DWP Offices Closures: Merthyr Tydfil

Wednesday 9th May 2018 Westminster Hall

[Steve McCabe in the Chair]

14:15

[Steve McCabe (in the Chair)]

I remind hon. Members that the debate is now scheduled to finish at 4.45 pm. I call Gerald Jones to move the motion.

[Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)]

I beg to move,

That this House has considered the proposed closure of DWP offices in Merthyr Tydfil.

It is a pleasure to serve under your chairmanship, Mr McCabe. Early in 2017, the Department for Work and Pensions announced that it intended to close many of its offices, sites and jobcentres across the UK. About 250 staff work in the DWP office in Merthyr Tydfil town centre, and they clearly make a contribution to spending in the community and our town centre. The office is well established and is close to the town centre, so our local economy would really notice the loss of this large workplace.

[Nick Thomas-Symonds (Torfaen) (Lab)]

I have a very similar situation in Cwmbran town centre, as Cwmbran pension centre makes that type of contribution. Does my hon. Friend agree that it is economically illiterate to take such jobs out of local economies across the valleys?

[Gerald Jones]

I thank my hon. Friend for that intervention. I agree with his point, and will comment on that further in the course of my contribution.

Job opportunities for local people would be limited if the DWP pulls out of Merthyr Tydfil. Such a proposal goes against what I believe the Government should be doing: helping to support local communities, the local economy and local jobs. The proposed move could mean services being more difficult to access for claimants and hundreds of jobs being moved out of deprived communities, where every job counts. In 2008, the Welsh Government moved several of their Departments out of Cardiff and located one of their regional offices in Merthyr Tydfil, bringing secure jobs to the town and supporting the local economy. The UK Government would do well to follow the Welsh Government’s example in that and, if I may say, many other areas.

If the closure goes ahead, the potential loss of jobs and incomes in the town would have a huge impact on Merthyr Tydfil and the surrounding communities across the heads of the valleys.

[Wayne David (Caerphilly) (Lab)]

A number of towns throughout south Wales will be affected similarly to Merthyr Tydfil. I refer in particular to Caerphilly, where the local authority has told me that retailers and businesses will be hit badly if the DWP moves its office out of Caerphilly to Treforest.

[Gerald Jones]

I agree with my hon. Friend. His point, similar to that made by other colleagues, highlights the fact that many towns across the south Wales valleys are in a similar position. Their local economies are supported by such jobs, and any move to remove them would be detrimental.

[Jessica Morden (Newport East) (Lab)]

My hon. Friend talks about the valleys. Does he agree that Newport is also affected? We are very proud of the civil service jobs we have in Newport; there are hundreds at Sovereign House, the DWP office. Does my hon. Friend agree that in a drive to centralise, the Government are overlooking the importance of local jobs and local expertise from local people? That would be lost, given the travel difficulties that people are experiencing getting to Treforest.

[Gerald Jones]

My hon. Friend makes a valuable point. I see Newport as part of the south Wales economic area. Job losses in that community would have a similar effect there as they do in other areas across south Wales.

[Nick Thomas-Symonds]

To highlight the point made by my hon. Friend the Member for Newport East (Jessica Morden), I have constituents who commute to Sovereign House in Newport who will now face disrupted travel from having to go so much further to Treforest, rather than down the road to Newport.

[Gerald Jones]

Again, my hon. Friend makes an interesting point. I will come on to some of the travel pressures that I have recently experienced myself.

As I said, the closure would have an impact on the surrounding communities across the heads of the valleys —an area trying its best to regenerate itself amid ongoing austerity pressures, which have created a difficult financial situation for our area.

[Anna McMorrin (Cardiff North) (Lab)]

I congratulate my hon. Friend on securing this important debate. In my constituency, in Gabalfa, the DWP office is set to close. Does he agree that such job losses take away something very valuable from our local communities? There is a lack of understanding from the Government of the transport challenges that will be faced by my constituents and many other people across the south Wales valleys.

[Gerald Jones]

The geography of south Wales is quite unique and people have to navigate the transport difficulties to which my hon. Friends have alluded on a daily basis. There are huge difficulties in access across valleys and from parts of south Wales to others and the transport links need to be addressed.

If the closures go ahead, they will decimate the economies of town centres across south-east Wales—town centres that are already struggling to cope. The DWP is planning to relocate staff to a site that, until last week, was known only as “north of Cardiff”. Last week, we had confirmation that it has signed a lease for a site on Treforest industrial estate. It was probably the worst-kept secret, but anyway it has now been confirmed.

