(10 years, 7 months ago)
Commons ChamberRead Hansard Text Read Debate Ministerial Extracts
David Mowat (Warrington South) (Con)
2. What assessment he has made of the Office of Fair Trading’s recent recommendations on the creation of independent governance committees in defined contribution pension schemes.
The Minister of State, Department for Work and Pensions (Steve Webb)
The Government announced last week that pension providers will have to implement new independent governance committees to oversee workplace pension schemes. This is part of the Government’s package of measures to ensure that workplace pension schemes are well run and deliver value for money.
David Mowat
I thank the Minister for that answer, and I congratulate him again on his brilliant announcement last week of a 0.7% cap, which is 50% of the cap that the Opposition imposed on stakeholder pensions. But the OFT report identified other governance issues with smaller pensions where trustees and fund managers come from the same organisations, and it suggested that these independent governance committees be set up quickly. Will he confirm that that will happen before auto-enrolment goes much further?
Steve Webb
I am grateful to my hon. Friend for his support for our robust action on pension scheme charges. On governance, we recognise that there is potential for conflict of interest in some master trusts. Therefore, in last week’s Command Paper, which I am sure he will have studied, we proposed that master trusts should be subject to the same independence requirements as independent governance committees. We are now consulting on that proposal.
Kevin Brennan (Cardiff West) (Lab)
What does the Minister make of the Government’s new Financial Conduct Authority’s first foray into the area of defined contribution pension schemes?
Steve Webb
The FCA will shortly announce details of plans to look at a raft of old pension and life assurance products, some of which have exit fees and high charges, and I think consumers will warmly welcome such an investigation.
Mr Julian Brazier (Canterbury) (Con)
I commend progress on this as well as the amazing wider package of pension reforms for which my hon. Friend is responsible. On the balance that trustees will look at, may I urge him to bear in mind existing people in the system, not just pensioners themselves, because with Sheerness Steel people who were still working were almost wiped out in order to protect those who had retired?
Steve Webb
My hon. Friend is quite right. As he knows, we have both the Pension Protection Fund and the financial assistance scheme to help those whose sponsoring employer has become insolvent. It is important that we make sure that sponsoring employers are in a robust position and that regulation is proportionate, which is why we are changing the remit of the Pensions Regulator so that it has regard, in its actions, to the sustainable growth of the sponsoring employer.
Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab)
Last week, the Minister announced that the Government were adopting lock, stock and barrel Labour’s policy on the pension cap. That is welcome news for savers, but the Minister and the hon. Member for Warrington South (David Mowat) both know that governance is key to ensuring that savers get value for money all the way through the pensions system. Does the Minister therefore agree that allowing big insurance companies to appoint independent governance committees themselves is a little like allowing the home team to pick the referee in a football match?
Steve Webb
The hon. Gentleman raises an important point about governance and independence. He should know that the proposed terms of reference for IGCs include requirements that providers go through open and transparent recruitment processes, and that members be appointed for fixed terms, with limited numbers of reappointments. The requirements are designed to avoid any possibility that IGC members have incentives not to challenge providers in order to remain in post.
Mary Macleod (Brentford and Isleworth) (Con)
3. What assessment he has made of recent trends in employment figures.
Nick de Bois (Enfield North) (Con)
8. What assessment he has made of recent trends in employment figures.
Alun Cairns (Vale of Glamorgan) (Con)
16. What assessment he has made of recent trends in employment figures.
The Minister of State, Department for Work and Pensions (Esther McVey)
We have record numbers of people in work, and the numbers are rising. Youth unemployment has fallen for six consecutive months. There are record rates of women in work and increasing numbers of people setting up in business. We are most definitely seeing a new enterprise generation.
Mary Macleod
Since 2010, unemployment in Brentford and Isleworth has reduced by 21% and youth unemployment by 29%. Will the Minister join me in welcoming this, and in inviting everyone in west London to my third jobs and apprenticeships fair on Friday at West Thames college?
Esther McVey
I would indeed invite as many people as possible to go along to my hon. Friend’s job fair—her third one. She does so much to help her young people to get into work, and she works to support women into work, which must be acknowledged, particularly as we are now seeing record rates of women in work.
Nick de Bois
In my constituency, there have been 60 new enterprise allowance take-ups, and there have been 200 across the borough of Enfield. Will the Minister update me on her plans for continuing that scheme? Will she also update the House on the scheme’s progress across the country?
Esther McVey
My hon. Friend makes a good point. The new enterprise allowance has been a huge success. The latest figures, which came out last week, show that 40,000 people have set up businesses in that way. It is now running at 2,000 new businesses a month. That is because we support those businesses financially, but it is also because we support them with strong mentoring. Equally, at the very beginning, they must have a good business plan. New enterprise allowances are here, and they are staying.
Alun Cairns
Unemployment in the Vale of Glamorgan has dropped by more than 27% since the general election. Does that not demonstrate that UK employment growth is happening in all nations and regions? We should be celebrating the fact that the economy is growing outside London and the south-east as well as growing in that region.
Esther McVey
I totally agree with my hon. Friend. He is right. As I have said, new enterprise generation stretches across the UK. Long-term youth unemployment in his constituency is down by 28%. I hope it will go down a little bit more and reach the national average—youth unemployment is down by 32% nationally—but a lot of good things are going on across the country.
Sheila Gilmore (Edinburgh East) (Lab)
22. Despite all the talk of new jobs, 2.3 million people are still unemployed, only 58% of whom are on the jobseeker’s allowance claimant count, which suggests that it is not the generosity of benefits that is keeping people out of work. What steps are the Government taking to get that number down?
Esther McVey
I do not know whether the hon. Lady was smiling when she was describing all the good news that is happening. There is a record number of people into employment—over 30 million—youth unemployment has gone down for six consecutive months, and there is a record number of women in work. Perhaps she did not hear that, which is why I have repeated the good news that our long-term economic plan is working.
