Baroness Lister of Burtersett (Lab)
My Lords, I support my noble friend, who made a very powerful case. The joint briefing from the churches and faith groups that was circulated to all Peers made a very good point. It said:
“A policy designed to incentivise families to make responsible choices, becomes an unavoidable financial penalty for anyone confronted by relatively common life events”.
This amendment in particular puts that quotation into relief. The Office of the Children’s Commissioner has raised similar concerns.
I made the point at Second Reading that this provision sits oddly with the Government’s own emphasis in this and earlier legislation on the importance of a dynamic perspective on family behaviour. Indeed, in a letter of 13 October to the EHRC about impact assessments for the current Bill, the Secretary of State made as his main point the need,
“to take fully into account the dynamic nature of people’s lives”.
So why are the Government refusing to do so now, especially, as my noble friend said, in relation to existing third or subsequent children where there is a new universal credit claim? What is the justification?
As my noble friend said, when this was explained to us I think the way it was put was that there would be an unfair advantage to richer families if they were able to claim universal credit for third and subsequent children. Perhaps these families were not claiming tax credits or universal credit before, but they could still be on a low income and simply not have claimed. We know that take-up is far from perfect. I know that the Government expect take-up to be higher for universal credit, but that remains to be seen. I have been around this game for quite a long time with the expectation that take-up would be improved by various benefits and so forth. However, it remains stubbornly at less than 100% for means-tested benefits. Even if they were better off—my noble friend made a powerful point here—financial circumstances can change very quickly in the event of life events or shocks. So where is the fairness in refusing support to, say, an early teenage child who is the third in the family and who was born many years ago?
The Minister of State, Department for Work and Pensions (Lord Freud) (Con)
I thank the noble Baroness, Lady Sherlock, and the noble Lord, Lord McKenzie, for bringing forward this amendment and I thank the noble Baronesses for making their points so succinctly, but effectively.
This amendment would change our approach to applying the two-child limit in universal credit so that it would apply only to children born on or after 6 April 2017. That effect would apply in existing and completely new claims for universal credit. This reform, which sees support for children in universal credit limited to two children, is primarily about fairness to the taxpayer. The tax credits system has grown unsustainably, and spending on tax credits for the 870,000 households which have three or more children is around £9.4 billion. To accept this amendment would, we estimate, increase projected universal credit expenditure by around £250 million in 2019-20. I am pleased that at least on this amendment I am able to provide the Committee with some costings.
The Government were elected on a manifesto commitment to reduce welfare expenditure by a further £12 billion during the lifetime of this Parliament, as part of the plan to eliminate the deficit and eliminate burdening the next generation with additional debt. There is no strong justification for the taxpayer to provide more generous financial support for completely new claims in respect of children born before 2017 than in respect of those born after that date.
Families already claiming universal credit or child tax credit, whether in or out of work, will not be affected in relation to children or qualifying young persons in their households before the key date while they remain entitled to benefit. Similarly, any household that has claimed universal credit or child tax credit in the past six months will be protected if their previous award included a child element for more than two children or qualifying young persons and they continue to have responsibility for them. I urge the noble Baroness to withdraw this amendment.
Baroness Sherlock
My Lords, I congratulate the noble Lord on being able to cost one of tonight’s amendments. I find his defence genuinely impossible to understand. I think he actually said that there is no stronger justification for exempting existing children than children who have yet to be born. I simply cannot understand how he can say that with a straight face because he has spent much of this evening telling us that this was all about choice and that parents who are on tax credits should make the same choices before having additional children as parents who are not. These are parents who already have children. These children already exist. They are not making a choice at all. The only reason they are making a claim for tax credits, or universal credit in this case, is because something has happened which means they have then had to fall back on the support of the welfare state. I do not understand how that is a justification and I invite him to think about it and maybe come back before I sit down and give me a choice.
The Government need to think very carefully. They keep giving justifications about choice until they do not hold, in which case they suddenly go, “Oh, look over there. Look at fairness”. This is either about choice or it is not. It cannot be about choice and when that breaks down a different defence is pulled out. It surely has to be one or the other. If it is about choice, how can it apply to people who have not made a choice? If it is not about choice, will the Minister please stop telling us that it is. Can I tempt the Minister to explain to me again why there is not a stronger justification for existing children than new claimants because I think I may have misheard? Is that what he meant?
