The Secretary of State for Work and Pensions (Ms Esther McVey)
With permission, Mr Speaker, I would like to make a statement on the changes announced to universal credit in the Budget last week and on the draft Universal Credit (Managed Migration) Regulations 2018, which we are laying in the House today.
The Chancellor announced a substantial package at the Budget to ensure that millions of people keep more of what they earn, and vulnerable claimants are supported when they move to universal credit. In total, this package will be worth an extra £4.5 billion across the next five years. I pay special thanks to all the colleagues, charities, third-sector organisations, Jobcentre Plus staff and claimants who fed back to me in order to build this package of support to ensure that universal credit is a fair system, supporting thousands who cannot work as well as thousands who can. I also thank my right hon. Friends the Prime Minister and the Chancellor for their support to deliver these measures.
Make no mistake: this is a Department that listens and a Department that will continue to listen, adapt, change and deliver. We will put an extra £1.7 billion a year into work allowances, increasing the amount that hard-working families can earn by £1,000 before universal credit is tapered away, providing extra support for 2.4 working families—I mean, 2.4 million working families. [Laughter.] Of course, the Opposition do not like helping 2.4 million working families, and they are laughing because we help and support people into work.
The work allowance increase was welcomed not only in this House, but among charities. The Child Poverty Action Group said:
“The work allowance increase is unequivocally good news for families receiving universal credit”.
The Joseph Rowntree Foundation said that this extra investment
“will help make universal credit a tool for tackling poverty”.
And we have gone further, recognising the genuine concerns raised about the support we were offering people, especially the most vulnerable, when they moved to universal credit.
We have made a further £1 billion package of changes, providing two additional weeks of Department for Work and Pensions legacy benefits for those moved on to universal credit—a one-off non-repayable sum that will provide claimants with extra money during the period before they receive their first universal credit payment. This is on top of the two additional weeks of housing benefit announced at autumn Budget 2017 and put into place this year.
We will also support the self-employed in moving to universal credit. We will open up a 12-month grace period before the minimum income floor is applied, supporting 130,000 self-employed claimants—because we are the party of business; the party of aspiration. We will support those in debt by reducing the normal maximum rate at which debts are deducted from universal credit awards from 40% to 30% of standard allowances. This will help over 600,000 families to manage their debts at any one point when roll-out is complete, providing them with, on average, £295 extra a year as their debts are repaid over a longer period.
This is targeted support to help work pay and support the vulnerable, which is why today I lay regulations to deliver the next phase of universal credit—managed migration, through which people will be moved on to universal credit. That is a move from a system that trapped people on benefits and created cliff edges at 16, 24 and 30 hours with punitive effective tax rates of over 90% for some. Under Labour, between 1997 and 2010, benefit spend went up by 65%. In 1997, households were paying £5,500 in taxes to fund the benefits system—and by 2010, the figure had risen to £8,350. The Conservative party was voted into office to manage the country’s finances and get them under control, and also to make sure that the benefits bill was affordable and sustainable for the future. While Labour Members may hanker for the dark old days of trapping people on benefits, excluding them from the opportunity of work and getting on in life, and at the same time delivering a big bill to the taxpayer, we do not. Under this Government, 3.4 million more people are in work, and the vast majority of those jobs are full-time permanent roles. This means that we have created more new jobs in the UK since 2010 than France, Spain, Ireland, the Netherlands, Austria and Norway combined, alongside creating a welfare system that supports those who need it.
Through universal credit, about 1 million disabled households will receive about £100 extra, on average, per month through more generous support. The Universal Credit (Managed Migration) Regulations 2018 will, in addition, protect 500,000 people’s severe disability premium at the point of migration, and deliver transitional protection for those we move to ensure that, at the point of moving, those managed-migrated have their entitlements protected. We will take a measured approach to delivering managed migration, taking our time to get it right and working with claimants to co-design it.
We have taken on board, and will continue to do so, the advice of experts and charities such as the Social Security Advisory Committee, whose report on the regulations we have published, along with our response, today. We have accepted, in full or in part, all but one of its recommendations—and the one we did not accept is because we want to make it more generous. I pay tribute to the hard work of the SSAC in scrutinising our regulations.