Mr Stephen Hepburn (Jarrow) (Lab)
But in reality, is it not true that long-term unemployment is rising, and that youth unemployment has doubled in the past six months, all because the Government are carrying out a policy whereby, at the next general election, good, secure, well-paid and skilled jobs in the public sector will have been slashed by 1 million, all with the goal of getting a low-wage economy in which insecurity is rampant?
Esther McVey
The hon. Gentleman spoke with gusto, but that was all he spoke with, because those are not the facts. Long-term unemployment has gone down and more people are in work than ever before. Perhaps he should have read the figures before he stood up to speak.
Lucy Powell (Manchester Central) (Lab/Co-op)
The Minister spoke of more women than ever in work, which is actually a reflection of the fact that there are more women of working age. She should look at other figures. For the first time in more than 15 years, the gender pay gap is rising, not falling. That is a reflection of women working below their pay grade, training and education, in part-time, low-paid work. What will she do about that?
Esther McVey
I have two figures for the hon. Lady. She is correct that there are record numbers, but I also said that there are record rates for women, which is different. That shows that our long-term economic plan is working. There are more women in work than ever before.
Nigel Adams (Selby and Ainsty) (Con)
4. What assessment he has made of recent trends in youth unemployment. [R]
The Minister of State, Department for Work and Pensions (Esther McVey)
Thanks to the Government’s long-term economic plan, youth unemployment is falling. I am particularly pleased that long-term youth unemployment has fallen by 38,000 over the last year. In my hon. Friend’s constituency, long-term youth unemployment has gone down by 38% in the past year.
Nigel Adams
Will the Minister congratulate, with gusto, local businesses, Jobcentre Plus, Selby college and York college for their efforts in ensuring that tremendous fall in youth unemployment since the last election in Selby and Ainsty?
Esther McVey
My hon. Friend said that with such gusto that I do not think I could top it. Employment and enterprise is important to him—at age 26, he set up his own telecommunications company with the aid of a Government enterprise grant, so he knows what he is talking about—and he is helping lots of people in his constituency.
Alison McGovern (Wirral South) (Lab)
Of the young people the Minister just mentioned who have a job, how many have gone on to work on zero-hours contracts?
Esther McVey
As the hon. Lady will know, the number of zero-hours contracts has remained fairly stable since 2000. They are called zero hours or casual hours, and they are used by Liverpool city council and Wirral council, which are Labour run. The worst council for using them is Doncaster.
We are having a full review of zero-hours contracts, and if they are exploitative we will bring about changes. Our report is due in July—something that Labour did not do for 13 years.
Greg Mulholland (Leeds North West) (LD)
Thanks to the new enterprise allowance scheme, more than 1,000 people in Leeds have met a business mentor and 490 have set up a new business, including 40 in my constituency. Does my right hon. Friend agree that that shows small businesses driving our economy and getting people back to work?
Esther McVey
I agree with my hon. Friend. New enterprises are starting up because of the new sense of confidence and optimism in the economy. The extra support that we are putting in place—checking business plans and providing support through mentors—is really paying dividends.
Mr William Bain (Glasgow North East) (Lab)
Some 180 young people in my constituency have been out of work for one year or longer. Can the Minister explain to the young man I met two weekends ago—he has been out of work for 18 months and is desperate to find a job—how the Government were so quick to give the banks a tax concession in the Budget, but are so slow to introduce a proper jobs guarantee plan for young people across the country?
Esther McVey
I would like to have a word with the young chap you are talking about, because I would like to give him hope and optimism, which is something that you are distinctly not giving—[Interruption.] I apologise, Mr Speaker. I do not mean your good self: I mean the hon. Gentleman. That young chap needs hope and optimism, and he needs to know what is happening in the rest of the country, because other people are getting jobs. Youth unemployment—including long-term unemployment—has gone down, and if the young chap sticks with it and gives it a go, he will get there in the end. That is the best news that I can give him. It is far better under this Government than it was under the Labour Government, when youth unemployment went up by 45%.
Damian Hinds (East Hampshire) (Con)
5. What steps his Department is taking to promote financial inclusion and to help families to budget.
The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
Through universal credit, the Department for Work and Pensions is investing £38 million in expanding credit union services to help more people to access affordable credit. A budgeting support package will be available to all those who need it through universal credit. At the same time, the Government are clamping down on loan sharks and doorstep lenders who have taken advantage of vulnerable people for too long.
Damian Hinds
In this 50th year of credit unions in Britain, may I commend the Secretary of State for what he continues to do to support the sector? Will he update the House on what is being done to tackle the excesses of the payday lenders he mentioned?
Mr Duncan Smith
The Financial Conduct Authority will limit continuous payment authorities, which allow payday lenders to take money out of people’s bank accounts, to two payments. The FCA will keep that under review. It is also preventing CPAs if a person would be left without money to buy essentials or for priority debts. We have already seen some payday lenders leave the market because it is being restricted in the right way. It is worth saying that before the last Government came to power, payday lending did not exist, but it spiralled to £1 billion-worth under them.
Dr Eilidh Whiteford (Banff and Buchan) (SNP)
Has not the source of the pressure on family budgets been policies such as the freeze in child benefit and the cuts to tax credits, which have left families hundreds of pounds worse off?
Mr Duncan Smith
The biggest pressure on family budgets was the fact that far too many people lost their jobs as a result of the crash in the economy, in which GDP fell by 7.2%. Since then, we have reformed welfare. It is difficult when people are out of work, but we are doing huge amounts to get them back into work. As my hon. Friend the Minister of State has said, more people are in work, more women are in work and more young people are beginning to get into work, so we are getting more people into a position to look after themselves.
