Welfare Reform and Work Bill

Baroness Evans of Bowes Park Excerpts

Wednesday 27th January 2016 Lords Chamber

[Lord McKenzie of Luton]

My Lords, I agree wholeheartedly with this amendment. It would be difficult to do otherwise because, as my noble friend reminded us, I moved a parallel amendment to what became the Welfare Reform Act 2009 when we were in government. When one looks back at legislation one has been responsible for there is always a moment of trepidation, but we are on safe ground in this case. Those were the days when the noble Lords, Lord Skelmersdale and Lord Northbourne, were heavily involved in our debates. Having said that—and I underline the importance that the noble Baroness, Lady Meacher, has placed on this amendment—it is slightly disconcerting to understand that one’s labours at the Dispatch Box all those years ago have lain dormant and fallow, so I press the Minister to say why it has not been introduced.

[Baroness Evans of Bowes Park (Con)]

My Lords, this amendment, tabled by the noble Baronesses, Lady Lister and Lady Manzoor, seeks to set into primary legislation a requirement for the Secretary of State, when preparing a claimant commitment, to have regard to the impact on any child affected by it. I fully support the principle that requirements should be adjusted according to individuals’ personal circumstances, including the well-being of any children for whom the claimant is responsible. However, this amendment proposes to unnecessarily prescribe the contents of the claimant commitment in the Welfare Reform Act 2012. During discussions with individuals, work coaches already take into account all the personal circumstances relevant to both claimant and child when agreeing work-related activities. We continually review the operation of the claimant commitment and will act on anything we find that can be improved. Claimants can request a review of their claimant commitment if they have concerns.

On the question asked by the noble Baroness, Lady Lister, about Section 31 of the 2009 Act, it applies to JSA and ESA, not universal credit. As part of the claimant commitment, parents can input into the contents of the commitment within universal credit.

We are very clear about the importance of our responsibilities with regard to the well-being of children. Regulations 98 and 99 cover the circumstances in which all or some requirements should be suspended for a temporary period, which includes circumstances in which a parent has to spend time caring for a child in distress or if they are in the kind of situation which the noble Earl, Lord Listowel, talked about. The number of hours a claimant is expected to spend carrying out work-related activity is also tailored so as to be compatible with the claimant’s individual childcare responsibilities.

These reasonable requirements, including any limiting or lifting and the reasons for this, are recorded within the claimant commitment. The amendment does not specify that it applies to the responsible care of a child; it refers to “any child”, which would make it extremely difficult to determine which children are being referred to other than those within the claimant’s responsibility. This would make it difficult for jobcentres to effectively administer.

The key principle of the claimant commitment is that we treat people as individuals and tailor their requirements accordingly. We have chosen not to prescribe in legislation what a claimant commitment should take account of in order that we can reflect all the possible circumstances people can present with. It would be too prescriptive to single out one element—the well-being of a child—and legislate that claimant commitments must contain this information. It would not be practical to prescribe everything a claimant commitment should contain—we want to take account of a broad range of circumstances.

We know that developing a skilled workforce is key to realising the flexibilities that we have built into the legislative framework of universal credit. We want to empower our work coaches to use this broad discretion to make sound decisions that are right for the individual in front of them. As the noble Baroness said, I talked at length about the work under way to invest in learning and development of our front-line staff, including the work coach delivery model and accreditation. I did that because I wanted to stress the importance we place on making sure that work coaches are trained and that they use their discretion to the benefit of the families they work with. I emphasised that element because I wanted to stress to noble Lords that we take that very seriously.

Existing legislation already enables us to take account of the well-being of children when setting a claimant commitment; it is something that work coaches routinely do. Therefore we do not believe that it is necessary to set out this level of detail in primary legislation. I hope that on that basis the noble Baroness will withdraw the amendment.

[Baroness Lister of Burtersett]

My Lords, I am grateful to all noble Lords who have spoken. The noble Baroness, Lady Manzoor, asked what there is to object to. It is a good question. The noble Earl, Lord Listowel, gave a very good example of what happens when a child is unwell. But the noble Baroness, Lady Meacher, in a sense finished off the argument by talking about the implications of the well-being of the child not being taken into account in a culture where many people are sanctioned—and, as the evidence from her inquiry showed, sometimes sanctioned for the wrong reasons.

I am again disappointed by the Minister’s response. It seemed simply to repeat the arguments that were made in Committee and did not really engage with the counter-arguments that I put. She said that Section 31 applies to JSA ESA. Yes, many lone parents are still claiming those benefits and will be for some time. As we know, universal credit is being rolled out slowly and the more complicated cases will move on to it more slowly, so why is it not being introduced in the mean time? I find it very sad that the good work of my noble friend Lord McKenzie is gathering dust. In fact, it was the good work done by the noble Lord, Lord Northbourne, that started it all, because it was his amendments that triggered this section, but nothing has happened. Therefore, I am afraid that the fact that it is JSA ESA is irrelevant.

This is not just one other detail; the best interests of the child is a fundamental principle that policy-making and legislation is supposed to have regard to in this country, or in any country that has signed up to the UN convention. So I am disappointed. Again, we have evidence of a sort of parallel universe where all the wonderful conversations are being had. It is excellent that the training is happening and I welcome that. However, as I understand it, when lone parents had bespoke advisers who understood the issues, rather than generic job coaches, they tended to be treated much better than they are now.

The helplines of organisations such as Gingerbread are constantly showing that the best interests of the child are not being taken into account. When this Bill is out of the way, I wonder whether the noble Lord or the noble Baroness would be willing to meet those organisations to talk about why there is this difference in perception, and perhaps we could have another look at Section 31.

[Baroness Evans of Bowes Park]

I shall be very happy to meet them.

[Baroness Lister of Burtersett]

I very much appreciate that. On that basis, I beg leave to withdraw the amendment.