In January, I and my Welsh Assembly colleague, Dawn Bowden AM, along with members of the PCS union, undertook an early morning journey on public transport to the proposed new site. It proved that to get to the new location by public transport will, for some existing employees, involve travel by train and bus, and walking a distance through a poorly lit industrial estate, which will undoubtedly be a major challenge in the winter months. The journey took all of two hours.

The site has poor access from the nearest train station along a narrow road with no pavement and my understanding is that it will have 1,700 full-time equivalent roles, but initial observations show that the car parking provision would be limited. There is a clear expectation that members of staff will travel by public transport, but it is also clear that many would find it extremely difficult to make that daily journey by public transport. Some members of staff already commute long distances to get to their workplace in Merthyr Tydfil as a result of previous DWP workforce reorganisations. Having to travel even further would, in many cases, cause hardship.

The construction of a brand-new building with a view to lowering costs seems a little confused. In many communities across south-east Wales, there is an opportunity to look at existing buildings, which would undoubtedly have a competitive financial case and retain jobs and viable office space in town centres. Alternatively, if a large employer such as the DWP pulls out of town centres, buildings such as the former tax office in Merthyr Tydfil, which closed nearly a decade ago, will remain empty and become dilapidated over time, often becoming a blight on the local community and impacting heavily on the wider public purse in the medium to long term.

UK Government offices are currently based in a number of towns in south Wales, supporting local jobs and economies. I am bound to highlight the opportunities that exist in Merthyr Tydfil. The option of retaining current jobs and having an enhanced presence is more than worthy of consideration. The current DWP office in Merthyr Tydfil is well-established and the staff turnover rate is low. Many employees have worked in that location for a long time and are committed to providing a good service to the public, and the local jobs market means that vacancies in Merthyr Tydfil are filled quickly and applicants remain in jobs. The DWP office is modern and has space for additional staff. Traffic congestion coming into Merthyr Tydfil at peak times is minimal in comparison with larger towns and cities and would mean that staff and customers would gain easy access, whether for employment or accessing the service.

I hope the Minister will comment on the concerns I have raised. Has the DWP yet undertaken an equality impact assessment regarding members of staff? DWP announced the proposed closure of Merthyr Tydfil benefit centre along with others in the south Wales area, yet, to date, local, district and senior managers state that equality impact assessments have not been completed or even commissioned. I received a letter in July last year from the then Minister for Employment, stating that an equality analysis was due to take place, so I would be extremely disappointed and annoyed if, after nearly 12 months, that had not happened. I cannot understand how the decision to close a site that provides quality jobs in such a deprived area of south Wales can be made without an equality impact assessment being carried out and its findings being considered. Surely carrying out an impact assessment on such a move is an essential first step.

An announcement was recently made that staff on fixed-term appointments in Merthyr Tydfil benefits centre will not have their contracts renewed, meaning that there will be at least 40 fewer staff by the end of the year. Yet the work will still need to be processed. Staff at the centre are concerned that current workloads will be exported to other sites, some possibly outside of Wales. They are concerned that something is being kept from them. Does the DWP have plans to close the site earlier than originally announced?

[Carolyn Harris (Swansea East) (Lab)]

Just last week, Virgin Media announced its intention to close a flagship site in my constituency of Swansea East, with the potential loss of 770 jobs. Jobcentre Plus will be the first port of call for all of those people who will be seeking new opportunities. Does my hon. Friend agree that any attempt to minimise local access to Jobcentre Plus can only add to the fear and frustration of those vulnerable people, who are already very fearful for their futures?

[Gerald Jones]

I wholeheartedly agree. My hon. Friend’s point reinforces the point about having access to quality jobs and services in local communities.

The plans for the Merthyr Tydfil office have caused real concern in my community. The workforce are clearly concerned. The local and regional branches of the PCS union have raised objections. I and a number of Parliamentary colleagues from across south-east Wales have raised concerns. My Welsh Assembly colleague Dawn Bowden and many of her Welsh Assembly colleagues have raised concerns. Local traders and employers in the town are also concerned.

Although the Minister may ignore some of those concerns, I feel sure that he would not wish to ignore the concerns of the newest Conservative Association in the UK, the Merthyr and Rhymney Conservative Association, which stated in March that it also objects to the relocation of those jobs. I understand that the association has written to the Minister to raise its objections:

“Merthyr Tydfil and Rhymney Conservatives are against this move as we believe the 200 jobs should be kept locally and not moved down the valley. We believe this would have a negative impact on workers by increasing commuting times and adding extra travel costs which would impact their cost of living.”

The deputy chairman for membership also said:

“I believe the proposed move of the DWP office to Treforest will have a detrimental effect on the current 200 strong workforce. I am a strong believer in the idea that local jobs should be for local people hence why we have contacted the minister in a bid to get him to re-think this decision which could potentially have a wide impact on the wider economy.”