Baroness Sherlock
At least my hearing is better than my understanding. I find that a profoundly disappointing response, even by the standards of tonight. But given that we are in Committee, I beg leave to withdraw this amendment.
Baroness Hollis of Heigham (Lab)
Can the Minister help me? I was just checking, and as far as I can see from handbooks, we continue to support various partners in polygamous marriages and we do not say, “After two partners you won’t get any more support for your third, fourth or fifth member of a polygamous marriage”. Why is it okay to have several spouses who are financed by benefit, but if you have more than two children they are not?
Lord Freud
I thank the right reverend Prelate the Bishop of Portsmouth and the noble Earl, Lord Listowel, for this amendment. On the ECHR point, the Government set out their assessment of the impacts of the policies in the Bill on 20 July, as I think I have already said. It is important to ensure that the dynamic behavioural effects of the changes are considered within that. Many of these analyses suffer from the fact that they are too static when considering gains and losses and too focused on notional changes.
On the question posed by the noble Baroness, Lady Lister, on child poverty impacts, I say that the intended impact of our reforms is to incentivise work, ensure that it always pays, and to allow people to keep more of what they earn. That is why, as we will go on to discuss, we are moving towards a life-chances analysis of poverty as our approach.
Baroness Lister of Burtersett
I am sorry to intervene, but that is no answer, my Lords. I asked a very clear, factual question. At present, the Child Poverty Act still holds; therefore this House deserves the respect of being given an analysis of the impact of the increase in the numbers of children in child poverty on the measures, which are still the law, and which will still be measured under the HBAI statistics, as the Minister has said. I do not expect to have it now, but I hope that the Minister will give us those figures before Report.
Lord Freud
As I said, projections on the HBAI are difficult, and everyone gets them wrong because they are done on a static basis.
I pick up the point from the noble Baroness, Lady Hollis: she will be pleased to know that universal credit does not recognise polygamous marriage.
On the family test raised by the right reverend Prelate, the noble Baroness, Lady Lister, and the noble Earl, it is not a tick-box, pass-or-fail test but is about looking at how policies support or potentially undermine family relationships, and about trade-offs. The family test ensures that family considerations are explicitly considered and recognised when making those trade-offs. These measures will ensure fairness for all families, both encouraging parents into work and giving a fair deal for the taxpayer.
Baroness Lister of Burtersett
I am very sorry to intervene again. As I said, the Home Office, which is not the author of the original family test—the DWP was—published the questions in the family test and how its policy met those questions. Of course the department must have carried that out not on a tick-box basis—I am not saying yes or no—but by carrying out a considered analysis around these questions. I simply ask why, therefore, the Department for Work and Pensions is not prepared to make available to this House the documentation of how the family test was applied to this clause?
Lord Freud
As I said, the documentation that we have published is the documentation that we need to publish to comply with our public sector equality duties. We have done that, even though the noble Baroness may feel that it is inadequate.
Baroness Sherlock
I do not presume to know any more than others about this subject—no one knows more than my noble friend Lady Lister. But on a number of occasions this evening, Peers from different Benches have asked the Minister very specific questions and he has simply got up and said, “What we have published, we have published”. The question he was asked just now was: “The Government must have conducted this test, because they are required to do it, so why won’t they publish it?”. “We have published what we have published” is not an answer. I am getting increasingly anxious about the quality of the responses this evening.
Take the example of dynamic benefits. Could the Minister explain that to me again? If he does not think that static analysis is good then he needs to find another way of analysing it. He simply cannot come to this House and say, “I cannot tell you the impacts of this because it is all dynamic”, because otherwise we will never be able to assess anything that the Government are going to do before they do it. That cannot be reasonable, surely.