Welfare Reform and Work Bill

Baroness Evans of Bowes Park Excerpts

Wednesday 27th January 2016 Lords Chamber

Moved by

[Baroness Evans of Bowes Park]

54: Clause 24, page 23, line 42, at end insert—
“(b) regulations under section 26 of that Act, or(c) Part 1 of Schedule 2 to that Act.””

[Baroness Evans of Bowes Park (Con)]

My Lords, the amendments in this group are mainly technical in nature. The majority of them respond to points raised by the Delegated Powers and Regulatory Reform Committee and we hope that they will be welcomed. Others stem from issues which we have identified might have been of concern to social housing providers, or they might be helpful to them in accommodating the rent reduction measure.

I start by addressing some of the points raised by the committee. In its report it expressed concern both that the power in Clause 26 to make provision for excepted cases through regulations was drafted too widely, which could provide latitude to make different provision for rent control or enforcement, and that negative procedures apply here. The powers under Clause 28 provide important flexibility to put in place, by means of regulations, alternative provision for how maximum rents should be determined in special cases. Our broad intention is to use these powers either to relax the requirements for social housing providers or to protect tenants.

However, we recognise some of the committee’s concerns and, in response, have brought forward Amendment 77, which restricts the use of the power so that it may not be used to increase the annual 1% reduction specified in the Bill or to impose a maximum rent below the social rent rate in a case where an exception from Part 1 of Schedule 2 applies. The amendment also provides clarity regarding how the power may be used to apply modifications of the provisions.

The power remains a wide one, and necessarily so, because it will allow the flexibility to put in place provisions which soften the effect on providers of the rent restriction measure. It will also put in place protection for tenants and, if necessary, make provision for new rent products launched during the life of this measure. These are important flexibilities to ensure the proportionate application of the Bill’s provisions so that they are aligned, as far as possible, with the current rent policy, and they will enable us to respond to developments in the sector. It is not our intention to use them to put in place significantly different or more onerous provision for large swathes of social housing. That is why we have not accepted the committee’s recommendation that regulations under this power should be affirmative. That would make implementing measures intended to assist providers or help tenants more burdensome and it would curtail the Government’s ability to act quickly to modify the effect of provisions where required.

Amendment 80 is consequential on Amendment 77, and Amendment 65 is, in turn, consequential on Amendment 80.

The committee also expressed concerns about the different approach to enforcement of Part 1 of Schedule 2 and of regulations under Clause 26—both, as originally drafted, powers to provide for enforcement—as well as enforcement of Clause 21, which is on the face of the Bill. We accept that there should be consistency of approach, so Amendments 54 to 58, 74 and 78 align enforcement of Schedule 2 and Clause 26 with that of Clause 21 so that all enforcement will be provided for on the face of the Bill through Clause 24. Amendment 60 is consequential on Amendment 74. Amendment 59 is a consequential amendment which transposes Clause 24 to after Clause 28.

We are grateful to the committee for identifying an inconsistency in drafting relating to the definition of formula rent and have brought forward Amendment 64 to address this. We have also taken the opportunity to clarify that the power to define formula rent includes the power to provide that it is a rent set in accordance with a method specified in regulations. The committee also expressed the view that delegation of the power to define “formula rent” is inappropriate in the absence of a proper justification and includes unacceptable sub-delegation. I hope that I will be able to reassure the House on both points.

As many of your Lordships will know, formula rent is a principle that is well understood in the social housing sector and a key element of the current rent policy regime. We have been clear that the definition of formula rent in the Bill will be aligned to the definition under the rent standard and government guidance on the reference date, albeit with the qualification that the flexibility to deviate from formula in exceptional circumstances will no longer be available. That policy intention has been subject to parliamentary scrutiny and, given that the method for determining formula rent is complex and involves reference to numerous tables of supporting data, we remain of the view that it is appropriate to set the definition out in secondary legislation and to refer to the rent standard and guidance from which that definition is derived. We do not accept that cross-reference to these historic documents is inappropriate, but do accept that the drafting did not make the intentions in this regard clear. Amendment 64, therefore, restricts such references to the rent standard and guidance documents applicable on the reference date.

Finally, the committee expressed similar reservations about the power to define affordable rent. Having reflected on them, we have tabled Amendment 70 to address the criticism of sub-delegation. We agree that cross-referring from the regulations to the content of the rent standard and guidance documents is not necessary. Instead, the regulations may provide that it is a rent set in accordance with a method specified or described in regulations. However, again, the Government’s clear view remains that the complexities of the definition are such that they are more appropriately dealt with in secondary legislation, which can, if necessary, be adjusted to reflect the terms of new affordable rent agreements.

I now turn to Amendments 66 to 68. These are important amendments to address a drafting oversight and to allow the continuation of the present policy that affordable rent housing may be let at the social rent rate when this is higher than the affordable rent, as may be the case in some low market-value areas.

Amendments 71 and 82 will enable continuation of the present policy that affordable rents are inclusive of service charge when determined on the percentage of market rent principle, but exclusive of service charge when determined on the social rent model.

Amendment 79 is a consequential amendment and removes the definition of “affordable rent housing” and “affordable rent” from the interpretation section, as these terms are no longer used other than in Schedule 2. Amendment 69 adds an example to the list in paragraph 4(4) of types of arrangements and agreements to which the definition of “affordable rent housing” may refer.

I now turn briefly to Amendments 72 and 73. I know that my noble friend Lady Williams had a helpful meeting with some of your Lordships to explain the purpose of these amendments. They amend Schedule 2, paragraphs 6(2) and (8), and would enable the regulator of social housing or the Secretary of State to issue an exemption allowing a provider to set initial rents at a specified percentage above the social rent rate if the statutory conditions for granting such an exemption are met.

Amendment 81 is a small clarification that, for the purpose of calculating rent reductions, the day on which a tenancy begins or ends should be treated as a full day. The purpose of this is to simplify calculations for providers.

