hours per week. That might not sound like a huge cut, but these support staff have on average contracts of only 15 hours a week so they are losing a third of their week’s pay. Local churches have been donating money from their charities to help fund curriculum budgets—not little extras but curriculum budgets, an area in which schools have had to make large cuts.
Teachers tell us about the voluntary help they receive in the classroom—people giving up their time free of charge. Without that voluntary work they would not be able to deliver the best teaching practice and would therefore be failing our children. We are reliant on the voluntary sector; I do not think this is what David Cameron’s big society was supposed to be doing—replacing and enabling the fundamental education of our children in schools.
Governors have told me they are concerned that next year things will be even worse as they will have to find extra resources to fund additional pension payments and in all likelihood that will lead to reductions in teaching staff. I was also struck to the core as I was leaving one of the meetings when I was told that one of the headteachers in my area had to make a member of the cleaning staff redundant to meet the budget that year, but was very upset about it and realised that this just was not practical, safe and hygienic, and he is now paying that member of the cleaning staff from his own salary. That is a ridiculous situation for us to be in in this country, and it is clear that the cuts are to the bone now and schools cannot continue to provide the kind of service they want to offer.
I also want to briefly talk in the time allocated to me about SEND—special educational needs and disability—education as there has been a huge increase in demand for that in my local area and there is real and deep concern. Nationally, demand for services for children and young people with SEND has increased by 35% in just the last four years; that is a huge increase but there has not been the budget to cover it. We are seeing now the reality of that in our constituencies, affecting our children. A recent Local Government Association survey of local authorities found that councils fund support for nearly 320,000 children with complex needs and disabilities but are facing a funding gap of almost £500 million. That gap has been plugged by taking funding from elsewhere in schools, as we have heard, and by drawing down reserves.
The National Association of Head Teachers has published the results of a survey on SEND showing that only 2% of respondents said the top-up funding they received was sufficient to meet individual education, health and care plan statements, while 94% of respondents were finding it harder to resource the support required to meet the needs of pupils with SEND, and 73% said it was harder to resource support for pupils with SEND due to cuts to mainstream funding. This is the reality of what we are seeing: vulnerable children who need the most help and support to enable them to flourish and fulfil their potential are those most let down by these cuts. That is balancing the books on the backs of the children who need the most help and support to flourish.
I also want to briefly mention children’s services because, as my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier) mentioned, wider cuts are having a knock-on effect as well. Pressure is building right across education and children’s services. In Redcar and Cleveland our children’s services have a £4.2 million overspend. The number of looked-after children is almost double what it was five years ago, and that is alongside the cuts of £90 million that Redcar and Cleveland has seen to its budget, which means it now has a £4.2 million overspend.
Ofsted’s 2017-18 annual report commented on a sharp increase in recent years in demand for assessments to be carried out, as well as a growing number of refusals by local authorities to do so, and raised concerns about increasing numbers of children awaiting provision despite having a plan in place. In 2018, 2,000 children with a statement were awaiting provision, almost three times more than in 2010.
The tone of today’s debate has been positive, constructive and thoughtful. We all want the same end; we all want our children to have the best start in life, to flourish and to have everything they need from their years in school, but the reality is this cannot happen without funding and the reality is that the funding formulas we have are not working. The support is not there; our schools are being cut to the bone and I urge the Government to do more to make sure every child can fulfil their potential.
I congratulate the Chair of the Public Accounts Committee, the hon. Member for Hackney South and Shoreditch (Meg Hillier), on bringing forward this report. It is good that we have recently had more debating time on things to do with children in schools. We have another debate on schools funding on Monday, and we recently spoke about maintained nursery education and the false economy of not continuing to fund it sustainably. Yesterday, we had the announcement on sex and relationship education. All these things add to the pressures and costs on schools, and I am afraid that the budgets for schools just do not go up commensurately to make them possible. We have had an intelligent debate so far. It has concentrated almost exclusively on schools, but it is a little-known fact that children’s social care is an important part of the Department for Education, which comes within the scope of today’s debate, so I want to raise a few issues on this.
One of the challenges is that, while this is a policy responsibility for the Department for Education, the funding goes through the Ministry of Housing, Communities and Local Government and directly to local authorities. This is one of the instances in which the Government need to work together and not succumb to cost-shunting, where cuts in one area can have an impact on children’s achievement elsewhere.
The hon. Lady is absolutely right, and it is of course the local authorities that get the blame for not delivering the goods, even though we have not been giving them the money to do so in certain cases. There are also huge differentials in the way in which those local authorities use their money.
On children’s social care, I would like to hear more about sufficiency funding, which the Chair of the Education Committee, my right hon. Friend the Member for Harlow (Robert Halfon), mentioned, and also about a 10-year plan. Children’s most important years are the ones before they go to school—those years will shape their careers in school and beyond more than anything else—so, for goodness’ sake, if we cannot have a 10-year plan for the social care needs of our children as they grow up, what can we have one for?
I am not going to have time to talk about schools today—I shall have to reserve those comments for the debate on Monday—but I just want to make the point that all the ongoing cost pressures on schools are going to be compounded by the recent directive from the Department for Education that was sent to schools on 6 February recommending a 2% pay rise for teachers this year. That is fine, but the Department’s report stated that
“a pay increase for teachers of 2%, in line with forecast inflation, is affordable within the overall funding available to schools for 2019 to 2020, without placing further pressure on school budgets.”
I am afraid that that is just not the case. School budgets are under huge pressure, certainly in my constituency and elsewhere in West Sussex, where we have been at the bottom of the pile for funding for many years. The cumulative effect of that underfunding means that there is no fat left to cut. All the savings have been made, so even a 2% increase in teachers’ pay, if it is to be paid for by the schools, will have enormous impacts on those school budgets’ ability to provide all the other services, which I will go into in detail in the debate on Monday.
On children’s services, a report commissioned by Action for Children, the National Children’s Bureau, the National Society for the Prevention of Cruelty to Children, the Children’s Society and Barnardo’s has come out today, and it confirms what we all know about the huge shortfall in funding for children’s social care. That shortfall was also identified in the work that the all-party parliamentary group on children did in the report “Storing Up Trouble” that we produced last year. It is estimated that there will be a £3 billion funding gap by 2025. One of the alarming observations in today’s report is that spending on early intervention services for children and young people fell from £3.7 billion to £1.9 billion between 2010-11 and 2017-18. That is a 49% decrease in spending on early intervention. At the same time, local authority spending on late intervention services for children and young people has risen from £5.9 billion to £6.7 billion—a 12% increase.
This is not rocket science. If we do not spend early to prevent the problems from happening to these children, we will pay for it later. We will pay for it socially—most importantly—and also financially. It is such a false economy not to do more in those early years around perinatal mental health, around child neglect and around making children ready for school, for growing up and for society generally. Some of the biggest falls in spending have been in some of the most deprived authorities in the country, where the impact can be greater because the other support services, including family support services, are not available to help those children.
I have been in this House for eight and a half years. When I retired as deputy leader of Gateshead Council, it had an annual revenue account of £310 million, but now, eight and a half years later, it is down to £200 million despite the huge growth needs built into the system in Gateshead.
Well, I have been here for 22 years, and I have also seen a thing or two.
When I was a Minister at the Department for Education, we came up with the early intervention budget because it was the right thing to do on so many fronts. It alarms me that early intervention is seen as a luxury add-on rather than an essential part of everything that we should be doing for our children, and we should be planning for it over the long term. That is why, for all the reasons I have set out, I am pleased to see—I know that the Minister for Children supports this work—the inter-ministerial working party led by the Leader of the House trying to co-ordinate early-years activities across Government.
Turning to schools, the big figures that we talk about in these reports—the big percentage increases—are meaningless until we translate them into their impact on the frontline. I have spent the past couple of years getting all the heads from all the schools in my constituency and all the chairs of governors together to ask them about the impact of funding challenges on their schools. I asked not what might happen, but what is happening now. I wrote a seven-page letter to the Secretary of State for Education with the findings from all those schools, which included impacts as a result of not replacing staff or replacing them with less expensive and therefore less qualified staff, of having to remove things from the curriculum, and of doing away with out-of-school visits. Alarmingly, counselling services have also been reduced—almost to zero in some cases—at a time when we all know the effect of mental health stresses on the younger generation. The Government have recognised that, and work is ongoing, but if people are not on hand in schools to help with the stresses and strains that lead to mental health problems, that will just store up expensive problems, both financially and socially, for children in those schools.
We have been generous and have planned for the long term in the national health service, and it is essential not to neglect early long-term planning in a preventive way for our babies, toddlers, children and young people. It is a complete false economy not to be doing that. While I appreciate the additional money that the Government have been putting in, I am afraid that the estimates that we are looking at today, when they are factored down to the impact that they will have in authorities such as mine in West Sussex, which has had severe underfunding for so many years, will have a detrimental effect on the life chances of our children. Frankly, we have to do better, or we will be picking up a much more expensive and complicated bill further down the line.
I am proud to have supported the request for today’s debate that was co-ordinated by my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier), the right hon. Member for Harlow (Robert Halfon) and the hon. Member for Oxford West and Abingdon (Layla Moran).
A report published last week by the Resolution Foundation predicted that the proportion of children in relative poverty could hit 37% by 2023. Low pay and cuts to welfare have hit and will continue to hit disadvantaged families the hardest, and I know all about that as a former headteacher of a school with a Sure Start centre on site. Not only does poverty affect a child’s experiences, but it is significant in determining their life chances. In education, the attainment gap between the most disadvantaged children and their peers is visible by the age of five, and it continues on throughout their childhood, potentially leading to poorer qualifications and difficulties in employment later in life.
As stated in the Education Committee’s report on life chances, the Government’s strategy on early years lacks direction. If the number of children in poverty is rising, the early-years workforce needs to be equipped with the support and resources to be the first line of defence in improving children’s life chances and to work on early intervention, as mentioned by the hon. Member for East Worthing and Shoreham (Tim Loughton). What is the Department doing to anticipate those challenges, rather than responding in the midst of a crisis when it is much harder and more costly to fix? In addition, funding pressures on local authorities and services have led to reduced support for children and families. Too often, schools take on the burden of providing that support.
As a former teacher and headteacher, I understand their drive to do whatever they can to help their pupils, but I also see the pressure that schools and teachers are already under from heavy workloads and funding cuts. Some 95% of schools in my Colne Valley constituency are facing a shortfall compared with funding levels in 2015-16, and 67% of schools in my constituency have lost over £150 per pupil—seven are losing over £400 per pupil. Just think what could be done for each individual child with that money.
My constituency has had a cumulative shortfall of over £5.5 million since 2015, while pupil numbers have risen by more than 800. At my last meeting with Colne Valley headteachers, they told me that the situation has led to cuts in staffing, resources and provision overall. They also talked about the difficulties in SEND provision due to a lack of child and adolescent mental health services and a lack of funding for the delivery of education, health and care plans.
Those headteachers said that their teachers are suffering from stress due to not being able to provide children with the support that their experience and professional awareness tell them is necessary. Let us listen to the professionals. Mounting workloads, rising class sizes and an ever-growing list of responsibilities have pushed classroom teachers to work a 60-hour week. All of that hard work is rewarded by stagnating wages.
It is therefore no surprise that teachers young and old, the recently qualified and those with years of experience, are leaving the profession. The number of teachers leaving exceeded the number joining in 2017, which shows just how serious this crisis is. I welcome the Government’s intentions in their recruitment and retention strategy, but committing £130 million for the delivery of the early career framework in 2021, alongside other smaller measures, is not enough to tackle the root causes that are draining morale in the profession.
If the starting pay for teachers remains low compared with other graduate professions, dedicated and passionate potential trainees may choose other careers. If qualified teachers do not have the resources to fully deliver lesson plans, or to offer extra support to those who need it, they are still going to experience frustration. If responsibilities for safeguarding and mental health, and so on, continue to be piled on to teachers, their workloads will not go down. What consideration are the Government giving to these wider, more fundamental issues in the education system that, if addressed, could deliver long-term benefits for both recruitment and retention?
All of us in this House want the best for the children in our schools. We want them to experience the joy of learning, to develop the skills to succeed in life as well as employment and, ultimately, to live a fulfilled and productive life. But if the Department does not prepare for rising levels of need or for rising numbers, if it does not address the root causes of stress and pressure for teachers, and if it does not give schools the tools to support both learners and educators, we will not be able to achieve those goals.
Unless education is fully funded, I can see children’s rights to a free education and to different forms of education being eroded, and I urge the Department to reflect on today’s debate and to use it as an opportunity to take radical action.
It is a pleasure to follow the hon. Member for Colne Valley (Thelma Walker), who speaks with a huge amount of authority on this issue. I congratulate the hon. Member for Hackney South and Shoreditch (Meg Hillier) on securing this debate, and it was a pleasure to support her application.
I should declare an interest, albeit not a pecuniary interest. My wife is a primary schoolteacher, and as comfy as the sofa is, I prefer the bed. I also have a seven-year-old in a local primary school and a young daughter who will start primary school next year, so I suppose that I have a vested interest.
Like many of my constituents, as a parent I completely understand the importance of education. When I speak to constituents, education is often their second largest priority—second only to our NHS. As a Conservative, I completely support equality of opportunity, which stems from education. Education is at the very heart of it. To that end, I am delighted that 1.9 million more children than in 2010 are being taught in good and outstanding schools—this has increased from 66% to 84%.
This is a debate in anticipation of the Government’s spending review, and although it is not only about money, money is inevitably an important factor. Let me start with the bits that I very much support and welcome. I welcome the introduction of the national funding formula, which is supported by a not insignificant £1.3 billion across 2018-19 and 2019-20. I welcome the fact that the Government protected the schools budget up to 2016, when other Departments faced cuts in the early coalition years. I welcome the fact that the core school funding budget will rise from £41 billion in 2017-18 to £42 billion this year and £43.5 billion in 2019-20.
One of the most enjoyable parts of being an MP is attending assemblies, which I do regularly on Friday mornings, and listening to not only teachers and headteachers but parents, governors and, indeed, pupils, to hear what they think and how they talk about our role here and how it impacts on them. I suppose this is a good juncture to pay tribute to all the teachers and the amazing schools we have in Colchester. Having met those teachers, headteachers, governors and parents, I find that we are asking our schools to do more than ever before and that is putting unbelievable pressure on teachers—I see that at home, but I also understand it from having spoken to teachers from across the schools in the constituency.
Schools are facing unprecedented cost pressures, and I wish to touch on a few of them because the context of the pressures schools are under is important when we talk about additional funding in education budgets. These cost pressures include providing support and intervention for children with specific learning difficulties; mental health issues; employer pension contributions; the national living wage; academies and multi-academy trusts potentially having less bargaining power than local authorities used to in terms of economies of scale; the costs that came with the general data protection rule; the rising cost of utilities; the apprenticeship levy; the growing cost of appeals; the costs of changing to multi-academy trusts; staff development; staff recruitment; and of course the teachers’ pay award. I have just touched on a few of the many rising cost pressures on schools.