We have changed a key part of the regulations, as charities have asked me, MPs and the Department, relating to the minimum statutory notice period for people moving from their legacy award to universal credit. We have extended this period from a minimum of one month to a minimum of three months to allow claimants maximum time to prepare and make their claim before their legacy award expires. Alongside this, we have unlimited flexibility to extend claim periods for people who need it. We will backdate any claimant who has missed the deadline date but has made a claim within a month of the deadline day passing. We will test a variety of communication methods, including advertising campaigns, face-to-face communication, letters, texts, telephone calls and home visits, to provide support for claimants during managed migration. We will constantly review our approaches, engaging fully with charities, experts, claimants and all Members of the House. I commend this statement to the House.
Margaret Greenwood (Wirral West) (Lab)
I thank the Secretary of State for advance sight of her statement. I would like to pay tribute to all the individuals, charities and Members of the House who have been holding the Government to account over their chaotic and damaging universal credit programme, which is pushing families into poverty.
In June, the National Audit Office published a damning report on universal credit. We know that the roll-out of the benefit is leading to people building up debt and rent arrears or being forced to turn to food banks for help. The Budget last week did little to address the very long wait for payments, which is causing significant hardship. Despite that, the Government are now planning to start the next phase of the introduction of universal credit, which they call managed migration, involving the transfer of 2.87 million people on to it.
Under the draft regulations, existing claimants will be sent a letter saying that their benefits will stop and they will need to make a new universal credit claim by a specific deadline. It is wholly unacceptable that the Government are shifting responsibility for ensuring that people get the help they need away from the Government and on to the shoulders of nearly 3 million claimants. It is no wonder that 80 organisations representing disabled people are calling for the Government to change tack. Learning disability charity Mencap has said that the proposals leave disabled people
“vulnerable to having their benefits stopped before they have made a successful claim”.
More than 400 organisations have responded to the Social Security Advisory Committee’s consultation on the managed migration regulations—a record number for the committee, which demonstrates the strength of concern about this issue.
Parliament is being asked to approve regulations that it may have very little chance at all to scrutinise and debate, even though the details of how the process will take place are not yet settled. When asked by the Chair of the Work and Pensions Committee on 18 October whether the regulations would be debated, the Minister for Employment answered:
“We need to have a debate in the House.”
It was clear from the context that the Chair meant a debate in the main Chamber. However, the shadow Leader of the House raised the issue at business questions on 11, 18 and 25 October without receiving a clear assurance that that would be the case. That is all the more important since Government Members make up a majority of the MPs in Committees, even though they do not have an overall majority in Parliament.
Let us step back and get a broad view of the Government’s supposed flagship social security programme. Universal credit was supposed to lift 350,000 children out of poverty. Instead, according to the Joseph Rowntree Foundation, an extra 1.2 million children may be growing up in poverty by the end of this Parliament. Universal credit was supposed to deliver work incentives and help more people into employment, yet the NAO says that the Department for Work and Pensions will never know whether universal credit leads to more people in work. Universal credit was supposed to simplify the social security system, but instead, around three in 10 claims of universal credit are closed and not paid, within a system that is complex and that people find difficult to navigate. This statement does nothing to address that.
The Government claim that 1 million disabled households will receive an extra £100 a month as a result of universal credit. What the Secretary of State has failed to tell the House is that the same report by the Office for Budget Responsibility reveals that around 1 million sick and disabled households will lose an average of £2,608 a year, or £217 a month.
Universal credit is failing. The Opposition have consistently called on the Government to stop the roll-out, but the Government are pressing ahead, despite the terrible hardship it is causing. We have a right to ask questions on behalf of our constituents, including whether the universal credit managed migration regulations will be debated in full on the Floor of the House so that all MPs get a chance to scrutinise and debate this critical draft legislation.
The Secretary of State says that the Government have accepted all but one of the Social Security Advisory Committee’s recommendations. That is highly questionable. For example, what new action will the Government take to support people who struggle to make and manage a claim online? Will the Department publish the more than 400 responses to the Social Security Advisory Committee’s consultation, to ensure maximum transparency? The Secretary of State must assure the House that there are sufficient safeguards in place to ensure that no existing legacy benefit claimants end up falling into destitution and that none falls out of the social security system altogether.