Amendment 62 modifies the principles for determining the assumed rent in order to avoid disadvantaging providers who implement their annual rent increases later in the year than 8 July. An “assumed rent” is a rent set by reference to the rent of a previous tenant, and this amendment corrects a drafting anomaly which could have meant that, in certain circumstances, the assumed rent would be determined by reference to the provider’s 2014-15 rate, not the 2015-16 rate as intended. Again, the Government’s intention here is that this amendment should prove helpful to providers.

Amendments 75 and 76 are consequential amendments.

I apologise to noble Lords, but I misspoke earlier: I was supposed to have said Clause 26 and not Clause 28. Due to the technical nature of these explanations, if it would be helpful, I am happy to write to noble Lords to clarify exactly what I meant and to correct what I said. Because it is late and these are technical amendments, I am very happy to pick up other points in correspondence if, having read what I said, noble Lords would like any further clarification. I am sorry about the length of time that that took. I beg to move.

Welfare Reform and Work Bill

Baroness Evans of Bowes Park Excerpts

Monday 25th January 2016 Lords Chamber

[Lord MacKenzie of Culkein (Lab)]

My Lords, I support Amendments 31, 33 and 34 in the names of my noble friends Lady Sherlock and Lord McKenzie of Luton. However, I shall concentrate on Amendment 32, which is almost but not quite the same as an amendment tabled in my name in Committee. I regret and apologise that I was unable to be in the House on that day. I am most grateful to the right reverend Prelate the Bishop of Durham for moving that amendment on my behalf—more importantly, perhaps, on behalf of people with life-limiting illnesses such as motor neurone disease.

In speaking to that amendment, the right reverend Prelate reminded the Committee of the promises made by the Conservative Party in the run-up to the general election. I want to refer to that promise again, writ large in its manifesto, which was to always protect the benefits for the most disabled. Despite that promise, the Bill before us does not fully protect people with life-limiting illnesses such as motor neurone disease and other similar rapidly progressing ghastly conditions. Either the words in the manifesto say what they mean and mean what they say or they do not. As of this moment, these promises are not being kept. Going some of the way is what has happened in the Bill—and some of the way is not fully protecting, and is not always protecting, benefits for the most disabled. Unless this amendment is agreed, or the Government come forward at Third Reading with something to produce the same outcome, they will have failed to keep that manifesto promise. I do not believe that is good enough in a modern, civilised society, where people with life-limiting illnesses should not be expected to suffer any more financial hardship than is the inevitable consequence of their illness.

People with motor neurone disease frequently end up having to build bedrooms and wet rooms downstairs, adapt furniture and face all sorts of costs. Couples who may have been reasonably comfortably off rapidly find themselves in considerable debt. As the right reverend Prelate the Bishop of Durham put it:

“Those whom we cannot reasonably expect to support themselves should not be expected to shoulder the burden of austerity”.—[Official Report, 21/12/15; col. 2405.]

The most disabled will lose perhaps more than £250 per annum by 2020 because the basic rate of the employment and support allowance is not exempted. I appreciate that the amendment in my name is rather complicated, but it is a serious attempt to right a potential wrong. If it is too complicated, I do not believe that it is beyond the wit of government to find another formula to produce a result that will give the full protection that is needed.

In Committee, the right reverend Prelate the Bishop of Durham expressed the hope that Ministers would give the matter further and serious consideration. The noble Baroness, Lady Evans of Bowes Park, said in response that benefits,

“are designed to provide a basic standard of living to those who are not in work but at a level that does not disincentivise moving into work”.—[Official Report, 21/12/15; col. 2406.]

People with life-limiting illnesses such as motor neurone disease are not disincentivised from going to work. They cannot go to work—would that they could. There is no behavioural change that people with these dreadful illnesses can make to get back into work. The noble Baroness, Lady Evans, concluded by agreeing that,

“we absolutely must provide suitable protections for disabled people”.—[Official Report, 21/12/15; col. 2407.]

However, she then did not support the amendment. The meaning of “suitable” is very different from the meaning of “full protection”, as was promised in the manifesto. A great many people with life-limiting illnesses, and their organisations such as the Motor Neurone Disease Association, take a great interest in what the Government will now do. I hope the Minister, for whom I have the greatest respect, will be able to say that he will bring something back at Third Reading along the lines of this amendment, which will honour the promise that the Government made in their manifesto in the run-up to the election.

[Baroness Evans of Bowes Park (Con)]

I thank noble Lords for tabling these amendments. I do not wish to spend too much time restating the same points that were made in Committee so I will keep my remarks brief. First, I address the amendments tabled by the noble Baroness, Lady Sherlock, and the noble Lord, Lord McKenzie, which replace the provisions in the freeze with a duty on the Secretary of State to review the benefits in question, having regard to inflation and the national economic situation.

I remind noble Lords that the provisions in Clauses 9 and 10 contribute £3.5 billion of the £12 billion of welfare savings by 2019-20 that the Government are committed to. The Government have a £35 billion consolidation plan, as the Chancellor set out in the summer Budget and the joint Autumn Statement and spending review, and we are on target to achieve a surplus of around £10 billion by 2019-20. The savings that the freeze provide therefore represent a significant proportion—10%—of the work that remains to be done through this Parliament to restore the nation’s finances.

Noble Lords have argued that these amendments would merely place a review on the freeze rather than remove it altogether, but they would remove the certainty provided by a legislated-for four-year freeze. This would lead to increased uncertainty about where the Government intend to find the necessary savings to restore the nation’s finances and could decrease market confidence in the Government’s ability to deliver their target surplus by 2019-20. Noble Lords have also raised concerns about the impact of this freeze. I reiterate that there are no cash losers to this policy and that inflation is still forecast, by the independent Office for Budget Responsibility, to be relatively low over the next two years, providing time for benefit recipients to adjust their finances to compensate. Furthermore, OBR forecasts at the Autumn Statement projected average earnings growth of around 3.9% by 2020, higher than projected inflation at around 2%, meaning many working families can expect to see the impact of the freeze offset by their rise in earnings. The annual average income of the poorest fifth of households has risen by £300 in real terms, compared to 2007-8.