Perhaps the Minister will share his response and confirm whether he agrees with his Conservative colleagues.

I have serious concerns that such huge changes for staff and customers are being taken forward at a time when universal credit is about to be rolled out in the area. Universal credit has proved to be challenging in many other areas. For the staff to be worried about their future while dealing with a major policy change is not a constructive or a timely mix.

Will the Minister confirm whether an equality analysis has been carried out regarding Merthyr Tydfil benefit centre? The DWP prides itself on being a diverse and inclusive employer and has many disabled and vulnerable workers. As we know, the public sector equality duty in section 149 of the Equality Act 2010 requires public authorities, including Government Departments such as DWP, to consider the potential impact on people with protected characteristics when making policy decisions and delivering services. The PCS union has been vocal in demanding that a full equality impact assessment and health and safety review be carried out.

Why is the DWP ignoring the Government’s green policy, which is trying to reduce the number of cars on the road, by relocating service centres to an industrial estate with poor public transport links? Why is the DWP ignoring the Welsh Government and the TUC’s “Better jobs in local areas” campaign by relocating away from local communities to centralised locations in cities or remote industrial areas?

Finally, why is the DWP suddenly not renewing the contracts of staff on fixed-term contracts, leaving sections decimated and unable to function? Is it planning to close the site earlier than announced? I would be grateful for the Minister’s answers to those queries in the hope that he can quell some of the concern, anxiety and growing anger about the decision, which does nothing to support local town centres and economies, or to protect local jobs.

16:30

[The Minister for Employment (Alok Sharma)]

It is always a pleasure to serve under your chairmanship, Mr McCabe. I congratulate the hon. Member for Merthyr Tydfil and Rhymney (Gerald Jones) on securing this important debate.

The level of employment in the United Kingdom is at a record high. In the hon. Gentleman’s constituency, the employment rate is 70.1%—an increase of 7 percentage points since 2010. That trend has been replicated across Wales as a whole, where the employment rate has increased by 5.8 percentage points since 2010, and now stands at 73%. I know that all hon. Members will welcome those jobs figures.

It may be helpful if I explain the background to the changes in the DWP estate, which have led to this issue. In March 2018, the 20-year contract covering the majority of the DWP’s current estate of more than 900 sites came to an end, which gave us a significant opportunity to re-evaluate what we need from our estate, taking into account the impact of universal credit, the increased use of online services and the improving employment rates. It is therefore right that we reconfigure our Jobcentre estate and make jobcentres fit for the 21st century. This is not about reducing services; it is about taking the opportunity to stop spending money on empty space, so we can spend more on supporting those in need.

In July 2017, we announced our plans for the majority of sites in the DWP estate. As part of that, we announced that five sites in south Wales, all with a focus on back-of-house activities, including Merthyr Tydfil, would be moving to a new single strategic processing site from 2021. As the hon. Gentleman outlined, the current office in Merthyr Tydfil is a mixed site, with a customer-facing jobcentre and a back-of-house processing function. I can confirm our intention is to keep the current site in Merthyr Tydfil for the next three years. Thereafter we will transfer the back-of-house staff to our new consolidated site for back-of-house operations, which, as the hon. Gentleman noted, we recently formally confirmed will be in Treforest.

[Anna McMorrin]

Will the Minister confirm what conversations he has had with the Welsh Government about the closure of those centres and the moving of the office to another site?

[Alok Sharma]

I will talk about the Welsh Government in a moment.

By choosing Treforest, we will be securing quality jobs for the next generation in an area that still lags in terms of employment rates. The hon. Lady talked about the Welsh Government, and the hon. Member for Merthyr Tydfil and Rhymney talked about following the Welsh Government. The Welsh Government recently set out their “Our Valleys, Our Future” strategy. Their ambition is to see more public sector jobs relocated to the south Wales valleys, and we believe our investment in Treforest demonstrates our commitment to that. The announcement of the move to Treforest was welcomed by Rhondda Cynon Taf County Borough Council.

[Gerald Jones]

Does the Minister recognise that the Welsh Assembly’s “Our Valleys, Our Future” strategy is about bringing new jobs to the south Wales valleys, not relocating jobs from existing communities, thus decimating the economies of those town centres?

[Alok Sharma]

Of course, the Welsh Government’s Welsh Revenue Authority has also chosen to base itself in Treforest. The DWP’s site is able to house 1,700 jobs, which is more than the number of people who are moving, so there is the potential to locate more new jobs at that site in the future. I know hon. Members are keen on that, and of course I support it.

[Anna McMorrin]

Will the Minister answer my initial question? What conversations has he had with Welsh Government Ministers about this move?