Given the potential impact of the draft regulations on claimants’ incomes, the large number of people affected and the strength of opposition to the proposals in their current form, it is a matter of real concern that they will receive such little scrutiny by Members. Members are extremely concerned about the impact that universal credit is having on people living in their constituencies. They must be given the opportunity to debate and vote on these regulations on the Floor of the House.
Ms McVey
While the Opposition cannot bring themselves to commend the extra £4.5 billion going into universal credit, let me read out what some independent charities have been saying. The Resolution Foundation has hailed this a “very welcome” £1.7 billion commitment. The Joseph Rowntree Foundation has said that this extra investment is
“a tool for tackling poverty”.
The Trussell Trust has talked about
“significant improvements that will make a real difference to many people supported by universal credit”.
The Child Poverty Action Group called this
“unequivocally good news for families receiving universal credit”.
Other charities have been saying that the Department is now listening to what claimants, charities and MPs are saying. The Trussell Trust has said that. Gingerbread has said that. Mind has said that. Mencap has said that.
I would also point out that an extra 1 million disabled people will be getting an extra £100 a month, and that 700,000 people who did not get all they should under the legacy benefits will get nearly an extra £300 a month. There are now 3.4 million more people in work. That is what we do: we help people into work. Youth unemployment has gone down by 50% since 2010—that gives young people a future, it gives them hope and it gives them a job—and that is happening under this Government.
I came into politics for social mobility. Social mobility is about moving forward and getting a job. There is no social mobility on benefits—there is no mobility on benefits. That is what this party believes in. It is the way to get out of poverty. That is why we welcome the extra £4.5 billion. The Opposition have asked for a debate on the Floor of the House, and, of course, there will be a debate on the Floor of the House. We believe in transparency. We are open and straight talking. We say it as it is.
We will be co-designing what happens with claimants. In the words of the publication that the OBR has put out on the Budget, by 2023-24 we will be spending an extra £2 billion on universal credit than on the system it replaces. I want to say a final word on debt under Labour: between 1997 and 2010, benefit claimants’ debt to local authorities increased by £1.8 billion through overpayments and errors in the legacy system, and £5.86 billion of debt was accrued on tax credits. That is a shameful record for the Opposition of putting claimants into debt on benefits and tax credits.
Several hon. Members rose—
Justine Greening (Putney) (Con)
I very much welcome the additional investment in universal credit in the Budget. Like many Members, I have met the DWP, Jobcentre Plus and citizens advice bureaux locally to talk about the roll-out of universal credit. It is obviously hugely important that people avoid going into debt unnecessarily, and I very much welcome the co-design approach to managed migration that the Secretary of State has set out. Will she say which groups are likely to be migrated first, and on what basis?
Ms McVey
I thank my right hon. Friend. For a year from next July we will be having a trial period or test period, working with 10,000 claimants to see exactly the way in which it should be done—for example, should it be done for the most vulnerable groups or should it be done geographically?—and to make sure that we get it right. That is how we work: we make sure that it works; we do not just go forward with an idea—[Interruption.] There is chuntering from the Opposition Front Bench. We will work with claimants to make sure it works for them.
Kirsty Blackman (Aberdeen North) (SNP)
I thank the Secretary of State for advance sight of the statement. The work allowance boost that we are being told we should welcome only undoes or reverses half the cut that was made in 2015. It is like taking £100 away from somebody, giving them 50 quid back and saying, “You should be grateful that I’ve given you 50 quid back.” The reality is that people are still worse off. The benefit freeze is still in place.
The sanctions regime is also still in place. I am particularly concerned about the methods of communication for universal credit. I have seen a number of people who come to my surgeries with mental health problems particularly—they cannot open letters or deal with having to jump through the hoops that are put in their way—who are then sanctioned because they are literally unable to jump through those hoops. I hope that the Secretary of State will look at all these issues. She has mentioned communication methods, and I very much hope she will put that at the centre of the decision-making process for communication.
On the exact amount of money that has been allocated for universal credit, it seems to me that nothing has been done on the basis of how much people actually need to live on. If it had, there would not be a huge increase in the number of people going to food banks and there would not be the incredible number of sanctions that we see. Rather than the Treasury deciding how much money should go to universal credit and the Department for Work and Pensions then divvying it up, it would be better to make decisions on the basis of how much people need to live on and what amount of money would encourage people to get into work.