Lord Freud
This amendment is asking us to do an analysis over the next six months. In practice, that is what will be happening on a dynamic basis, because we have introduced as part of universal credit a test-and-learn approach in which we are able to assess what happens to families and learn the lessons in order to roll out universal credit. That is a pretty public process and we publish what we learn. So, in practice, we have a process that incorporates the dynamic effect of these changes in its overall impact, rather than taking individual bits and pieces of the policy. That is the best answer that I can give to the question. On that basis, I urge the right reverend Prelate to withdraw this amendment.
Baroness Hollis of Heigham
I want to come back at the Minister. I was not trying to make a cheap jibe but, unless I am misreading a handbook that I have used over the years, if you are in a polygamous marriage and your spouse is married to someone else, you may claim as a single person within it, which is an allowance for you, including if the other person still lives in the same household with you. In other words, under UC—this is on page 154—there is continued financial support for other partners in a polygamous marriage. If that is so, why is it acceptable to apply that to adults but not to children?
Lord Freud
The noble Baroness has a long memory. Polygamous marriages were recognised in JSA, income support and ESA. We took a decision not to recognise those marriages in UC. Only the first marriage is recognised for universal credit purposes.
Baroness Hollis of Heigham
Except that financial support will, presumably, continue to be given to the other women who are in a polygamous marriage by virtue of their polygamous status.
Lord Freud
No. If there is a third person in that household they would be treated as a single person.
Baroness Hollis of Heigham
The point I am making is that they may be treated as a single person but they are getting financial support by virtue of that polygamous marriage, whereas the third or fourth child will get nothing.
Lord Freud
This is really becoming arcane. We have said that we do not recognise polygamous marriage in universal credit. But clearly there is an individual there, and we will treat them as a single person. It is actually, ironically, a little more expensive than treating them as a wife.
The Lord Bishop of Portsmouth
Can I make what I hope is not an arcane point? I invite the Minister, in responding to my amendment, which relates quite specifically to faith communities, to add something about that. He has not mentioned the word “faith” in his response, unless I have misheard.
Lord Freud
No, I have not; the right reverend Prelate is correct. In this policy we have looked through that to people’s choices, whether they are those in the benefits system or the people supporting those on the benefits system. I have not made an explicit comment on race or religion.
Lord Freud
My Lords, by virtue of Clause 4 the Government are committing themselves to reporting annually on their life chances measures of children in workless households, including long-term worklessness in England and the educational attainment of children, including disadvantaged children, in England at the end of key stage 4. The collective purpose of all the amendments in this group, laid by the noble Lord, Lord Ramsbotham, the noble Baroness, Lady Manzoor, and the noble Earl, Lord Listowel, is to place additional duties on the Secretary of State to publish and lay before Parliament further reports, information or data about a range of other areas. The question for us to consider is: what is the most effective way of harnessing primary legislation to achieve these aims?
We want to make a difference by taking action in the areas that will improve the life chances of all children and I think that is the answer to the question from the noble Lord, Lord McKenzie, about the policy. It will be addressing the life chances of those children, tackling the root causes of poverty, not the symptoms. Our new approach focuses government action on the most important drivers of poverty—worklessness and poor educational attainment—and on reporting progress in those areas annually. We will prioritise action in those areas and follow up our clear commitment to publishing a life chances strategy. As part of this we will develop a wider set of non-statutory measures on the root causes of child poverty, including family stability, problem debt and addiction.
The noble Lord, Lord Ramsbotham, by virtue of Amendment 22 seeks to expand the duty placed on the Secretary of State to include a duty to report on the progress of children living in England at age five, including disadvantaged children, in their cognitive, personal, social and emotional, and physical development. It is vital that all pupils thrive and develop in their early years and I recognise the importance of understanding where pupils are at the start of their school journey. Monitoring a child’s personal development is a core function of every education setting, enabling teachers to tailor their support based on how each individual is progressing. However, there are two key issues at the heart of the life chances reforms—action on work and education. Lives can be transformed through focusing on those two key drivers of poverty.
The end of key stage 4 is a vital point in a young person’s education. It represents the culmination of primary and secondary schooling and provides a consistent point at which to measure attainment across all young people. Pupils who fail to achieve at the end of key stage 4 are at higher risk of not being in employment, education or training. That is why the Secretary of State is making a commitment through the life chances measures in this Bill to report annually to Parliament on educational attainment at key stage 4.