In the short time available, I wish to touch on further education, which I genuinely believe is verging on crisis. For 16 and 17-year-olds, funding has been frozen at £4,000 per student since 2013, and for 18-year-olds, it has been frozen at £3,300 since 2014. As I just mentioned, colleges and sixth forms are not immune to all those different cost rises and more, and the Government have imposed a range of new requirements. Costs have risen sharply and the budget has not risen to reflect that. That is not good for students; it is damaging our international competitiveness; and it harms social mobility.
The Secretary of State is no longer in his place, but the Minister for Apprenticeships and Skills is. They will know, because I have lobbied them both on this issue on numerous occasions, that I believe that schools have already maximised the efficiency savings that were available to them. A toolkit was helpfully provided by the Department, and schools have used it and gone even further. I genuinely believe that there is no more fat left to trim, and I do not want our headteachers focusing on how they can further squeeze their budgets; I want them focusing on educational attainment and improving outcomes for students in all our schools.
So I do have some asks. I know the Minister has heard them before, but I do not apologise for repeating them. We do need an increase in the revenue budget and in the high-needs budget. The rate for 16 to 19-year-old pupils must increase. The national funding formula needs to be rolled out and implemented in full as soon as possible. Funding settlements should be for a minimum of three years. We cannot expect schools to produce three-year budgets but not give them that certainty and consistency in their funding. We have to increase the capital budget for our schools.
Does my hon. Friend think it odd that the NHS has a budget for 10 years, local government has a budget for three years and yet schools have a budget for only one year?
I thank my hon. Friend for that intervention. He reads my mind, because I was just about to say that we need a long-term plan for education and schools, in the same way that we have one for our NHS. This is absolutely the right thing to do, because teachers and headteachers need that certainty and consistency. We also need to ensure that mental and physical health services are adequately resourced.
I genuinely believe that we are on the precipice. The vast majority of any school budget—anywhere between 80% and 90%—is spent on people. They are the asset in our education system. If there is no more fat to trim, the only place left to go is to reduce staff, and that will have a detrimental impact on pupils’ attainment and, indeed, outcomes across the board. There are already schools in Colchester that are letting support staff go and not filling vacancies. My fear is that if that continues, we will start to see a decline in results.
I wholeheartedly believe that education is at the heart of equality of opportunity. I believe in social mobility, and education is its key enabler. Education is an investment in our people. I will continue to lobby for additional funding for education and ask that the education budget is increased in all the areas I have mentioned ahead of the next spending review.
It is a pleasure to follow the hon. Member for Colchester (Will Quince).
The West of England combined authority, which includes my Bristol South constituency, is one of the areas currently producing a local industrial strategy in a bid to help to boost productivity. Early analysis of the evidence base for the strategy has shown gaps in educational and training provision compared with future business needs and that the job market does not work well for all residents, particularly those with low or no formal qualifications. The attainment gap is larger in the west of England than nationally, with 16 to 17-year-olds more likely not to be in education, employment or training, and there is significant inequality across the geographical area. These inequalities in education need to be addressed to improve future productivity. The local industrial strategy will be successful only if it is inclusive and supports opportunities, but how will that be achieved? I will confine my remarks to the policy areas that I think are critical to reducing inequality and improving social mobility: early years, further education and apprenticeships.
The hon. Member for East Worthing and Shoreham (Tim Loughton) gave a good summary of the need to support early years education. The evidence base is strongly in favour of high-quality education between birth and the age of five, as has been well established for a number of years. I am a former governor of one of Bristol’s many nursery school and children’s centre settings that has education, not social work or childcare, as its core purpose. As a former member of the Public Accounts Committee, I remember when we looked into the entitlement to free early years education. We saw strong evidence for the sector but recognised that it was not stable and that local authorities needed more support. Local authorities and, indeed, the Department for Education had no real mechanism for identifying what was happening in the sector or whether it was being managed well.
The Education Committee and the Treasury Committee are looking into the provision of the additional childcare element, but we need somehow to get the Government to look across Departments and join up the policy objectives and the money so that we can be clear about what is wanted from the sector. I recently met some of my local headteachers, some of whom have been teaching for 30 years, and they have never seen so much of their workload given over to picking up the crises families are going through. The question for the Department is what is its early years policy objective and how is it going to get grips with it and with the local government cuts that are having such an effect, particularly on the maintained sector.
Several colleagues have spoken about further education, which is absolutely the other key driver of social mobility. It offers everyone a second chance and the opportunity of lifelong learning that the economy and individuals need. The funding cuts to post-16 education have been really quite severe, particularly since 2010. FE funding has been the hardest hit since that peak, resulting in closures, job losses and, critically, cuts to the student numbers that are needed so much. The post-16 transition time is vital. We really need to get to the point where we consider that point as important as the transition into school and the transition from primary into secondary education. The cuts to further education are a barrier to that happening, so I absolutely support the call to increase the funding rates for 16 to 18-year-olds.
I support the letter of the chief inspector of schools to the Public Accounts Committee in which she, too, supported the increase in the base and a welcome look at the accountability across the different bodies that are involved in further education to try to improve their performance, to improve what they are trying to do and to share information.
The Public Accounts Committee also looked at the sustainability of the sector. The area reviews are coming to an end, and I do hope that the Committee will look again at what is happening in this sector. We have seen some good leadership in this sector with regard to financial sustainability, but, again, I ask the question: what does the Department want to achieve for its money in further education? I worry about whether the sector has been made financially sustainable and what on earth are we left with in terms of the teaching in some of those settings to help on that productivity and skills gap, which is so crucial.
When the right hon. Member for Harlow (Robert Halfon) was a Minister, he came to Bristol South, looking at the importance of a good further education provider in a constituency such as mine, which has many similarities to Harlow in terms of supporting young people into those better opportunities.
I support part of what the Government are trying to do with apprenticeships, because of the post-16 situation in my constituency. Since becoming an MP, I have championed apprenticeships as a route, or a ladder, to greater opportunities. I am about to hold my third apprenticeships and jobs fair on Thursday. This year, I have managed to work with the council and the Department for Work and Pensions to cohere the work that is being done in my constituency around the people of Bristol South. I hope that the fair is again a great success. Again, we are not seeing the apprenticeship policy really doing what it needs to do to improve life chances.
In conclusion, we have a good overview on this matter. Again, I thank the National Audit Office for its briefing—I went to one this morning. We know what the Department is spending its money on, but we are not really clear about its objectives and about how it is achieving better outcomes for young people. We are also clear that we have a skills gap, a productivity problem and a population who are desperate to fill those jobs, which can give them better life chances. The Department’s vision is to prioritise support particularly for disadvantaged people in disadvantaged areas, but, I am afraid, that it is not working in my constituency. I am keen to work with the Government to make sure that it improves.
I welcome today’s debate. Already, we have heard a whole range of broad themes around education, including, importantly, how we can support and improve the life chances of our young people. It is pretty obvious that the Department has a wide range of responsibilities to secure the delivery of high quality education that meets the needs of our young people and our country. It is right that, over the years, we have seen a focus on rigour in the system and, importantly, that we have ensured that our children and young people are supported and that they get the right kind of care, skill and support to enhance their opportunities and their life chances.
I welcome the fact that, since 2010, there are now 1.9 million more pupils being taught in schools that are rated “good” and “outstanding” by Ofsted. That represents about 86% of all pupils. The fact is, however, no Government, and no Government policy on education, can ever stand still. As we have already heard from friends and colleagues—hon. and right hon. Members—as part of the comprehensive spending review it is important that the Government consider how schools, education providers and local authorities are funded for the services that they provide.
We have also heard about care today—care for young people. Care is provided not just by our schools, but through local authorities. It is a fact that many of our local authorities are strapped for cash and challenged with many other pressures. Education stands at the foundations of our country, and it is, of course, where our next generation comes from in terms not just of our labour market, but of our citizens. It is our duty to equip them with the right kind of skills and to ensure that they have every opportunity when it comes to making a success of their future.
Like many Members, I have many excellent examples in my constituency of outstanding leaders, teachers, education providers, schools and academies. All of them are pioneering and innovating. In the Witham constituency, we have the remarkable Connected Learning Multi-Academy Trust. It is headed up by a remarkable former head teacher called Mrs Jane Bass. The success of that trust is quite phenomenal in the way in which it has turned around failing schools that were within the local authority’s remit. It has done that through demonstrating leadership and providing resource, sometimes with disagreements with the local authority on funding. We have all had to fight alongside our headteachers and our schools to really make sure that they can bring in the resources. Many hon. Members have highlighted what academy conversion does to enhance schools’ financial resources too. School improvement plans also play an important role in turning around many schools that are not performing. That, again, is where resources are needed.
I want to touch on a couple of issues with academies and academy trusts. My right hon. Friend the Minister for School Standards and, I think, everybody in the Department is fully aware of the Academies Enterprise Trust and the historical issues that have been associated with it. I urge Ministers never to take their eye off the ball with regard to governance. The governing structures of some these rather big multi-academy trusts—in the case of the AET, one of the fastest growing trusts in the country—did not have the necessary oversight and accountability, and that then led to problems with school exclusions and other wider issues. That is only one of the trusts covering not just my constituency but neighbouring areas too.
Many parts of our communities and constituencies are experiencing considerable population growth. We are now looking at new developments in Witham town and in areas such as Stanway that come under the Colchester borough where we are seeing new investment in schools, which is the right thing to do.
Only a week ago, we were speaking in Westminster Hall about another issue that has been raised today—financial support for children with special education needs. I do not want to go over many of the points that have been covered already. The governance reforms are welcome, as is the new 2015 SEND code of practice, which is vital. At the same time, however, the introduction of the education, health and care plans is leading to a much greater increase in demand, complexity in particular cases, and, unsurprisingly, pressures on local government and authority funding. Essex County Council has experienced exactly this. Yes, there has been more resource from the Government centrally, and in Essex that equates to over £3 million a year for the county council, but we still have pressures. For example, issues around the transfer of the block grant for schools from the county council are causing tensions locally.
There are many other issues around skills, apprenticeships and support for young people, but for the purposes of this debate we should say that we pride ourselves, as a country and a nation, on our education system. It is absolutely right that we all collectively work together to do more to provide the aspiration, hope and opportunity that will support the life chances of young people in our country.
Order. In order to be able to get everybody in, I am going to have to cut the time limit to five minutes.
I thank the hon. Member for Hackney South and Shoreditch (Meg Hillier) for bringing forward this incredibly important debate. I want to emphasise and add my voice to the concerns that many Members on both sides of the House have raised about the financial pressures facing so many of our schools.
The reason I wanted to take part in this debate is that schools in my constituency are literally at desperation point—and we know why. Mainstream schools have seen their general budgets savaged by 8% real-terms cuts since 2010. So when Ministers say that they are spending more, we know that that is not true, per pupil in real terms. In fact, it is a thinly veiled attempt to gloss over very real, serious and damaging cuts. That is demonstrated by the stark results of a recent survey of approximately 2,000 headteachers. One of the questions put to them was, “Do you trust what the Department for Education says about overall school budgets and the financial situation of your school?” Shockingly, fewer than 1% gave the answer, “I trust what the DFE says about school budgets.” Ministers cannot ignore that, or the other shocking results such as 80% reporting that teachers in their schools were contributing their own money to buy resources for their pupils to use. In addition, 86% said that recruitment and retention of teachers is getting harder, and 87% disagreed with the statement, “Any additional revenue or cash received in the financial year 2018-19 has been greater than additional costs in the same period.”
All that evidence and those abstract figures are borne out by the reality in our schools up and down the country. Headteachers in Brighton are writing to me in desperate terms. They face sleepless nights because of the impact of the funding crisis on their ability to support pupils, particularly those with complex needs. Schools have to manage delayed education, health and care plans, as well as crippling pressures on local authority budgets. The LGA has identified a potential £1.6 billion deficit for special needs education, and yet the Government have responded with an inadequate £350 million. Head- teachers say that that is too little too late and does not even cover local authority high needs shortfalls, which simply exacerbate the problems with mainstream SEND.
For example, teachers in my constituency say that the very successful Every Child a Reader scheme for SEND children can no longer be funded because their schools simply do not have the money. I have had so many letters saying that schools are having to drop crucial counsellor services and so on. There is real concern. I am grateful that the Secretary of State has said that he will meet a delegation from Brighton to discuss this issue, but it goes right across the country.
In the short time I have, I want to say a few words about sixth-form funding. There are so many areas of concern in education funding, but the pressures on post-16 funding are huge. I have two fantastic sixth-form colleges in my constituency—Brighton Hove and Sussex Sixth-form College, or BHASVIC, and Varndean—and an amazing FE college, the MET. They all feel massively under pressure because they do not have enough funding. Those concerns are, again, backed up by the statistics. London Economics found that in real terms, sixth-form colleges received £1,380 less per student in 2016-17 than in 2010-11. That is a 22% decline in funding. The IFS was also clear, saying that funding per student aged 16 to 18 has seen the “biggest squeeze” at all stages of education for young people in recent years.
At the same time, costs have risen. Students’ needs have become more complex, and the Government are asking more of schools and colleges. The purchasing power of sixth-form funding has been greatly diminished as a result. A recent funding impact survey by the Sixth Form Colleges Association makes shocking reading. It found that 50% of schools and colleges have dropped courses in modern foreign languages as a result of funding pressures; 34% have dropped STEM courses; a huge 67% have reduced student support services or extracurricular activities, with significant cuts to mental health support, employability skills and careers advice; and 77% are teaching students in larger class sizes.
The only way to address the funding crisis in 16-to-18 education is to raise the rate paid per student. Sixth-forms can respond to the Treasury’s “something for something” mantra. An increase to the funding rate of at least £760 per student would have specific outcomes. It is the amount needed to provide student support services at the required level, to protect subjects at risk of being dropped, such as modern foreign languages, and to increase vital extracurricular activities such as work experience and university visits. I will conclude by echoing what others have said: these cuts are hugely counter- productive because they mount up and will mean bigger cuts in the future.
It is a great pleasure to be the tail-end Charlie in this high-quality debate and to follow the hon. Member for Brighton, Pavilion (Caroline Lucas).
I should declare an interest: I come from a family of teachers. In fact, my elder son is now a teacher too. What comes with that is a commitment to not only visiting schools but engaging with them, as well as with our further education college—the outstanding Gloucestershire College—and the University of Gloucestershire. I also ought to refer to the newest university in the country, Hartpury University, in the constituency of my neighbour, my right hon. Friend the Member for Forest of Dean (Mr Harper). They all have masses to offer lots of people with skills and interests in various sectors.
This debate focuses on estimates and therefore inevitably on money. However, it is encouraging that the debate has been about not only what an Opposition spokesman in an earlier debate called “growing the cake” but improving the cake. How do we get the outcomes that are obviously affected by the input of money but where the relationship is not absolute? What really makes the difference?
I ask myself that a lot because in my constituency we have outstanding primary schools in areas that would be considered economically deprived, such as Tredworth, Coney Hill, Robinswood and Finlay Community School, which is on the verge of outstanding. Coney Hill is in fact rated the fourth best primary school in the county of Gloucestershire, and the second best is Field Court, also in my constituency, which is in a slightly more affluent part of the city. We therefore know that it can be done, and schools that have succeeded, such as Coney Hill, have not done so because they get a great deal more money.