I turn to the amendment in the name of the noble Lord, Lord MacKenzie of Culkein, regarding employment and support allowance. This amendment seeks to place into legislation a requirement for the support group component of ESA to be uprated by an additional amount above the amount it would otherwise be uprated by. This additional amount would be equal to the difference between the current main rate of ESA and that rate if it were uprated by inflation. I should remind noble Lords that, as said in Committee, those in the ESA support group receive an additional amount on top of the personal allowance—the support group component—which we have specifically exempted from the benefits freeze. Furthermore, the enhanced disability and severe disability premiums within ESA are also exempt from the freeze, as are benefits which contribute towards some of the additional costs of disability such as disability living allowance and personal independence payment.

Noble Lords will be aware that spending on main disability benefits went up by over £2 billion over the course of the last Parliament, and that the proportion of those in relative poverty who live in a family where someone is disabled has fallen since 2010. We believe that we are continuing to provide important protections for the most disabled through the exemptions we have from the freeze, and that this amendment is therefore not required.

In conclusion, the Government believe that the freeze strikes a necessary balance between making important welfare savings while having in place the protections for the most vulnerable and disabled. I therefore urge the noble Lord to withdraw the amendment.

[Lord McKenzie of Luton]

My Lords, I thank the noble Baroness for her response. If the Government are to be in surplus in 2019-20, why is it necessary for any benefits freeze to extend into that year, whatever the rationale for earlier years? The noble Baroness said that there are no cash losers, but we know what that means: in real terms, people are going to miss out. Specifically, I refer the noble Baroness to my question about what she said in the previous debate about the balance being struck between—in her words—the needs of claimants and affordability. I ask again: how were the needs of claimants assessed in that determination?

The response to my noble friend, who made a compelling case, was deeply disappointing. In any reasonable understanding of language, the commitment made in the manifesto has not been met by how this issue has been dealt with this evening. I ask the noble Baroness to reflect again to see whether the Government could at least come back on the issue raised by my noble friend. As he outlined, those with life-limiting injuries are the most disadvantaged and are missing out. This is simply not fair.

[Baroness Evans of Bowes Park]

As I said in relation to the disability element, we have exempted quite a number of elements from the freeze, so we believe that we are ensuring that disabled people continue to get support and that the most vulnerable are protected. In more broad terms, we need to ensure that benefit spending is sustainable in the long term.

[Lord McKenzie of Luton]

Is that it? Given the hour, I think there is no point in pursuing this, except to ask whether, on that point, there is nothing further the Government wish to say to my noble friend Lord MacKenzie in relation to those people who find themselves in the support group and are undoubtedly short-changed by the way that the Government have dealt with this uprating.

[Baroness Evans of Bowes Park]

As I have said, we are protecting certain elements of disability benefits. We understand the needs of disabled people which is why, as I set out in my response, a number of elements are being kept outside the freeze. Overall, we have increased spending on the disabled and will obviously continue to try to ensure that they have the support that they need.

[Lord McKenzie of Luton]

My Lords, we are clearly not going to make much further progress this evening. In the circumstances, I beg leave to withdraw this amendment but it is deeply disappointing that this issue of the support group has been dealt with in this way.

Welfare Reform and Work Bill

Baroness Evans of Bowes Park Excerpts

Thursday 21st January 2016 Lords Chamber

[Lord Freud]

That the amendments for the Report stage be marshalled and considered in the following order:

Clauses 1 to 10, Schedule 1, Clauses 11 to 25, Schedule 2, Clauses 26 to 35, Title.

[Baroness Evans of Bowes Park (Con)]

My Lords, I beg to move the Motion standing in the name of my noble friend on the Order Paper.

Motion agreed.

Welfare Reform and Work Bill

Baroness Evans of Bowes Park Excerpts

Tuesday 12th January 2016 Lords Chamber

Moved by

[Baroness Evans of Bowes Park]

104BC: Clause 21, page 20, line 23, after “began” insert “at or”

[Baroness Evans of Bowes Park (Con)]

My Lords, I will speak to the government amendments which are largely technical in nature and stem from issues that have been raised with us. The amendments seek to improve the drafting of the Bill and ensure that the policy can be implemented smoothly. We also intend that they will be helpful to social housing providers. I am aware that my noble friend had helpful meetings with your Lordships before Christmas to explain the purpose of these amendments. I will now seek to put that forward to the House.

Amendment 104BC is a minor technical amendment. It closes a small gap in the drafting of the provisions to bring into the scope of Clause 21 any tenancies that began at,

“the beginning of 8 July 2015 but less than 12 months before the beginning of the first relevant year”.

Under Clause 22, we have set out some exceptions to the policy. The purpose of the exceptions in Clause 22(2) and (3), and the equivalents in Schedule 2, is to protect the value of stock held by social sector landlords, to provide confidence to the financial sector and to ensure that providers can continue to use their stock as security for borrowing.

Amendments 108B to 108D and Amendments 110C to 110E improve the drafting of those exceptions and clarify that they apply to the registered provider’s interest in the property only if the relevant steps are taken for the purpose of enforcing the lender’s rights under the security as intended. They also clarify that for the purpose of these exceptions, where a registered provider appoints an administrator, this is a step to enforce security.

We have brought forward Amendment 110F in response to concerns regarding the potential for practical implementation difficulties in certain circumstances. The new clause, “Implied terms”, is intended to help social housing providers to comply more easily with the requirement for rent reductions for social tenants. The amendment overrides any provision of individual tenancy agreements that may prevent providers varying the tenancy agreement to reduce rents on the most appropriate annual timescales. This is a somewhat technical amendment, so it may help if I provide some background in order that its purpose, which is to assist providers, can be better understood.

The Bill requires social providers to reduce by at least 1% the rents payable by their individual tenants over each of four relevant years. Each provider has a single relevant year, which, as a general rule, will run from April to March. However, a private registered provider with an established practice of co-ordinated rent years for the majority of its tenants may choose instead to use that period as its relevant year. If there is no clear majority the default is that the provider must use 1 April.