Paul Maynard (Blackpool North and Cleveleys) (Con)
Financial resilience for families in my constituency can be a real challenge. One of the biggest impacts on the family budget can be the loss of a loved one. Does the Secretary of State think it is now time to consider whether social fund funeral payments should be index linked to inflation to ensure that they keep pace with the cost of funerals?
Mr Duncan Smith
I am certainly prepared to discuss the matter with my hon. Friend if he wants to come and see me about it. I keep that area of the social fund under review, as he knows. We localised about £200 million of the social fund to councils so that they could deal with the problems people face directly. We also kept the remaining money, so a total of about £1 billion goes out to all sorts of things, such as funeral payments, support for loans and support for people in hardship. This is a big push by the present Government to help people ahead of payday lenders.
Kate Green (Stretford and Urmston) (Lab)
Last week the BBC reported that just 6% of households affected by the bedroom tax had managed to move. Also last week, a report from Real Life Reform showed that nearly eight out of 10 tenants hit by the bedroom tax were in debt, with borrowing increasing by an average of £52 each week and families increasingly relying on loan sharks. Rather than preaching about careful budgeting, why do Ministers not just scrap this hated and unworkable tax, which is sending people spiralling into debt?
Mr Duncan Smith
It is interesting that the Opposition and the hon. Lady take the view that people moving is a bad thing. Let me just tell her—[Interruption.] It is interesting that they say that, but 30,000-plus people—I will repeat that: 30,000 people—who were in overcrowded accommodation have now had the opportunity for the first time to move into houses where they are not overcrowded. The hon. Lady and the Opposition left us with a quarter of a million people in that position—250,000—so in 10 months over 10% have had the opportunity to move and we are saving over £1 million a day. I call that a success.
Karl Turner (Kingston upon Hull East) (Lab)
6. What steps he plans to take to tackle long-term unemployment.
Ben Gummer (Ipswich) (Con)
13. What steps he plans to take to tackle long-term unemployment.
The Minister of State, Department for Work and Pensions (Esther McVey)
Those at risk of long-term unemployment are given personalised support through the Work programme. Industry figures show that it has moved half a million people into work. Jobseekers returning from the Work programme will get extra support through our new help to work scheme.
Karl Turner
Through the hard work of the Labour-led council and the three Hull MPs, Siemens has now said, “Hull, yes,” to a joint investment, with Associated British Ports, of £310 million, which will create 1,000 jobs, but this is not a silver bullet. We have a long-term unemployment crisis in my city. Will the Minister now support Labour’s job guarantee for the long-term unemployed?
Esther McVey
I am glad to see that the hon. Gentleman is taking full credit for the Siemens move, but I would like to think that the long-term economic plan and everything this Government have done for the last year should take some credit too. Equally, long-term unemployment in his constituency is down 20% on the year, while long-term youth unemployment in his constituency is down 34%, so I would say that what we are doing is right. Our long-term economic plan is right and I am glad that Siemens is in his constituency.
Ben Gummer
It is a fact that every Labour Government since the war have left office with unemployment higher than when they came in. That is why I am particularly proud that unemployment, both youth and total, is lower than when we came into office in 2010. We have a particular issue with long-term unemployment in Ipswich. What will my right hon. Friend do to ensure that when we leave office—in the long distant future, I hope—long-term unemployment will be lower than when we took office?
Esther McVey
My hon. Friend is correct, and he is meticulous in his homework and his figures and in everything he does. I would also like to explain to the House that long-term unemployment in the UK is half that of the eurozone—the figure is 2.7%—so what we are doing is right. Let us not get out of office, because when we are in office we run the country a lot better.
Stephen Timms (East Ham) (Lab)
The hon. Member for Ipswich (Ben Gummer) is absolutely right. Last year, the number of people who had been unemployed for more than two years reached a higher level than at any time since 1997. It then started to fall, but last week—contrary to what the Minister said a minute ago—it went up again. Does she accept that long-term unemployment is a terrible waste of human and economic potential, and will she now introduce a compulsory job guarantee for those who have been receiving jobseeker’s allowance for more than two years?
Esther McVey
It seems that the Opposition never really learnt anything. They want to introduce the future jobs fund and traineeships, for instance, because they enable them to manipulate the figures. They can take people off long-term unemployment and start the clock ticking again, but the figures that they give are unreal and untrue. We are ensuring that we measure the levels correctly, and that there is an honest assessment of what is happening to unemployment, including long-term unemployment. I can tell the Opposition, without fiddling any figures, that it is coming down.
Miss Anne McIntosh (Thirsk and Malton) (Con)
The corollary of long-term unemployment is the problem of hard-to-fill job vacancies. Can my right hon. Friend give me the most recent figures for the Thirsk, Malton and Filey travel-to-work area, and can she tell me what the Government are doing to place people in the care jobs which are so important to the community but so difficult to fill?
Esther McVey
My hon. Friend will be pleased to know that we are introducing sector-based work academies. When people are nearly job ready, and when businesses in the care sector have jobs to provide, we bring young people together and give them work experience and training, and a guarantee of a job interview at the end of that. Forty per cent. of those young people are being given jobs in the care industry.
Ian Swales (Redcar) (LD)
7. What assessment he has made of the effectiveness of the benefit cap.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
12. What assessment he has made of the effectiveness of the benefit cap.
The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
The benefit cap is working. The latest statistics show that 39% of those who are no longer subject to the cap have since moved into work. We will evaluate the policy thoroughly, and expect to publish the findings in the autumn.
Ian Swales
The average yearly pay in my constituency is about £21,000 before tax and national insurance. Does the Secretary of State think that a benefit cap of £26,000 gives people outside London an incentive to work?
Mr Duncan Smith
The introduction of the benefit cap meant that, for the first time ever, people who were out of work could not end up with more than the average earnings of people who work hard and try to make their way in the world. That was the first stage of the process. Obviously, as with all our policies, we continue to look at it, but I currently have no plans to change the existing levels.