It seems to me that the challenge for us as MPs is how to know what does make a difference. How can we be sure about what a school needs and whether it is getting enough of it? How can each school—every one of which will claim, and they may be right, that they have cut to the bone in order to make sure that every penny is used effectively—know how good they are as against other schools? How can we compare them, and how can we see how good they are at managing the business of a school, as well as being an outstanding place of learning for all the pupils there?
In this sense, of course, the statistics do not always help to shed light. The IFS, an independent body, tells us that the funding for five to 16-year-olds will have gone up by 50% in real terms from 2010 to 2020. If I translate this into a local figure, Gloucestershire schools will be getting 3.1% more in 2019, but salaries have increased by 3.5% and there are the pension increases as well. I deduce from that that this is not an issue of cuts—that is a very easy word to use, particularly in opposition—but of costs growing faster than the increases that schools, further education colleges and universities are getting from the Government. That is the challenge for heads and others who are running schools.
In a debate in Westminster Hall at the end of January on education in Gloucestershire, the Minister for School Standards referred to a number of things that the Government are doing to try to help schools with the issues I have mentioned. They include the schools buying club, the schools commercial team, the DFE schools buying strategy, a pilot project in the south-west of England at which 39 schools in Gloucestershire are registered, a focus on supply teachers and agency workers costs, and a benchmarking website. All these things sound very encouraging, but I sense—the Minister for Apprenticeships and Skills will be able to shed light on this—that not all of these are really up and running or are easy-to-access tools for us or the heads of the schools.
I turn now to further education funding, which is of course the worst part for funding in the education sector, despite all that has been done with the new national colleges, T-levels, the investment in apprenticeships and so on. The fundamental fact we have to deal with is that we are in the bottom quartile for OECD skills, at level 4 or 5, for the education of our apprentices and others. At level 4 or 5, we are really way below where we should be in terms of the numbers studying. The letter I wrote with my colleague the hon. Member for Scunthorpe (Nic Dakin) to the Chancellor focused on the fact that, of all the areas in education that need funding, we really are looking for more to boost productivity and to boost what our young people can give. As 165 Members signed that letter, I urge the Minister to consider it.
It is a pleasure to follow the hon. Member for Gloucester (Richard Graham).
Many people have made incredibly important points about the cuts in so many different areas—FE, schools and children’s services—but I would like to focus my contribution on how the cuts are affecting children with special educational needs and disabilities. Among the written evidence given to our Education Committee inquiry on SEND, there is a really useful summary from the Devon SEND Improvement Board, which said:
“The level of funding for SEND provision remains insufficient to meet increasing demand and puts significant pressure on existing budgets. Local authority, NHS and High Needs Block budgets have not grown to reflect the increasing demand for EHCPs and specialist provision. Tension related to funding is directly affecting parental relationships with professionals and organisations. The increase in general costs is affecting schools’ ability to support increasing SEN needs for example increases in national insurance contributions and the rise in living wage, with no additional funding to cover these increases.”
I am not sure about everyone else in the House, but certainly the concern that stands out for me is the tension affecting parental relationships, which is something I am hearing about in my surgeries and in all the evidence given to the Education Committee. Parents relate having to fight the system in order to get the support their child needs. That point was made a number of times.
One of the more worrying pieces of evidence, submitted by Christine Lenehan, is that in some special schools 100% of the children attending are there only because their parents were able to fight through tribunal. She said that is actually a class issue, because it is white, middle-class parents who are able to go to a tribunal and know how to work the system and where to get support. What about all those children whose parents do not have the same cultural capital and do not know how to go out there and fight for them? They are not in these residential special schools, so where are they and what is happening to them?
Jean Gross mentioned the lack of interventions and support for children with SEND. She talked about the lack of speech and language therapies. I am sorry, but that is also a class issue. I know from parents in my constituency that those who can afford it will of course pay for speech and language provision for their children. They will pay for additional tutoring and support, but that is not universally available to all children. The SEND cuts are not only cruel and unfair, but exacerbating the situation that children are already facing. All this talk of social mobility and equality of opportunity is not played out in the schools system that has been created by this Government.
I have two asks in relation to SEND funding. First, the Government should stop the idea of notional funding of £6,000 for schools and instead make that actual funding. Secondly, they should look at reforming the whole of SEND funding, because so much is based on what local authorities get. We know that there is no correlation between the number of SEND children in an area and the amount of money it gets, because that is based on a historical formula rather than an actual formula for that year. Instead, I would like the Government to consider some kind of SEND pupil premium money, which would follow the child around the country. That way, even if the child moved between local authorities, their parents would still know that they were entitled to the same amount of money to meet their needs. At the moment it is a postcode lottery.
In my last effort to be helpful—I do like to be helpful to the Government—I have identified some departmental savings that the Government might be interested in. One is the 84 interest-free loans that have been given to multi-academy trusts, with no information on how much was given or when it was given. A recent freedom of information request on what the associated conditions were was refused We could also ask the Education and Skills Funding Agency to do an asbestos survey on buildings before schools actually move into them, which could save millions of pounds in decontamination costs.
We could also look into making savings by re-brokering and being a little more open and transparent about how much money has been handed out by regional schools commissioners to encourage academy chains to take on other ones. We could look at the pupil number adjustments, and at academy trusts getting extra money for schools with an estimated roll. How much money has been written off by that rather secret process? Could we have more transparency on that? Finally, could we look at helping schools to save the £200 million they collectively pay on entry fees for exams?
I thank the hon. Member for Hackney South and Shoreditch (Meg Hillier) for introducing this extremely interesting debate. I also send my best wishes to the school mentioned by the hon. Member for Oxford West and Abingdon (Layla Moran). As a former teacher, I know the feeling of dread when the inspectors are coming—in Scotland we had Her Majesty’s Inspectorate of Education, rather than Ofsted—so I send my best wishes to her school, and indeed to any school undergoing inspection at the moment.
As we have heard, school budgets are being stretched to breaking point. The hon. Member for Gloucester (Richard Graham) talked about the costs pressures, which include pay rises for teachers, higher employer contributions to national insurance and teachers’ pension schemes, and rising costs. There is an urgent need for a better commitment from the Government, because these issues become even more pronounced when we focus on sixth-form and further education spending, tuition fees and academies. We know that in the next six years there will be a 19% increase in pupil numbers in England. The hon. Member for Hackney South and Shoreditch highlighted that it is not enough to just increase education funding, as has been mentioned by a number of hon. Members on the Government Benches. We know that the budget is increasing, but it has to be a per pupil increase in spending to have any impact.
I would just like to mention academies. We do not have academies in Scotland. In England, they were hailed as a way forward and a remedy for failing schools. At first, it looked as though that was the case, because money and resources were thrown at them. However, we now see a disturbing situation where some high-performing and improving academies are accepting fewer children from disadvantaged backgrounds or pupils with additional support needs. Surely that cannot be considered a success. Pupils with special educational needs must be properly catered for. If they are not being catered for within the academy system, there has to be greater spending on them in maintained schools and that increase must be significant. We are not talking about a small increase in per pupil spending: if they have been taken out of the academy programme, we have to put serious investment into them in other schools.
On academies, the teaching profession in England has experienced an attack on terms and conditions, including the ability of school leaders to bypass nationally agreed pay scales. That allows schools to stretch budgets further or ensure huge pay awards to the chief executives of multi-academy trusts without, it seems, any scrutiny. Essentially, Department for Education funding is being syphoned off to pay individuals, regardless of the success of the academy itself. According to the Education Policy Institute, there is little measureable difference between the performance of academies and local authority schools. Underperformance in academy trusts, including a lack of diversity in the pupil cohort, must be challenged, as should academy trusts that are paying excessive salaries to CEOs, a point highlighted by the right hon. Member for Witham (Priti Patel).
A number of hon. Members talked about post-16 funding, including the right hon. Member for Harlow (Robert Halfon) and, in particular, the hon. Member for Wolverhampton North East (Emma Reynolds). We know that since 2010 this funding has been cut sharply. The hon. Member for Brighton, Pavilion (Caroline Lucas) talked about the 22% cut in funding that has damaged the variety of courses, the number of STEM courses offered and the provision of extra-curricular activities, and has resulted in larger class sizes.
Given the hardship that further education colleges are having to cope with, it is little surprise that Ofsted’s annual report concluded:
“We are concerned about the financial sustainability of the college sector, and the clear impact that real-term cuts to Further Education funding can have on provision.”
A long-term overhaul of post-16 education in England is needed. Courses must be linked specifically to needs in the labour market. We regularly hear rhetoric about positive destinations for young people, and how we have to value all types of education and all outcomes for young people, but increasing the budget for further education is only a part of that. We also have to make sure that courses are properly tailored to needs in the job market. Brexit will make this issue even more acute, so England really should be looking at what we are doing in Scotland. In Scotland, we are ensuring that college places are actually linked directly to employment requirements, and we have the highest number of young people going on to positive destinations.
One issue that has not been mentioned this afternoon is tuition fees, but I think it is important if we are talking about budgets. We estimate that £23.4 billion is expected to be paid out in student loans this year, with capital repayments amounting to only £1.1 billion. As became apparent last December, these huge tuition fees betray a staggeringly short-term perspective that has added £12 billion to our national debt.
Up until now, it suited the Government to pretend that student debts are genuine loans, but it is now clear that many graduates will never earn enough to pay off these loans in full, which will result in the Government effectively having to pay the loans off. Why continue to put these pressures on students? Why not look at proper funding of our courses in higher education?
In conclusion, education funding must serve young people regardless of their background or educational needs. We must ensure that 16 to 19-year-olds are properly catered for. Funding must be adequate to ensure that young people avoid a lifetime of debt, and finally, meagre education budgets should not be siphoned off to line the pockets of rich businesspeople in academy trusts.
What a fantastic debate we have had this afternoon. I congratulate all the many colleagues from across the House on their contributions to the debate and, of course, the Chair of the Public Accounts Committee, my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier), on opening it. I also take this opportunity to give my best wishes to Sally Hunt, the general secretary of the University and College Union, who has retired this week on health grounds. I wish her all the best for the future.
I would like to echo some of the points that many Members around the Chamber have made today and start by paying tribute to all the educators in our schools and educational establishments across England. They do a fantastic job to educate the next generation and to feed our economy with the skills that we require. It can often seem in this place as though we are all preoccupied with Brexit, but hearing from so many hon. Members today says to us that education is enshrined as one of the three pillars, as I see it, that helps social mobility and keeps our society going forward and our nation progressing in a global economy. The Chair of the Education Committee, the right hon. Member for Harlow (Robert Halfon), and the Education Committee member, my hon. Friend the Member for Colne Valley (Thelma Walker), made powerful contributions, as always, based on the practical obstacles and on ensuring that better educational outcomes are there for all learners.
Like the right hon. Member for Harlow, I look forward to hearing the response for the Government from the Minister for Apprenticeships and Skills. I am glad to highlight the work that goes on in further and adult education, which, of course, is where I got my qualifications, but as my hon. Friend the Member for Wolverhampton North East (Emma Reynolds) articulated, the reality is that since 2010, funding for adult and further education is down by £3 billion in real terms. Colleges are facing collapse and sixth-forms have been cut by a fifth. At the same time, there is a significant underspend for the apprenticeship levy, yet the money now lines the coffers of the Treasury rather than funding our education system. My hon. Friend the Member for Bristol South (Karin Smyth) made a key contribution about the need for cross-departmental work and funding. We on the Opposition Benches are clear about investing in both further and higher education and replacing the current unsustainable system of fees and loans.
As the hon. Member for Glasgow North West (Carol Monaghan) said, the Department’s estimate is down by £12 billion. For once, that is a reflection not of cuts, but of the accounting change that means that it can no longer pretend that every pound of student loans is paid off. Can the Minister tell us how much additional funding will be needed to continue the current system, and will that be provided? She will know the alarm that universities have expressed about some of the leaked discussions around higher education funding.
Let me turn to the issue that we have heard raised time and again in these debates, including today, from Members across the House and across the country: the desperate shortage of funding for our schools. The hon. Member for The Cotswolds (Sir Geoffrey Clifton-Brown) said that every child in this country deserves the chance to thrive, and on that, I absolutely agree with him. I also agree with his contributions about school exclusions, which I hope the Minister will address.
Last year, the Secretary of State told us that every school
“will see at least a small cash increase.”—[Official Report, 29 January 2018; Vol. 635, c. 536.]
In the spring statement, the Chancellor gave the House a guarantee that every school would receive a cash increase. Will the Minister tell us whether that guarantee will still be honoured?
The hon. Member for Mid Derbyshire (Mrs Latham) spoke about her concerns with the national funding formula and cuts to her local schools, as did the hon. Member for Brighton, Pavilion (Caroline Lucas). Of course, the Chancellor had something else to say about schools in the last Budget: he offered them “little extras”—enough funding for them to buy a couple of whiteboards. Schools have lost billions of pounds and now they are offered a whiteboard! I hope that the hon. Members for Colchester (Will Quince) and for Gloucester (Richard Graham) are not on the naughty step at home, following their contributions today. Of course, the Education Secretary has promised that he would ask for at least some of those billions back. As my hon. Friend the Member for Redcar (Anna Turley) outlined, our schools desperately need the money now.
The right hon. Member for Witham (Priti Patel) and the hon. Member for Colchester brought up the stat of 1.9 million pupils in good and outstanding schools, but I caution hon. Members: more pupils are in our schools and some of those schools have not been inspected for years. On league tables, I do not think that talking about so-called “failing schools” is helpful for the teachers who deliver excellence in their classrooms in those schools every single day. My school would have been a “failing school”, but I do not think my school failed me—or I would not be stood at this Dispatch Box today, doing the things I do with the resilience that I have.
We are reaching the last financial year of the additional school funding announced in 2017. Will the Minister tell us whether there is any sign of that new funding from the Treasury? Children with special educational needs need the help most, and they are not getting it. My hon. Friend the Member for Kingston upon Hull West and Hessle (Emma Hardy) raised the heart-breaking experience of parents and their children in need of additional support and the inequalities they face in the system. Despite the Prime Minister’s words, austerity is far from over in education. Ministers have told us for years that they are protecting school budgets, yet our analysis of the Institute for Fiscal Studies data found that school funding in real terms will be £1.7 billion lower in 2020 than it was in 2015. The hon. Member for Oxford West and Abingdon (Layla Moran) was right to highlight the pressures on the system and the need for the focus on outcomes and to crack down on the financial scandals and lack of oversight in some trusts.
Finally, I would like to address the early years. I welcome the Health and Social Care Committee report published today. I hope the Minister agrees that early years support can transform lives for the better. Yet across the country, children’s centres are closing, nurseries are under threat, childcare is underfunded and the shambolic roll-out of tax-free childcare left an underspend of around £1 billion. I hope that the Minister will agree that Sure Start centres desperately need that money.
The hon. Member for East Worthing and Shoreham (Tim Loughton) was absolutely right to raise children’s services, the pressures that they face and the fantastic work they do every single day, and to link that to the report out today from Action for Children.
This is an important debate, and I am glad that we have had it on the Floor of the House. But our children’s services, nurseries, schools, colleges and universities need not words, but actions. Investment in education is an investment in our collective future.
I thank the hon. Member for Hackney South and Shoreditch (Meg Hillier) for securing the debate. I can assure her that I will not resort to smoke and mirrors. That is not really my style. I will not necessarily be able to give her all the specific details about the money that I think she will want to hear, but I will respond to a couple of her points.