We need to ensure that people are not going to food banks, that families are not in poverty and that young people are not starving as a result of the Government’s policies.
Ms McVey
As I said previously, when we came into office, we had to take an overview of Government spending, full stop. We were voted into office to get this country’s finances under control. One of the decisions that we had to make was on the size of the benefit bill because it had grown by 65% under the previous Labour Government. We took hold of that, and decisions were made across the board—I have never shied away from that. Again, in 2015, further decisions were made after a general election. The Opposition did not vote against the changes and cuts. Their Whips’ advice on that day was to abstain. Some broke ranks, but generally they did not.
Those changes are now coming through, but I said that I would go out, meet people, listen, learn and see what we could do and afford, and that is why an extra £4.5 billion has gone into universal credit. I look at what people are saying and why they have welcomed the increase. I reiterate that there are 3.4 million extra people in work and that we are targeting the money at the most vulnerable.
The hon. Lady is right about communication, which is key. That is why we will work with charities to get it right.
John Howell (Henley) (Con)
In easing the passage to universal credit, there is a great role for jobcentre staff. The problem is that I do not have a jobcentre in my constituency. Will my right hon. Friend bring forward the idea of mobile jobcentres to help the transition and manage the process?
Ms McVey
My hon. Friend makes a very good point—he has probably been reading my mind. Outreach work is key: how do we get to the most vulnerable, whether people in isolated parts of the country or those with learning difficulties or transport difficulties? We will look at outreach work and perhaps a mobile bus. We should look at new, good ideas for connecting with our claimants.
Frank Field (Birkenhead) (Ind)
I thank the Secretary of State for the money she managed to claw back from the Treasury—I advise her for her own safety not to take routes home in the dark that pass the Treasury. A crucial element of her statement was the one-off, non-repayable sum for claimants who have been transferred to universal credit. Will she give the House an assurance that the sum—non-repayable, therefore incurring no debt—will be equivalent to the sorts of sums people would get if they were already on universal credit?
Ms McVey
We have made sure that that will be people’s benefit going forward. As I said, it is the sum that they need when they adjust from two to four weeks and it is, as the right hon. Gentleman said, non-returnable. That is to ensure that people can balance the money when moving from a two-week to a four-week payment. It is extra money.
Philip Davies (Shipley) (Con)
I know better than most how hard the Secretary of State worked to get support from the Chancellor in the Budget. I commend her for doing that. Will she assure my constituents that the welfare bill will not once again spiral out of control, as it did under the previous Labour Government, taking money away from hard-working taxpayers?
Ms McVey
The Conservative party is always about balancing fairness for everybody: fairness to the taxpayers paying the bill as well fairness to those getting benefits and those going into work. I thank my hon. Friend because when I met his Trussell Trust team in Shipley, one of their first requests was that the maximum rate at which deductions can be made should reduce from 40% to 30%. I am glad that I can deliver that today.
Janet Daby (Lewisham East) (Lab)
I strongly disagree with the Secretary of State. Universal credit is not getting residents out of poverty. I say that because a constituent of mine, who has mental health problems, contacted me this morning. He was moved over to universal credit and fell into housing arrears, which is exacerbating his mental health condition. It is very distressing for him. For those people unable to self-identify for managed migration, how will they acquire additional support? I do not think it is good enough that people are being tested out and then this is failing them.
Ms McVey
If the hon. Lady would like to meet to discuss what has happened to her constituent and how we can support him, I am more than happy to do so. Equally, I know that a lot of people are coming to universal credit with debt—it is not due to universal credit, but what they come with. Maybe together we can work to support that person.
Michael Tomlinson (Mid Dorset and North Poole) (Con)
I congratulate the Secretary of State on securing additional funding. In the detail for transitional provisions, she said that there would be two additional weeks of legacy benefits for those moved on to universal credit, which is a one-off, non-refundable payment. That may take time to sink in on both sides of the House, but can she confirm that this is additional money? Does she, like me, look forward to hon. Members on both sides of the House welcoming it and supporting it?
Ms McVey
I am glad my hon. Friend understands that this is additional money. My concern was how people, who are used to getting paid not monthly but fortnightly, would manage to cope with the change. That is why we have brought in the measure. Hopefully that money can help them if they have debt, because it is additional money to their household.