Stephen Metcalfe
Given that Members in all parts of the House have now supported a cap on benefit spending, will my right hon. Friend tell us whether he has received any representations on how it is possible to promise to repeal some welfare reforms such as the benefit cap while at the same time avoiding a breach of the overall cap?
Mr Duncan Smith
Interestingly, the Opposition voted against the imposition of the benefit cap, which they subsequently claimed to support. Last week they did a U-turn and voted for the welfare cap, which is the overall setting of the level of welfare. They plan to get rid of the spare room subsidy, but they have not told us where they will find the money. So here we go again: it will mean more money in taxes, more money in spending, more money in borrowing, and a bust economy once more.
Alison Seabeck (Plymouth, Moor View) (Lab)
9. What progress he has made on the mesothelioma compensation fund scheme; and if he will make a statement.
The Minister of State, Department for Work and Pensions (Mike Penning)
I am proud to say that the Diffuse Mesothelioma Payment Scheme Regulations 2014 were passed by the House on 17 March, and the scheme administrator is in place. Applications will be accepted from next month, and we will make the first payments in July, as planned.
Alison Seabeck
Can the Minister explain why this morning, following an earlier inquiry on my part, there is nothing on the Department’s website, nothing on the gov.uk website and nothing on the website of Gallagher Bassett, the scheme administrator, although the scheme is intended to be up and running early in April? My constituents who suffer from this disease want to know how to apply. I think that the Minister is cutting it a bit fine.
Mike Penning
We may be cutting it a bit fine, but we want to get it right. We do not want people to try to apply before it is possible for them to do so. I find it difficult to understand why any Opposition Member should deny that this is a wonderful scheme that gives hope to people with a disgusting, horrible disease. Those people received nothing previously, which is why the scheme is so important.
Guy Opperman (Hexham) (Con)
In a previous profession I represented many victims of this terrible disease and I welcome the fact that the coalition has managed to get approval for the mesothelioma fund on the statute and also secured enhanced damages. Does the Minister agree not only that this will make a very big difference in the north-east, where there is a high prevalence of this disease, but also that the focus now must be on enhanced publicity so all the victims know just what they have to do to get the compensation?
Mike Penning
I could not agree more and I was very proud to be able to announce that we will be raising the benefit to 80% of average civil claims. That will give £123,000 to the claimants and their loved ones, plus £7,000 in legal fees, which if they do not spend they can keep; it will not be clawed back in any shape or form. People have waited for this scheme for many years and we will do everything we can to make sure that people who deserve it get it.
Diana Johnson (Kingston upon Hull North) (Lab)
10. What assessment he has made of the effectiveness of (a) the Work programme and (b) Universal Jobmatch.
The Minister of State, Department for Work and Pensions (Esther McVey)
The Work programme is a success, and industry figures show it has moved half a million people into work. Universal Jobmatch revolutionises the way jobseekers look for work and it has already helped many jobseekers find the jobs they want through the millions of vacancies posted since 2012.
Diana Johnson
We recently heard that 60% of jobs on the failing Universal Jobmatch programme are bogus, such as the one for an MI6 “target elimination specialist”, and many of my constituents have been ripped off by criminal scams. With the Jobmatch programme set to be axed, will MPs now get the monthly constituency figures on the number of jobseekers chasing each job, which was removed in 2013, or will that information still be withheld?
Esther McVey
Opposition Members just love to run everything down despite the fact that all these things we have put in place have helped a record number of people into work. We introduced a brand-new scheme that was in addition to what people could already do to look for work. More than half a million companies have opened up a scheme within Universal Jobmatch, which is helping millions of people to find work. Whenever we find any businesses that are not correctly adhering to terms and conditions—it is a tiny number—they are removed, but I have to say that this is a terrific addition to help people look for work. Shame on you!
Chloe Smith (Norwich North) (Con)
The Minister knows of my passion for directly tackling youth unemployment in my constituency. Could she also tell me a little bit about what she is doing to help older workers find work, particularly using the tools referred to in the question?
Esther McVey
My hon. Friend does so much in her constituency to try to find young people jobs, such as setting up a scheme to find 1,000 of them jobs. She is doing that incredibly well and that task has nearly been completed. She is right that we have to help people of all ages. Yes, we put a £1 billion Youth Contract in place to help young people, but we have got to help people of all ages to get into work, which we are doing, whether through a new enterprise allowance, sector-based work academies, job clubs or Jobs First, and I can only reiterate that record numbers of people are in work.
Mr Frank Field (Birkenhead) (Lab)
As somebody who supports Jobmatch, may I ask the Minister whether she shares my concern that some of our constituents have been ripped off by those who are acting fraudulently? What steps has she taken to safeguard this scheme, which most of us support?
Esther McVey
The right hon. Gentleman, my constituency neighbour, is right in saying that 14 job- seekers —out of the millions a month who are looking for jobs through the scheme—were asked to pay for a Criminal Records Bureau check. The DWP is now working with them. Ten have put in for a compensation claim, and we are helping them to sort that out. If there is a bogus job or one that does not adhere to the terms and conditions on Universal Jobmatch, it is removed immediately. However, despite that one company, more than half a million companies are putting jobs up on the scheme to help people into work. I think we can all say that this is a resounding success.
Lorely Burt (Solihull) (LD)
The Work programme provides tailored support to the people who are most at risk of becoming long-term unemployed, at a fraction of the cost of Labour’s flexible new deal. Companies such as EOS in my region have been successful in helping people in that way. Does my right hon. Friend agree that we should be supporting the programme, rather than criticising it as the Labour party is doing?