The Secretary of State is extremely mindful of the problems involved in asking schools to do more. He is determined to ensure that we do what we can to help them to manage their budgets and their workload. The hon. Lady mentioned high needs. An additional £250 million will be invested in 2019-20, and we are looking at some of the perverse incentives that currently exist, especially considering that first £6,000 that schools are asked to pay. The hon. Lady raised the issue of asbestos exposure and capital budgets. The impact of asbestos in buildings on health, and the changes and challenges that it poses, are quite complex, but I welcome her comments about the schools survey that we have undertaken. The Department has established an asbestos working group, which includes the Health and Safety Executive, to address some of those problems.
A total of £23 billion has been provided for capital spending over five years—between 2016-17 and 2020-21 —and we are on track to create 1 million new school places during the current decade. That will be the biggest expansion for two generations, and it contrasts with the loss of places between 2004 and 2010. Between 2010 and 2017, 825,000 additional places were created; that includes 90,000 in 2016-17 alone. I should add that 97.7% of families received offers from one of their three top primary school choices, and 91 received offers from their first choices. Those are important figures, because that is what matters to parents.
I will respond to some of the most pressing points that have been raised, but I should first point out that in 2018-19 the Department’s resource budget is about £79 billion. Of that, £18 billion is for higher and further education, £55 billion is for early years and schools, and £0.3 billion is for social care, mobility and disadvantage.
I welcome the contribution of the Education Committee, and the work of the Chairman, my right hon. Friend the Member for Harlow (Robert Halfon), has been particularly valuable. He is right to remind the House that putting in more money does not necessarily equate to better outcomes. It is not as simple as that. Good outcomes are what matter, but good outcomes in themselves are not enough. We want excellent outcomes not only for those at school, but for those for whom school did not work. Many of them need a second, a third or even a fourth chance. I am, of course, delighted that my right hon. Friend raised the issue of further education, and I thank him for his kind comments.
My right hon. Friend talked about the importance of plans. It will certainly not be before time that we articulate a vision for further education, which is so often squeezed between the noises surrounding schools and universities. As my right hon. Friend rightly says, reducing inequalities in education has a wide impact, not least on people’s health—those who are better educated have better health—and it can also enable people to become socially mobile.
I was extremely pleased that the hon. Member for Wolverhampton North East (Emma Reynolds) reiterated the need to reform all education, highlighting further education. I assure her that we are very aware of the issue of maintained nurseries. I am aware that their need to know the situation is very pressing.
Will the Minister give way?
I do not have much time, so if my right hon. Friend will forgive me, I will not.
My hon. Friend the Member for The Cotswolds (Sir Geoffrey Clifton-Brown) raised the issue of exclusions. We are not complacent, but I should point out that the number of exclusions reached a peak in 2008. The hon. Member for Oxford West and Abingdon (Layla Moran) raised a specific issue about local schools and academies. I think it is a mistake always to blame structures, but I understand her underlying point about accountability, which is so important.
My hon. Friend the Member for East Worthing and Shoreham (Tim Loughton)—although he was corrected slightly by the hon. Member for Hackney South and Shoreditch (Meg Hillier), the Chairman of the Public Accounts Committee—raised the important issue of children’s social care. He drew attention to the key role that early years education and care play in the eventual outcomes for young people. He made a predictably powerful speech. I worked with him when I was in the Department of Health, and I am extremely pleased to see him continuing his excellent work, albeit from the Back Benches. I know he has also been a champion for his local schools and their funding, as indeed has my hon. Friend the Member for Colchester (Will Quince), who reiterated similar issues. He raised one thing that has long been a bugbear of mine: the need for more certainty in budgets. He mentioned three-year rolling budgets, but whatever it is we are talking about something that gives organisations certainty.
I have already met the hon. Member for Bristol South (Karin Smyth) and she raised the issue of inequality and social mobility and the importance of local industrial strategies. She, like the Chairman of the Public Accounts Committee, highlighted the need for us to have an articulate and adequate clear vision for further education. I am sure she is aware that Bristol is one of the five cities in our “5 cities” project trying to increase diversity in apprenticeships. I met a woman recently in Bristol who demonstrated exactly what can be achieved through apprenticeships. [Interruption.] She was a single parent, and I am sorry hon. Members on the Opposition Front Bench find this amusing, but I found it very moving: she had been unemployed for 10 years and had a small child, and because of that project she had got a level 2 apprenticeship and was really proud of what she had achieved, and proud that her daughter was now proud of what her mother was doing.
My hon. Friend the Member for Gloucester (Richard Graham) has been a huge champion of further education and rightly pointed out the need for much greater emphasis on levels 4 and 5; we are looking at that at the moment. He also recognised the need to increase the number of people undertaking qualifications at that level.
I know the hon. Member for Kingston upon Hull West and Hessle (Emma Hardy) always tries to be helpful and it is always a pleasure to hear her contribution, and she rightly pointed out the inequalities that exist from those with sharp elbows fighting those tribunals.
We are investing an additional £1.6 billion in schools this year and next over and above the funding confirmed at the 2015 spending review. This significant additional investment means core funding for schools and high needs will rise from almost £41 billion in 2017 to £43.5 billion in ’19-20.
We recognise the cost pressures that schools, nurseries and further education are under, but the Government have achieved a huge amount since 2010: 1.9 million more children are being taught in good or outstanding schools; the attainment gap between rich and poor pupils has shrunk by 10%; a record proportion of disadvantaged students are going to university; and we now have a truly world-class technical education offer through T-levels and high quality apprenticeships. There is massive reform in apprenticeships which has a life-changing impact. There has also been £100 million into the national retraining scheme, a partnership between the Government, the TUC and the CBI.
I am a lucky Minister to be able to contribute to debates that are often so well considered and passionate and I will never cease to be grateful to all those involved in education at every level. We all want the same thing: that whoever you are, wherever you are born and whoever you know, everyone has the chance to get on in life, and get a rewarding career and a job.
We on the Government Benches will not play party political games with education, but put children, young people and adults and education first and foremost, and we will not shirk the difficult decisions sometimes needed to make sure we achieve that end. Party political rhetoric has no place in a debate like this; it is, as many Members have said, the outcomes for those we serve that matter.
I rise very briefly to thank all hon. Members who have contributed and put in such detailed preparation and to thank again the NAO for its work.
It is important that we debate the money, because ultimately that is what then shapes how policy can be delivered, and I reiterate my points made at the beginning: that we must look at the money and talk about the right baselines—per pupil funding, not vast global amounts on different year bases, because that gives a confusing message.
The Government need to look at every area of spending and assess how effective they are being in delivering their outcomes. I may disagree with the outcomes, but it is right, as the hon. Member for Oxford West and Abingdon (Layla Moran) said, that we focus on those outcomes.
I thank hon. Members for their contributions. This is not the end of this: the PAC will continuously look at education spending, value for money and outcomes, and I know the Select Committee on Education so ably chaired by the right hon. Member for Harlow (Robert Halfon) will do so as well. So the Minister will see a lot more of us, and I put the Secretary of State on alert that we will be poring over the numbers and challenging him at every step of the way to make sure he is getting as much value as possible for the taxpayer, for our pupils and for all those who work so hard in our education system from cradle to further education and higher education in order to deliver better outcomes for young people.
Question deferred, (Standing Order No. 54).
Department for Work and Pensions
[Relevant Documents: Twentieth Report of the Work and Pensions Committee, Universal Credit: managed migration, HC 1762; and the Government response, HC 1901; Twenty-first Report of the Work and Pensions Committee, Universal Credit: support for disabled people, HC 1770; Twenty-third Report of the Work and Pensions Committee, Two-child limit, HC 1540.]
Motion made, and Question proposed,
That, for the year ending with 31 March 2019, for expenditure by the Department for Work and Pensions:
(1) further resources, not exceeding £880,517,000 be authorised for use for current purposes as set out in HC 1966,
(2) further resources, not exceeding £170,914,000 be authorised for use for capital purposes as so set out, and
(3) a further sum, not exceeding £1,334,611,000 be granted to Her Majesty to be issued by the Treasury out of the Consolidated Fund and applied for expenditure on the use of resources authorised by Parliament.—(Rebecca Harris.)
I am pleased to be bringing this debate today, and I thank colleagues from across the House who have supported it and who are here to speak. The spending of the Department for Work and Pensions is the highest of any Department and represents almost a quarter of all Government spending. It is therefore important to scrutinise that spending, especially as the 10.7 million people who rely on our welfare state are those who usually have no other place to turn.
The welfare state in Britain was set up by the 1945 Government in order to defeat the giant of want and to create a country fit for heroes, but 70 years later, across Britain we are seeing an increase in situations that we think of as part of the bygone era of the 1930s. Even around our Parliament today, we are seeing people sleeping rough on our streets, dying in the freezing cold. Across the country, we are seeing families queueing up for food banks, and disabled people left isolated without the care that they need.
Poverty rates are rising, especially among children and people in work. The Joseph Rowntree Foundation’s annual analysis of poverty tells us that 14.3 million people—more than one in five of our population—now live in poverty. That includes 4.1 million children, a rise of 500,000 over the last five years. It also includes 4.6 million people living in persistent poverty—the poverty trap that lone parents especially are unable to escape. And shamefully, 1.5 million people, including 365,000 children, now live in destitution, unable to afford even the basic necessities. In the fifth richest country in the world, those bare facts should shame us all.
The Government rightly tell us—as I am sure the Minister will do today—that the Department’s spending is rising. It has risen by £31 billion, or 20%, since 2010. But alongside real wages falling for a decade, housing costs rising much faster than inflation, especially in areas of very high housing shortage, and cuts to so many of the local services that people rely on, our welfare safety net is in danger of not working. That is why I am particularly pleased that we are having this debate to look into the reasons for the seeming anomaly of rising spending and rising poverty, and so that we have the opportunity to suggest some answers for the Department to consider.
We know that £27 billion of that £31 billion increase in the Department’s spending relates to the state pension, with the triple lock and the single-tier pension delivering increased prosperity for most pensioners. That is good to see, but, as with many aspects of DWP spending, it does not tell the full story. While the state pension has increased, pensioner poverty has also increased. The rate of pensioners in poverty halved in the decade to 2013, but since then it has risen by 330,000 to 16% of pensioners. That change was partly due to reductions in pension credit, which now supports a million fewer pensioners, but also due to housing costs, which is a serious problem for the Department across the full range of benefit claimants.
The situation is worse for those who are not pensioners. The Institute for Fiscal Studies stated after the Budget that we will still see cuts of £4 billion a year to welfare spending on in-work age groups in the years to come. It is the particular and persistent focus on reducing spending that has played a major role in the increase in poverty, and destitution in particular. The emphasis on making welfare spending fairer to working people ignores the fact that the majority of claimants of state support are already in work. In the 2015 Budget the then Chancellor claimed that benefits should be frozen for four years because average wages had risen by only 11% while benefits had increased by 21% since 2008 due to high levels of inflation. The argument that real-term falls in wages should equate to even larger falls in the benefits on which so many in-work families rely fails to recognise the realities of life on low pay.
I thank my hon. Friend for giving way. We have seen changes over the past few years, including increases in some pensioner benefits and in the national living wage, but the group of people who stand out more than any other are those on benefits. It is utterly unacceptable that we can even consider maintaining the benefits freeze for one final year. It has to go.
I thank my hon. Friend for that intervention and pay tribute to her campaigning for people on benefits. I agree with the sentiment of her intervention, because over 10 million people are affected by the reality of the four-year freeze. When it was announced in 2015, inflation was just 0.4%, but it has been 2.3% and 2.6% in the past two years. Since the freeze’s introduction, the cost of living for people on low incomes has risen by £900 a year. In real terms, the income received by a single person on jobseeker’s allowance or income support of just £77 a week will fall by over £5 a week by 2020—a drop of £267 a year. When people on such benefits have less than £10 a week to spend on food, the loss of £5 makes a huge difference. Someone can just about eke out £10 a week for food, but eating for £5 a week is impossible. It is no wonder we are seeing such growth in the use of food banks.
For families, the freeze bites even harder. If it continues, low-income families are likely to lose out on an extra £210 a year due to inflation. If we see inflation rise because of disruption to trade or food tariffs or shortages, inflation for people on low incomes will be far higher. If the benefits freeze ended a year early, that would provide an essential income boost to over 10 million people struggling on low incomes and reduce poverty for 200,000 people, so I strongly urge the Government to look at doing so as soon as possible.
Of course, welfare is in the process of being reformed, especially through universal credit. I worked for USDAW—the Union of Shop, Distributive and Allied Workers—for almost two decades, so I know just how vital in-work benefits are to millions of families who struggle to get by on low pay and often low hours. I know that UC was designed to fix such problems to ensure that work always pays, and I applaud that aim, but the stark reality is that universal credit has led to a 30% increase in referrals to food banks where it has been rolled out. I see families in my surgeries facing eviction, and I give credit to the thousands of people who are organising food banks across the country to help people who cannot afford enough to eat, but that is not good enough. Food banks cannot cover the whole country—I know that from my rural area—and they should not have to, either.
I pay tribute to fellow members of the Select Committee, which has made recommendations to the Government on universal credit, and to members of the all-party parliamentary group on universal credit which, with me as chair, is producing a report on a whole range of universal credit issues—I am pleased that the Secretary of State has already committed to meeting us about it.
I thank the Government for the improvements they have already made to universal credit, and I welcome those changes, but we are still seeing problems. Some 5.1 million people in working families will see their income reduced, on average, by £2,300 a year, and 1.3 million people in out-of-work families, with even lower outcomes, will see those outcomes drop by £1,400 a year. At a time when persistent poverty and destitution are rising, the Government’s flagship policy should not be looking to take over 10% of our population even deeper into poverty.
Will my hon. Friend give way?
I was asked to take 10 minutes, so I will have to wrap up soon. I am sure my hon. Friend will get a chance to speak.
I ask the Government to look urgently at three issues with universal credit. First, the five-week wait for payment puts people into debt right at the start of their claim, and the levels of universal credit are simply not enough to enable them to escape that debt. Secondly, the multiple deductions: people receive an advance, and they might have debts on top of that from tax credits, housing arrears or utility bills, and they end up with an income that they simply cannot live on. Thirdly, the support for children and adults with disabilities. This Government are proud of saying that they like to support the most vulnerable people but, as one of my constituents says, “If a six-year-old boy who is bedbound is not one of the most vulnerable and does not deserve support, who does?”
We need a system that treats people like human beings. Yes, it is down to money and, yes, it is down to support, and I welcome the Secretary of State’s commitment to personalised support, but that support needs people to implement it, not computers that simply say no and not processes like the one I raised in a Westminster Hall debate on carer’s allowance where carers are being taken to court under the Proceeds of Crime Act 2002 and are being forced to sell their homes because they have made an error.
We want to see investment in jobcentres and DWP staff so that they can deliver the personal support that they want to deliver, that this Government want to deliver and that we all want to see. This Department covers a huge range of people and complex issues. We all need to have trust that our welfare safety net is still there. It is the hallmark of a civilised society, and I look forward to this debate helping us to bring it in together.
Order. I thank the hon. Lady for her brevity, but it will be obvious to the House that we have little over an hour and a half left in the debate and that a great many people want to speak, so we have to start with a time limit of six minutes.