Noble Lords will be reassured to know that the Department for Education already publishes a great deal of data on the progress of pupils—how well they are doing in the earlier stages of their career, including key stage 1 and key stage 2—and the annual reporting at different stages of primary schooling already provides significant detail on the progress and attainment of disadvantaged pupils.
The noble Baroness, Lady Manzoor, by virtue of Amendments 23 and 27 seeks to expand the annual reporting duty placed on the Secretary of State to include data on the educational attainment of children and disadvantaged children at the key stage 1 point. I recognise the importance of understanding and tracking pupils as they make their way through the key stages. It provides a basis for teachers to look at how each child is progressing. I am pleased to reassure noble Lords that the department already publishes a statistical first release each year on the assessment of key stage 1 pupils in reading, writing, maths and the results of phonics screening. That includes disadvantaged pupils.
Baroness Manzoor
Just on that point, I have heard this evening that various departments do their own thing, but coming new into the House I find that maybe we need a little bit more joined-up thinking. When you look at the Bill it would be nice to have something that says very clearly that key stage 1 is very important and this is what the Government are doing to track from key stage 1 to key stage 4.
Lord Freud
That is a good point but, in essence, if you are not achieving the target in the earlier stages, you will know you are not going to get to the right point at key stage 4, so I think in practice this is built into the process.
Amendment 28, in the name of the noble Earl, Lord Listowel, would place a statutory duty on the Secretary of State to publish and lay before Parliament a report on children in care and care leavers. As I think we indicated earlier this evening, we share the noble Earl’s commitment to improving life chances for this particular group. We publish a wealth of information on both children in care and care leavers. There are two annual statistical publications, the first of which provides data on the numbers of children in care and the numbers entering and leaving care. It also includes data on placements, children who go missing from care and outcomes for care leavers, including their economic activity. The second publication deals with educational attainment at both key stage 2 and key stage 4, so I hope that noble Lords will be reassured that we already have the comprehensive data that the noble Earl is looking for.
We are also taking action. We recognise that children in care often need special attention at school. The Government’s own measure of educational disadvantage includes children who have been in care. Children in care also attract the highest rate of funding through the pupil premium plus and, from December, will be recognised in the education performance tables. At a local level, we have given local authorities £44 million over three years to support all young people to continue living with their foster families after the age of 18, helping to provide a stable setting at the key point of transition.
In Amendment 29, the noble Earl looks to do much the same with children who are “homeless” and “at risk of homelessness” every year—in other words to create a duty to lay an annual report. The noble Earl will be pleased to know that I have been a member of the ministerial homelessness committee now for the last five and a half years, so I am absolutely informed in this area. We agree of course that care and attention are required in the case of children who are at risk in this area, and we publish relevant data. Local authorities collect and publish data on the number of households with children who are eligible as homeless and in priority need and data on the number of children in temporary accommodation, which is published on a quarterly basis. I think that the last figures came out in September. This area is a key priority. Since 2010, we have invested over £500 million to support local authorities and voluntary sector agencies to help the most vulnerable back into society.
On Amendment 30, problem debt clearly is a key factor in trapping families in poverty and adversely impacting on their living standards, mental health, family stability, financial inclusion and well-being. This is a well-chosen issue. We intend to develop a range of non-statutory indicators, which will include that one, as well as family breakdown and drug and alcohol dependency, and set these out in our life chances strategy.
Baroness Lister of Burtersett
I have a couple of points, the first on problem debt. Will the Government also be assessing the impact of the Bill on debt? We have had briefings from a number of organisations that give debt advice, such as StepChange, which are very concerned that the Bill, in particular the clauses we have just been debating on the end of financial support for families with three or more children, are going to increase debt significantly.
I also wondered whether the Minister could comment on another point. He has twice referred now to addiction, which the Government talk about as a sort of root cause of poverty. A couple of years ago I put down a Written Question asking what the Government’s estimate was of the proportion of children living in poverty with at least one parent addicted to either drugs or alcohol. The Minister’s answer was that the Government do not have such an assessment. Drug or alcohol use is not recorded on the survey used for UK poverty national statistics. I wonder therefore—how do the Government know that this is a root cause of poverty, when they seem to have no relevant information?