Ruth George (High Peak) (Lab)
When cuts to universal credit were voted through by the House, MPs were promised that everyone would receive transitional protection, but the delay to managed migration means that less than half the 7 million families affected will receive it and 3.2 million families will still be over £2,000 a year worse off. Will the Secretary of State look again at the very wide criteria for changes of circumstances that are being used to transfer people from legacy benefits on to universal credit at an ever-increasing pace?
Matt Warman (Boston and Skegness) (Con)
Universal credit rolled out a couple of weeks ago in my constituency. Does the Secretary of State agree that the money she announced today will make a particular difference to people in my constituency who are often paid weekly or fortnightly, rather than monthly? It is often they who are the most vulnerable and who need the most help.
Mr Speaker
Order. Just before the Secretary of State responds to her hon. Friend, I am sure that what she said she said in all sincerity, but I am 99.9% recurring certain in my own mind that the hon. Member for High Peak (Ruth George) was here at the start of—[Interruption.] Order. I am not debating the point with the hon. Member for North Dorset (Simon Hoare). [Interruption.] Order. No facial expressions are required. I am just telling him and the House the situation. The hon. Lady was here—end of.
Ms McVey
It seems a moot point on both sides of the House whether or not the hon. Lady was here, but that being the case she will know that we have put an extra £4.5 billion into the system to support transitional protection. That is exactly what a fair Government would do: provide the correct transitional protection.
Mr Speaker
I would quite like to lighten the tension on this matter. May I just say to hon. Members, for the avoidance of doubt, that perambulation in the Chamber from one row to another is not an entirely novel phenomenon? May I say to the hon. Member for North Dorset, who is an old friend in the House of Commons, that it is not uncommon? The fact that a Member perambulates from one Bench to another does not mean that that Member has exited the Chamber. As far as I am concerned, the hon. Lady did not exit the Chamber.
Louise Haigh (Sheffield, Heeley) (Lab)
The Secretary of State quoted the Child Poverty Action Group a couple of times, but she failed to mention that in the same press release, it also said that
“unless there is a further fundamental re-think of how universal credit works—and robust safeguards in place before it is scaled-up—people will continue to be pushed into debt and driven to food banks as part of their claim.”
Why did she omit that bit?
Ms McVey
Having met this charity group, too, I have said that I will work with it so that when we can, we listen, change and adapt what we need to do, which we have done so far since I have been in office, and we have the extra money through the Budget. That is what I am prepared to do.
Dr Julian Lewis (New Forest East) (Con)
I am not certain what the attitude towards gambling is in the Secretary of State’s household, but would she care to place a bet that if the universal credit system is up and running and if, heaven forbid, the Labour party comes into government, it will be most unlikely to replace it with a mish-mash of different cross-cutting benefits such as existed previously?
Ms McVey
That is a very good question, because it seems that Opposition Members do not really know what they are going to do. It seems that the shadow Chancellor is going to get rid of it and the shadow Secretary of State is not really sure, but I know that in the Lords, they want to keep it. Perhaps when the next person stands up, they will tell us exactly what the Opposition Front Benchers are going to do with universal credit.
Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)
Universal credit is due to start in my constituency in just a few weeks’ time. Local families and local advice services and food bank volunteers are all deeply concerned about what this will mean and about their ability to provide support for people in the run-up to Christmas. Given that the Secretary of State has had to admit that there are a whole series of problems with the policy, which is why she had to bring forward a whole series of changes—even though they do not go far enough—will she please recognise the risks to families in my constituency at Christmas and halt this introduction now, so that we can make sure that more families are not pushed into debt and poverty at such an important family time?
Ms McVey
I wonder whether I could invite the right hon. Lady to go to see the work that Jobcentre Plus and the work coaches are doing and how they are helping an extra 1,000 people each and every day into work and, equally, how they are working with the most vulnerable to sort them. If I did what she said and stopped the roll-out, it would mean that 1 million disabled people who would possibly be getting an extra £100 would not be getting it, and that those 700,000 people who have not got the right amount of benefit—nearly £300 a month—would not be getting it.
Bob Stewart (Beckenham) (Con)
Can I just get this right? Is it correct that our country gives more family benefits to our people who need them than any other developed country? [Interruption.]