--- Later in debate ---

[Lord Kirkwood of Kirkhope (LD)]

My Lords, I support what the noble Lord, Lord McKenzie, has just said. He is right to say that the process of this particular measure and its sections through its various parliamentary stages has been less than best practice. Of course, it is not the Minister’s fault; I think that the Committee is grateful to her for her concise explanation of what these amendments seek to do, and it is agreed that they are, by and large, improvements. However, having substantial bits of policy of the kind covered by the sections and amendments that we are dealing with this evening in a summer Budget Statement, with no prospect of any consultation beforehand—an ex cathedra Statement by the Chancellor of the Exchequer, and then a long Summer Recess where everybody tries to work out what on earth it all meant—is not a good way of producing legislation.

It does not surprise me that there was a degree of confusion at the Commons Committee stages and that we are now faced at this quite late stage with admittedly helpful amendments. However, they are technical and they need consideration, because they increase the corpus of housing law and make things more complicated. Not only does the primary legislation make it more complicated; it will spawn secondary legislation. This House will no doubt look forward to studying it in great detail, larding and littering the statute book with consequential changes, including protecting mortgagees, implied terms in leases—which is always dangerous; from a legal point of view, implication by statutory legislation is never a good thing—and transitional protection, which may well be necessary. But at this stage I think it is appropriate for the noble Lord, Lord McKenzie, and the Committee to say to the Minister that housing Bills and measures of this kind should be done properly. Consultation and Green Papers are always an advantage. If we had had a Green Paper in relation to these clauses, some of the difficulties that the Minister faced in introducing these amendments could have been avoided and could be avoided in future.

[Baroness Evans of Bowes Park]

I thank both noble Lords for their contributions and take note of the points that they raised. In specific relation to the draft regulations, we will be putting out information on our detailed intentions in due course, and I will look at what more information can be provided at Report.

[Lord McKenzie of Luton]

Can I just press the Minister a bit to say what “in due course” means? Can we narrow that timeline a bit? For example, is it likely to occur before we get to Report?

[Baroness Evans of Bowes Park]

As I said, we will look at what information we can provide for Report; I am afraid that I cannot go further than that.

Amendment 104BC agreed.

--- Later in debate ---

[Lord Kerslake]

My Lords, I shall speak to my Amendments 110A and 110B. I am conscious that we are reaching the end of a long process, so I shall keep my remarks short. These amendments go to a specific issue that needs addressing. They focus on giving flexibility and excepting social rent reductions for two types of new supplier: affordable rent suppliers and social tenancies. That does not address the whole of the issue that I spoke about earlier because the social housing model involves cross-subsidy. When housing associations look at new supply, they look at two things: their investment plan’s overall viability and the viability of individual schemes. For schemes that are less profitable and more marginal, rent is crucial.

There is shared recognition in this House about the need for new supply of all types, including social housing. By giving flexibility by excepting new supply from the rent reduction policy and giving flexibility in the starting rates for these properties, it is very likely that some schemes that would have been put on the back-burner because of viability will go ahead. These amendments will cost very little because new supply is less than 2% of existing stock and therefore the cost in terms of benefits is very small, and the gain, in terms of new supply at the margin, will be considerable. These are two small amendments that will address the issue of new supply, give flexibility at local level to make decisions on rents and tip schemes that would otherwise not have been viable into viability and enable them to be built.

[Baroness Evans of Bowes Park]

My Lords, I shall start by addressing Amendment 110, which was tabled by the noble Baroness, Lady Sherlock, the noble Lord, Lord McKenzie, and the noble Earl, Lord Listowel. It would in effect reverse the summer Budget measure of applying a four-year freeze to housing benefit local housing allowance rates from 2016-17.

Between 2000 and 2010, expenditure on housing benefit doubled in cash terms, reaching £21 billion per year. If left unreformed, by 2014-15 housing benefit would have cost taxpayers £26 billion per year. This measure to freeze local housing allowance rates for four years will build on the reforms introduced in the last Parliament, which saved £4 billion and continue to deliver savings of around £2 billion a year. Savings from freezing local housing allowance rates are estimated to be around £655 million for Great Britain over the four-year period of the measure.

I will set out the process for setting the local housing allowance rates and what we already do to monitor the levels in comparison with market rates. Within DWP, local housing allowance rates are monitored each year to assess any divergences between the rates and local rents. Each autumn, the rent officer services provide DWP with rental data for all broad rental market areas for the 12 months up to the end of September. This is used to review the rates, and in the past two years has been the basis for identifying which rates should be increased by the targeted affordability funding.

If any changes are needed to secondary legislation, such as setting out a schedule of which areas and rates might be increased by the targeted affordability funding, they need to be carried out during the autumn and laid before Parliament, observing the requisite timescales before the amendments come into force before the LHA determination date at the end of January each year.

I should add that the Secretary of State has the power to review the local housing allowance rates or to provide in regulations for the maximum housing benefit to be an amount other than these rates. These powers have been in place since the LHA scheme was introduced and were reinforced in the Welfare Reform Act. Noble Lords will be aware that this measure has already passed through secondary legislation and been agreed by the Delegated Legislation Committee in the other place. The order was not prayed against by Members of this House and was therefore not subject to a debate. I reassure noble Lords that, alongside the LHA rate, we will continue to publish at the end of January, as we have done previously, the 30th percentile of market rates in each area. The noble Lord, Lord McKenzie, asked about his figures. They are broadly right in terms of the figures that he asked about.

The first step is for a provider to determine what would have been the rate of formula rent for that social housing—I apologise to noble Lords; I do not think this is quite right. I have not responded to the question from the noble Lord, Lord Kerslake. Typically for me, I appear to be missing a page. I will now turn to Amendments 110A and 110B, tabled by the noble Lord, Lord Kerslake. I am grateful to him for bringing forward these amendments and giving me the opportunity to explain to the Committee the approach that the Government are taking regarding rent-setting for new tenancies.