Lord Freud
There have been studies showing the numbers who are addicted to one or the other. I remember producing some figures on that in the debate on the last Welfare Bill. Clearly, one of the points of developing a life chances strategy is to get a better grip both of those areas and, indeed, the figures on debt. As the noble Baroness hinted, the figures are imperfect, and that is one of the reasons we want to get a better grip on it. When we look at the levels of debt, that will tell us about impacts, and we can start to analyse what those impacts are. That would of course include any government measures and the impacts would be revealed.
Lord McKenzie of Luton
I am still a little unclear on one fairly key point. When responding to the consultation on the measurement of poverty, the commission recommended almost a two-pronged approach. One was that there should be a multidimensional focus on the causes of poverty, but a clear focus on recording the experience of poverty and dealing with poverty here and now with an income measure. I understand what the Minister has been saying about focusing on the causes. One can see the longer-term impact of that; but what, precisely, are the Government going to do differently in respect of the here and now of people’s actual experience of poverty—people who simply do not have enough income today, and will not tomorrow or the day after, to get by and play their part in society? That is what I find to be missing, so far at least, from the Minister’s response.
Lord Freud
I am not sure that the Government would do much different from what they are doing. They have a safety net and there are various measures to support people. We are building at speed now the universal support system in which we are combining with local authorities to help the most vulnerable, but in a very different way from how people have been helped in the past, which was through crisis loans that they went on and on building in a random way, without anyone looking at the root causes of their problems and trying to help them out of them. This approach accords with that. Clearly, we will be spending our money on the root causes of poverty and on life chances. But there will be income measures published, because we have said that we will go on publishing the HBAI. If people want to see what is happening, that gets a lot of publicity every year. That is the change: the money that we will be spending on life chances. Those are some of the mechanisms by which we will do it. Universal support is one of the key things, but there are a lot of other things. Getting mental health right is something that has evaded Governments for a long time, and we are now spending more money on that than any Government have before.
I urge noble Lords not to press these amendments.
Lord McKenzie of Luton
Could we perhaps have one more brief run-through of the issue of income? The Minister says that the Government are not doing anything specific to address income poverty other than the application of their current broad benefit regime, with all the cuts that that is now having to endure. Is that it, in terms of actually tackling current poverty? How does the Minister deal with the point that pretty much every expert out there has concluded—certainly the commission has—that we need to have consistent, robust measures of poverty? What the key driver is, and all the other stuff, is subsidiary to that. There seems to be an overwhelming view coming from the experts on that. Is that not a view that the Government share?
Lord Freud
No. Every year I stand here because there is a forecast that says that child poverty is going up, has gone up or will go up, but when we actually see the figures we find that child poverty has actually gone down; the Government have been impressed and shocked by that. When you transform the economy, change the culture so that work is what has been driving things, and move up the employment rates and the earning rates in the way that we have, you find that the behavioural impacts are very different from the static analysis that many of the external experts tell us about.
The Earl of Listowel
My Lords, it is late so I will ask just two brief questions. I thank the Minister for his response. Can he give an indication of when a homelessness strategy might be produced, or is there already one that I am not aware of? He has mentioned that there are various kinds of homelessness, such as overcrowding and unfit accommodation. The one that is of most concern, though, is housing insecurity, when families just do not know where they will be from one day to the next. What is the strategy to deal with that? Is one forthcoming? How often does the interdepartmental group meet? Perhaps he might like to write to me on that last question.
I have been talking with practitioners working around the troubled families initiative, which I warmly welcome. Their work is much undermined by the fact that they build a relationship with a family, as they must and do very effectively, but then that family is moved somewhere else because the accommodation was private and temporary, and there just is not the security of tenure that there needs to be. Perhaps the Minister could help me with those questions.
Lord Freud
As I said, we will be putting out the life-chances strategy in time. The interministerial meets every quarter, I think.
The Earl of Listowel
Sorry, but I am asking about a homelessness strategy, dealing with the particular issue of housing security for families.
Lord Freud
Is the noble Earl talking about the interministerial meeting, which deals with those issues? Yes, I think it meets quarterly.