It is a pleasure to speak in this debate on the spending of the Department for Work and Pensions. I thank the hon. Member for High Peak (Ruth George) for leading the debate and for her speech.
I understand the issues that the hon. Lady raises, but, as a Conservative Member, I want to try to make a case for the positives since 2010. In doing so, I would not want it to be thought that I do not have constituents who have been let down by the system. We must always strive to do more and to learn from such issues, but the situation has existed for years under every Government—it has not only existed under this present Government.
I will touch on employment, universal credit and our work to help those with disabilities, sicknesses and impairments, all of which are so important because the Department is responsible for a quarter of all Government spending. A vast £215 billion is spent on benefits and pensions.
Employment is the greatest success of the Government that I have been supporting since 2010, as the unemployment rate has halved since then. The most important thing to me in my role of being an MP is to help people to find work, find hope over despair, find something to feel proud about and find something where they really contribute. It is about taking them from being people who rely on the benefits system when they do not want to do so and giving them a position where they are paying in to help others.
This has been a great success: we now have the highest numbers in employment since records began; we also have an unemployment level at 4%, which is as low as it has been since the early 1970s; youth unemployment has halved; female unemployment is at its lowest rate; and wages are now growing at their joint fastest rate in a decade.
I am particularly proud that our unemployment rate is half that of Eurozone countries. It is important to say that every Labour Government have left office with unemployment higher than when they took office. The unemployment rate rose from 2.1 million in 1997 to 2.5 million in 2010, whereas it has now fallen to 1.36 million. Although there may still be matters that need addressing, this Government have reduced unemployment by 1 million and helped those people to find work and hope, so there is not that much of a stick to beat us with.
Let us look at universal credit, because it is part of our mantra of helping people into work.
Of course I will give way. The hon. Gentleman now has his chance.
If the hon. Gentleman wants us to provide a stick to beat the Conservatives with, he could try the National Audit Office report that said categorically that there is no evidence to suggest that UC has got anyone into work. So where is his evidence?
The evidence states that those on UC are more likely to find work and to increase their earnings—that has been found as well. The whole idea of course is that work pays. [Interruption.] The very fact that unemployment has gone down by 1 million suggests that UC is helping people into work. If the hon. Gentleman does not believe that helping people into work is the right thing to do and that we should keep people on benefits, we have indeed failed, but I happen to believe that ours is the right way forward.
There is something I do not understand here. Not only is there the five-week starting period, but what is now evident is that there is an 11-week starting period. Someone who is moving but staying in accommodation provided by the same social landlord will end up with 11 weeks when they get none of their housing benefit paid, and they are in debt from the very beginning. That has happened to dozens of my constituents. How does that possibly help people to get into work?
First, we have the two-week run-off with regard to housing benefit. We also have the system of advances. So I do not recognise those figures at all.
Will the hon. Gentleman give way?
I will not give way, because I am taking quite a lot of time. The reality is that UC is designed to mirror the world of work. In the world of work, 75% of people get paid monthly, and so the benefits system is designed to do that, because everybody on benefits is supposedly able to find work and this system mirrors the world of work. It is the right system to help people.
Another aspect of UC is universal support. It used to be the case that when someone was on benefits they were languishing on benefits, no one cared about them and they did not get the tailored support that UC gives. Now if anyone chooses to go to their jobcentre, as I do regularly, they will find a completely different approach—one where there is compassion and tailor-made support. The work coaches—[Interruption.] It is all well and good the hon. Member for Garston and Halewood (Maria Eagle) chuntering from the Benches, but if she had spent time with her work coaches, seeing the passion that they have in getting their people into work, she would see that they have more effect in doing that than she has by sitting there chuntering away.
My view is that UC works, and 82% of those on UC believe it works, too. It is all well and good for MPs to knock it for political purposes, but if they wanted their constituents to be helped, they would get behind this system, rather than constantly knocking it for political ends.
The hon. Gentleman says that 82% are satisfied, but does he agree that 18% unsatisfied is still too high?
Yes, of course, because we should always strive for 100%, as I said right at the start. But when we hear Opposition Members talking, we might think that the figure is at zero—it is not. I spend the time with those delivering the support and those receiving the support, and they are happy with it. Let me compare that with the previous system of tax credits. They were rushed in so fast by the Labour party that we ended up seeing overpayments of £7.3 billion and people pursued through the courts to get that money returned. Where does that leave the party of compassion? A success rate of 82% is high when one considers the challenging circumstances of people on universal credit.
In my remaining two minutes, let me turn back to those on disability support. I find that many of those who have been assessed for PIP and ESA have been let down by the system. I say to my Front-Bench colleagues that we need to continue to look to do more to help them through the assessments. I recognise that they are very much tailored benefits that take account of the cost of a disability. By their very nature, there will be challenges, but universal credit is absolutely a challenge that we should meet.
Again, I come back to the employment figures: we have got many more people with disabilities into work than the Labour party did. Anybody with a disability should be told that they are just as able to find work, and that they have the support the Conservative party to do so, as those who are not disabled. Failure to do that is complete discrimination. I am really proud of the support we offer. My office is a Disability Confident office: we want to make sure that we give people the exact same opportunities. I am proud of our position with regard to those with disabilities. The fact is that we are now spending an extra £10 billion to assist people, compared with 2010.
When it comes down to it, we are helping people to get into work—[Interruption.] The hon. Member for Battersea (Marsha De Cordova) says we are not, but I have just said that there are an extra million people in employment under this Government compared with under her party’s Government. The statistics do not—[Interruption.]
Order. We do not shout from the Front Bench, nor from any other Bench, but especially not from the Front Bench.
Thank you, Madam Deputy Speaker.
It is notable that we can deliver rhetoric, shout and talk about the individual cases, which of course we should, but the statistics show that this Government have got more people into work and are spending more money helping people on benefits. This Government have a record to be proud of, and I am only sorry that more of my colleagues are not willing to stand up and say so.
There has been a huge change in the debates that we have about poverty in this country. When I first came into the House, there were these rather distant debates in which we talked about what the poverty line should be and whether the Government’s benefits were adequate. We now face a situation—certainly in my seat and in the constituencies of others—that is a matter not simply of poverty and people being hard-pressed but of destitution. We cannot be surprised by that, because although the Government have rightly increased the national living wage and personal allowances, most of the cuts in public expenditure to rid us of the deficit have fallen on families and poor families on benefits. If one message goes out from this debate to the Chancellor, I hope that it is that enough is enough. The Prime Minister has talked about our now being through the austerity period; if we are, the first groups who should feel the relaxation of the whip of austerity should be the families who have been so badly hit by the cuts imposed on them to try to balance the books.
There have been seven main cuts, and I wish to remind the House of how extensive they are. They are not cuts that affect pensioners: all affect those who are of family age—families with children. The first is the freeze, which my hon. Friend the Member for High Peak (Ruth George) talked about. I congratulate her on securing the debate and on her contribution. Such a freeze is almost unheard of in our terms. In 1953, Harold Macmillan made the decision on behalf of the whole country that, as living standards rose, poorer people would benefit from those rises. Ever since then, Governments have tried to hold to that commitment. They have had varying degrees of success, but their intent has been that the poor should share in rising living standards.
Since 2011, we have had a freeze on benefits that means that the least advantaged—if I can put it in a sarcastic way—have suffered. For example, a single parent who is out of work and has one child has lost £888 of what their income today would be had the freeze not taken place. A single earner couple with two children have suffered the amazing cut in their living standard of £1,845. That alone, I hope, will get the alarm bells ringing in the Treasury, so that when the Chancellor makes his statement come the spring, we will see some change on banning the freeze for the final year.
I am glad that the Chair of the Select Committee has raised the benefits freeze. Our research through the Library shows that this final year of the benefits freeze is due to raise an extra £1.2 billion in savings for the Treasury, because of increased inflation. Does he not agree that, as a result, this Government should scrap the final year of the freeze?
I hope that long before the Chancellor rises at the Dispatch Box—the position that the Minister will be in when he replies to this debate—he will have made the decision that there will be no more freeze. He will say, I hope, that the freeze will be lifted, and I hope that, from this debate, we will build a movement in the country that convinces him and his Cabinet colleagues that that is the one overriding priority.
There are, however, six other cuts of which I wish to remind the House. The first of those six is the cut in council tax benefit. A total of 4.4 million families have been affected by this cut—of not paying council tax in full—with an average weekly loss of £3.
Let me turn now to sanctions, on which the Select Committee, the House and the Government quite properly indulge in debates. Three million people have been sanctioned since 2012. We know now that a person can be in work and sanctioned. I challenge the Minister to answer this when he replies to the debate: as a person can be sanctioned for not getting a higher income, even though they are in work, will he tell me how many work coaches in DWP have been sent for interviews by their colleagues because, given the amount of benefit that they draw as a result of the wages that they gain from DWP, they will now be sanctioned if they do not improve their income. Sanctions, therefore, form the second cut.
Another cut has come in the form of the lowering of the local housing allowance. Since 2013, 1.4 million of our fellow citizens have suffered an average loss of £50 a week. We are not talking about our salaries; we are talking about people who are earning very, very modest incomes from the benefits system.
On the bedroom tax, 704,000 of our constituents have suffered, on average, a weekly loss of £15 a week. A total of 197,000 households are affected by a benefit cut of between £63 and £73. Then there is the two-child limit, which affects 70,000 households, but which is likely to increase to 600,000, with an average weekly loss of £53. Any one of those cuts causes mayhem to the budgets of poorer people who have no savings—whether they are in work or not in work. I have witnessed in my constituency, as other Members have witnesses in their constituencies, an issue now not of poverty, but of people who struggle with all their might to maintain a roof over their heads.
I wish in a way that, at the time, I had been able to defend the courage of my good friend the Member for Bexhill and Battle (Huw Merriman). He is right that employment is up, but for the parts of the country that my right hon. Friend the Chair of Select Committee and I have seen on our tour—I hate that word because it sounds like a holiday—of food banks, what we saw were people who were utterly on the edge. With the greatest respect, universal credit is not built to deal with people who have no financial resilience at all. They are the people that we are talking about, and these cuts have absolutely cut them to the bone.
And beyond. Families know they are finished as a family if they lose their homes, so the fight is to keep the roof over their heads. They go without food; they go without heat; and they go without basic necessities. This debate is, for me, the first time that we have in this House to confront the system for those of our poorest constituents who face not just poverty, but destitution. They are the ones who have paid the most to bring down the budget deficit, and they should be first in the queue, as far as the Chancellor is concerned, to get relief when he makes that spring statement.
Order. I am afraid that I will have to reduce the time limit to five minutes.
It is an honour to be able to speak in this estimates day debate. I congratulate the hon. Member for High Peak (Ruth George) on starting us off. It was a pleasure, for the first part of this Parliament, to serve on the Work and Pensions Committee with her, the right hon. Member for Birkenhead (Frank Field), and the hon. Members for South Cambridgeshire (Heidi Allen), for Glasgow South West (Chris Stephens) and for Bermondsey and Old Southwark (Neil Coyle).
I will turn to some of the work we did together on the Committee in a moment. Before I do so, I want to return to the absolutely essential point that must always frame the current debate on benefits. A few years ago, before I entered this place, I was lucky enough to be the director of policy at the Centre for Social Justice, which looks at the root causes of poverty in the UK. One of the things that our research showed time and again, and that the research of my predecessors had shown, was and is that there is a human cost to worklessness that sits alongside the financial cost. The effect of being out of work for an individual, for a family and for large numbers of people in a given community is substantial. It affects people’s self-worth, mental health, and family stability. In itself, alongside the monetary troubles that they have, it affects their resilience.
That is why I am so proud of the fact that it is under a Conservative Government that we now see record employment, and that under this Government we are finally starting to see wages rise. This makes an enormous difference to individuals, families and their communities. It is very difficult to put a monetary value on that, but very easy to see the value of it when we meet those individuals and families and go into those communities. It is a great legacy, because we now have 637,000 more children growing up in working households than we did in 2010. The long-term effect on those young people’s future lives is enormous, because we know the cost and effect of children growing up in workless households, in entrenched worklessness. This is a real achievement.
Sitting alongside that, we have the welfare reforms that the Government have been bringing in since 2010, which are nothing short of revolutionary. I think that everyone across the House agrees on their aims. Everyone agrees on where we would like to be—that is, with a welfare system that actively assists, encourages and helps people to get into work, to sustain work, to take more work, and to become more self-reliant in order to be able to provide more easily for their families and for themselves. There is no doubt that universal credit is the mechanism to do that. There is also no doubt that this is a system in evolution.
I have been pleased, with the Select Committee and as a Tory Back Bencher, to work alongside the Government in helping a number of reforms to come through, such as the improvement in the taper rate and the improvement in work allowances. It was very good to see the Joseph Rowntree Foundation publish on 20 February a report showing that 3.9 million families on universal credit will be better off as a result of the changes made at the November Budget last year. This is a sign of real improvement starting to make a difference to the lives of people it was intended to help. Similarly, the new Secretary of State has said that she will seek to increase the number of people who are getting direct payments to their landlords and support to main carers. That is very welcome. I would certainly like the additional surplus that this excellent Chancellor has created to go towards hopefully ending the benefit freeze as soon as possible, allowing investment in universal support, and reducing further the waiting times.
I would like to begin by congratulating my hon. Friend the Member for High Peak (Ruth George) on the way in which she opened the debate. The context set out for us by the Chair of the Work and Pensions Committee, my right hon. Friend the Member for Birkenhead (Frank Field), of the cuts since 2010 should be borne in mind during the debate. The House of Commons Library estimates cuts of £37 billion to working-age social security since 2010 and £4.8 billion to disability benefits.
I want to talk about a couple of cases, one of which relates to decision making in personal independence payment cases. I was interested that the hon. Member for Bexhill and Battle (Huw Merriman) raised the issue of PIP being a bit of a problem. I have seen numerous instances of very poor-quality decision making in PIP cases, particularly when people are migrated from DLA to PIP. These are people with multiple and severe disabilities, often with lifetime awards under DLA, with fluctuating yet deteriorating conditions and usually with the higher rate mobility component entitling them to a Motability vehicle, but they simply lose that when assessed for PIP and consequently lose their cars and their mobility—the one thing that makes their lives a little easier.
In a recent written answer, the Government admitted that 44%, or a staggering 157,740 people, who were previously getting the higher rate mobility component under DLA had been reassessed and lost their eligibility to the equivalent rate. No doubt some people’s entitlement has been raised—I accept that—but a lot of disabled people have lost their access to a vehicle and had their lives upturned and made much harder, often wrongly. These decisions, many of which are perverse, have come to my advice surgery. They are inevitably overturned when they finally get to an appeal, but that takes months. When they do get to appeal, 70% of cases are overturned, and people get their higher rate mobility back.
People do not get any of that additional money during the months that they have to wait for an appeal. The Government say, “Yes, but if you do win the appeal, you get the money back,” but for people who are short of money and on the breadline, this can mean many months of lost income.
The hon. Gentleman is correct. For people waiting, it may as well be never. The Courts and Tribunals Service tells me that on Merseyside the average waiting time for an appeal is 38 to 42 weeks—10 months.
