Universal Credit, Personal Independence Payment, Jobseeker’s Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013

Monday 21st October 2013 Lords Chamber

Motion of Regret

20:01

Moved by

[Lord McKenzie of Luton]

That this House is concerned that provisions in the Universal Credit, Personal Independence Payment, Jobseeker’s Allowance and Employment and Support Allowance (Claims and Payments) Regulations 2013 (SI 2013/380) to provide for the payment of universal credit awards on a monthly basis may result in budgeting pressures on low income families; and further regrets that universal credit awards being paid in respect of children or rent charges will not by default be paid to the main carer of the children or to the person liable for that charge, and expresses concerns that this may impact disproportionately on women and vulnerable members of society.

[Lord McKenzie of Luton (Lab)]

My Lords, the regulations before us this evening cover a range of matters, including the claims and payment arrangements and contributory ESA and JSA, as well as arrangements for claiming and payment of the personal independence payment. The thrust of this Motion is to focus on the awards and payment arrangements for universal credit. Of course, these regulations are only one set of a raft of regulations that we have considered concerning universal credit and other benefit changes. Some may be a distant memory in terms of the legislative process, but they are a looming reality for many. The context of all this has shifted dramatically since the start of the Summer Recess, when we were assured by the Minister that we could rest easy in our beds, that universal credit was on time and on budget and that everything was going swimmingly.

The Secretary of State told Parliament in March that universal credit,

“is proceeding exactly in accordance with plans”.—[Official Report, Commons, 5/3/2013; col. 827.]

However, the September NAO report uncovered the truth, describing how the Major Projects Authority raised concerns about the DWP having no detailed blueprint and transition plan for universal credit, which must therefore be reset. It recites that the Government will not introduce universal credit to all new out-of-work claimants nationally from October 2013, but will add a further six pathfinder sites this month. The NAO report emphasises that the pathfinder systems have limited function and do not allow claimants to change details of their circumstances online, as was originally intended. The department does not yet know the extent to which the new IT systems will support national rollout. In its October 2011 business case, the DWP expected the universal credit caseload to reach 1.1 million by April 2014; that reduced to 184,000 in the December 2012 business case. What is it now? Can the Minister tell us when the Government will set out a detailed plan for the full rollout of universal credit?

At a time when some of the poorest families in the land are being forced into debt by the bedroom tax and other measures, it is a scandal that the Government are writing off tens of billions of pounds of wasted expenditure because of their incompetent management of the universal credit programme. It is against this backdrop—where the department has delayed rolling out universal credit to claimants, has had weak control of the programme, is not achieving value for money, has been overoptimistic about timescales and has demonstrated lack of openness about progress—that we are obliged to return to some of the basic architecture of the scheme, to challenge whether it, too, has lacked the rigour of full analysis and, in particular, whether some of the protections against the worst impact of monthly payments are fit for purpose.

We cannot yet look to the April pathfinders for help as their scope is very narrow, covering where universal credit is applied to those who are single, are without children, are not claiming disability benefits, do not have caring responsibilities and are not entitled to housing support, but have a bank account and national insurance number. Clearly, these pathfinders will not tell us much about the impact of universal credit on low-income families and those who rent. The characteristics of those admitted to the further October pathfinders are not clear. Perhaps the Minister will tell us what those characteristics are and especially whether they will involve those who rent their homes. If not, at what point will universal credit be applied to those that do? So far as monthly payments are concerned, has the payments exception policy been applied yet to any recipient of universal credit under the pathfinders?

The substantive issues we raise tonight are not new—we raised them throughout our deliberations on the Welfare Reform Bill, and the Minister will doubtless hear from noble Lords with the same force and passion as was evident then. As our Motion sets out, our concerns are about the impact of monthly payments of universal credit on low-income families and about putting the clock back to the days where support for children did not go directly to the main carer and where the default position of rent support going directly to tenants increased the prospect of poor families losing their homes. We know that the justification for making monthly payments direct to claimants is that it will encourage personal budgetary responsibility and mirror the world of work. This is despite the fact that only half of those earning less than £10,000 a year are paid on a monthly basis. Life on benefits is not a comfortable existence for anyone who has tried it—and not just for a week here or there. There is the grinding awfulness of the poverty it brings, where there is simply no margin for error and where hanging on for the next payment date and juggling the cash to meet the next most pressing bill is the routine stuff of life. The temptation is to skip a payment here to meet a pressing payment there and risk becoming trapped in a cycle of debt.

How will monthly payments and assessments make things better? Research by the Social Market Foundation concludes that they will not, the Government’s exception policy notwithstanding. Although supporting the Government’s aim of encouraging greater personal responsibility and financial resilience, it concludes that changes to the payments and assessments system,

“could cause significant hardship for families on the lowest incomes”.

Its research outlined the budgeting methods that many households adopt to see them through, which inevitably involve debt of some sort, whether formal or informal. The households that it researched cited, in particular, the fact that more frequent payments served as a method to help them ration their income and restrain their spending. They feared that the larger payment might be spent too quickly, given the competing demands on their low income. On the exceptions policy, the Social Market Foundation expressed concern that a centralised system of identifying vulnerable claimants was an inefficient way of helping households and suggested an alternative of claimants being able to opt in to a budgeting portal. Have the Government given that any thought?

The Child Poverty Action Group focused on the “rough justice” that can ensue from monthly assessments where benefit claimants receive increased entitlements but which disadvantage claimants whose entitlement reduces. All of this is happening at a time when the discretionary social fund has been abolished along with crisis loans, community care grants and budgeting loans. They are to be replaced by payments on account or short-term advances and local welfare provision to be provided by local authorities. Short-term advances are much more restricted in scope than crisis loans and are only payable to benefit claimants in very tightly prescribed circumstances. As CPAG points out, that will not cover situations where a person has no, or insufficient, money to meet basic needs. Budgeting loans will continue to be payable to universal credit claimants, subject to strict criteria, on a discretionary basis with no right of appeal.

As for local provision, a recent Children’s Society report identified that money given to local authorities to replace community care grants and crisis loans is only a little over 50% of the equivalent spending at 2010 levels. Hard-pressed local authorities are in no position to make up any shortfall. Have any universal credit claimants under the current pathfinders been eligible for support for local welfare provision, short-term advances or budgeting loans, and what has been their experience?