Esther McVey
My hon. Friend is right. Of course we have to support schemes that work and of course we have to support businesses that want to get involved with our scheme. What is interesting is that we have got industry signed up to everything we do. All the big companies and all the small companies are signed up to what we want to do. The Opposition have come forward with a job guarantee, but not one business has signed up to that.
Steve Baker (Wycombe) (Con)
11. What recent assessment he has made of the effect of withdrawing crisis loans on homeless people wishing to raise rent in advance to secure housing.
The Minister of State, Department for Work and Pensions (Steve Webb)
Crisis loans have been withdrawn, but DWP budgeting loans are still available for rent in advance. There is also a range of support available through local authorities, including discretionary housing payments and local welfare provision, and, as I am sure my hon. Friend knows, there is a rent deposit scheme in his constituency administered by Wycombe district council.
Steve Baker
I am most grateful to the Minister for his answer. Unfortunately, Wycombe Homeless Connection has stated categorically that the withdrawal of crisis loans has made it much harder for homeless people to get into flats and homes. Will he write to me to tell me exactly what he expects from Wycombe district council, so that we can ensure it is properly guided? May I also point out that I would support the Department restricting certain benefits to the wealthiest pensioners if that would enable homeless people to get off the streets and into homes?
Steve Webb
I am sure that my hon. Friend would want us to stick to the terms of the coalition agreement, which commits us to protecting pensioner benefits for the lifetime of this Parliament. However, he is right to say that we have to do right by homeless people, and I welcome the fact that the December quarter’s homeless acceptance figures were down by 5% compared with a year earlier. That covers the period in which the change was made, and there are now about 50,000 homeless acceptances a year, which is about half the level that we saw in the early years of the Labour Government.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Does the Minister find, as I do in my constituency, that when people in his own constituency get into a real crisis, the help that they used to be able to draw down is no longer there and that the community and third sector groups and charities are underfunded?
Steve Webb
On the contrary, the money that we were spending on crisis loans and community care grants, amounting to more than £170 million a year, has been devolved in full to local government. The hon. Gentleman should take the matter up with his local authority if is not spending it properly.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
14. How many IT specialists are working on the digital solution to universal credit.
The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
We continue to build up the Department’s digital capability, having launched the Government’s first digital academy and brought in a man called Kevin Cunnington, who was previously global head of online at Vodafone. Some 370 people are working full time on the universal credit change programme. The aim of any multidisciplinary team is that individuals should come and go, reflecting requirements at each stage. A team of 50, of which 25 are digital specialists, is currently working alongside other experts, and it is steadily building and on track.
Chi Onwurah
It is my understanding that the Secretary of State plans to continue the development of the existing, discredited universal credit IT system while building a new system in parallel, on the recommendation of the Government Digital Service. Will he confirm whether that is the case, and set out how much extra that double development is going to cost? Also, how is he going to recruit the skills he needs, given the current shambles?
Mr Duncan Smith
First, on the skills side, we have been recruiting and we have also been educating internally at the DWP, which has been a big success. The digital process, which is about improving this, will carry on. It is the development that was recommended for the longer term. In the meantime, the live service is running, and the system is not discredited. It is working, with the pathfinder rolling out through the north-west, and it will continue to roll out. The vast majority of the equipment being developed in that will be used within the digital system, so those who say that the money being spent on that is being wasted are simply wrong. It will be used in the medium and longer term for all of the universal credit roll-out.
Charlie Elphicke (Dover) (Con)
In developing universal credit and its IT system, what lessons have the Government drawn from IT projects conducted by the previous Government?
Mr Duncan Smith
The reason why we are doing this in a way that tests it at each stage, so we make sure we have got it right before rolling it out and taking more numbers on board, is because we want to make sure that taxpayers’ money is protected through this process and that the system works. I recall, as I am sure my hon. Friend does, that when the Labour Government launched tax credits it was a total disaster; we had loads of people in our surgeries with real problems relating to payments. This Government will never revisit that, which is why I will never accept any advice from the lot who wasted billions on failed IT programmes.
Chris Bryant (Rhondda) (Lab)
I know the Secretary of State loves to argue that black is white and white is black, but how on earth can he possibly stand here and suggest that this project is “on track”? The Government promised that 1 million people would be on universal credit by tomorrow—by 1 April this year—but how many are on it? He said at the beginning of the month that there were 6,000, but the figures given by the Minister of State, the right hon. Member for Wirral West (Esther McVey), show that fewer than 4,000 are. So precisely how many people are working on the IT? Is it 50, as the Secretary of State just said, or is the figure eight, as the Minister of State said earlier this month?
Mr Duncan Smith
I know the hon. Gentleman likes to get up and speak, but sometimes he needs to be aware of the facts that have been given to him. I have just given those facts, but because he was not listening I will give them again. Of the team of 50 working on the digital system, 25 are digital specialists—there will be more as we develop it and report back. May I simply say that instead of moaning about this system, Opposition Members might like to visit it, as many other MPs have done, because they will see how successful its rolling out has been? Some 90% of the claims for JSA as a result of universal credit are now made online, and 78% are monthly payments—these are people confident to receive those payments. [Interruption.] The reality is that the systems the Labour Government implemented were failures, whereas this will succeed and change many people’s lives.
Mr Speaker
Order. Mr McCann, I say to you in all courtesy and in all charity that the role of the Parliamentary Private Secretary—you are sitting in the PPS slot—is to nod and shake the head in the appropriate places, and to fetch and carry notes, not to shriek from a sedentary position or gesticulate in an unseemly manner.
Andrew Bridgen (North West Leicestershire) (Con)
Will my right hon. Friend confirm, and remind the House, that universal credit is set to deliver £35 billion of benefit to our economy?
