The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud) (Con)
My Lords, I should like to repeat as a Statement the Answer given by the Secretary of State to an Urgent Question in the House of Commons earlier today.
“Universal credit is a major reform that will transform the welfare state in Britain for the better, making 3 million people better off and bringing £35 billion of economic benefits to society. Rightly for a programme of this scale, the Government’s priority has been, and continues to be, its safe and secure delivery. This has been demonstrated throughout our approach to date, which started with the successful launch of the pathfinder in April 2013 and has continued with the controlled expansion of universal credit. On 5 December last year I announced that universal credit would be rolled out to the north-west and be expanded to couples from the summer of 2014, and would then expand to families later that year. That is exactly what is happening.
A fortnight ago we began our north-west expansion—universal credit is now in 24 jobcentres and will reach 90 across the country by the end of the year. A week ago we started taking claims from couples. This careful rollout is allowing us to test and learn as we go along, continuously improving the process. My department has always worked, and will continue to work, closely with the Treasury on these rollout plans. As we have made clear in a number of recent debates and answers to Parliamentary Questions, the Treasury has approved funding for the universal credit programme in 2013-14 and 2014-15, in line with the plan that I announced in December of last year.
These approvals are given by the Chief Secretary to the Treasury—such matters are delegated to him by the Chancellor—and these approvals are subject to rigorous controls, in line with recommendations made by the National Audit Office. It has always been our plan to secure agreement for universal credit in carefully controlled stages. First for singles, where we have agreed funding with the Treasury and are already rolling out in line with that agreement; then for couples, where we have agreed funding with the Treasury, and are already rolling out in line with that agreement; then for families, where we have recently secured agreement from the Treasury and will begin rollout later this year.
All of this was confirmed by the Financial Secretary to the Treasury in the answer to a Parliamentary Question yesterday, and that set of agreements confirms the approval of the strategic outline business case plans for this Parliament. The final stage in this process has always been sign-off of the full business case, which covers the full lifetime of this programme, and will eventually bring £35 billion of economic benefits to society. My right honourable friend and I expect to agree that shortly”.
Lord Freud
I acknowledge that in this House there is a supportive atmosphere towards universal credit. The contrast between the dialogues that we have in this House and another place is marked, and always has been marked, and I appreciate that.
On transparency, this programme is subject to an enormous amount of public challenge—whether from the NAO, the PAC or the Work and Pensions Select Committee. A lot of information is available. A couple of weeks ago, I committed to ensure that Peers got more precise information. I am getting a programme going for that, so I hear that and understand it.
On the apparent difference between my colleague, Esther McVey, and Bob Kerslake, they are both right, because they are answering slightly different questions. The first was about the strategic outline business case plans for 2013-14 and 2014-15. I went through in my Statement how they have been approved. Bob Kerslake was answering a question about the entire lifetime. As I said, that has not yet been approved, but we expect to have that cleared up and approved shortly.
Baroness Jenkin of Kennington (Con)
My Lords, as my noble friend is aware, several noble Lords were able to visit the jobcentre in Hammersmith this morning to see for themselves how the programme is being rolled out. Perhaps I may take this opportunity to thank officials from DWP and those at the jobcentre who were able to brief us so fully and to say how impressed we all were by how it is working—in particular, we were impressed by the coaches, who were able to give so much care and attention to individuals. Can my noble friend confirm that other noble Lords across the Chamber will be able to visit the jobcentres where universal credit is being rolled out to see it for themselves in a similar way?
Lord Freud
One thing I want to ensure is that I can get as much information to noble Lords as I possibly can. I am pleased to say that I have extended an invitation, which has been accepted, to arrange for a group of opposition Peers—as many as the noble Baroness would like to bring; well, not quite as many as that; we could not fit them all into Hammersmith; but enough to fill the room with a little standing room—to go through what is happening on the ground and the process.
One thing that I am keen to show the noble Baroness, which we saw this morning with a small group, is access to the work coaches to see how they work with clients in an entirely different way—in particular, to try to help the most vulnerable, whether it is looking at how they budget or various other things that they will need to do under universal credit.
Baroness Hollis of Heigham (Lab)
My Lords, Mr Duncan Smith insists that UC is on time, on track and on budget. I fear that it is not. None of the monitoring bodies—the Treasury, the Major Projects Authority, the NAO, the DWP Select Committee, the Public Accounts Committee, Sir Bob Kerslake—believes that. To paraphrase Sir Jeremy Heywood, the project remains well off-track. We want this to work. Will the Minister, whose integrity we entirely respect, give us the facts and the future plans rather than recycle the empty bluster of the Secretary of State?
Lord Freud
My Lords, this is a very large programme and the way we are doing it is quite responsive. What we have is a test and learn process. That is not just an empty phrase. It is a very large process, based on a live run-out of many tens of thousands of people, which feeds into how we build a fully digital interactive service that we are building at the same time. We will make changes to the process. That is what it is about. It would be silly to do all that work without being responsive. We learn lots of things. One of my jobs is to try to understand what we are finding out and then make those changes. There will be changes. Having said that, we announced a rollout process in December and we are, to my pleasure, managing to get it out to time with those plans. The next stages, which are towards the end of the year, are really important—moving on to families, bringing in childcare and going to that digital place. By the end of the year we will have a working test bed of how a fully interactive process will work. I am not saying it will not change after that, but I am saying that we are doing what we were planning to do.
Lord Kirkwood of Kirkhope (LD)
My Lords, I encourage my noble friend to redouble his efforts, as he has undertaken to do, to maintain cross-party support for this transformational programme which is so important to the future of our country. I am as impatient for implementation as anyone, but I exhort him to do this carefully—as he is doing—even if it means that the programme slips a little. It is better that it works properly than it is rushed and done wrongly. Does my noble friend agree that there is an advantage to keeping some flexibility in the funding of the scheme? Passported benefits, childcare costs and the local support services framework are all massively beneficial, and the Treasury should be persuaded to invest more money so that the programme is even more effective in future.
Lord Freud
My Lords, we are indeed trying to get that flexibility. One can look at our very intensive dialogue with the Treasury—going through point by point and milestone by milestone—in two ways. One can look at it as pretty onerous, and it is. On the other hand, it gives one a chance to look at what we should be doing next and changing it. One example is on the support system delivered locally—in the jargon, the LSSF. We were able to go to the Treasury and get more money put into that process quite recently because it could see how valuable and important that was.
Not locking everything down early and having that dialogue works. Frankly, you do not know what you are going to find out or what you are going to need to do when you have a major programme. Having that understanding from the Treasury of what we are doing and keeping it well-informed so that we can make those changes as we go along does work.
Lord Hylton (CB)
My Lords, most people are not yet eligible for universal credit. Can the noble Lord give the figures for how many people at the moment are subject to benefit sanctions and what is the current delay between agreeing that someone is eligible for a benefit and their actually receiving payment? Are these two factors not responsible for a good deal of destitution?
Lord Freud
In the universal credit build-out, we are fully aware that there is a gap between claim and payment. There is also a gap in the present legacy systems. We have set up a system of advances so that people can get the cash flow to match the differences. Alongside that, where there is, to use the word of the noble Lord, “destitution”, or immediate crisis, we are setting up the local support framework working with local authorities. They can get some of that support to people and are far more efficient at doing that than a bureaucratic central system would be.