We know that low-income families are poorly placed to cope with the current economic challenges. Some 10 million low-income households are in unsecured debt; three-quarters of those in the lowest income quartile have no cash savings. The cost of living squeeze is not only hitting the poorest, although it bears more heavily on them. Current levels of inflation will mean that universal claimants endure a real cut in their income at a time when energy bills are soaring and childcare costs are rising at almost 6% a year.

One thing is certain. For those who currently struggle to make their benefit receipt last until the end of the fortnight, the temptation to resort to payday lending will be enormous. For irresponsible payday lenders, the temptation to exploit an expanded market created by monthly payments will be irresistible, and with it the risk that continuous payment agreements will drain bank accounts as soon as benefit payments arrive. We applaud the work that the Minister is doing in encouraging the expansion of credit unions, but note that he is on record as seeking to restrict continuous payment agreements to accounts of benefit claimants until utility bills and rent have been accounted for. Could we have an update on that work? Will the Minister support the call that Ed Miliband has made for a special levy on these payday lenders, so that further moneys can be channelled into credit unions?

We raised the issue of the impact of universal credit payments on women, because time and time again it is women who are being hit hardest by this Government’s measures. It is women who are paying three times as much to get their deficit down, even though they still earn less than men. New mothers particularly are being hit, with House of Commons Library research showing that they will lose almost £3,000 during pregnancy and their baby’s first year.

My noble friend Lady Lister will say more about the wallet to purse issue, given her deep understanding of its history, and why the hard-won settlement should not be put in jeopardy. However, the Government have implicitly acknowledged the concerns we have raised about monthly payments, payments going to the main carer where children are involved, and payments going directly to landlords, because those have all been covered in their proposed alternative payment arrangements. As far as it goes, that is to be welcomed, but it raises a number of issues about how it will work in practice. The main concern is that this is a centralised system. Jobcentre Plus will decide whether an individual can have an APA and there is no right of appeal against an adverse decision. The key issue is whether Jobcentre Plus will have the capacity to make the determination a potential entitlement on a fair basis, given the range of circumstances that has to be taken into account.

Will the Minister indicate the expected number of claimants who will receive an alternative payment arrangement by, say, April 2014 and by full rollout? We have seen the first draft of the local support framework, which sets out the principles of the support that will be offered. However, what was planned as phase 2 of the universal credit rollout was supposed to provide the basis for the DWP and local authorities to start to plan these vital services. What is the plan now, given the revised universal credit rollout?

The Government have also launched demonstration projects to test how claimants can manage monthly payments of housing benefit. These are supposed to inform the final development and design of the exceptions policy. Will the Minister please update us on whether the projects will include any circumstances where monthly payments of rent are made under universal credit, rather than under the existing benefits regime?

We have supported the introduction of universal credit and will continue to do so, despite the project being seriously off-track. We have offered our support to help to restore confidence in the project. We have an unease about some of its components, especially combined monthly payments as the default position, and we will continue to press for the development of fair, comprehensive and practical exemption arrangements. We make no apology for promising to revisit these issues regularly and robustly. I beg to move.

20:15

[Baroness Lister of Burtersett (Lab)]

My Lords, there are many issues raised by the claims and payments regulations, but I plan to focus on the two that I raised in our debates on the Bill itself: monthly payments and payment into single accounts. These are lumped together in the guidance on personal budgeting support in a way that is not very helpful, because there are different issues at stake—a point to which I will return. Nevertheless, some questions relate to both matters: most fundamentally on both, the Government have rejected the arguments made by many noble Lords for choice about payment arrangements in favour of a convoluted system of personal budgeting support, which I suspect is going to be pretty difficult and staff-intensive to administer.

The clear injunction in the guidance that alternative payment arrangements are not available through choice would appear to contradict the earlier claim in the guidance that they would be claimant-centric—that is, done with, rather than to, the claimant. While I am pleased that the policy is no longer couched in the language of exceptions and vulnerability, designed to make a claimant feel different, this still appears to be the underlying philosophy.

This is also revealed in the argument that alternative payment arrangements should be temporary, to avoid labelling claimants as financially incapable. However, it is the Government who are in effect labelling them as such, by requiring claimants, who may be managing as well as can be expected, to adapt to payment systems that might simply be inappropriate for their circumstances. This determination to change claimants’ behaviour smacks of the kind of social engineering that sits uneasily with both traditional Conservative and liberal philosophy.

In our previous debate on regulations, the Minister said that he would be able to provide more information about the department’s working assumptions on the number and proportion of claimants likely to be deemed to require personal budgeting support,

“as we work our way through”.—[Official Report, 13/2/13; col. 755.]

As that was eight months ago, is the Minister now in a position to provide more information, as requested by my noble friend Lord McKenzie of Luton in his excellent and passionate opening speech? In particular, will he provide the information regarding those requiring monthly or split payments? Does he accept SSAC’s warning that the range of claimants who require these facilities may be greater than anticipated?

Will the Minister also explain how personal budgeting support will work with couples? In the case of joint claimants, will just one or both need to demonstrate the facts as listed in the annexe to the guidance? Will the decision about whether it is needed be based on a joint interview? Will money advice be offered to both members of a couple and will the Minister also advise us about the progress made with financial products such as jam jar accounts, which he earlier presented as a solution to just about all payment problems?

In July, the Minister was still able to tell the Work and Pensions Select Committee only that he hoped to be,

“coming up with something in the not-too-distant future”.

That is not very encouraging. Has he also taken on board the Social Market Foundation’s warning that jam jar accounts, while potentially beneficial,

“have only partial applicability across the claimant population”,

because of strong resistance from a significant number? Part, though not all, this resistance was because of the likely cost to the claimant. As the Communities and Local Government Select Committee observed:

“More information is needed … on how these accounts would work and who would pay for them”.

The Social Market Foundation cites evidence from the financial inclusion taskforce of the lack of appetite for financial products among about half of the unbanked. Those without a bank or Post Office account will be able to use the Simple Payment service to receive their benefit. As the Minister confirmed in a Written Answer, the problem with this is that it requires claimants to withdraw the whole amount, and not part, of each benefit payment at the same time, up to a limit of £600. This is potentially a lot of cash to withdraw in one go and leaves the claimant vulnerable to both robbery and temptation. Although it is estimated that only about 60,000 working-age claimants will be paid in this way, it is a cause for concern. Why is it not possible to draw part of the payment, as this would surely often be the responsible thing to do?