Schedule 2 to the Bill sets out how maximum rent should be determined during the four years of rent reductions for tenancies that were not in place at the beginning of 8 July 2015. Different rules apply to existing and new social housing and affordable-rent housing, and they are set out in paragraphs 1 to 3 of Schedule 2 respectively. Rents for new social housing, excluding affordable-rent housing, may be set up to the social-rent rate. It may be helpful for me to explain in slightly more detail how the social-rent rate is calculated, which is set out in the Bill in paragraph 1(4) of Schedule 2. The first step is for a provider to determine what would have been the rate of formula rent for that social housing at the beginning of 8 July 2015. The Government’s intention is to set that out in regulations that will mirror the formula for 2015-16, as set out in the rent standard guidance and the Government’s guidance for rent. In this way we have sought to make the 1% rent-reduction policy work in a similar way to existing policy in so far as we can.

Noble Lords will be aware that formula rent takes into account relative property values and local earnings, the size of the property and an overall rent cap. Local circumstances are therefore taken into account in determining what the rate of formula rent is. Once determined, the social-rent rate is found by then applying the appropriate annual reductions. But we do not think it appropriate to continue to allow providers of new general-needs housing the flexibility to set rents at up to 5% above formula. That flexibility was only ever intended to be taken up by general-needs housing providers on an exceptional basis and is now out of step with the Government’s policy for rent reductions, which necessitates a more tightly-controlled approach. As I have explained, the social-rent rate will be closely aligned to the previous formula-rent policy, which took into account local conditions. Local property values and local earnings are in fact built into the formula.

For new tenancies of affordable-rent housing, paragraph 3 of Schedule 2 provides that the rent payable by that tenant should be set at no more than 80% of the amount that would be the market rent for that property, and that in the following years a 1% per annum reduction to that maximum rent applies. But this is a maximum rent, and guidance regarding other factors of rent setting, including local factors, remains in place. Housing which may be let on the affordable-rent basis will be identified as such by regulations under paragraph 4 of Schedule 2 to the Bill, and I can be clear that our intention is that this will reflect existing policy regarding properties that may be let at an affordable rent.

Welfare Reform and Work Bill

Baroness Evans of Bowes Park Excerpts

Monday 21st December 2015 Lords Chamber

[Baroness Evans of Bowes Park (Con)]

My Lords, Amendment 70, tabled by the noble Baroness, Lady Sherlock, and the noble Lord, Lord McKenzie, seeks to require the Government to report on the adequacy of the funds provided to local authorities to support troubled families. We believe that the best way to judge the adequacy of the funding will be in the outcomes that the programme achieves. Our report will ensure that the Government remain transparent in publishing the progress made by families supported by the programme. This amendment, therefore, is not necessary.

The Government have committed to funding the new, expanded troubled families programme. In the spending review 2015, funding of £720 million was allocated for the remaining four years. Of course, the new programme also aims to incentivise local authorities to reprioritise existing resources to achieve better outcomes for families with multiple problems. These families are known to local services and money is already spent on them.

As the noble Lord, Lord Beecham, said, there is pressure on funding for children’s services, but we have actually seen local authorities maintaining relatively stable funding in these areas. However, we completely understand that there is pressure, and that is why we are also providing additional resources to change the way services respond to these families to achieve better outcomes.

As a number of noble Lords have said, funding for the new troubled families programme is available to local authorities in three ways. They are provided with a service transformation grant to transform their services and collect evidence for the national evaluation; they receive attachment fees of £1,000, as mentioned, for each family that they agree to work with; and they are able to claim an £800 results payment once one of these families achieves significant and sustained progress.

Of course, noble Lords will be well aware that the real financial prize, as a number of noble Lords have said, is the long-term change that we make to these families’ lives. It is not the money provided by central government, but the cost savings that can be delivered through redesigning their services to deliver better results for complex families with multiple problems and to see those families take control of their lives and move forward. We would certainly expect, as the noble Baroness suggested, local authorities to work together when a family moves from one area to another. It is both in the local authorities’ interest and in the family’s interest, so we would expect the sharing of information.

The programme has been designed to incentivise local services to reprioritise their money and front-line resources away from reactive services towards more integrated, targeted interventions to offer better outcomes for families with high-cost, multiple problems. By responding more effectively to the issues that these families face, the burden placed on local services can be reduced for the long term.

It is also important to remember that we are talking about a programme that has a track record of success. As the noble Baroness said, the original programme achieved success with about 116,000 families struggling with a multitude of problems. This could not have been achieved if the right services had not been in place. As with the original programme, the Government have asked local authorities to provide information that will enable us to assess its impact. This includes understanding what is being spent on families and the savings that are being achieved through local cost-benefit analysis. The noble Baroness, Lady Sherlock, asked whether this would increase the burden on local authorities. We do not believe that it will, because local authorities have already agreed to supply this information as part of the national evaluation of the expanded programme. Furthermore, they themselves receive valuable analyses of the programmes to help them drive improvement to their services.

Amendment 71, tabled by the noble Baroness, Lady Manzoor, seeks to require the report of the Secretary of State for Communities and Local Government to include information on the types of interventions families receive and whether they are successful. DCLG has always recommended that families should be supported through a whole-family approach to achieve positive outcomes, but it does not mandate a specific type of intervention. This is because we believe that, to work effectively, local authorities need the flexibility to adapt their approach to their local area and to each family they work with. There are no set or standard interventions that are universally applied by or across local authorities: each intervention is specific to each family. Given this necessary flexibility, the effectiveness of the programme will be measured through the outcomes it achieves with families rather than the individual intervention that it uses.

The duty to report, as it stands, already ensures that the Government are held to account on the effectiveness of the programme through publishing annual information on the progress made by families. To make progress, families will have received effective support from local authorities and their partners. The report will include information on this.

It may also be worth noble Lords noting that the report Parliament will receive annually on the troubled families programme will be based on the national evaluation of the expanded programme and the payment by results achieved by local authorities. The national evaluation will provide information about the progress of families against the six headline problems that the programme seeks to address.