Nick Thomas-Symonds (Torfaen) (Lab)
The full service roll-out of universal credit began in my constituency in July last year. People who are moving from legacy benefits on to universal credit are being made worse off. How on earth can a system incentivise work if it is making people in work poorer?
Ms McVey
What it is doing is supporting more people into work—3.4 million. By bringing in the work allowance—£1.7 billion a year—we are now able to focus extra support on families with children and supporting disabled people. Therefore, it will be even more beneficial to them going forward. That is positive support that we are giving through the Budget changes.
Eddie Hughes (Walsall North) (Con)
Universal credit came to Willenhall two weeks ago. Of the 157 cases we have had so far, only three are awaiting processing for payment. Can the Secretary of State explain why it seems to be going so smoothly, given that Opposition Members assure us it is a disaster?
Ms McVey
My hon. Friend, who has actually visited his jobcentre plus to find out what is happening on the ground, gives a truer reflection of what is happening on the ground. I have spent most of this year travelling from Brighton up to Angus in Scotland and meeting jobcentre coaches, and most of them are telling me that universal credit is working for the vast majority of people, but I wanted to make sure we got extra money from the Chancellor in the Budget to help the vulnerable people it maybe was not helping.
Chris Stephens (Glasgow South West) (SNP)
The Secretary of State will be aware that her Department has agreed with the Social Security Advisory Committee’s recommendations about telephone claims for universal credit, but we know that DWP contact centre staff are concerned that having to deal with such high call volumes might mean they cannot process claims. How many additional staff will be required in DWP contact centres to deal with telephone claims for universal credit?
Ms McVey
The hon. Gentleman raises a good point. That is another thing we will looking at during the managed migration, as we expand the system and more people come on to universal credit—how many more people do we need in call centres; how many more work coaches?—because we will need the right number to give a good service.
Sir Desmond Swayne
“The Government has listened to the frontline. These are significant improvements that will make a real difference.” Who said that?
Stephen Timms (East Ham) (Lab)
Everybody claiming universal credit has to wait at least five weeks before being entitled to payments, including those being moved across from previous benefits. The Secretary of State referred to the additional two weeks of previous benefits announced by the Chancellor in the Budget. How can Ministers justify stopping all benefits for a period of at least three weeks for people migrating from previous benefits on to universal credit?
Ms McVey
It will be a continuum. The payment cycle will be going from two weeks to four weeks, and this is actually extra money. They will be getting two weeks’ extra money because they will be getting the full period they are entitled to when it comes along after four weeks. This is not giving them less money, or even part of their money; this is two weeks’ extra benefit.
Simon Hoare (North Dorset) (Con)
Some of the most vulnerable in our communities will always look to their citizens advice bureau for help and assistance on these matters. The announcements by our right hon. Friend the Chancellor last week, and confirmed by the Secretary of State today, are incredibly welcome. What plans do she and her Department have to explain to our local CABs the nature of the changes and the benefits that will accrue from them to ensure that some of the most vulnerable people in our communities have a happy experience of universal credit, not one like the Opposition describe?
Ms McVey
My hon. Friend raises a good point, and that is why we worked in partnership with Citizens Advice across the country—so it could help people get on to universal credit. We felt it was the correct thing to do. It works with the most vulnerable people—it knows them—and is a trusted independent group. That is why we chose it to work with.
Kate Green (Stretford and Urmston) (Lab)
I welcome the announcement on reducing the deduction rate for the repayment of debt, but 30% of someone’s benefit is still quite a lot to be paying back on debt repayment. Will the Secretary of State take seriously the suggestion in the report of the Work and Pensions Committee last week that debt advice becomes a core part of the universal support offer?
Ms McVey
The hon. Lady, who knows a lot about this subject, is correct about the debt advice and the support that is available. We are building in measures to help more people to obtain debt advice. They often do not like asking for it as such, so we are going to change the term to “money advice”. Many people do not like to admit that they are in debt, even if they are.
Let me clear up one point. We are not talking about 30% of the entire benefit; we are talking about 30% of the standard allowance. Obviously, that does not include housing or childcare. It is a significant reduction in the rate, led by calls from the Trussell Trust.
Maggie Throup (Erewash) (Con)
Universal credit has already been fully rolled out in my constituency, and for the majority of people it is working; but, more important, more people are working too. Does my right hon. Friend agree that universal credit can also empower people to work more hours, which has got to be good for their self-esteem?