Mr Duncan Smith
Yes, I agree with my hon. Friend on that. The National Audit Office report said that a minimum of £38 billion would actually be the positive elements brought to the UK economy and those who are in need. The real problem is that the Opposition say they support it, but they carp about it. The reality is that every change they ever brought in was a failure. They wasted billions of pounds of taxpayers’ money. We will implement this carefully and because of that, people will benefit, rather than suffer, as we all recall they did when Labour introduced tax credits.
Mark Pawsey (Rugby) (Con)
15. What recent assessment he has made of the effect of universal credit on employers.
The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
The Department has consulted widely with employers over the past 12 months to ensure that universal credit works in the best way possible for them. The Minister with responsibility for welfare reform recently met national employers, trade bodies and employer representative groups, and we know that universal credit will have a positive impact on employers through the flexibility it brings to their work force—unlike tax credits.
Mark Pawsey
I thank the Secretary of State for that answer. He will be aware the Rugby jobcentre is among the first six offices to introduce universal credit. Will he join me in complimenting the staff there on achieving a successful roll-out in a complicated procedure? Given recent concerns about child care, will he reassure the House about the availability of child care support under universal credit for families in work?
Mr Duncan Smith
I am grateful to my hon. Friend for raising that issue, because under universal credit we will increase the child care level to 85% of the cost. We will be investing a further £400 million a year in a steady state, and 500,000 families will gain. These are positive incentives to go back to work. Child care costs are now paid up to a maximum of £646 per month for one child and £1,108 for two or more children. In universal credit we are removing the 16-hour rule, which exists in tax credits and is a major disincentive for many lone parents and others to take jobs—that has been abolished, and some extra £200 million will help 100,000 families back into work.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
17. What recent assessment he has made of whether the UK will meet the 2020 statutory child poverty target.
The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
The Government are committed to the Child Poverty Act 2010 and to ending child poverty by 2020. It is not possible accurately to project child poverty figures, but already we are seeing progress in tackling the root causes. Just last week, we learned that there are now 290,000 fewer children living in workless households compared with 2010, and that has a net impact and effect on child poverty.
Catherine McKinnell
The Secretary of State mentions reducing the number of children in workless households, but today child poverty is overwhelmingly a problem for working families. Since 2010, the number of parents who work part time but who want to work full time is up 45%. What are the Government going to do about the prevalence of low-paid insecure work that is trapping families in poverty?
Mr Duncan Smith
The last figures that covered people who were in work and in poverty were misrepresented by those who talked about them. In truth, those figures reflect what happened under the previous Government, when we saw an increase of 500,000 families who were in work and in poverty. That has been flat since the election. We are working on that to ensure that we get as many people out of poverty as possible. The reforms that we are changing and making to get people back to work, which the Minister of State, my right hon. Friend the Member for Wirral West (Esther McVey) has talked about, will have a huge impact on those who are in poverty now.
People are better off in work. Despite what Labour did, people have more chance now to change their circumstances and more likelihood of coming out of poverty. Let me remind the hon. Lady of one little fact. Labour spent £175 billion of taxpayers’ money on one benefit—chasing a child poverty target that it simply did not achieve. That was wasted money.
Mary Macleod (Brentford and Isleworth) (Con)
T1. If he will make a statement on his departmental responsibilities.
The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
We were pleased this week to find elements of—that new families formed were no longer breaking up. These figures came out last week to ensure that we are making our programmes work for very good reasons. Families are now staying together. Stable families in households being able to—[Interruption.]
Mr Speaker
Order. May I gently interrupt the Secretary of State? I thought that he was going to give a brief rundown of his departmental responsibilities in answer to the first topical question.
Mr Duncan Smith
I was talking about the figures that came out last week on new families forming and staying together.
Mary Macleod
May I thank my right hon. Friend for the work that he and his Department are doing in transforming lives and getting people back into work? In preparation for my jobs and apprenticeships fair on Friday, will he confirm the job vacancy figures for both London and Brentford and Isleworth?
Mr Duncan Smith
At the end of last week, there were 927 active vacancies and 1,493 active jobs in the Brentford and Isleworth constituency. The vacancies were largely in retail, travel, transportation and tourism. The jobcentre has also worked with Asda and Premier Inn to deliver work experience and sector-based work academy opportunities.
Rachel Reeves (Leeds West) (Lab)
Just 46% of disabled people are in work, while 40% of disabled people not working report that they want to work. Helping disabled people into work provides them with security and dignity as well as helping control the costs of social security. Will the Secretary of State tell the House what proportion of disabled people referred to the Work programme get a job?
Mr Duncan Smith
The Work programme has been successful for those who are furthest from the labour market. The group of people the hon. Lady is talking about who suffer from sickness and disability have, for the first time, been worked with and helped back into work. The figures that we are seeing now are slower than we would have wished, but they are, none the less, improving all the time. Let me remind the hon. Lady that no one has ever attempted to get these people back into work. The Work programme is succeeding in helping into work those who were never in work before.
Rachel Reeves
The truth is that just 5% of disabled people on the Work programme end up in work. If that is a success, I would like to know what failure is. It is worse than doing nothing. It is a disgrace to let disabled people down in such a way. In the Budget, spending on employment and support allowance was revised up by a staggering £800 million because of delays, incompetence and the complete failure of the Work programme. Will the Secretary of State now agree to take action to help disabled people and give them the support they need and reform the failing Work programme?
Mr Duncan Smith
Let me remind the hon. Lady that, as I said earlier, for these people, and the previous Government made no effort whatsoever to get them back to work—[Interruption.] No, 2.5 million people were written off on sickness benefits under the previous Government. No one worked with them and about 1 million were left without anybody seeing them for nearly 10 years. That is the record of the previous Government. I simply remind the hon. Lady that since we came to power, some 22,000 have started a job for the first time and many thousands more have worked with the Work programme to get ready for work without a requirement to go to work. The programme is succeeding and improving all the time and this is the first time that the thousands who are going back to work have ever had help—they got none from the previous Government.
