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The Minister for Employment (Alison McGovern)
As ever, Sir Roger, it is a pleasure to serve under your chairship. I thank my hon. Friend the Member for North West Cambridgeshire (Sam Carling) for securing this debate and for the very important work that he has done to support the Renters’ Rights Bill, which will make a big difference to the experience of people living in privately rented homes.
On behalf of us all, may I congratulate the hon. Member for East Grinstead and Uckfield (Mims Davies) on her new appointment? She is right to say that she and I have debated these issues many times. I will miss doing so, and I know that many of my colleagues in the DWP miss her. We wish her all the very best in her new role.
The current level of poverty is unacceptable: 1.3 million more people are in poverty than in 2010. Poverty damages lives in so many ways, as we have heard this afternoon. People simply cannot fulfil their potential when struggling to pay for basic essentials, or in many cases going without them. I am determined that we will take steps to put that right.
Good work will always be the foundation of our approach to tackling poverty. Hon. Members will know that we had a manifesto commitment to bring forward changes in this area. We will shortly publish the “Get Britain Working” White Paper, which will announce our reforms in that area. We will have a new service to support more people to enter, remain and do better in work, and a youth guarantee, with increased join-up of employment and health, which are causing so many challenges in this area. Through our plan to make work pay, we will ensure that we create opportunities for all by tackling low pay, poor working conditions and job security. This is a truly ambitious agenda to empower working people and grow our economy.
We want to protect living standards, and wages are important in doing that. The national wage introduced by the new Labour Government back in 1999 has had a transformative effect on the fortunes of working people. In last week’s Budget it was announced that the national living wage will rise to £12.21 an hour from next April, boosting the pay of 3 million workers. That is an increase of 6.7%, worth £1,400 a year for a full-time worker, helping us to make progress towards a genuine living wage.
Hon. Members have mentioned the child poverty taskforce. I will take today’s debate as a submission through the child poverty taskforce process, because we have shown how interconnected many of the issues are. It is shameful that in a rich country such as the UK, 4 million children were living in relative poverty last year, and that 800,000 children have used a food bank in the past 12 months. As has been said, the End Child Poverty campaign has suggested that 1.2 million children were in furniture poverty in 2022. That is just unacceptable. It scars children’s lives now and can damage their long-term health, education and employment outcomes. It holds our country back, and we are determined to see change.
I hope it is helpful to hon. Members if I give a brief update on the child poverty taskforce, which is working to publish a comprehensive and ambitious child poverty strategy in the spring. Last month, we published a framework to set out how we will develop the strategy, harnessing all available levers because, as so many Members have said, policy in one area affects another. We want to develop the strategy with exactly that in mind. We have four key themes: incomes, costs, increasing financial resilience and getting better local support. On that note, I recently visited Glasgow, where the city council is doing excellent work to join things up locally, as Members have suggested.
Later this month, the taskforce will meet employers, trade unions and think-tanks to discuss options to increase incomes and financial resilience in low-income households. We want to ensure that the strategy addresses poverty in every corner of the land and that we hear and learn from families in poverty as we shape it. We will be holding engagement events across the UK—I have already visited various constituencies myself—bringing together a diverse range of voices and setting up a new forum for parents and carers to ensure that the experiences of our kids are included at the heart of the strategy.
The Government believe that a wealthy country like the United Kingdom should have a social security system that meets the needs of people who are unable to fully support themselves through work. We know that for many, the system we inherited is not currently achieving that. We are determined to fix the fundamentals so that low-income families can afford the basics. We have inherited a number of policies and a challenging fiscal climate that have left us with difficult choices.
In response to the shadow Minister’s point about universal credit, it is fair to say that the policy has been on a long journey. Some of the points she made about the responsiveness of social security during the pandemic are important. We must learn from that and try to address the challenges we now face. That is why we have committed to reviewing universal credit and will listen to a full range of views on potential changes to make sure that it is doing its job now.
As a first step, the Chancellor announced in last week’s Budget that we will introduce a fair repayment rate. That will help households on universal credit who are having deductions made from their benefit, perhaps because they had a loan of some kind or moved into a new home and needed to buy furniture or other items. We will ensure that they can retain more of the money from their benefit to help them to budget for essentials like this. Over 1.2 million households on universal credit will benefit from the changing of the deduction cap from 25% to 15%. It will mean an average of £420 a year, which is a good down payment on a future plan.
I turn to the specific issue of furniture affordability. Most of us will experience large one-off costs or unexpected expenditure at some point. As hon. Members have explained fully, these costs can be difficult to budget for, and we do not want to drive people into debt.
Jim Shannon
I mentioned the significant work done by charities and particularly churches, including St Vincent de Paul. What are the Minister’s thoughts on that?
Alison McGovern
The hon. Gentleman makes his point very well. Let me respond briefly to questions that Members have raised. I will ask the relevant Minister to write to my hon. Friend the Member for North West Cambridgeshire about the regulatory changes arising from the Renters’ Rights Bill, on whose Public Bill Committee he served ably. I reassure him that the DWP will work across Departments, because these areas cover different departmental responsibilities. We will include all those points in the child poverty taskforce. The hon. Member for Strangford (Jim Shannon) is right about charities—Wirral Repair Café in my constituency does a fantastic job.
My hon. Friend the Member for Uxbridge and South Ruislip (Danny Beales) made an excellent speech on household support fund guidance. I encourage him to be part of that conversation. I will take away what he has said, but he might want to write to me with more detail. To other hon. Members, I say that we are looking at all the ways in which poverty is now affecting people, given the spikes in energy prices and other issues. The comments were about the construction of homes and how we can limit the cost of energy are very important. I encourage Members to keep bringing those points forward, because now is the time to address them.
Hon. Members will know that the social security system has always made provision to help people on low incomes without adequate savings, and we do consider the impact of budgeting loans, advances and other measures. I mentioned the change in deductions. We know that while there will always be people who struggle to meet unexpected costs, no one wants a system in which large numbers of people are relying on crisis support to help them to feed their families or pay for heating and other day-to-day essentials. We want the system to genuinely respond to this as a crisis, not a chronic problem.
To support the upcoming child poverty strategy and address the demand we face, as the hon. Member for East Grinstead and Uckfield mentioned, we are continuing to provide substantial funding for crisis support through the household support fund and discretionary housing payments. We will invest £1 billion, including the Barnett impact, to extend the household support fund in England for an additional year until 31 March 2026 and to maintain the discretionary housing payments fund for a further year. This will ensure that the current targeted support is available for the most vulnerable.
In the end, we know that there is no quick fix. The issues that we have in this country are deep rooted and complicated, but that can never be an excuse for not trying to tackle them. We have taken the first steps, and there is more to come in the child poverty strategy and the “Get Britain Working” White Paper. I look forward to working with all Members here to get this right.
Question put and agreed to.
Resolved,
That this House has considered furniture poverty.