Ms McVey
My hon. Friend is right. This benefit is about empowering people. It is about helping them to take on work, or extra work. Under the legacy systems, people were locked out of work even if they wanted to do it. We know that there are about 113 million extra hours of work out there. We also know that there is a record number of vacancies in the economy. We can help people, get them a career, get them on the jobs ladder, and get them doing what they want to do in this world.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
Analysis of the universal credit measures in the Budget shows that more than 3 million households will still be worse off, especially disabled people and the self-employed. Following the High Court judgment compelling the Secretary of State to provide transitional protections for disabled people migrating on to universal credit, what is her response to the comment on page 76 of the Social Security Advisory Committee’s report that her proposals leave disabled people worse off and need “further consideration”?
Ms McVey
I hope that the hon. Lady will be voting for the changes that may give 1 million more disabled people an extra £100 a month, and the extra protection for the severe disability premium for 500,000 people, which is key. As I have always said, should we need to give any more support for vulnerable groups, we will work—and I will work with the Chancellor—to ensure that that happens. However, I commend to the hon. Lady the managed migration regulations, which, as she will see, provide for significantly more support.
Mr Philip Hollobone (Kettering) (Con)
The Opposition love to talk about benefit cuts. Will the Secretary of State confirm that, as a result of the measures in the Budget, spending on universal credit, when it is fully rolled out, will be £2 billion a year more than spending on the equivalent legacy benefits, and that this will be worth £300 a year to each universal credit family?
Ms McVey
My hon. Friend is right. That was in the forecast for 2023-24 in the Office for Budget Responsibility’s Budget report. We are a party that is fair to the most vulnerable and supports the rest into work. To be honest, I do not know why Opposition Members are voting against helping the most vulnerable and giving them more support than they would be given by the legacy benefits.
Several hon. Members rose—
Jess Phillips (Birmingham, Yardley) (Lab)
It is a miracle that someone who has had no social mobility and has lived on benefits can be called in the House, but I managed to make it here on those legacy benefits, and managed to get the same fancy job as the Members over there, so I am not sure what they are talking about.
I want to ask the Secretary of State about my constituent who was raped by the man with whom she lived and who therefore had to move. She was forced on to universal credit because of a change in her circumstances. She works—she has always worked—and she is £200 worse off. She is a single mother. What is being offered to her today—and this is why we are not supporting it—will still leave her £160 a month worse off. This is a rape victim, a single mother¸ who is in work. What will the Secretary of State do for her?
Mr Marcus Jones (Nuneaton) (Con)
I welcome the progress that my right hon. Friend has made in securing changes that support people in a better way. There will have to be a number of votes on the measures that she is proposing. What does she think people will not be getting if Members decide not to back the changes that she is advocating?
Ms McVey
That is a crucial question. If people do not vote for these changes, it will mean the most vulnerable not being helped, it will mean 1 million disabled people not getting £100 a month, it will mean disabled people not getting severe disability premium, and it will mean 700,000 people not getting their full benefit and being supported as well, in addition to the other measures I mentioned. I thank my hon. Friend for asking that question.
Stephen Lloyd (Eastbourne) (LD)
I commend the Secretary of State for making her statement to the House. I also note with approval the list of organisations that the Secretary of State said had come out and supported the Government putting back in the £1.7 billion for UC from the £3 billion cut in 2015. I note that I and my party were not in that list, but I am sure the Secretary of State will remember that since the election I have been saying again and again that to make work pay we have to bring back the full £3 billion. Will the Secretary of State commit to the further £1.3 billion that will really make work pay?
Ms McVey
We are making work pay. That is why more people are going into work. We are also changing the system significantly so that people are not trapped on benefits. We are making the system as fair as we can for those on benefits and those paying for it, and we are also protecting the most vulnerable; that is what we are doing.
Steve Double (St Austell and Newquay) (Con)
I thank the Secretary of State for showing once again that she is listening and is prepared to change and improve things as we go along, because these changes have been hugely welcomed by DWP staff in my constituency and constituents on UC, and indeed by many charities who work with the most vulnerable. Does the Secretary of State share my surprise that the one group of people who seem unable to welcome these changes are the Opposition?