Henry Smith (Crawley) (Con)
T2. What is my right hon. Friend’s assessment of how the Government’s triple lock guarantee for increases in the state pension has benefited thousands of pensioners in my constituency and across the country?
The Minister of State, Department for Work and Pensions (Steve Webb)
I am grateful to my hon. Friend for flagging the fact that we have increased the basic state pension by whichever of earnings, prices or 2.5% gives the best outcome for pensioners. Compared with the earnings link, which we think the Opposition would have restored from 2012, that is an extra £440 a year in state pension for pensioners in our constituencies.
Gavin Shuker (Luton South) (Lab/Co-op)
T3. A constituent of mine who is on jobseeker’s allowance wrote to me to ask for financial support to get feedback on her interview technique to find where she was falling down at interview. Instead, I gave her a mock interview and, I hope, some helpful feedback. She says of the jobcentre, “I have asked umpteen times for interview practice, but all I get is directed to tips on the web.” Why can that not be provided by the jobcentre?
The Minister of State, Department for Work and Pensions (Esther McVey)
I would like to know which jobcentre that was. I know, as I go to jobcentres all the time, how caring and supportive the advisers are. They take as much time as necessary, particularly with the claimant commitment we have rolled out across the country, to find out what skills, tips and support claimants need. I know that that is working, which is why we have record figures. I shall take the issue up, however.
Dr Julian Huppert (Cambridge) (LD)
T8. A number of my constituents have contacted me to say that they are having to wait six months or even longer for an assessment for employment and support allowance or the personal independence payment. Surely that is unacceptable. What will the Minister do to make sure those people get assessments that are both accurate and prompt?
The Minister of State, Department for Work and Pensions (Mike Penning)
There are two separate answers to that question. On WCA, Atos is leaving and we will bring in a new contractor before moving to multiple contractors to ensure that the suppliers can do what is said on the tin, all without paying a single piece of compensation to Atos—[Hon. Members: “Hear, hear.”] Exactly the opposite, actually—Atos will be paying it to us. Secondly, PIP is being rolled out. We need to ensure that we get it right, as the hon. Gentleman said, and we will make sure that we get it through quicker. We need to make sure that the assessments are correct rather than making mistakes.
Julie Hilling (Bolton West) (Lab)
T4. My constituent, Lyn Ward, has had a lumpectomy, a mastectomy, chemotherapy and radiotherapy. Eleven months later, she is still waiting for her PIP assessment and in desperation has gone back to work, even though she is not yet fit. When will that be sorted out?
Mike Penning
As I said to the hon. Member for Cambridge (Dr Huppert), we need to make sure that we get it right as we roll out PIP. The hon. Lady can give me the details of the case if she would like. Thousands of cases have been handled correctly, and if there are mistakes we must ensure that they are addressed.
Steve Baker (Wycombe) (Con)
T9. What recent assessment has the Secretary of State made of the innovation fund in helping disadvantaged young people?
Mr Duncan Smith
The innovation fund, which started with £30 million put in by my Department, has helped to build up the concept for social impact bonds, which will help to invest in the sort of projects that my hon. Friend is talking about. The trials have been to help children from the ages of 14 to 16 to get remedial education and to be job-ready. That has been a huge success and we will in due course publish the figures, but it opens the marketplace to new money from private investors and trusts.
Dame Anne Begg (Aberdeen South) (Lab)
Last week, the Select Committee on Work and Pensions published a report that recommended that the backlog for the PIP assessment should be cleared before the Government continued with the migration from the disability living allowance to PIP. Will the Government accept that? Will the fact that Atos has now lost the contract for the WCA have an impact on PIP? What action has the Minister taken to speed up new claims for PIP?
Mike Penning
Atos leaving the WCA contract will have no impact on the PIP part of the contract. We are making sure that we speed it up as we go. Interestingly, as the Chair of the Select Committee knows, I have turned off the tap on reassessments so that we get the initial backlog done first. The backlog is taking too long, in my own Department as well as in the two providers, but we will get it right.
David Rutley (Macclesfield) (Con)
Given the German Government’s determination to clamp down on EU migrant benefit abuse, does my right hon. Friend agree that there is growing support among key EU member states for this Government’s agenda on this vital issue?
Mr Duncan Smith
Yes, there is huge support in other countries. Recently, Mrs Merkel, the Chancellor of Germany, said:
“There is a need for clarity: who is entitled to claim social security in Germany, and under what conditions.”
The Deputy Prime Minister of the Netherlands, among others, has said exactly the same. I am in discussions with many of my counterparts across Europe to make sure that we, as individual independent nations within the EU, will be able to impose the conditions we require to stop migrants coming here just to get better benefits than they would in their own country.
Mrs Mary Glindon (North Tyneside) (Lab)
With thousands of PIP claimants waiting six months or more for even their medicals before they get anywhere near any money, will the Minister say exactly what penalties he is imposing on Atos and Capita for failing so abysmally?
Mike Penning
As I said in my previous answer, it is not just Atos and Capita that are too slow. They are under a contractual obligation to the Department and I am enforcing that contract, so where they are asked for compensation we will get that compensation.
Tim Loughton (East Worthing and Shoreham) (Con)
One of the most satisfying ways for people to get into work is often by setting up their own businesses. I am always impressed by the young entrepreneurs mugging me in my constituency to buy something from their new business. Will my right hon. Friend update us on the progress of the new enterprise allowance, in particular on how it is helping our younger entrepreneurs?
Esther McVey
My hon. Friend obviously has very enthusiastic young constituents with vibrant businesses. He is right that the new enterprise allowance is helping young people aged 18 to 24, some 7% of whom have set up their own businesses. I have said that we are creating a new enterprise generation, as shown by the 2,000 new businesses a month, 7% of which are set up by those aged 18 to 24.