The noble Baroness, Lady Manzoor, asked about data matching, which was used by local authorities in the original programme in relation to outcomes. They used data sets to track and monitor the progress of families. However, the fact that they used data in this way should not imply a lack of support for families. Every family that it was claimed had been turned around made real progress following support from local services. This is checked through the councils’ internal audit process before they can claim a results payment.

On the Guardian report that the noble Baroness mentioned, that was based on something of a misunderstanding of the programme. The programme certainly encourages services to join up and offer better support for families with multiple problems through redesigning their approach to providing support, and we advocated a family-style intervention approach, but that is not the only approach. The Guardian looked only at a certain subsection of families who achieved support through the programme in this particular way, rather than the large number of families helped through a whole variety of different approaches.

On the basis of the information I have provided, I ask noble Lords to withdraw Amendment 70 and not move Amendment 71.

[Lord Beecham]

Could the noble Baroness indicate whether it is intended to have longitudinal studies of the programme and, if so, what kind of period we might look at? Secondly, are the Government encouraging—perhaps they are; I ask out of ignorance—peer review between different authorities carrying out projects of this kind? That would seem particularly helpful given the range of problems faced.

[Baroness Evans of Bowes Park]

I believe that the full scope of the reports has yet to be decided. I am certainly happy to take back those two suggestions to the department.

[Baroness Sherlock]

My Lords, I thank all noble Lords who contributed to this short debate. I thank the noble Baroness, Lady Manzoor, the noble Lord, Lord Kirkwood, and my noble friend Lord Beecham for their support.

We heard a lot of emphasis on evaluation. When the Minister takes this back to the department, I urge her to reflect a bit more carefully on that. I was a little concerned that, towards the end of her remarks, she seemed to imply that we do not need to assess either quality or funding because if the outcomes work it must have been okay. The question I would raise is that of causality. We are dealing here with very complex situations. Essentially, a family that is already engaged with lots of agencies and that may have multiple problems is an organic and dynamic unit—coming in and going out all the time. To assume, because it started at X and ended at Y, that what happened must have been the right thing is a very central government assumption and a slightly risky one in the circumstances.

I ask her to take that back, along with the suggestion of my noble friend Lord Beecham about longitudinal studies and peer review, to try to think very carefully about how we can capture the learning. With respect to the noble Lord, Lord Farmer, the point of these programmes is that what one authority does may not be the best thing for another authority. It depends on the circumstances, as my noble friend Lord Beecham described.

I also take the point made by the noble Lord, Lord Kirkwood, about terminology. Certainly, when I was on the riots panel I talked to a number of families who felt that being stigmatised got in the way of their trying to deal with things. It was not that they did not know they had problems; it was just that everybody constantly telling them that they had problems did not help. They wanted help to get themselves out of those problems, not to be branded. We need to find a way to ensure that that does not happen. I encourage the Government to think some more on that.

I am also grateful to my noble friend Lord Beecham for pointing out to the noble Lord, Lord Farmer—whose interest in this subject I recognise—how many local authorities are struggling with funding, especially in the poorest areas where so many of these families will be. We need to be aware of that. I am grateful for the subject having been aired in this debate and I hope that the Government will come back to us on this on a regular basis. Given that, I beg leave to withdraw this amendment.

--- Later in debate ---

[The Lord Bishop of Durham]

My Lords, I support these three amendments. I do not wish to repeat what has already been said but the passion of the noble Lord, Lord Kirkwood, echoes in my heart because I, too, am deeply concerned by the impact these freezes will have on the poorest.

Most of us were delighted when the Chancellor of the Exchequer decided in the spending review that the national economic situation meant that we could, after all, as a nation afford not to make the previously determined cuts in tax credits. If this House had not voted the way it did, I presume he would not necessarily have been given the opportunity so to reassess in the light of the national economic situation. If the Bill is passed as it stands, the Chancellor has no option but to enact a freeze for the next four years.

While accepting that welfare spending must be controlled, we need to look very seriously at the impact on the poorest. I do not want to see the Chancellor’s hands tied to a freeze if the national economic situation continues to improve as forecast, or perhaps even more significantly. Suppose it does: who should be the beneficiaries? Surely, it should be the poorest. If the economic situation improves in 2017 and the Chancellor realises that actually, the nation could afford a slightly higher rate of child benefit or other benefits, that is what he should allow—not give it to people already perfectly well off because we earn enough. As the noble Lord, Lord Kirkwood, said, austerity, frankly, is not hitting large numbers of us. Surely, then, the Chancellor should value the freedom to once again say, “Well, we didn’t think we would be able to afford this but the national economic situation is better than expected so we are delighted to be able to offer a small—or perhaps large—amount of extra support for the well-being of children and the most needy in our country”. Does the Minister not think that would be a good position for the Chancellor to be in, rather than having to stick with a freeze without exception?

[Baroness Evans of Bowes Park]

My Lords, I thank the noble Baronesses, Lady Sherlock and Lady Lister, and the noble Lord, Lord McKenzie, for these amendments. I will first set out why we believe a four-year freeze of certain social security benefits, child benefit and elements of working tax and child tax credits is necessary.

In total, measures to freeze benefits and tax credits are projected to contribute £3.5 billion of the £12 billion welfare savings the Government are committed to by 2019-20. The Government need to make these savings to reduce the deficit and to manage welfare spending. Spending on welfare increased by 54% in real terms between 1999 and 2010, and tax credit expenditure more than trebled over the same period. Despite the progress made in the last Parliament to increase incentives to work and reduce reliance on benefits, there is still more to do.

Some 7% of global expenditure on social protection is spent in the UK, despite the fact that the UK has only 1% of the world’s population. Between 2008 and 2015, average earnings rose by 12%, and the minimum wage increased by 17%. At the same time, benefits such as jobseekers’ allowance increased by 21% and the individual element of child tax credit rose by 33%. The benefit freeze will begin to reverse this trend. However, we are clear that we must continue to protect the most vulnerable. That is why we ensured that certain benefits are exempted from the freeze, such as pensioner benefits, benefits which contribute to the additional costs of disability and care, and statutory payments.