I have a constituent whose mother came to me in despair for help. She is a young woman of 29 years but has serious and worsening immune conditions, which are baffling her doctors and causing her health to deteriorate. She has so many conditions, and I will not go through them all, but she can hardly walk at the best of times and sometimes is in a much worse state. She often has to visit four different hospitals, sometimes with two or three appointments a week, and has been using a Motability car to do so. However, she does not have her Motability car any more because it has been taken away. She had a lifetime award of higher rate mobility under DLA, but when she was migrated to PIP, she was only awarded the lower rate. She appealed for a tribunal hearing last May and is yet to receive a date for it. She was recently told that she is likely to have to wait another six months, but my office is trying to get that hearing expedited.
The young women’s mother came to see me because the car had to be returned and the first trip to hospital without it cost the family £17.50 one way. Her parents are low-paid workers and cannot afford to make such payments. The family were considering having to choose which hospital appointments to go to, which is a shocking situation. Fortunately, the Mayor of Liverpool has a hardship fund. I have referred her to that, which is now paying for the family’s taxi trips, but she should not have to rely on that kind of assistance when she is entitled to the payments; I have no doubt that she will get her car back when she finally gets an appeal heard.
I want to raise another benefits issue affecting disabled young people who have special educational needs. It is about a difference between the rules for ESA and the rules for universal credit that seriously affects a small number of young people with special educational needs. My constituent Antony Hamilton has autism and developmental co-ordination disorder. He is in receipt of PIP and has an education, health and care plan, which required him to complete two years of specialist post-16 education provision before going on to do A-levels. As a consequence, he is a bit older than the typical A-level student, and he turned 20 at the beginning of the second year of his A-level course last October. The child tax credits and child benefit his father received for him ended at that time, but he still had most of a year of full-time education to go.
Under the legacy working-age benefits, Antony could have applied for non-contributory ESA to cover the financial loss, which is £170 a week. Under universal credit, however, there is no such option. He has been told he would have to apply for universal credit, undergo a work capability assessment and be required to work or search for it, which is something he cannot do because he is in full-time education. It is Catch-22 for people like Antony. He is working hard to achieve in educational terms, but his parents are having to spend their small savings to help him to be able to finish his A-levels. The letter his father got from the DWP said:
“The Department of Work and Pensions…does not set the policy and legislation relating to UC, this is the responsibility of the UK Government.”
Will the Minister please enlighten us about who is setting this policy, and about what he is going to do to help Antony?
When it comes to problems with the Department for Work and Pensions and its policies, it is actually quite difficult to know where to start. The people who depend on this Government Department often depend on it absolutely, and it absolutely is not working. It is not working for those on universal credit, assessments for personal independence payments are not fit for purpose, and the benefits freeze has been described by the Joseph Rowntree Foundation as the “biggest policy driver” of poverty in this country.
Perhaps universal credit might work if the Government had not taken £3 billion out of the budget back in 2015—it might then fulfil its original and admirable brief of simplifying the system and helping people get back into work—but they did, and now it is not doing so. They did put half of the money back, but it still is not enough. I do, however, applaud the Secretary of State for her acknowledgment that the problems with universal credit have contributed to the frightening and unacceptable growth in the use of food banks by families in this country. We are also seeing late payments, increased stress for people who are often already suffering from stress or mental health issues, and a growth in homelessness.
Let us put this into context. The DWP will spend £184 billion on benefits and pensions this year. That is a quarter of all public spending. More than half of that, £105 billion, is on pensions, mainly the state pension. Only £22 billion is spent on working-age benefits, and a further £21 billion on housing benefit. As MPs, we have a duty to be careful with our language and to help change the story people in this country hear about the relationship between benefits and poverty.
The DWP should exist to help families break free from poverty, to support people into work who are able to work and to provide security in old age, but that is not what the story of current policies reflects or tells people who are listening out there. Policies such as the five-week waiting time for universal credit reinforce the feeling among claimants that the Department does not actually want to help them, at least not right away. What they see is a delaying tactic—putting off payments for as long as it possibly can. Meanwhile the Government have spent £370 million last year, and advance payments just paper over the cracks.
I beg the hon. Gentleman’s pardon.
In my constituency of Edinburgh West, we are only just learning at first hand about the problems of universal credit, which was rolled out in the constituency at the end of November. We are much better acquainted with the problems caused by PIP assessments and inequities in the changes to the state pension age for women. Every week, I have people come through my door who have been refused PIP, often for the most inexplicable reasons. One constituent, who has had a Motability car for years, was told she did not need it because, if she could drive, she could obviously walk.
I tried to intervene on the point about universal credit. I do not believe that I voted on universal credit, because it was voted for prior to 2015, when I was first returned to the House. The policy that the hon. Lady is talking about was delivered by a Lib Dem-Conservative coalition, so it is actually her party’s own policy.
Yes, it was our policy, and if it had been delivered with the amount of money that was originally intended, it might have worked. However, in 2015 the then Chancellor took £3 billion out of the budget, leaving the policy crippled.
Will the hon. Lady give way?
I will continue, if the hon. Gentleman does not mind.
The constituent I mentioned was told that she did not need her mobility car, because if she could drive, she could walk. However, the car was specially adapted for her disability—a disability she was born with and for which she wears callipers. She cannot walk any distance. It was nonsense.
If the Department wants to save money, it should get more of these assessments right the first time, and bring assessments in-house to help it to do that. In 2015-16 the Ministry of Justice spent £103 million organising ESA and PIP appeal hearings, not including the costs to the DWP of defending them, yet two thirds of those hearings went in favour of the claimant. Meanwhile, the Government spent £370 million a year on contracts to Atos, Capita and MAXIMUS to conduct those assessments. That money could be much better spent. Surely it would be cheaper and fairer for the DWP to invest properly in trained professionals to carry out these tests.
Perhaps the most important thing the Government could do—as we have heard, this is the starkest omission from their estimates—is to end the benefits freeze. According to the Joseph Rowntree Foundation, that is the biggest policy driver behind the expected rise in poverty by the end of this Parliament. It estimates that ending the freeze a year early would cost £1.4 billion, reducing the number of people in poverty by 200, 000. It is absurd that the Government have been unwilling to accept that, given that they had the money to spend but instead put it to use by giving a tax cut to higher-rate taxpayers. Surely it is morally wrong to attempt to balance the books on the backs of the most vulnerable. The Government should use the spring statement to scrap the final year of the benefits freeze, and finally make the DWP work for the people it is intended to work for.
I want to raise one topic, which has already been touched on by my hon. Friend the Member for High Peak (Ruth George) in her excellent speech opening the debate: namely, the current five-week delay between claimants applying for universal credit and being entitled to their first payment. Like the hon. Member for Edinburgh West (Christine Jardine), I welcome the change of tone from the Secretary of State and her frank acknowledgment of the fact, long denied by her predecessors, that the roll-out of universal credit has increased demand at food banks.
The theory of the five-week delay was explained to us by the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith) during the coalition period. He explained that people leaving a job will have their last monthly pay cheque in the bank, which will keep them going for a month. In addition to the normal waiting days, which have always been part of the benefits system, that results in a delay of five or six weeks.
There are some obvious problems with that justification. For example, what about those who are paid weekly? The hon. Member for Bexhill and Battle (Huw Merriman) told us that 75% of people are paid monthly—that may well be right; I think it is about right—but what about the 25% who are not? According to the latest annual survey of hours and earnings, 16.2 % are paid weekly and 2.9% are paid fortnightly. What are those people supposed to do during this five-week gap? The Government’s justification for the five-week gap clearly does not apply to them.
I have repeatedly pressed Ministers on this subject. They are not capable of providing a justification for the five-week delay for people who are not paid monthly. I do not blame them, because there is no justification. I confidently predict that we are not going to hear a justification that works for them when the Minister winds up this debate. What about people on zero-hours contracts? They cannot be confident of having had a monthly pay check when they left their last job either. Even more starkly, the five-week gap will also apply to the millions of people about to be transferred from legacy benefits to universal credit.
On zero-hours contracts, does it alarm the right hon. Gentleman that someone on universal credit who comes out of a zero-hours contract job could be sanctioned, whereas if they were on a legacy benefit, they would not be sanctioned?
The hon. Gentleman is absolutely right. On JSA, people could not be sanctioned for that and on universal credit they can. I agree with him that that is wrong. That was revealed in a very recent written answer.
Another written answer to a question I asked last week told us that 57% of new universal credit claimants are taking an advance. The proportion of those applying for universal credit who have a month’s savings, as the policy assumes, is less than half. Most applicants have to go into debt to the DWP and take an advance to stay afloat in the first five weeks. Having been forced into debt in that way by the Department, far too many people find it impossible to get out of it. That is why we have seen the big increase in demand for food banks.
The Secretary of State suggested that the problem was temporary, because of early glitches in the roll-out of universal credit. No doubt it is true that the extraordinary delays that were experienced at the start of the universal credit roll-out did make things even worse, but the fact that over half of applicants are forced into debt by taking an advance, because they do not have the money in the bank that the policy assumes they will have, is why so many people have to use food banks and why so many get into arrears with their rent. This problem is hard-baked into the Department’s current policy.
The Trussell Trust made the point that it found the increase in referrals to its food banks was 52% in areas where universal credit had been rolled out for 12 months or more, compared with a 13% increase for areas where it was, at most, three months since universal credit had been rolled out or it had not rolled out at all. In other words, when universal credit is well-established and has been there for at least 12 months, the increase in referrals to food banks is greater than when universal credit has just been introduced. The Trussell Trust has been pointing that out for a considerable length of time.
Another change of tone I welcome came in another written answer last week. It told us that the Department is now working with the Trussell Trust to see if it is possible to develop—I think this is how it referred to it—a “shared conclusion” about the impact of universal credit on food bank demand. I shall certainly be very interested to see that shared conclusion when it is published. The Trussell Trust briefing for this debate highlights the five-week delay as among the
“urgent problems causing significant hardship”.
It goes on to say that Trussell Trust food bank referrals due to benefit delays are increasingly driven by this initial wait. It is a huge problem that needs to be fixed.
I pay tribute to my hon. Friend the Member for High Peak (Ruth George) for her excellent opening remarks.
The social security system was designed to be a safety net, but it has now become so threadbare and the holes so wide that many people are slipping through it. One key reason is that, although DWP spending has increased since 2010, we are supporting a larger pensioner population. There is also the introduction of universal credit, which replaces the previous system under HMRC. The generosity of many other support payments is decreasing. The changes and cuts to social security add up to savings of £30 billion for the Exchequer this year. That is going to rise to £36 billion in 2021 and £38 billion by the end of 2023-24, and this is in the context of Brexit.
The Government have sought to save money from changes to benefit rules, and we have heard about the freeze. There are the £4.8 billion cuts affecting disabled people; disabled people need that extra support because of the extra costs that they face, but that seems absolutely to have escaped the Government. The other thing is penalising children and children not being supported, as they have been in the past, and, of course, restricting women’s eligibility for the state pension by pushing the state pension age up.
My hon. Friend has to remember that this is against a background of the £12 billion cuts that the present Government fought general elections on. They have no mandate for it, so this all falls into place. However, she raises a very important point that is still a very live issue—women born in the early ’50s being denied their pension. The Government have just shut the door in their faces. I think that it is a disgrace given some of the problems that these women experience now. Some are on the poverty line as a result of all this. Does my hon. Friend not agree?
I totally agree. I have visited my hon. Friend in Coventry and many of the women from the so-called WASPI group who have been campaigning vigorously on this.
Although we did see a welcome increase in spending on UC in last year’s Budget, at the same time, the disability benefits and benefits for carers went down. Even though there were changes to universal credit last autumn, 3 million people will still be worse off under universal credit. Nine out of 10 low-income disabled households will not benefit from the Budget increases, alongside 640,000 self-employed households and 475,000 working lone-parent households. The effects of these social security cuts in the context of a rising cost of living are there for everyone to see. We have heard about the rise and rise of food banks. I never had a food bank in Oldham until this Government came in.
There has been the increase in personal debt and rent arrears. Eight million—the highest level ever—working households are in poverty. Two thirds of the 4.1 million children living in poverty are from working households. Four million sick and disabled people are living in poverty. Over 300,000 more older people are living in poverty since 2010. Our life expectancy is stalling—this is in the context of an increasing state pension age—and infant mortality, for the first time in 100 years, is increasing. Four babies in 1,000 will not see their first birthday.
The austerity agenda has not helped the economy one iota. Analysis used in the Office for Budget Responsibility’s model has shown that the independent effects of austerity have been to stifle economic growth by at least £100 billion in the last year alone—that is £3,600 per household. However, it is not just about that—the human toll as a result of these cuts cannot be underestimated.
Last week, we heard about Jodey, who took her own life after she was found fit for work following her work capability assessment. The DWP failed five times to follow its safeguarding rules in the weeks leading up to Jodey’s suicide, although it knew that she had a history of mental health issues. We learnt about 52-year-old Jeff, who won his appeal against his work capability assessment saying he was fit for work seven months after he had died. A few days earlier, we heard about 64-year-old Stephen Smith, whose emaciated six-stone body was photographed by the Liverpool Echo in a hospital bed. He had also been found fit for work. In my Oldham East and Saddleworth constituency, one of the worst cases I ever had involved a man who had a brain tumour. He was refusing to have the life-saving surgery that he needed because he was scared that he was going to get sanctioned. His medical team contacted me, pleading with me to intervene on his behalf.
I have a whole list here of different constituents and the struggles that they have had with the DWP, whether that is with PIP, the work capability assessment or UC. I want to particularly thank my team for the work they have done; without them, I could not do my job.
We are the sixth richest country in the world, and it is reprehensible for us to treat our citizens in this way. We must never forget that, like the NHS, our social security system should be there for all of us in our time of need, providing security and dignity in retirement and the support needed should we become sick or disabled or fall on hard times. It is a vital weapon in our fight against poverty and inequality—and one of which we should be proud, not ashamed.
It is strange that but a couple of handfuls of Members are here to discuss one of the largest budgets that the Government dispose of. We never analyse the expenditure very closely as it goes through Parliament; personally, I feel that a new system of assessing expenditure—more like a proper budgetary process in a local authority, frankly—is long overdue.
I will speak primarily about acquired brain injury, which may not come as a surprise to many Members. I know that people think that it looks as if I have had a brain injury of my own of late—it looks far more dramatic from behind than it is on the inside, but I am enormously grateful to people who have commented.
I want to talk about the issue because all too often an acquired brain injury, which might have come about through a road traffic accident, carbon monoxide poisoning, a stroke or a whole series of other means, may not be visible to the naked eye when we meet somebody. I have said this before in the Chamber, and it is true: the person standing in front of us in the queue, who is being difficult and seems drunk, might have a brain injury. All our judgmental attitudes may say more about us than about the person standing in front of us.
When somebody is being assessed by the Department for Work and Pensions for benefits, it is really important that the assessor has a full understanding of brain injury, for a multitude of reasons. First, such judgmental attitudes might be of no assistance whatever; and secondly, because the person’s condition may vary—not only across time, but from day to day or at different times of the day.