This brings me to the question of monthly payments, because if it were a more frequent payment, this would not be such an issue. Since noble Lords from across the House first raised concerns about monthly payments, evidence has been mounting to demonstrate just how un-claimant-centric this policy is. It is clear, from both government and independent research, that a significant number of claimants—particularly those out of work—see this as posing a real risk to their financial security. They fear it will upset their budgeting strategies and leave them running out of money.

In a DWP press release about early findings from the direct payment demonstration projects, the Minister acknowledged that the findings,

“show that most people on low incomes manage their money well.”

As SSAC has noted, one of the key lessons was that:

“Budgeting support needs to recognise that people on low incomes often budget on a fortnightly or weekly basis.”

Has it not occurred to the noble Lord that there is a connection here? As the demonstration projects show, many people on low incomes use fortnightly or weekly budgeting strategies as a means of managing their money well. Research shows that mothers, in particular, often take great pride in doing so. By forcing them to change their budgeting strategies, the Government could be setting them up to fail, a message that comes across clearly from the SMF study cited by my noble friend.

That is likely to have an adverse impact on morale, as well as living standards and, in doing so, could undermine the very objective of making claimants more work-ready. Where a more frequent payment is agreed, it will be paid in arrears, in addition to the new seven-day waiting period for some claimants. As the Women’s Budget Group has pointed out, this means that,

“claimants would be paid only half what they are owed for the month seven days after the end of that month and will then wait another half month for the remaining half. This would seem to contradict the Government’s wish to help those who find monthly payment most difficult and can result in hardship cases and requests for advance payments.”

Women’s Aid, to which I am grateful for its briefing, warns that most survivors fleeing domestic violence will have no alternative to claiming a budgeting advance. I appreciate why the Government are not keen to make a half payment in advance, but does the Minister accept that it would create fewer problems than paying in arrears?

As I said earlier, the question of payment into a single account versus a split payment raises rather different issues to that of monthly payment, even if both are likely to have adverse gendered impact. It is about access to, and control over, money rather than about managing it. The erroneous treatment of split payments as a management issue is illustrated by the guidance on when to review alternative payments. It says that the adviser,

“will decide that the claimant is now capable of managing the standard monthly payment.”

Where a split payment has been granted because of domestic violence, as opposed to a partner’s financial mismanagement, such advice is surely irrelevant. On what basis will a decision whether to continue a split payment be made? Does the Minister accept that there may be some situations where it cannot be treated as a temporary measure?

At present, the guidance seems to suggest that split payments will be an option only in cases of financial abuse or domestic violence. Can the Minister confirm that they will not necessarily be restricted to such cases? With whom will an adviser discuss this question and, even more importantly, the initial decision to make a split payment? Will it be both partners, and if so, will it be discussed separately or together, or will it be just the partner in need of diversion? If the latter, what will the other partner be told about the interview? How will advisers negotiate with gendered power relations which are likely to be at work between the partners to ensure that they have a true picture of the situation?

The department’s study of the implementation of JSA DB easement revealed a reluctance to disclose domestic violence to advisers, a concern that was raised by SSAC. This is likely to be the case here too. How will advisers detect domestic abuse, particularly when it is not manifested physically? Where a male partner uses the threat of abuse of various kinds to control a female partner, it could well be kept hidden. What steps can be taken to ensure that a split payment, which reduces the money paid to the perpetrator, does not provoke further domestic violence? Will the Minister indicate what training in financial abuse and domestic violence is proposed for universal credit advisers? More generally, what is the department’s response to SSAC’s recommendation for an effective training programme designed to ensure that advisers have a sufficient understanding and capability to manage the complex and dynamic nature of risk and vulnerability within universal credit?

It is important that the evaluation does not conflate the effects of wrapping up a number of benefits in one payment with payment into a single account under the rubric of a single payment, as did earlier departmental research.

At present, the guidance seems to suggest that split payments will be an option only in cases of financial abuse or domestic violence. Can the Minister confirm that they will not necessarily be restricted to such cases? It is not always possible to foresee situations in which they might be appropriate, and it would therefore be wrong to rule out other scenarios in advance. Indeed, Fran Bennett, to whom I am grateful for her briefing, suggested adding the scenario where a lone parent with children from a previous relationship takes an unemployed new partner into her rented accommodation. It may not be conducive to the success of a new relationship if one partner has control of all their joint universal credit.

I apologise for asking so many questions, but I cannot find the answers in the public advice and guidance. Reading that guidance, I am not convinced that the department fully appreciates how delicate and difficult an issue this is in any couple where there are difficulties of any kind with regard to control over money. Indeed, only last week, in discussing other regulations, the Minister drew attention to the extent of domestic abuse. If the fears of organisations such as Women’s Aid are realised, I suspect that the Government will have to revisit the policy and rethink the default position to ensure that both members of a couple have direct access to their share of universal credit, if they want it.

The Government’s refusal to listen to reason on these key payment issues could derail the successful implementation of universal credit, which is already looking somewhat shaky, to put it kindly. During the passage of the Bill the noble Lord, Lord Boswell, said,

“if this is the nail in the shoe that gets the whole thing discredited because it does not work or gives rise to disturbing social consequences, we will have lost the great prize of universal credit that many of us want”.—[Official Report, 10/10/11; col. GC 434.]

We should remember the lessons from the child support legislation, when widespread consensus about key principles meant that insufficient scrutiny of the practical details led to one of the worst examples of social policy-making in recent history. I hope that even at this late stage, the Minister will take heed and remove the payments nail from the universal credit shoe.

[Lord German (LD)]

My Lords, I agree with some of the sentiments that we have just heard from the noble Baroness, Lady Lister, and with some of those that we heard in the opening speech of the noble Lord, Lord McKenzie. It seems that there are questions which need to be asked and questions which are still outstanding. However, perhaps some of the clues to the answers that we need to those questions can be found within the noble Lord’s opening speech. He said that we do not yet have the evidence from the rollout of universal credit to give us the learning pattern that we need to establish the route forward for some of the detailed questions which lie before us. They are real issues.

20:30

I draw back to the principles that lie behind the way in which you construct a process dealing with these three major, complex issues. It depends on which way you look through the prism or telescope. As was rightly said, they are all about changing behaviour and the way in which people do things. It is about where the balance lies. Is it in devising, on the one hand, a system where the needs of the most difficult determine its shape, or, on the other hand, do you run with the generality of people’s capabilities and then provide specific support for those who cannot manage, whether that is in the short or long term or transitionary?