Ms McVey
My hon. Friend makes a great point. They have also been unable to welcome the extra 3.4 million people in work, a reduction of youth unemployment by 50%, and the record numbers of women into work and of BME—black and minority ethnic—people into work. I do not know what they would welcome.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
The reason why we have these concerns is because of cases like this: a constituent of mine—a single mother of a terminally ill child aged 2—had her application for income support lost by the DWP, was then forced to claim UC, and while that was being considered all her benefits were stopped and she was forced to live on her son’s DLA and her carer’s allowance for her terminally ill son. Does the Secretary of State think that sort of case is acceptable and why is she pushing ahead given that cases like this have arisen?
Ms McVey
We have always said that we will deal with such cases. When fully rolled out, we will have up to about 8 million people here and we get it right most of the time for most of the people, but should something go wrong—and obviously something has gone wrong there—people come to their MP, which is only right, and then they bring the case to me and the Department and we get it right. But no system in the world is 100% right for 100% of people, and I apologise when it goes wrong, and then we will fight to get it right.
Kevin Foster (Torbay) (Con)
I have been interested to hear the Secretary of State’s responses to a number of questions. How many recommendations from the Social Security Advisory Committee has her Department accepted?
Helen Goodman (Bishop Auckland) (Lab)
A constituent of mine recovering from cancer came to see me. She had literally no money for food because at the moment UC is so badly designed that those whose pay date coincides with their claim date get no money at all in two months of the year. Before the roll-out, will the Secretary of State correct this design fault?
Ms McVey
In those instances we are working with the individual and then helping them with a manual workaround to make sure they are back on benefit and we are supporting those people. As I have said, it is never going to be a system that is right 100% of the time for 100% of people, but it is working the vast majority of the time for the vast majority of people. That is why people are saying up and down the country, “This is working; I’m getting into work.” In fact, this is the one single thing that claimants say to me who have been unemployed before—eight years ago—and are now coming back to the job centre. They say that because of the scare stories from the Opposition, they have been frightened to go into—
Matthew Pennycook (Greenwich and Woolwich) (Lab)
The full service was rolled out in Greenwich on 3 October and I am extremely concerned about the number of people locally who appear to be claiming universal credit when it is not necessary for them to do so and who are worse off as a result. What more can the Secretary of State’s Department do, particularly in terms of training and information sharing among organisations on the ground, to ensure that only those who need to claim universal credit are doing so?
Ms McVey
This is the new system, and people will be claiming universal credit as it rolls out to their jobcentre. This is a modern system that helps people into work and helps the most vulnerable. Probably the best thing that the hon. Gentleman could do is to work with them to ensure that they are on the system and that it is working for them.
David Hanson (Delyn) (Lab)
I wrote to the Secretary of State more than a month ago about an anomaly drawn to my attention by my local citizens advice bureau—namely, the difference for women on maternity allowance as opposed to maternity pay. Has she managed to resolve that issue, because many women are worse off as a result of this policy?
Christian Matheson (City of Chester) (Lab)
Chester was an early roll-out area for universal credit, so let me tell the Secretary of State how the migration has been going. A constituent of mine lost her husband; he died suddenly leaving her with a primary school-aged child. She was on a widow’s pension and tax credits, and was just about managing, but she was then told to go on to universal credit. She is now £250 a month worse off and she is going to lose her house. My question to the Secretary of State is this: can she have her money back?
Thangam Debbonaire (Bristol West) (Lab)
Child poverty and street homelessness are both going up, so I would like the Secretary of State to put on record her prediction for the future under the new universal credit system. Will child poverty and street homelessness fall or rise?
Ms McVey
At the moment, there are 1 million fewer people in absolute poverty and, under this Government, nearly 1 million fewer children are growing up in workless households. We believe that work is the best way out of poverty, and having a role model in the house who is working is the best way to get out of poverty too.
Chris Elmore
Thank you, Mr Speaker. Further to the shadow Secretary of State’s question about the managed migration regulations, will the Secretary of State confirm—yes or no will do—that this will be debated on the Floor of the House and not in Committee?
Nic Dakin
Waiting to get their universal credit is causing people huge problems. Will the Secretary of State do everything she can to address that problem, because it is the main thing that comes up when people come to see me every week—almost every day—with their problems about the universal credit roll-out?