Covid-19: People Living in Poverty

Baroness Bennett of Manor Castle Excerpts

Thursday 30th April 2020 Lords Chamber

Asked by

[Baroness Bennett of Manor Castle]

To ask Her Majesty’s Government what assessment they have made of the number of people who will be (1) living in poverty, or (2) unable to meet their basic needs, as a result of COVID-19; and what steps they are taking to support such people.

The Question was considered in a Virtual Proceeding via video call.

--- Later in debate ---

[Baroness Bennett of Manor Castle (GP)]

My Lords, I thank everyone who has put their name down to speak in this debate and apologise that the time available is so short. I hope this is something that the Procedure Committee will look at.

In the two weeks since we have returned from recess, your Lordships’ House has heard many times about the massive, far-reaching schemes that the Government have introduced in response to the Covid-19 epidemic, as we did in this morning’s government response to my Oral Question about growth dependency. Most of these schemes were introduced when both Houses were in recess, but we have now had opportunities to subject them to scrutiny and to share concerns that noble Lords and MPs have been hearing from members of the public, many of them desperate and frightened, who have pointed to the holes that the rules of the schemes have left many in. I am sure that in this debate we will hear many more case studies.

In the other place, my honourable friend Caroline Lucas has been pointing out how the scheme for the self-employed has left out those who took pay in the form of dividends, those whose self-employment was recent, and those who were self-employed part-time. I have been contacted by many—identified by #newstartersfurlough —who started a job after 28 February, and so their employers are not able to apply for the 80% wage subsidy for them. Can the Minister tell me how many people the Government know, or estimate, are in those two groups that are missing out on help?

There are also, no doubt, huge numbers of people who were on the minimum wage—which is not sufficient to live on, as the Living Wage Foundation makes clear—and are now on 80% of an already inadequate income, their employer failing to top up the Government’s furlough payments even if, as in the case of giant multinational companies, they could well afford to do so. Can the Minister tell me how many are so affected?

I acknowledge that gaps, such as those in the self-employed and new starter schemes, were inevitable, particularly given the speed with which these schemes had to be established. However, we might want to think about having prepared schemes for times of crisis in future. Perhaps, rather than abolishing these schemes when possible, the Minister could commit the Government to look at mothballing them and having the computer systems and legal frameworks held on standby. We live in an age of shocks—climatic, financial and health; we cannot know when the next one will strike, only that it will. Putting resilience—the ability to deal with them and to ensure that households are able to deal with them—at the centre of every government policy is essential.

For the immediate future, it is important that we know how large the gaps are—something that only the Government can establish. I hope the Government already have plans to adapt the existing schemes and slash the numbers falling through the gaps. That is one way in which the Minister could perhaps answer the second part of my Question, about how they plan to help those now without adequate, or even any, income. However many patches are laid over the gaps in these schemes, some people will always fall through; that is the nature of conditionality. If one of the conditions is having to apply, that is one way in which significant numbers will always miss out. I cite the example of pension credit, for which it is estimated that 15% of eligible pensioners do not apply, leaving them living—by definition—on tiny incomes.

I can already safely speculate that the Minister will say, “Ah, but there’s universal credit”—and yes, there is. On other occasions, your Lordships’ House has heard of its many limits, horrors and inadequacies, and I am not aiming to restart that debate today. At least with all sanctions suspended—as I understand it; perhaps the Minister can confirm that—some of its worst horrors, of people being left absolutely penniless through no avoidable fault of their own, are not currently occurring. I hope the Minister will also acknowledge that its level will not meet the commitments of many people who, suddenly and entirely unpredictably, have only it to rely on. I hope that the Minister will tell us today that the Government plan to make the ending of universal credit sanctions a permanent state of affairs. Taking away an already inadequate level of income and leaving people penniless for months or years is no way for a society to treat anybody.

Again, we have the problem of conditionality—rules being applied that some are unable to meet. In recent years, we have seen the level of conditionality in social security tightened, and tightened again. We have seen our politics dominated by the disgraceful and false distinction between so-called strivers and skivers, perhaps falling to its greatest depths with a former Chancellor’s obsession with the setting of people’s window blinds. That conditionality has led many to miss out on money they desperately need and should have a right to. In the age of Covid-19, that cannot be allowed to continue. That is why, as I pre-warned the Minister, I ask her whether the Government are considering a universal basic income—a payment going to every member of this society as part of the answer to the second part of my Question. Only an unconditional, universal payment can ensure that no member of our society is left penniless, in a Dickensian world of want and misery.

I have to tell the House that I am not co-ordinating this call with the First Minister of Scotland, Nicola Sturgeon, who yesterday told her House that Covid-19 makes

“the case for a universal basic income stronger than ever”

and that she would be putting that to our Prime Minister. That coincidence reflects calls from an increasing number of directions, party political and not, for a universal basic income. An unconditional regular payment at an adequate level, going to every woman, man and child in our society, could ensure that no one is left in poverty or unable to meet their basic needs. Surely, in a society that has the capacity to deliver it, that is a basic condition to call it decent and to fit the categorisation of a human rights-respecting society.

I hope that no Member of your Lordships’ House would deny the right to life, yet we do not currently guarantee the means to deliver life: for people to put food on the table and keep a roof over their head. Charity, particularly in the form of food banks, has increasingly been left to struggle to provide that most fundamental human necessity. In the age of Covid-19, of course, that is even more difficult.

Finally, today, much of the debate around Covid-19 is about ways out of the lockdown and this debate must look forward to that period. Initial government schemes to provide people with cash have been extended and are likely to be extended again but, at some time in the not too distant future, they will start to be unwound. Inevitably, that will mean that more gaps appear in the safety net, more people will not meet the changed criteria, or their circumstances will change, and they will be left in poverty without the means to meet their basic needs.

I am, and will remain, a proponent of a permanent universal basic income. One possibility for the intermediate period, to ensure that no one is left to the vagaries of conditionality and needing to rely on the stretched resources of charity and voluntary help, is a “recovery basic income”. I am aware of two such worked-through proposals, one from the UBI Lab Network, the other from Malcolm Torry of the Citizen’s Basic Income Trust and the London School of Economics. Again, I have shared these with the noble Baroness and, time allowing, I hope she might offer some thoughts on both the principle of a recovery basic income and the proposals—and maybe even on a general universal basic income. I also look forward to hearing the thoughts of the many other noble Lords taking part in this debate.