I am drawn to the second of those approaches. That is how you encourage self-reliance and how people will be better able to manage their lives and futures: working with the flow and giving a helping hand to those who need it as appropriate. The difficulty, of course, is in where to draw the balance—the line between the one and the other—then in devising structures which are based on a general capability, and then in devising where the boundaries are in providing that assistance and support. From what I have heard so far in the debate, whatever support is provided it must be local, flexible and based upon a local assessment of where people are. Perhaps the Minister can tell me what those processes might be.

In annexe A to the universal credit guidance on budget support, we were given two tiers of categories under which people might need extra support and, possibly, alternative payment arrangements: highly likely factors in tier one and less likely factors in tier two. That was quite an extensive list of 22 different categories of people who will need some form of support with the way in which universal credit is rolled out. If you have a rigid, centralised structure which comes from decisions taken here in London, it will not necessarily meet the ambition of a flexible approach provided with local understanding and assessment.

I will also address some of the issues relating to how these payments will be made. One of the conflicting issues which has now arisen is the consequence for the Post Office card account, which the Government support and which provides a form of basic banking. One of the primary reasons that many in your Lordships’ House would like to see that sort of support continue is that it provides footfall across our local post offices. For many post offices, particularly in urban inner-city areas, that is the means by which they continue to survive. I hear of the Post Office card account plus, which is a trial going on in the east of England with an additional capability for providing jam pots by means of direct debits. Can my noble friend the Minister reassure me that the Post Office card account, or a replacement for it, will exist when the contract for that account comes to an end in March 2015, and that we are trying with the rollout of universal credit to provide the best facilities for people so that they can take advantage of cheaper budgeting arrangements by means of direct debits and other means of payment, particularly to energy companies?

On the issue of monthly payments, which is a major change, perhaps we should look back at the evidence from 2009 when the previous Government changed from a weekly to a fortnightly payment system. That was a doubling that we discussed during proceedings on the Welfare Reform Bill. What evidence came out of that shift? Did the department undertake any active research to find out whether the shift in 2009 had caused any behavioural change, whether there had been major difficulties as a result, whether people’s budgeting arrangements made them fall into arrears, whether they were unable to cope, and whether we could learn any lessons appropriate for the current regime?

After all, we know that claimants will face many management challenges and, where there is a clear need, they will require a level of assistance. It is in this area that I wonder whether Jobcentre Plus, given the strictures placed upon it, has the capability to handle that money advice. We are told in the information with which we have been provided that claimants will be referred to online, telephone or face-to-face support with expert providers at a national or local level, depending on the issue. I understand that this money advice has to be readily available but will it be available to people locally? Will the people making decisions on the back of the advice that people have been given be able to take those decisions and treat people differently? There are concerns about vulnerable people moving on to a monthly payment. It matters that we as a Government are able through Jobcentre Plus to manage the whole process in a local and flexible manner. That goes back to the first set of principles that I outlined.

In respect of payment to one member of the family—the split payments issue that the noble Baroness, Lady Lister, raised—the decision on who will receive the funding in a household is crucial. Given that we have not had the rollout in any area where this policy will have an effect, has the Minister had any thought as to how the need to be flexible regarding who receives the payment will be dealt with? Who will make that decision? Will it be the household? If the household makes a nomination, how will we be certain that that is correctly the view of the whole household, given that there are sometimes pressures that may not be appropriate? Given that there are 12 categories of people who may be treated differently because of the need for alternative payment arrangements, how will that be taken into account locally and how will it be dealt with?

I should like to turn to the question of what level of arrears might be built up, on which we have some evidence from demonstration projects. Can my noble friend confirm that the findings in May 2013 from the department’s work on these trials show that the level of payments were on average 94%, with the lowest being 91% and the highest 97%? Whatever is the case—and the percentage figures are in the 90s—a whole range of people is falling into arrears and represent the gap between 94% and 100%. Can my noble friend provide us with more information on how that will work?

Finally, I reiterate the point about the rollout of universal credit. This is something in which we have all invested our support because it is a crucial change to the way in which we make more efficient and effective ways to support people. It is concerning that we are having to extend that rollout. May we have the latest information on how that will be projected into the future and when we can expect the regime to be fully in place?

[The Lord Bishop of Ripon and Leeds]

My Lords, I am very grateful to the noble Lord, Lord McKenzie, for bringing this matter to our attention again, and for the three powerful speeches which we have already heard. First, I want to emphasise my concern about that part of the Motion which speaks of the way in which universal credit awards paid in respect of children will not necessarily by default be paid to the main carer of the children and the disproportionate impact this will have on women. Through my work, I have become increasingly aware of the mother’s crucial role in the sorts of situations that we have been discussing over the past few minutes and indeed over the past few years. The mother needs to have proper control of the money which is coming for the benefit of the family and in respect of her children. I hope that in our discussions and the way in which the regulations and the whole universal credit system are worked out we shall be able to pay attention to the mother’s role, which in many circumstances is crucial when the whole family is under severe stress.

Secondly, I share the concerns which have been expressed by all previous speakers about the impact of the monthly payments system. It is already beginning to make it more difficult to control the finances of the family and, as the noble Lord, Lord McKenzie, said, there is the danger of opening the way for payday lenders. We are already seeing considerable growth in the work of payday lenders. That in itself is not yet due to universal credit but my fear is that universal credit will become a factor as the monthly payment system comes into being.

I wanted to take up one particular detail of the regulations which fits in with the monthly payment concerns but is also specific. Regulation 26 of Part 2 speaks of the back-dating of universal credit and limiting that back-dating to some very narrow categories. This contrasts with the present situation for tax credits, which can be back-dated for up to 31 days so long as the claimant meets the rule of entitlement throughout that period.

I raise that question for two reasons. One is that many people will become eligible for universal credit at the birth of a new child—a particularly difficult moment to be making your claim. Secondly, the regulations acknowledge the possibility of the failure of systems. However, it will be hard to prove that failure if a claim is delayed or not made until three or four weeks after the claimant is entitled to make it, especially if that reason involves the inability of the claimant to access the system, whether due to a fault in the system itself or due to the claimant’s online skills.

What I would like the Minister to say to us is that one-month’s back-dating would be legitimate without a particular reason needed for it. That would reduce bureaucracy and would reduce the complexity of making claims. If he cannot do that, then at least there should be a back-dating for families who have become eligible for universal credit because they have had a new child and are busy with the celebration of its birth. That should happen without the requirement for “medical evidence” to demonstrate the incapacity to claim. Not getting online at the point when you are having a child seems to me to be a self-evident reason for delay in making your claim. There are far more important things to be doing on the day of the birth of your child, are there not?