One of the most common symptoms of an acquired brain injury, even a relatively mild one that may have followed concussion, is chronic fatigue. I do not just mean feeling tired, as we might from day to day in the normal course of things, but real debilitating fatigue that means that we simply cannot get out of bed—not through laziness, but through utter fatigue at the core of our being. The Department for Work and Pensions has found it very difficult to cope with assessing somebody in that situation without resorting to language of, “Pull your socks up, chap!”
I know that the Minister is keen to see whether there are ways for us to work this out better, and I, along with the all-party parliamentary group on acquired brain injury, am really keen to make sure that every single assessor has some understanding, at least, of acquired brain injury—and, if they are not sure, the ability to refer the individual to another person.
There is another element to the issue. Fatigue is one of the most common elements of an acquired brain injury, so someone with one needs to harness all the energy they do have to strengthen their brain and recuperate. That requires a superhuman effort. I have spoken to individuals who have been through major road traffic accidents. They know that all the stuff they do with their doctors and clinicians—all the neuro-rehabilitation—is about how they strengthen their brain. But the benefits system is so complicated that it makes them feel like a number rather than a person; they find that they are using their energy just to deal with that, rather than making themselves better.
There could be a real advantage if there were a grace period of four or five years for people who have had a brain injury, so that once they had their first assessment they would know they would not have another for a set period. This is not about spending money; it is simply about enabling people to resuscitate and revitalise their own brains.
There is an additional problem which is known as the frontal lobe paradox. People may present extremely well and do well in tests, but some of the other elements of their executive function simply do not work as well as they might. That is why it is so important for us to have a system that can respond to individual needs. I hope very much that in the coming months we will be able to develop the system further, and that Ministers will work onside, to ensure that we can address those needs.
Like others, I pay tribute to our colleague the hon. Member for High Peak (Ruth George) for securing this important debate.
In the limited time available, I want to concentrate on a couple of elements of universal credit in which technical failings still cause real difficulty for individuals who receive it. I am aware that the new Secretary of State has been in listening mode, has taken on board some of the criticisms that she has heard in the House, and has improved and applied the suggestions that have been made. I hope that the Minister will give some feedback on these specific issues, so that the Department can improve the position.
When people who are moved on to universal credit already have a medical condition or disability, they are immediately placed in an assessment period similar to the one that in which they were placed when receiving employment and support allowance. The problem is that the period can be as long as 14 weeks, during which time their incomes can be cut by as much as £200, £300 or even £400 a month. If people on low incomes must wait 14 weeks for the result of an assessment that they have already undergone to receive ESA, that is clearly an anomaly in the universal credit system, which I urge the Minister to examine, respond to, and fix.
There is a second element of universal credit that involves an anomaly. When someone who has been receiving a severe or an enhanced disability allowance—which is only received by those with very significant impairments—moves on to universal credit, that person will automatically lose the additional money. The point of the enhanced disability allowance, which has existed for a long time, is to help people with severe disabilities to receive that little bit of extra money which enables them to function and lead secure and independent lives. I ask Members to imagine immediately losing up to £300 or £400 a month. It would catastrophically damage one’s income. I should be grateful if Ministers revisited and fixed both those anomalies.
Let me finish with a couple of real stories of the kind that we all encounter in our constituencies. They concern tribunals. My senior casework manager, Scott Stevens, is an outstanding advocate for disabled people. During both my times in Parliament, I have always done my best to ensure that he, or one of my team, represents disabled constituents at tribunals as their advocate. I pay tribute to Scott: he has a success rate of about 85%. When disabled people come to me in connection with tribunals and we are able to support them, we win 85% of those cases.
“Win/lose” is rather inappropriate language in this context, and I will explain why. We won a case at a disability tribunal on Monday. Again, Scott was there, acting as an advocate. What did we win? This was an individual who has between three and five epileptic episodes daily, both during the daytime and in the evenings. She had received the personal independence payment for a long time, but was knocked off it 10 months or a year ago, so we had to go to the tribunal to enable her to be put back on to it. I repeat that this is someone with an epileptic condition experiencing three to five episodes a day, yet she was considered not suitable to receive PIP. Members in the Chamber will not be surprised when I tell them that she was restored to 11.5 points so she now gets her PIP entitlement. That is just wrong: it is wrong that she has had to wait 10 months—and we can imagine the amount of debt my constituent is in because obviously she has not been receiving the full entitlement for 10 months. So I pay tribute to Scott Stevens for winning that case and I pay tribute to my constituent and I am glad she has got her PIP entitlement back, but I really do think the DWP has to revisit this so people do not keep having to go to tribunals.
I am afraid we have to reduce the time limit to four minutes.
I am pleased that the House is having this debate today because it has given Members an opportunity to highlight how the DWP is not being resourced properly. The DWP has the single largest departmental budget, yet it finds itself under-resourced when it comes to dealing with the consequences of the Government’s welfare reforms.
The Government’s welfare reforms, be it universal credit or the personal independence payment, have disproportionately hit the poorest and most vulnerable in our society. Just look at what has happened to those claiming income support and jobseeker’s allowance; both benefits are based on the principle of supporting those already in, or seeking, employment, yet the Government’s decision to include both benefits within the benefits freeze is undoubtedly having the opposite effect. There has been a real-terms decrease in the basic rate of income support and JSA, falling from a high of £78 in 2012 to £72 in 2019. The Trussell Trust highlights that low income was the main reason behind 31% of referrals to its food banks from April to September 2018. That highlights to me that the Government’s benefit freeze is creating a crisis of in-work poverty—a crisis which the DWP is currently not equipped to address. I urge the Government to bring an end to the benefits freeze now. Prices are rising and the DWP should be properly resourced to support low-income households—households which are currently set to lose £200 this year because of the benefits freeze.
That brings me to the issue of sanctions. I have consistently called on the Government to bring an end to the cruel sanctions regime. There were over 15,000 sanctions taken in April 2018, with the clear majority being implemented against UC claimants. This is despite an admission in a DWP report in October 2018 that there was no evidence that sanctions encourage claimants to get into work or increase their earnings. I was disappointed that the Government chose to reject calls from MPs to ease the burden of sanctions on some of the most vulnerable claimants, including single parents and those with disabilities. There should be a maximum period for which a sanction can apply and greater understanding that some claimants will miss appointments because of issues around health, childcare, finances and even local transport failures.
Members from across the House agree that there are real problems with UC and that the DWP has not been properly resourced to deal with them. The most glaring issue with UC is the five-week wait. The DWP has tried to take steps to address that, but those measures are either time-limited or do not go far enough in supporting those transitioning on to UC. With 1.6 million people expected to transition onto UC this year, it is vital that the Government act now to equip the DWP to deal with this problem.
More than 70% of PIP appeals found in favour of the claimant between January and March 2018. This represents a 17% increase in successful PIP appeals since January to March 2015, and we have to ask why the DWP has spent £108.1 million since October 2015 to fund legal professionals and their staff to fight these appeals while claimants are left to shoulder the costs of their appeal as a result of this Government’s cuts to legal aid. The Labour party wants to bring back legal aid.
I stood with the DWP staff in Coatbridge when it closed its office in 2017, but, sadly, we lost that fight. The building is still empty; why not reopen it and bring back the resources to Coatbridge?
I congratulate my hon. Friend the Member for High Peak (Ruth George) on opening the debate and setting the scene for us. I want to talk briefly about the position in Gateshead. My constituency is wholly contained within the local authority area of Gateshead and I want to touch on various points. We are seeing many of the worst problems occurring in my constituency. We had the full roll-out of universal credit in October and November 2017, so many of my constituents did not benefit from the tweaks that we had later. That clearly does not apply now, but there were some problems earlier on. Yes, people who have applied since the changes have seen the benefit of the roll-over of two weeks’ housing benefit, but many have been left in a difficult situation.
The housing company that manages the housing stock across the Gateshead Council area is the Gateshead Housing Company. According to up-to-date information, there are currently 3,087 tenants on universal credit who even now, collectively, have arrears of £1.8 million. That is an average of £583 each, up from an average of £283 before universal credit. I am told that this is caused by the delays in receiving payments. I am also told that 41% of the tenants of the Gateshead Housing Company have been put on alternative payment arrangements, which is a much higher proportion than either the Government or the company expected. This is not a case of the authority or the housing company leaving people to the worst of the system; this is happening after people have had help.
This builds on existing issues resulting from the bedroom tax, or the under occupancy tax—whichever you want to call it, the problem is the same. It involves those who do not have a chance, whatever they might want to do, to move to a smaller property. There were 1,579 people affected by that, and we can see a cumulative effect building up. The roll-out figure for people going on to universal credit has been much greater than expected. As I say, this is not an area in which people have been left to struggle, but there is still a problem with the housing revenue account.
I want to speak briefly, and quickly, about a report commissioned by Gateshead Council into the impact of universal credit. These are the headlines. First, those claiming universal credit found the experience complicated, difficult and demeaning. Secondly, the consequences of waiting five weeks for their money—and in many cases up to 12 weeks, with an average wait of 7.5 weeks—pushed many people into debt, rent arrears and hardship. For many of them, this included going without food. Thirdly, the staff supporting claimants found the system to be inconsistent, with inaccurate advice being given and difficulty in correcting what were clearly mistakes. Fourthly, universal credit is not working for vulnerable claimants, and it significantly adds to the workload of the staff supporting those claimants. I could go on, but I do not have time to do so.
We have also heard about the difficulty for people moving from the disability living allowance to the personal independence payment, with many people having their benefits reinstated on appeal. It cannot be right that the system allows people to go through all that agony, only to then reinstate their benefits. We have to get that right. Finally, I want to mention one of my constituents, Rev. Tracey Hume, who has said:
“I volunteer with a food bank. I am also a Methodist minister who has had to find benevolent funds to pay for gas and electricity while people wait five weeks for their first payment. We cannot expect people to live like that.”
A few hours ago, our city bid goodbye to Kane Walker. He was a young man who died on our streets in the cold of January. A man gone; a man who should still be with us; a man who, together, we have failed to save. And yet Kane Walker was not the only homeless man to have died in Birmingham. More than 70 homeless people have died on the streets of our city over the past four years. That is why I say to the Minister that the core of the debate today is not numbers or statistics but the moral emergency of homelessness that is now out of control because the safety net has been shredded around people who are only a couple of twists of fate away from the pavement.
When the National Insurance Act 1946 was passing through Parliament, creating the Minister’s Department, Clem Attlee himself moved the Second Reading. He was absolutely determined to see a social security system in this country that would deliver freedom from fear of want. He wanted to slay the five giants of injustice that Beveridge identified back in 1944. However, look at the evil giant of unemployment today. In Birmingham, youth unemployment has shot up by 23% over the past year, with 15,000 more young people now out of work. When Beveridge launched his report, he talked about the giant of disease. Today, disability is knocking more people into poverty than ever before, and yet 33,000 people in our region have been stripped of their right to PIP over the past few years, plunging them into a poverty from which it is difficult to recover.
When Beveridge talked about his five giants, he talked about freedom from want, and yet nearly 60,000 people in our region last year had to rely on food banks—a third of them children—which is a rise of nearly a third over the past few years. The giants of injustice that Beveridge identified now hunt and haunt us on the streets because of the collapsing safety net, and it is the crisis of universal credit that is that the core of the problem. I was amazed to discover in an answer to a written question yesterday that the Mayor of the West Midlands has not written to the Government once in the past year to express concerns about universal credit.
In my last minute I will rattle through the many different problems that Birmingham MPs have identified. There is wholesale confusion about eligibility for housing benefit and universal credit. Huge variations exist in the deductions made for advance payments. The self-employed experience long waits for correct payments. Sanctions are issued against those who are too ill to attend interviews. Those who challenge the inappropriate use of sanctions face huge benefit delays of up to five months. Constituents are forced to travel across the city to access IT to fill out online forms. Constituents with mental health problems are denied the right to face-to-face support. There are process delays and confusion about getting link codes to connect to childcare components, and the same applies to entitlements. There is total confusion about those moving from non-UC areas into UC areas. More confusion exists around eligibility for free prescriptions. Finally, there is complete confusion for our EU neighbours who have to pass the habitual residence test once again. In one of the richest countries on earth and in a city like mine, how can it be that homelessness has spiralled by 1,000% in five years? The system is in crisis, and this Government need to put compassion back into the system where it belongs.
It is a pleasure to follow the impassioned, articulate and erudite speech by the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) and to speak from the Front Bench for the SNP. It has been a good debate, and I commend the speeches from the hon. Members for High Peak (Ruth George), for Oldham East and Saddleworth (Debbie Abrahams), for Edinburgh West (Christine Jardine), for Rhondda (Chris Bryant) and for Blaydon (Liz Twist), the right hon. Member for East Ham (Stephen Timms) and the many others who made fantastic speeches. I agree with the Chair of the Finance Committee, the hon. Member for Rhondda, that this debate is far too short and that it is no way for us to scrutinise the spending of the largest-spending Department.
While I agreed wholeheartedly with all that was said by the right hon. Member for Birkenhead (Frank Field), the Chair of the Work and Pensions Committee, he listed a number of problems and areas that require improvements, and the Scottish Government are already acting on two of them. I hope that he will reflect on the fact that the Scottish Government have maintained council tax benefit and fully mitigated the bedroom tax, and we can see the difference in the child poverty in Scotland as a result.
The hon. Member for Brentwood and Ongar (Alex Burghart), who is not in his place, was right to say that work is the best route out of poverty, but while the nations of the UK have record employment levels, child poverty rates are still rising. We know that the Government are about to publish some very damning child poverty statistics, so Conservative Members cannot ignore the need for greater state intervention in this area. It cannot just be about work.
In the limited time available to me, I will raise a number of topics that expand on some of the things that have already been said by others. First, I want UK Ministers to look in greater detail at the benefits freeze, which was introduced in the 2015 Budget—a Budget, of course, that attempted to obliterate the social security system in these isles. The freeze has seen the value of the benefits affected drop by 6.1% over a four-year period, which has hit households hard and is seen by many groups as the key driver of rising child poverty. The Resolution Foundation said this month that child poverty is projected to rise by a further 6% by 2023-24, which would mark a record high.
Billions of pounds of savings have been made through the benefits freeze on the backs of the lowest-income families. In the final year of the freeze, the Exchequer is set to achieve even greater savings than anticipated. The higher than anticipated inflation rate means that the freeze will save over £1.2 billion more next year than the £3.5 billion that had been targeted.
When we know that the freeze is contributing to higher rates of poverty and that the Treasury is about to save more money than even it had targeted, surely the final year of the freeze needs to go. The Secretary of State for Work and Pensions has already said that she does not want to see the freeze continue any longer. She is acknowledging the difficulties it has caused, so why do she and others not go one step further and stop the final year? The spring statement would be the ideal opportunity for that to happen.
I turn now to an area that the Government do not want to be debated. I have called for a debate and a vote on this issue on three occasions, and other Members across the House have, too, but we are being ignored by this Government. UK Ministers want to enact a piece of legislation that is seven years old—it was brought in two Governments and two Parliaments ago—to cut pension credit entitlement. It will mean that mixed-aged couples will no longer be entitled to pension credit and will have to claim universal credit if one member of the couple is under state pension age. It has been estimated that this will cut £7,000 from the incomes of affected households.
When the measure was passed in 2012, we were in a very different political and economic landscape. Pensioner poverty was decreasing, but now we know from the Joseph Rowntree Foundation that pensioner poverty could be on the rise again. It is clear that this Government need to seek a new mandate for the cuts. They need to test the will of the House on what it has inherited and see whether it is still the right thing to do.