Mr Dave Watts (St Helens North) (Lab)
Following last week’s Budget, will the Minister assure me that if people exhaust their pension pots they will still be entitled to the full range of pensioner income-related benefits?
Steve Webb
Unlike the Labour party, we actually trust people with their own money. The people we are talking about have saved frugally for their retirement; they are not the sort of people to blow the lot. We will, of course, look at all the rules on capital in our Department and in the Department of Health in the light of the announcement to ensure that they are up to date, but I think the hon. Gentleman’s view that older people will blow the lot is far from the truth.
Robert Halfon (Harlow) (Con)
Is my right hon. Friend aware that unemployment in Harlow is now 600 lower than it was at the general election, and that the number of apprenticeships in the past year has gone up by 86%? Will my right hon. Friend pay tribute to the Jobcentre Plus and the agencies that are working well with the Government’s Work programme to improve the unemployment and skills situation in Harlow?
Esther McVey
My hon. Friend is right to mention the people who work tirelessly to help people into work. All the staff at the Jobcentre Pluses, all the benefit staff and all those who work on the Work programme dedicate so much of their time to something that they believe in: getting people into work.
Andrew Gwynne (Denton and Reddish) (Lab)
Frankly, the answers that Ministers have given so far on the Work programme defy belief. How can Ministers be satisfied with a Work programme where the latest data show that only one in five people, having spent two years on the programme, go on to secure a job that is sustained?
Esther McVey
I will give the hon. Gentleman the figures: 1.5 million people are now receiving support that they have never received before, and half a million of those have got a job. More than 252,000 of those who have been long-term unemployed now have a lasting job. The hon. Gentleman might not think that that is very good progress, but I would say that it is revolutionary: it is turning people’s lives around. I meet those people and they say, “You know what, I thought the world had given up on me, but not now. I’ve got a job and I can support my family.”
Duncan Hames (Chippenham) (LD)
I congratulate the Pensions Minister on the radical reforms he announced last week, which will be warmly welcomed by the retired secondary cancer patient whose case I raised with him before the Budget. How soon will people like her be able to get their hands on what is, after all, their own money?
Steve Webb
I am grateful to my hon. Friend, who did indeed raise the issue with me before the Budget. Short-term changes came into effect last week to raise the limits on things such as draw-down and, in the jargon, trivially commuting small pension pots. Legislation will go through for much greater liberalisation to come into effect in April 2015.
Natascha Engel (North East Derbyshire) (Lab)
We read in The Guardian—it must be true—that the Secretary of State is considering charging for appeals against DWP decisions. If someone has their benefits stopped, with what money are they supposed to pay to get justice?
Mike Penning
That is a matter for the Secretary of State for Justice, but we have no plans whatsoever to charge for appeals or tribunals.
Mr David Nuttall (Bury North) (Con)
Does the Secretary of State agree that, when it comes to a jobs guarantee, in the real world there is no such thing as a guaranteed job and that new, genuine jobs can be created only by growing companies?
Mr Duncan Smith
What is interesting about the Opposition’s view of a jobs guarantee is that their future jobs fund failed. We have introduced work experience, which costs a tiny proportion of what the future jobs fund cost—some £300, as opposed to £6,000 or nearly £7,000 a job—and as many people get into work and come off benefit as did under the future jobs fund. Labour’s make-work schemes do not work, but our schemes, which get private sector employers to help, do. We are getting people back to work.
Bill Esterson (Sefton Central) (Lab)
More than 15,000 people in my constituency, which is over 40% of those in work, earn less than the living wage. For millions of people the employment figures hide the reality of underemployment, zero-hours contracts and part-time, low-paid and insecure work. I wonder whether the Secretary of State can tell me how many of his constituents earn less than the living wage.
Mr Duncan Smith
I never heard Labour Members moan much about the living wage when they were in government, but all of a sudden it becomes an issue. The reality is that we are doing more to get people back to work, which gives them a chance to improve their living standards and incomes. The reality is that I took the decision to ensure that my Department pays the living wage, including to the cleaners. The Opposition never did that. I think that we stand ahead of them in that matter.
Philip Davies (Shipley) (Con)
Has the Secretary of State noticed that when the spare room subsidy was first removed the Opposition and their mouthpiece of choice, the BBC, complained that too many people would be removed from their homes, yet last week Labour BBC was complaining that too few people have been removed from their homes? In the interests of fairness, surely taxpayers not on housing benefit who cannot afford a spare bedroom should not be expected to pay for a spare bedroom for people on housing benefit.
Mr Duncan Smith
The first and principal point is that this programme is saving over £1 million a day for hard-pressed taxpayers, many of whom, as my hon. Friend said, cannot afford a spare room themselves but were paying taxes to subsidise those who had spare rooms. The second point is that over 30,000 people who were once in overcrowded accommodation, left behind by Labour in terrible conditions, are now moving into better houses. This programme is a success. The Opposition did nothing about those people the whole time they were in government.
Mrs Anne McGuire (Stirling) (Lab)
In my constituency the waiting time for PIP assessments is now 26 weeks. [Interruption.] After further investigation, I discovered that that is because of a lack of suitable accommodation in which to carry out assessments. Why was a contract signed with Atos when there were no suitable premises in my constituency in which to carry out PIP assessments?
Mike Penning
I find it very hard to listen to that from a former Minister in the Government who signed the original contracts with Atos, and who seemed very happy with it at the time. We have removed Atos from that work. I will look into the particular situation the right hon. Lady refers to, but I find it very difficult when Opposition Members hark on about what to do about Atos when it was they who employed it in the first place.
Mr Speaker
I cannot identify the individual involved—I would not be in a position to do so—so I will simply tell the House collectively that blowing one’s nose underneath a microphone is a distinctly risky enterprise.