Can the Minister clarify the circumstances under which a claimant is considered unable to make a claim online as a result of system failure, and whether that can include not just a direct failure of the system but also the difficulties that individuals are facing and will face in getting online to make a claim? I hope that the Minister will be able to give some reassurance so that people do not miss out on credits to which they are entitled by the regulations.

20:45

[Baroness Hollis of Heigham (Lab)]

My Lords, I will follow the right reverend Prelate the Bishop of Ripon and Leeds in his point about going online. First, I want to say, as others have said, that I very much support universal credit and I am watching with wry horror now the number of people being taken to court for failure to pay the £2 or £2.50 owed on their council tax bills by virtue of the localised council tax system. One wishes that some other parts of the Government had listened to some of the debates that we had in Grand Committee on that subject.

Like others, I am concerned about where some of the cuts are going to fall. In particular, I remain worried by the disincentives to second earners, usually women, in couples whom we want to encourage to go back into the labour market. We increasingly make it less financially worth while that they should do so. I think that is very foolish indeed.

However, my biggest concern has been not just the payment problems, which my noble friends Lady Lister and Lord McKenzie have mentioned, but the assessment issues associated with them. Perhaps I may remind the noble Lord that, as far as I am aware, most of the pathway schemes and experiments so far have been with younger people in urban areas. They are more likely to be IT-literate and more likely to have access to IT facilities. I am chair of a housing association that runs across a rural county. A substantial proportion of my older tenants have no access to WPs. Of those who do, only 14%, when I had my last tenants’ conference, actually used them for financial matters, such as the handling of bank accounts and so on. In order for those other tenants to be able to claim universal credit, they have somehow to access a WP. I have four centres across the county of Norfolk—in King’s Lynn, Norwich, Dereham and Great Yarmouth, and possibly North Walsham, but we will see—in which we will set up local offices. There will be terminals and there will be people to guide people through their applications. That is fine, except that people may have to go on something like a 15-mile bus ride to make their application. Because it is a paperless system, they will not be able to correct any mistakes online. They will not be able to answer any queries about the information. They will not be able to follow it up because they will be back home.

I tried to see whether there was any way I could bring IT facilities to people in that situation. I considered, for example, whether I could provide terminals in people’s homes inexpensively, possibly through a leasing system. Yes, I could, except that those same tenants cannot afford to pay the broadband or dial-up charges. So I cannot put them online in their homes. I then thought about whether I could in some way get them smartphones to give them some online access. No, they cannot afford the charges of smartphones. So they cannot afford to go online. Indeed, in some parts of Norfolk you cannot even get access to broadband, but that is another matter. We have only 90% coverage, so sod the 10%. No doubt they will get their money somehow. None the less, in large parts of Norfolk, there will be a large number of people who have no access to terminals in their home or to a smartphone, who have no computer skills, who have to go into a local centre, and who, if any mistake is made, will have no ability to correct it.

You may think that assessment will be only once a year or once every six months and therefore this is a minor problem compared with the payment issues. I hope that is right, but one of the crucial reasons why the old CSA computer toppled over, which was at the core of the failure of the CSA to deliver the service it should have delivered, was that half of all lone parents had more than 12 changes of circumstances in a year. They were largely associated with changes in childcare at each holiday period because it did not fit the school’s working time or the mother’s work patterns. You can get real-time information from an employer about income, but you cannot get real-time information in the same way for ever-changing childcare bills. That means that that lone parent or that couple will have to reassess, reclaim and adjust their UC online as it is going to be paperless. Will the Minister tell me how I should respond to this? I have hundreds of tenants who at the moment have no IT skills, no access to gaining them, although I am trying to do crash courses where people are willing to take them, no terminals at home, no ability to afford dial up if it were to exist and no access to phones. How are they going to input the information they need to input to get the money they are entitled to? I would be glad of some help on this point.

[Lord Kirkwood of Kirkhope (LD)]

I shall make a short contribution to this important debate. I am grateful to the noble Lord, Lord McKenzie, for introducing it. Using a Motion of Regret is clunky, but this is important. I shall start with a question about parliamentary process. Things have changed since the old days. In my experience of parliamentary change of this kind, Bills were much less far reaching and were implemented over a much shorter timescale. After the six-month period of purdah, Ministers could always explain the unfolding of the regulations that flowed from the primary Act. We are getting to a stage where we are paying more attention to guidance rather than to statutory instruments. Statutory instruments are becoming almost as skeletal as the primary legislation. Therefore, how are parliamentarians able to keep up with what is going on, particularly when this is at least a five-year implementation phase? I think it would be a good trick if the Government could achieve it in a five-year period.

In parenthesis, I want to strengthen the Minister’s hand. Speaking for myself, I am much more interested in getting this universal credit reform right than I am in sticking to any timetable, political or otherwise. I have next to no interest in what will happen in May 2015 compared with this important legislation. It is transformational architecture, but because it is transformational, it is difficult to deliver for reasons that we have heard.

It is not just that it is taking five years to do. It is now intimately engaged with other government departments. HMRC is the prime one, but not the only one. There is also DCLG—is it DCLG or DCLM?

[Baroness Hollis of Heigham]

DCLG.

[Lord Kirkwood of Kirkhope]

Thank you. I am Scottish. Luckily it does not apply to me.

[Baroness Hollis of Heigham]

You are lucky.

[Lord Kirkwood of Kirkhope]

I know.

We have a lot of extra heavy lifting to do to try to make sense of what is going on. If that was not enough, we have for the first time a completely transformational application of ICT technology in digital delivery. All that means that this has to be done slowly and sensitively. I would like to think that the kind of flexibility that the Minister showed in the seminal Committee stage of the 2012 Act is still available to us because if he is not sensitive to the sort of things that are being raised he risks prejudicing public perception of what he is trying to do, as the noble Baroness, Lady Lister, said.

I am absolutely certain that the vast majority of people who will need to take advantage of universal credit in future are literate and have internet access. We know from government research that the penetration of digital technology is increasing and will continue to do so. It is the two lowest deciles of income distribution in terms of household income that I continue to lose sleep about—people who earn less than £10,000 a year. We have been hearing about some of these acute problems and they are just as acute as they were in 2012. I understand that we have to hasten slowly to get this right, but we have to find a better way of informing Parliament about what is going on. I think the next set of detailed guidance that we can expect—my spies tell me and my spies are everywhere—will be in the late summer of 2014 and the next substantial rollout might not be until the spring of 2015. How are we, as parliamentarians, to keep up with what is actually going on? Reading the newspapers is not always helpful because, although they can highlight some of the problems, they do not tell the whole story.