[Alok Sharma]

I have been in post for a number of months, and I personally have not had a direct conversation with my Welsh counterparts, but I am happy to write to the hon. Lady after this debate to set out the conversations that have been had with the Welsh Government. As I say, with this move we are supporting the strategy that the Welsh Government have set out for additional jobs in the valleys.

[Nick Smith (Blaenau Gwent) (Lab)]

Does the Minister accept that those jobs are being moved from the heads of the valleys area—the north—to the south towards Cardiff? It is the area around Merthyr, and further east towards Tredegar, Ebbw Vale and Brynmawr, where jobs are needed most.

[Alok Sharma]

When we make changes to the estate, of course we have to take into account the impact on jobs, but new jobs in other areas will be created as a result, and it must be balanced with the savings we will get as a result of the reconfiguration of the DWP estate. That money will be ploughed back into helping those most in need.

[Anna McMorrin]

Will the Minister give way?

[Alok Sharma]

Let me continue for a little while.

In arriving at Treforest as the new site, we conducted a comprehensive postcode mapping exercise of the home locations of all potentially affected DWP colleagues. I have a set of figures for how long it will take individuals located in the five sites to reach Treforest by public transport. The latest personal travel report published by the Welsh Government—I think it is from 2013—set out that eight out of 10 journeys to work are by car. The proportion has remained broadly unchanged for 10 years. The timings I have been given suggest that the journey times will be about 20 to 25 minutes in most cases—perhaps less.

[Anna McMorrin]

The Minister is being very generous in giving way. Has he actually been to the south Wales valleys?

[Alok Sharma]

Certainly not during my time as a Minister in this role.

There is a train station at the edge of the estate, where the new site will be. We understand that the Welsh Government have ambitious plans to enhance the transport links throughout south Wales, and that they will further improve access to Treforest, which is one of their key priority areas for the south Wales metro. We will work closely with colleagues in the Welsh Government and the local council on those transport solutions.

The hon. Member for Merthyr Tydfil and Rhymney said that there is insufficient parking space at Treforest. The DWP has made provision for substantial car parking on site to complement the park-and-ride development led by the Welsh Government.

Based on current estimates, moving our back-of-house functions to Treforest will impact about 239 DWP staff in Merthyr Tydfil. As part of the move, we want to maximise the retention of DWP colleagues, along with their valuable skills and experience. To do that, we will consult fully with colleagues and trade unions and have one-to-one conversations with staff to understand the personal impact of any changes on them.

[Wayne David]

Has the DWP made any objective assessment of the impact that moving people out of a number of communities will have on those communities?

[Alok Sharma]

The question was asked in terms of the staff who will be required to move, as I said, although we did do a postcode mapping exercise. The hon. Member for Merthyr Tydfil and Rhymney also asked about the impact on claimants, but a jobcentre will continue to be located in Merthyr Tydfil—I confirm that again.

We shall seek to redeploy any staff, wherever possible, who are unable to move to the new location. We are also prepared to pay colleagues’ excess travel costs for up to three years to assist their transition. When it comes to the front-of-house staff, as I said, I reassure Members that we are committed to retaining a jobcentre in Merthyr Tydfil, so the impact on claimants should be minimal, because there will still be a jobcentre there. We are looking for alternative premises, and we want to be in the new location by the end of March 2021.

[Gerald Jones]

The Minister mentioned the discussions with staff and the impact assessments for those staff. Will he give us more information as to when those impact assessments are likely to take place? As I said, it would have been advantageous to the Department for that to have been done before the final decision was made—a case of the proverbial stable door being bolted after the horse has gone. Will he give us some indication of when the assessments are likely to take place?

[Alok Sharma]

We are talking about a move three years from now so, clearly, informal conversations will start now—that would be natural—and staff will be evaluating where they want to be located. We expect the formal process, however, to start nine months before the actual move. The reason for that is simple: individual circumstances may change during the period leading up to a move, so we want to deal with people and their circumstances in real time.

The hon. Gentleman also raised the issue of equality impact assessments, and I confirm that we have been mindful of our equalities duties throughout the process. The hon. Member for Cardiff North (Anna McMorrin) asked me whether I had visited any of the sites. I said that I had not. I confirm that I have visited Newport jobcentre but not any of the back-office sites due to be relocated to Treforest.

The move from the existing site at Merthyr Tydfil will be a change for the Department and for our claimants and staff. By choosing Treforest, however, the DWP is making a long-term commitment to providing quality jobs in an area of need. In securing the site on a 25-year lease, we shall provide job security for our staff. We are also committed, as I said, to retaining a jobcentre in Merthyr Tydfil itself.

Question put and agreed to.