Baroness Lister of Burtersett
The Minister talked about working with local authorities on child poverty, which obviously is welcome, and I think that he said something about not wanting to do that in a random way—excuse me, it is a bit late so I cannot remember exactly what he said. If that is the case, though, why are the Government removing the duty on local authorities to develop strategies? The letter that the Minister received from the Children’s Commissioners just the other day underlined how valuable that duty has been. I know that local authorities, within the constraints that they are having to work in, have been quite imaginative in trying to think about what they can do as partners of central government in combating child poverty, so I really do not understand why that has been taken away, given what the Minister said about wanting to work with local authorities.
Lord Freud
It is the same answer that I have just given: we want local authorities to focus their time on action to get at the root causes, not at the symptoms.
Baroness Lister of Burtersett
But surely the strategy could be a strategy to get at root causes. The Child Poverty Act does not say that local authorities have a duty to deal with symptoms. It says that they have a duty to help to eliminate child poverty, and of course that is about trying to get at root causes.
Lord Freud
What we are doing is working with local authorities to support them in getting at the root causes. That will be our strategy.
The Earl of Listowel
While I am grateful to the Minister for that information about the interdepartmental group and how often it meets, I wonder if he could give an indication of whether it is looking to develop a strategy specifically for housing security for families, or whether he might be prepared to take back to that group a request from this House—at least, from myself—that such a strategy should be developed. This seems a very important area.
Lord McKenzie of Luton
I will follow up on the point about local authorities that my noble friend Lady Lister raised. The Minister will be aware that we are in the era of devolution deals, particularly with combined authorities—Manchester was the first, and there are others as well. As part of that process, is the department engaged in inputting into the package with a particular focus on child poverty issues?
Lord Freud
As noble Lords will be aware, the Government’s emphasis is to put authority into the hands of local authorities, which is what devolution is about. Therefore they cannot have devolution on the one hand and then send a whole series of specific requirements down on the other.
Lord Ramsbotham
My Lords, I thank all noble Lords who have contributed to this group of amendments. I also thank the Minister for his response. However, it contained one of the most disappointing sentences that I have ever heard from a Dispatch Box, when he said that he was not sure whether the Government could do more than they are doing. The Government could do a great deal more than they are doing and more than they have indicated they are willing to do tonight.
Lord Freud
I thank the noble Lord very much, but I do not want to let the noble Lord leave the Chamber tonight so disappointed. When I said the word “do” I meant that our approach to what we are trying to do would not change. That does not mean that we are satisfied with our level of energy and input. I want to make that clear so that the noble Lord does not think that I was making a complacent remark when I was talking about our approach.
Lord Ramsbotham
I am grateful to the noble Lord for that explanation. He knows perfectly well that on previous occasions he has earned the respect of the House by the way he has responded to questions and has been willing to take part. If I have another disappointment, it is that he has not responded to my suggestion that we should meet and have a discussion about all these issues. I do not feel that I have had an answer, particularly to the problem of mental health which was raised in Amendment 34.
I have always been worried about strategy as far as its production in Whitehall is concerned. I was once berated by a senior civil servant in the Home Office, who said to me, “I wish you’d stop talking about strategy. We don’t need strategy—all we need is strategic direction”. I said to her, “What do you mean?”, to which she replied, “Top down, of course”. I said, “Well, that’s where you’re absolutely up the creek. Just because somebody says something from the top does not make it a strategy”. A strategy is something which unites everyone in the delivery of something, which includes all the ministries that have been mentioned tonight. For example, when it is mentioned that the Department of Health knows about mental health or the Department for Education knows about attainment at key stages 1, 2, 3 and 4, why not get together and have an information-gathering strategy at which each of the ministries is required to produce what is required to have an overall strategy which feeds all the government departments that need to draw on that to process legislation.
I very much hope that we will be able to talk through this. I have listened to what has been said from the Floor of the House throughout today’s proceedings and there is a great deal of expertise that could help the department to produce better legislation, which is surely what we are all about. While I am happy to withdraw the amendment at this stage, I promise the Minister that we will return to it on Report and possibly at Third Reading.