I make a plea to the Minister. Can he think about ways of dealing with this other than Motions of Regret? It is a game we can all play, and we could do it every month if we had to, but I think there is a more grown-up way of accepting that, for the next two years and, indeed, for the rest of this Parliament, there will be periods when the Government could find a parliamentary opportunity for us to have a sensible discussion, be given reassurances and ask these detailed questions which are so important, not just to us, but to the people outside.

I agree with everything that has been said about the monthly payment, particularly by the noble Baroness, Lady Lister. That is probably my biggest worry. I know that she has more expertise than I about the split payments, but I listened carefully to what she had to say and I think that her questions deserve answers. The additional problem of behavioural change, on top of everything else, is something that is too dangerous, and I wish we were not doing it at all. Maybe we could do it in future, when this gets straightened out, but it is too risky to do it in this way.

My final point before I sit down, because it is late, is that the SSAC has done a very good job. I still remember the long look I got down the ministerial nose when I suggested this at the beginning. This was my idea, because I thought it would help. Luckily, the Minister eventually took my advice. The SSAC has done a remarkable job and I hope that the Minister will continue to involve it. Although it does not have any statutory control over guidance, if we get to the position where guidance is needed, such as in the definition of what is vulnerable, and we cannot get that clear with the stakeholders that the SSAC knows and works with so well, then we will be lost when this gets implemented. I hope that the Minister will give us an assurance that the SSAC will have a key and continuing role in this evaluation and monitoring process. Otherwise, it will be more difficult to achieve successfully.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)]

My Lords, I should genuinely like to thank everyone who has spoken today. I want to emphasise that I listen very closely to what noble Lords say in this House and, without shame, steal as many of the good ideas as I can. This is not just with a long nose, using SSAC, which has done an extraordinary job in helping us to sort out not just the regulations on universal credit but a lot of other things, too. I shall describe some of what we have been doing since we went through that committee and some of the ideas that we debated together then which I have tried to use and embed.

I hope also to allay some of the concerns expressed by noble Lords. When one has a new canvas, as we have here, one can worry about absolutely everything. It is important to be alert to the issues that one needs to worry about and then, as the evidence comes in, to see what the real problems are and to be able to move. We have laid out this evening a range of possible things that could go wrong. Some of them may go wrong and we will need to do something about them. Others may not emerge as issues, so it is important that we are watching this like a hawk.

21:00

I will take this opportunity to remind noble Lords of what we are trying to do with universal credit. It is replacing not a good system but a flawed system, which has a lot of problems. It is designed so that claimants can better understand what their benefit is and so that their incentives are improved. It is dynamic and responsive and it influences claimant behaviour—we make no apology for that—by helping to ensure that they can see that work is always a better option. It brings together in-work and out-of-work support into a single payment, in a way that is not the case today. That is at the heart of what we are doing to break down the barriers that stop many people taking work in the first place.

I will first touch on where we are with universal credit. A lot has been said about it in the press and by the National Audit Office, which the noble Lord, Lord McKenzie, talked about. The National Audit Office said that further work and investment were required for full rollout; we know and acknowledge that. We are doing a pathfinder, which people are able to do online. Many more people than we expected as a proportion have done so, although noble Lords will not be slow to point out that they are a particular type of people. We have accepted the recommendations of the Major Projects Authority to review the IT and make it more flexible and secure, and we are looking very hard with GDS—the Government Digital Service—to see how we can get best value out of IT.

I need to clarify a point that has confused some people. When the NAO said that there was no clear idea how the system would work, it is very clear that it was not referring to the policy. We have done an enormous amount of work—indeed, noble Lords in this Chamber have done a lot of work—in making that clear. It was about the IT technology underlying it; that is where the issues are.

We have a pathfinder, which is up and working well. We go national this month. We start in Hammersmith in a few days and we will go forward with a further five jobcentres in the period up to next spring. Just as important as the pure universal credit is the rollout of key elements of universal credit, so every jobcentre will be using the claimant commitment by next spring. We are installing internet-access devices in 6,000 jobcentres across the country, which may be a solution to the problems that the noble Baroness, Lady Hollis, talked about. We have 11 in-work progression pilots up and running, which test ways to help claimants on low incomes increase their working hours in order to reduce their dependency on benefits.

We are right to go for a phased rollout to ensure that we test universal credit and the support available to vulnerable claimants every step of the way. We are working intensively, as noble Lords must imagine, to complete our rollout plans and we remain committed to delivering UC safely and securely over a four-year period to 2017. I echo what my noble friend Lord Kirkwood said about what was more important. I am not allowed to say that timetables are not important, because they are, but it is far more important that we do this safely and reliably and do not cause the kind of problems that noble Lords are worrying about when they think back to the CSA, for instance. We will make another announcement later in the autumn on further plans for the rollout.

We are doing other testing; the direct payment demonstration project has been referred to. We have also had 12 local authority-led pilots testing face-to-face support. We are expanding the credit union pilots and the testing of a personal planner to prepare claimants for universal credit in a live environment.

The noble Lord, Lord McKenzie, asked about the claimants. Regrettably, we have a strict publication schedule; these are national statistics now, so the timing of publication of some of those details that noble Lords would love to hear about is such that we are aiming to start publishing at the end of this year, 2013, so there is not too long to wait.

My noble friend Lord German talked about the importance of local flexible support. Picking up many of the ideas that we were discussing in Committee, the framework around UC is certainly almost as important for the vulnerable as UC itself, and that is what the local support services framework is about.

In February, we published the principles of how those partnerships will work. This is something that we have not done as a country before, so we are really trying to pull in the support, looking at where we have overlaps and where we have gaps. We have had some extraordinarily close working partnerships between the Local Government Association, Scottish local authorities, the Welsh Local Government Association, the DWP, local authority representatives generally and third sector groups. We are really beginning to develop a plan and will issue the next iteration of that shortly, but that is going to be very much about the elements that we need to trial and test—detailed trialling and testing of all these different elements about which noble Lords are rightly concerned. We will incorporate into the update and test plan what we have been learning from the local authority-led pilots, the pathfinder and the direct payment demonstration projects, as well as feedback from staff.