Staying with pensions, we know that a number of those who will be affected by the cuts to pension credit will be some of the 1950s women who have been ripped off on their state pension entitlement by this and previous Governments. The UK Government must do more to help the WASPI women, and they must listen to some of the suffering that cutting their state pension entitlement has caused. Despite the rises we have seen via the triple lock, it is worth pointing out that the UK state pension remains one of the most miserly in Europe.
An area where the new Secretary of State has shifted ground is on the two-child policy. She has accepted that rolling out the two-child policy to children born at any time, not just those born after the policy was introduced, would be unfair. We appreciate the small steps the Government have taken in some areas of universal credit, including the two-child policy, but they are clearly not enough. Given that the Secretary of State has accepted the injustice of one aspect of the two-child policy, surely she does not have far to travel to accept that limiting social security payments to two children is morally and socially wrong in its entirety. I urge her to rethink this disastrous policy, which is already forcing more children into poverty.
There is also a growing campaign, as we have heard again today, for the Government to do more on the five-week wait for universal credit. They have taken some steps to assist people moving from the legacy system to universal credit, but they have not gone far enough. A good place to start would be to use the assessment period for the advance payment of UC proper. If there is an acceptance that people need an advance, why say that the money needs to be paid back? People cannot be expected to live off fresh air, and they should not be expected to prolong indebtedness or financial hardship.
The pressures of UC do not stop at those who are receiving it. We heard yesterday that the Public and Commercial Services Union members who are working at service centres in Walsall and Wolverhampton have balloted to strike over changes to workload, recruitment and staff consultations. On top of the problems in UC, ongoing scandals are facing the personal independence payment, employment and support allowance, which was debated yesterday, and the withdrawal of disability premiums—even with some transitional provisions from this Government, this is letting disabled people down.
Meanwhile, the Scottish Government are building a social security system based on dignity and respect, one that garners the confidence of those who need it and the buy-in of taxpayers who pay for it. We have created a carers allowance supplement, to uplift payments by £442 a year, better to reward carers for the incredible job they do. We have introduced the best start grant and baby payment in Scotland, which expands on the UK’s maternity grant by providing eligible families with £600 on the birth of a first child and £300 for subsequent children, without a cap on the number of payments made. What the Scottish Government have done already, and plan to do with new announcements soon, shows this Government what is possible.
In conclusion, while the problems I have listed with the UK system persist, we cannot be expected to agree with the Department for Work and Pensions estimate. The Government need to do more and come back having built a system based on dignity and respect, as we see starting in Scotland. This Secretary of State, the sixth I have faced, is taking steps in the right direction. She has admitted that there are problems with the two-child policy and finally admitted that there is a link between this Government’s social security policies and the rise in food bank use, but they must go further. I know she is pleading with the Treasury for the resources to go further, and we hope we can hear of that at the spring statement.
It is a pleasure to follow the hon. Member for Airdrie and Shotts (Neil Gray). I congratulate my hon. Friend the Member for High Peak (Ruth George) on securing such an important debate, and of course thanks go to the 14 Members from across the House who have contributed to it. They made very powerful speeches indeed. This is my first experience of closing an estimate’s day debate for the Opposition, but, sadly, it is certainly not my first experience of a debate in this Chamber that highlights the chaos, unfairness and even sheer inhumanity of our current social security system under this Government. Debates such as today’s have been a depressingly familiar occurrence during my short time in this Chamber. They have been depressingly familiar for those of us who are debating and highlighting these issues, but of course the position is far worse and far more serious for those experiencing them, as was illustrated by my hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams). This system is dehumanising and frightening, and it is, on too many occasions, a tragedy.
As we have heard today, report after report from the Work and Pensions Committee, the National Audit Office and the Trussell Trust has offered major warnings about the Government’s direction of travel. Their findings have been echoed throughout this Chamber once again today. It is troubling enough to hear yet more accounts from right hon. and hon. Members of the human cost of this Government’s approach, in contributions such as that from my hon. Friend the Member for High Peak, who spoke about the rising child poverty evidenced by the Joseph Rowntree Foundation, and that from my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne), who spoke about the human tragedy that is homelessness and youth unemployment, but what is worse is that despite some of the spin, the warm words and the change in mood music, there is still no systematic evidence that this Government are acting in a coherent manner to address the problems that Members have highlighted today.
Universal credit has caused severe hardship for hundreds of thousands of people, yet the DWP is still failing to address the key issue of the five-week wait for an initial payment, as stated by my right hon. Friend the Member for East Ham (Stephen Timms). In the past year, 57% of new universal credit claimants have received an advance payment. It is a debt. That is a clear indication of the dire need people are experiencing. Make no mistake: just because 57% received a loan—an advance payment—that does not mean that the other 43% had no problems with the service at all. For many of them, the reality was not a good experience. Their experience was delay, debt, hunger and food banks.
Recently, the Secretary of State finally admitted what no one before her would admit but almost everybody in this Chamber already knew: the growth in food banks is linked to universal credit. It is belatedly welcome that the Government are finally, partially, waking up to the truth, but accepting it is not enough: action is needed. All too often, the only action from this Government is to press ahead.
Despite all we have heard, the Government are intent on seeking parliamentary approval for a pilot of managed migration to universal credit for some people, to start in July this year. The Secretary of State claims to have listened to charities and Opposition Members when we have evidenced the chaos and hardship that unmanaged migration will bring to 2.78 million people. Let me be clear: that chaos and hardship for 2.78 million people will now be chaos and hardship for 10,000 people. We are calling for a halt to the process altogether.
To add insult to injury, the Government claim that nobody will be worse off as a result of the changes, but, as evidenced by many of the contributions today, that really is not the case. Their belated, forced and haphazard approach to protecting severe disability premium claimants, some of whom were set to lose £178 per month, suggests a Government without a full understanding of how their own policy will affect people. There remain circumstances in which people will lose transitional protection—for example, when they become a couple or if they separate. How can a party that once claimed to be the champion of the family implement a policy that makes people think twice about formally entering a relationship because of the financial cost or, even worse, condemns people to staying in one that is not working and that is not safe, because they cannot afford to leave?
Were someone without prior knowledge or experience of what we are debating to have sat in the Chamber today, they would have heard these stories and asked a simple question—why? Although it is true that backgrounds to stories can be different and the reasons multiple, there is a simple answer to that simple question: austerity. The Library estimates that cuts to spending on social security and working-age tax credits will mean that some £37 billion will have been cut from social security by 2021-22, compared with 2010. Meanwhile, the richest corporations, including those in the financial sector that should shoulder some of the responsibility for austerity, have had tax cuts of more than £110 billion pounds. That is not fair, right or just.
Child poverty is up, with a massive 4.2 million children in need; in-work poverty is up, and now affects 8 million people who are in work; and wages have not recovered to 2008 levels. This Government have spent nine years using social security as a vehicle for cuts; meanwhile some of their friends in the financial sector and in the banks have received bonuses and unjustifiable tax cuts. Ministers may claim a jobs boom, but the reality for thousands and thousands of our constituents is zero-hours contracts or fearing for their jobs, as more and more of our manufacturing and retail base faces mounting insecurity and instability.
Despite all that, the Department for Work and Pensions supplementary estimates show that the Department did not bid for additional 2018-19 funding from the Treasury. Austerity is not over, and there appears to be little or no attempt from the Department for Work and Pensions to make it so. The Resolution Foundation has estimated that the fourth year of the benefit freeze alone saves the Exchequer £1.5 billion in 2019-20, making a total of £4.4 billion over the four years. That has meant that the poorest and most vulnerable people are falling further and further behind. The record shows us that when it comes to social security, this is a Government who do not change course.
It is a pleasure to respond to this debate—a vital discussion on how this Government, and our Department in particular, support people across society. I wish to pay tribute to the hon. Member for High Peak (Ruth George). We have not always agreed on every single issue, but it is clear that she is a tireless campaigner in this area. Her speech was particularly measured. She highlighted some genuine concerns that she has been pushing on in the years since she was elected. She should be proud that, in some of those areas, she has already effected change, and I know that she is an incredibly valuable member of the Work and Pensions Committee. I had the pleasure of joining her for about four weeks. Securing this debate is a tribute to her efforts.
There have been some very good speeches. In the limited time that I have, I will not be able to cover all of them, but I and my ministerial colleagues have taken note of everything that has been said and, where relevant, we will make direct contact.
Last year, the Department supported 20 million people—more than half of the adult population. We spend somewhere in the region of £190 billion, slightly more than a quarter of Government spending, and the equivalent to the GDP of Portugal. We have always been proud to share the proceeds of our growing economy with, often, some of the most vulnerable people in society.
My hon. Friend the Member for Brentwood and Ongar (Alex Burghart) made a powerful point about the impact on workless households and what an enormous difference that work can make. My hon. Friend the Member for Bexhill and Battle (Huw Merriman) said that, probably, the Government’s greatest achievement is our record on employment. Since 2010, the employment rate has increased to a joint record high. Youth unemployment has almost halved; the female unemployment rate is at a record low; and nearly 1 million more disabled people are in work than in 2013.
Last year, wages grew at their fastest rate in a decade at 3.4%. We are going further to support those in work, with the introduction of the national living wage, which is worth £2,000 a year. The changes to the income tax threshold are worth £1,200 a year. We have seen the doubling of free childcare and the extension of childcare cost support through universal credit. Money being spent on childcare support has risen from £4 billion in 2010 to £6 billion today—a 50% increase. However, this jobs miracle is not a given. Our labour market is outperforming many other developed countries: more people have moved into work in the UK since 2010 than in France, Spain, Ireland, the Netherlands, Austria and Norway combined. What a stark contrast that is to the previous Labour Government, and every other Labour Government who have always left office with higher unemployment.
Many of the speeches have understandably focused on universal credit. We are creating a welfare system in which it pays to work. It simplifies a complex legacy benefits system that too often thwarted opportunities to work. I was heartened that my hon. Friend the Member for Bexhill and Battle highlighted the huge amounts of great work done by individual work coaches. One thing that most impresses me when I go on visits to jobcentres is the enthusiasm that work coaches have for universal credit, giving them, for the first time in a generation, the tools to provide personalised and tailored support. For the first time, claimants have a named work coach who helps them navigate the support for housing, training and childcare, leaving up to 50% more time for them to find work. In addition, they get the support of universal support partnerships, which responds in real time. This contrasts with the legacy benefits, which were hugely complex, with six different benefits across three different agencies: Her Majesty’s Revenue and Customs, DWP and local authorities. We saw from our own pieces of casework just how some of the most vulnerable people fell through the system. It is estimated that £2.4 billion of financial support was left unclaimed a year.
Will the Minister give way?
I will not take interventions just yet, as I need to make a bit more progress. A total of 700,000 of some of the most vulnerable claimants have missed out, on average, on £230 a month. These are some of the people where £5 either way makes a real difference. We have removed the 90% tax rate for some, and the hated 16, 24 and 36-hour cliff edges.
However, it is right to say that improvements are needed. Many of the Members who have spoken powerfully today have helped to change universal credit since its inception. There is still much more to do, but we all welcome the additional £4.5 billion-worth of investment into universal credit set out over the last two Budgets, which means that we will be spending £2 billion more on universal credit than under the legacy benefits.
I will give way shortly.
We have seen changes to advanced payments. We introduced the two-week run-on for housing benefit for existing claimants and, in April 2020, an additional two weeks for ESA, JSA and income support claimants as they migrate over. We have scrapped the seven waiting days. Rightly, the Secretary of State is putting a real focus on looking at alternate payments, whether that is paying direct to the landlord or paying more frequently. We have increased the work allowance by £1,000, worth £630. We have extended the exemption for the minimum income floor for the self-employed. We are continuing to listen to these debates to make further improvements.
I have constituents who were housed by Rhondda Housing Association. They were on the old benefits, but because they have been moved by the housing association to new properties, still with the same housing association, they have been moved by the DWP on to universal credit and have to start from the very beginning. The bulk payment system and the payment directly to the housing association means that they have lost out on 11 weeks of housing benefit and, consequently, are suddenly in arrears having done nothing wrong. Will the Minister please make sure that this is put right for my constituents?
The hon. Gentleman is absolutely right—we have to make the transition as smooth as possible, where possible sharing data and working with support organisations.
That brings me neatly—this is why I was right to take the hon. Gentleman’s intervention at that point—on to the key point. Many of the people who will be in the benefits system are incredibly vulnerable. They do not have the family support—the network—that can help them to deal with life’s challenges as they come towards them. My ministerial colleagues and I work closely with charities, stakeholders, Members from all parties, and the Work and Pensions Committee. We also work with those with genuine, real-life experience, because they will not only raise, with their experiences, what needs to be improved, but can help with the training and guidance of our frontline staff.
I know this is a small point in the overall scheme of universal credit, but I mentioned my constituent Antony Hamilton and the issue he has in doing his A-levels while being a bit older because of his special educational needs. I would be grateful if the Minister could confirm whether anything could be done to help Antony.
The hon. Lady made a powerful point about Antony, and the relevant Minister will contact her to discuss it further.
The key for us is partnership working. On domestic abuse, we are rightly working with Women’s Aid and Refuge to help with training and guidance, and to strengthen our ability to identify, refer and support. We are working with organisations such as Barnardo’s and the Children’s Society to strengthen opportunities for care leavers. Ex-offenders are working closely with the Ministry of Justice to make sure that their universal credit claim is in place before they leave prison so that no people are falling between the gaps. On homelessness and rough sleeping, we are working with a number of organisations. Only today, Crisis said that over the past two years the Government have been showing drive and energy.
I am sorry but I do not have time to give way. The duty to refer change that was brought in in October will be addressing the points that the right hon. Gentleman made.
This party is committed to supporting the most vulnerable. Household incomes have never been higher. Income inequality has fallen. Risks of low income and material deprivation for children and pensioners have never been lower. The incomes of the poorest fifth are up by £400 in real terms, with 300,000 fewer children in absolute poverty. We are now spending £50 billion a year in supporting those with disabilities and long-term health conditions—£4 billion higher than in 2010. We, as a Government, are determined to help the most vulnerable. This is what drives me and many Members across the House who are here today. This Government are determined to get it right for the people who need the most support.
I thank the Minister, the shadow Minister and all those who have made powerful speeches. Members across the House raised the issue of PIP appeals and the impact of some terrible cases. My right hon. Friend the Member for East Ham (Stephen Timms) talked about the five-week wait. The Chair of the Work and Pensions Committee, my right hon. Friend the Member for Birkenhead (Frank Field), raised the benefits freeze, which came on top of a three-year freeze to tax credits and the three-year 1% cap introduced under the Welfare Benefits Up-rating Act 2013. That must be a priority.
I was pleased to hear from the Minister that the Government are looking to do more. My colleagues on the Select Committee are working on two reports on natural migration to universal credit and the welfare safety net. I hope the Government will read and respond to those, as well as the report being compiled by the all-party group on the many issues that remain with universal credit, many of which do not require additional funding but, if solved, will help people to be supported by a personalised system.
Question deferred (Standing Order No. 54).
The Deputy Speaker put the deferred Questions (Standing Order No. 54).