I have talked about the extra 6,000 computer terminals that we will have in jobcentres, but one of the things that the local support service framework will be looking at very closely is the provision of the kind of access that the noble Baroness, Lady Hollis, was concerned about.

The noble Lord, Lord McKenzie, raised the issue of monthly payments. He and other noble Lords have been worried about how that will work. One of the important things about it is what it does for the poverty premium. I am going to talk about that in a little while, but let me go back to the basics here.

With universal credit we are encouraging claimants to take responsibility for their financial affairs, particularly in relation to those issues that act as a barrier to work. About 75% of people have their wages paid monthly and that figure has been rising steadily over the past decade. In addition, more than 60% of those earning more than £15,000 per annum—which is where the majority of the UC working population sits—are now paid monthly. So this is about building a system for the majority with, as my noble friend indicated, support for those who need help to manage it. As noble Lords have pointed out, many claimants are currently paid multiple benefits: different amounts, different paydays, different frequencies, and that makes budgeting difficult. They may have learnt how to manage round it, but the cost of it is often the poverty premium.

The poverty premium is, essentially, paying more for essential goods and services because you are unable to commit to monthly direct payments or take advantage of offers and discounts. Let me give some examples. Some energy companies offer a discount of up to £100 for customers who pay using a monthly direct debit plan and mobile phone bills can be up to three times more expensive if using a pay-as-you-go plan. Financially excluded households also pay more for essential household goods because they are less likely to have savings to cover unexpected spending or be able to access affordable credit. As a simple example, the price of a washing machine shows that I could pay £317 if I bought it today from a major online retailer but if I went instead to a weekly hire-purchase scheme I would end up paying more than £1,000 for exactly the same product.

The poverty premium takes money away from the people who can least afford it. I know that the noble Baroness, Lady Lister, worries about the poverty premium as much as any other factor for these groups of people. If we can get it right, that is one of the most important and attractive features of paying people a proper amount of money monthly. It will help them change how they pay their bills; it will allow them cheaper tariffs for gas, electricity, mobile phones and other bills; it will help them develop financial capability and confidence and it will allow low-income households to build or improve credit ratings and gain access to affordable credit.

We have to recognise that some people will need help to budget and we will have a budgeting conversation with each claimant when they make a new claim, identifying what help and support they need and ensuring that safeguards are in place to help them manage their money. We will ensure that those responsible for children and housing payments are supported where necessary. Couples will decide which bank account their universal credit payment will be paid to but, in cases where couples cannot decide, we will make payment either to the main child-carer or, if there are no children, to the person responsible for paying the bills. We can, if necessary, split the payment within the household or make more frequent payments. I remind noble Lords that child benefit will continue to exist outside universal credit and will be paid to the main carer.

There is a concern that many claimants do not currently have access to a transactional bank account. I can reassure noble Lords that we already have a voluntary agreement with the major UK banks to offer basic bank accounts and we are working with the Treasury and the banking industry to review minimum standards for basic bank accounts. We are also consulting with financial providers across the private, social and third sectors to explore ways of making budgeting, or jam-jar, accounts more widely available.

The POCA contract expires in 2015 with an option to extend for two years. I can inform my noble friend Lord German that we are currently in discussion with the Post Office regarding the future of the service. We are committed to ensuring that claimants have access to appropriate financial and banking products, and will continue to work with the Post Office to develop its suite of products in line with claimant needs. We continue to work on the budgeting, or jam-jar, account, looking at a range of potential budgeting tools. The noble Baroness, Lady Lister, asked about that.

21:15

I have approved a further investment of £38 million to help credit unions provide financial services for up to 1 million more consumers by March 2019. That could save low-income consumers up to £1 billion in loan interest payments. Clearly, I have a great concern about the payday lending industry. I am in discussion with regulators, in particular the FCA, about how to make sure that they do not undermine the position of low-income households going into universal credit.

On budgeting pressures and housing, I will emphasise why this is important. Monthly housing costs paid direct to claimants are a key to building up financial capability. Clearly, we cannot have a situation in which a barrier for someone moving from being out of work to being in work is the fact that they have to transform the way in which they pay their landlord. For claimants who genuinely cannot manage to pay their rent, we can make managed payments of rent to landlords to protect the tenancy. At the start of a claim, we will review the claimant’s financial capability, and we will look at it again if the claimant accumulates one month’s rent arrears as a result of persistent underpayment. At that stage, we will make an early intervention, reviewing what financial support they may need and making managed payments of rent to their landlord if necessary. If the claimant goes on to accumulate two month’s rent arrears, we will automatically pay the housing-cost element direct to the landlord, and cover the arrears through deductions from the universal credit.

The noble Baroness, Lady Lister, referred to the way in which the payments were made. A budgeting advance can be made, but clearly it is just an advance; it is not a question of getting half early and another half at the end of the month. It is half early, the full amount at the end of the month and then a very gradual repayment of the early advance. Therefore, the position is not the one that the noble Baroness envisaged.

On part-payment, we will have the ability to issue universal credit through a simple payment, as the noble Baroness requested. However, this will not be the right method of payment for the majority of claimants; we are looking for most people to be paid through a bank account, as they are already.

On demonstration projects, my noble friend Lord German made the point that the average collection rate was 94%, and that the rates were improving. I believe that most claimants will be able to manage their household bills. However, where they cannot, we have safeguards in place to protect the household’s tenancy and the landlord’s financial position.

We recognise the importance of safeguarding the welfare of tenant claimants who have incurred debts. Therefore, under universal credit, there will be a co-ordinated approach to making deductions, aimed at protecting the most vulnerable from financial hardship. Safeguards have been introduced, such as an overall maximum amount that can be deducted from someone’s universal credit each month, which equates to 40% of their standard allowance. This rate aligns with the amount that a claimant could receive under a hardship payment. If you look at the proportion of a standard payment, that boils down to a typical family of two parents and two children living in the rented sector seeing their overall payment decrease by a maximum of 13%.

My noble friend Lord German asked who gets alternative payment arrangements. We will consider information provided by claimants, advisers, third-party organisations and anyone who may support or assist the claimant. We will make the alternative payment arrangements on a case-by-case basis and not through a centralised or automated system. Decisions will be made with the claimant rather than for the claimant. It is not about having a central system.

I am running on a little long. If noble Lords would not mind me being another five minutes, I will go through some of the issues. I am conscious of the question about scarcity of information coming to noble Lords and ask their indulgence on that basis. I want to deal with as many of the issues as I possibly can.

On the questions about women, households with single women and coupled households are, on average, better off after the introduction of universal credit. It still encourages people to work and benefits claimants who find the existing system a barrier to work.

As my noble friend Lord German and the noble Baroness, Lady Lister, mentioned, a range of factors affect split payments: people with drug, alcohol and other addictions; learning difficulties; mental health conditions; temporary or supported accommodation; homelessness; severe debt problems; and domestic violence, which we have now defined in a much more satisfactory way. They do not make for an automatic switch to split payments or alternative payments, but mean that we have a basis on which to make a case-by-case consideration. On the issue of violence, we can take referrals from third parties such as support workers, landlords and others.

More generally, universal credit incentivises second earners to work, with the number of second earners who lose more than 70% of their earnings by moving into work being significantly reduced. I am not ruling it out on any fundamental ground; there is a complexity issue here, but there is also a cost issue, given that there is already an incentive there.

The right reverend Prelate the Bishop of Ripon and Leeds raised backdating. We will expect households where there is a change of circumstances which means they become eligible for UC to make that claim as soon as possible. However, if they are in hospital or incapacitated we will consider a claim for backdating.

The system failure issue is about system failure, not about people not being able to work the system; the system has to be down. I remind noble Lords that we have telephone and face-to-face systems and home visits as part of our service. It is not an automatic, “you have to use the online system and that’s that”. There will be a tiered system, although we are looking to get as many people online as possible. Indeed, it is amazing how the digital approach is taking off. We are now looking at people using not computers but smart phones. In fact, the GDS is being redesigned for a phone not a computer because that is the latest technology.

I have committed to a very full programme of evaluation for universal credit. It will include studies of implementation covering themes such as customer, staff and stakeholder experience. We will ensure that we understand the impact of this reform on all types of claimants. We are currently evaluating the pathfinder, and through our work with claimants and external stakeholders, we are looking at a range of issues, including the impact of monthly payments and how people are budgeting. Clearly, early findings from that will inform the further rollout of universal credit.

We believe that universal credit is the right approach. Indeed, I hear from noble Lords in this Chamber that the main approach is seen as the kind of root-and-branch reform that we need in our basic welfare system. It will provide better work incentives, but it is vital that we build around it a system that protects the most vulnerable and works with universal credit. I commend these reforms to the House. I trust that my response has reassured noble Lords and that as a consequence the Motion will not be pressed.

I heard my noble friend Lord Kirkwood’s point about keeping the most informed and valuable audience in the country about this informed and in dialogue, and I will think about it pretty hard.

[Baroness Lister of Burtersett]

I am very sorry to prolong matters. I quite understand that it has not been possible to answer all the questions asked, but will the Minister undertake to write to all noble Lords who have taken part in this debate with detailed responses to the questions that have been asked?

[Lord Freud]

I have tried to answer absolutely everything. I will double check. If I have missed anything, I will write on it, but my answers are on the record. I think that I answered virtually everything, but if there is anything more, I will make sure that I cover it.

[Lord McKenzie of Luton]

My Lords, I thank noble Lords who spoke in this debate. It has been a debate of some quality and detail. I also thank the Minister for his very detailed reply. Like my noble friend, I think it would be good to look at the record to see what, if anything, might be outstanding. We acknowledge that the Minister listens to the House and certainly responds to the House—for 28 minutes on this occasion.

We welcome the announcement about credit unions. That is good news. As the Minister will, I hope, have understood, we are on the same page as far as support for universal credit is concerned. We are all signed up to a single in and out of work payment. We welcome the fact that the Minister has accepted the Major Projects Authority’s recommendations. On that, and touching on a point made by the noble Lord, Lord Kirkwood, about helping us keep abreast of what is happening, there was a contrast between our perception about where universal credit was when we went on holiday and the rather rude awakening of the NAO report. I hope there is a way of smoothing that in future.

We have news about a further six pathfinders starting this month. The scope of the people involved in them is still a little unclear, as is whether it is still the fairly narrow category that we started with in April and, in particular, whether it excludes people who rent their accommodation. On the pathfinders—this again touches on one of the points made by the noble Lord, Lord Kirkwood—we do not want this to be rushed; we want it to be right. As I understand it, some of the early pathfinders are focused on helping subsequent policy development. That is why it is important that there is some co-ordination.

I thank the right reverend Prelate the Bishop of Ripon and Leeds for his support. We are on the same page in concerns about payday lenders. The right reverend Prelate did get an answer about the backdating of universal credit. Whether it is sufficient, he may wish to reflect. He made the telling point about the crucial role of mothers in the evaluation and understanding of how universal credit should work.

21:30

My noble friend Lady Hollis, as ever, put in a plea for council tax to be taken back in by the Government. Knowing my noble friend, this will be a recurring theme in our debates between now and goodness knows when—until Mr Pickles gives in. However, my noble friend did raise an important point about paperless transactions, how those work, how people correct the position, particularly when they are remote from IT access, particularly in rural areas.

The noble Lord, Lord Kirkwood, talked about getting it right and about guidance being increasingly where the detail is. It used to be that the primary legislation was the framework and then the regulations would flesh that out in some detail. We are now shunting it further down the process. If there are ways of informing us along the way more effectively then that would be very helpful.

My noble friend Lady Lister, as ever, made a powerful and telling contribution. She should never apologise for asking questions. What is important is that we get the answers—and I accept that we have had a raft of answers tonight. Whether we have had them all, we will have to read in the record. The points my noble friend made about the challenge to how the jam-jar accounts are working, how the system works for couples, and how one detects issues of domestic abuse and violence at home are really important ones and illustrative of the sort of detail that has to be outlined in the guidance on how it is going to work in practice. My noble friend also made the point that focusing on principles is fine but overlooking how it will work in practice is the slippery slope.

Finally, the noble Lord, Lord German, also recognised that there are questions to be asked about the monthly payment issue, particularly about the capability of Jobcentre Plus, again an issue about which we have common concerns. He talked about arrears in the demonstration project. As I understand it, these are demonstration projects about monthly payment of housing benefit. Therefore, that is not a replica for monthly payments of universal credit because alongside the housing benefit payment there is the usual sequence of other payments. Now, how much one learns from that in developing the rest of the system, I am not sure. Having said all of that, I beg leave to withdraw the Motion.

Motion withdrawn.

House adjourned at 9.33 pm.