Concerns have been raised about the level of benefit rates after three years of 1% rises, to now be followed by four years of the freeze. Successive Governments have always sought to strike a balance between the needs of claimants and affordability, and I can reassure noble Lords that when introducing this freeze we have had due regard to these issues, but we believe we have struck a balance that protects certain key benefits and generates the savings I have set out.

There are no cash losers with this policy, and the continued growth in wages will help to mitigate the impact of the freeze for working families. The OBR expects wage growth to reach 3.9% by 2020. Around 30% of households will face a notional loss but, as I have said, the other things we are doing in the broader economy should go some way to mitigate it, and I will go through a couple of them in a second. We have also fully assessed the Bill’s impacts on equality and the wider budget meeting our obligations, as set out in the public sector equality duty.

The purpose of the amendments is to replace the freeze with a duty on the Secretary of State to review those benefits, having regard to inflation and the national economic situation. This Government’s overall approach is to give a level of certainty to taxpayers, employees and benefit claimants. As well as setting out the four-year freeze, we have also set out a clear plan to raise the national living wage to £9 an hour by 2020, to increase the tax-free personal allowance to £12,500 by the end of the decade and to double the free childcare available for working parents of 3 year-olds and 4 year-olds to 30 hours a week, which is worth £5,000 a year. The amendments would take away the certainty that we are attempting to implement, and for that reason we cannot support them.

The noble Baroness asked what happens after the four-year period.

[Baroness Hollis of Heigham]

The Minister has said that this is very helpful to benefit recipients because they now have certainty that their benefit will fall in real terms, as opposed to the possibility that it might keep pace with the cost of living. Would she care to correct her statement?

[Baroness Evans of Bowes Park]

I have said that we have had to make some difficult decisions.

[Baroness Hollis of Heigham]

Difficult for whom? To use the phrase used by the noble Lord, Lord Kirkwood, I suspect that every Member of this House is protected from the difficult decisions. The difficult decisions will fall on those people who will have to choose whether to turn off their heating or pay their rent.

[Baroness Evans of Bowes Park]

As I said, by being upfront about the freeze, we are trying to ensure that people in receipt of these benefits understand that that will be the situation over the next four years. We are taking numerous other measures, including the national living wage and the childcare changes, to try to help these families in other ways. That is what we are doing with this freeze, and I urge the noble Baroness to withdraw her amendment.

[Baroness Sherlock]

My Lords, I thank all noble Lords who have spoken in this short debate. I thank my noble friend Lady Lister and the noble Lord, Lord Kirkwood, for highlighting the difficulties that the Government must have in understanding the implications of their decisions, since looking forward four years they have no way of knowing what economic conditions will prevail and what will happen to inflation.

I particularly want to thank the right reverend Prelate the Bishop of Durham for making a very obvious point: that when this House voted on tax credits, the Chancellor was in position to make a difference. The reason why he was able to overturn that decision was that he found £27 billion down the back of the sofa. It is not impossible that there might be some more money down the sofa, if he shakes it hard enough. It is not impossible that, if all the boasts the Government make about the marvellous things happening to the economy come to pass, a couple of years down the line he may find the economic situation is looking good. If the economy is growing again, he may want to reconsider his decision not to share the proceeds of that growth with the poorest in our country. Why on earth would he want to tie his hands?

I would put money on it that if I asked the poorest people affected by this whether they would rather have the certainty of benefits falling in real terms year on year, or keep open the possibility that they will rise if the economy improves, most would be willing to take a chance—unless the Government are suggesting they would in fact cut them. All this amendment does is to allow the Government, if they wish to do so, to have exactly the same savings in four years’ time, but it would make them do two things. Every year, they would have to come back and look the country in the face, via this House, look at what people have to live on and explain their decision, and they would have to account for it. All they would have to do is to put it to both Houses of Parliament every year. What are they afraid of? People out there have suffered enough. The very least the Government can do is stand up for themselves. Given that we are in Committee, I beg leave to withdraw the amendment.

Welfare Reform and Work Bill

Baroness Evans of Bowes Park Excerpts

Monday 21st December 2015 Lords Chamber

[The Lord Bishop of Durham]

My friend, the right reverend Prelate the Bishop of St Albans, cannot be here this evening. Therefore, I will speak largely on his behalf about Amendment 101, tabled by the noble Lord, Lord MacKenzie.

In the run-up to the general election, the Prime Minister was quick to stress that,

“the most disabled should always be protected”.

He was, of course, quite right to do so. We might be operating in a time of limited resources but that does not negate our moral duty to ensure that the most severely disabled people in our society are protected from financial hardship. Those whom we cannot reasonably expect to support themselves financially should not be expected to shoulder the burden of austerity. They already face enough burdens of their own.

For example, motor neurone disease is a condition that progresses so rapidly and so violently that there is little time for contingency planning. Jobs are lost and circumstances change so quickly that those suffering from the disease are often forced into debt. In practice, this means ensuring that the most severely disabled people in the UK—those in the ESA support group—are protected from cuts such as those in the Bill. This, of course, is exactly what the Government promised to do in their manifesto in promising to exempt disability benefits from the freeze to working-age benefits.

I recognise that Her Majesty’s Government have opted to exempt the ESA support group component from the freeze, but that component forms less than a third of the total provision made to the support group through ESA. The basic rate of ESA has not been exempted, meaning that those in the ESA support group, just like those in ESA WRAG and on JSA, will lose more than £250 a year in real terms by 2020.

The amendment tabled by the noble Lord, Lord MacKenzie, is an attempt to rectify this situation with regard to those in the support group. I realise that it is not a simple amendment. The Government cannot exempt certain groups from the freeze to the basic rate, for then it would cease to be a basic rate. The amendment therefore seeks to compensate the freeze through an uprating of the ESA support group component. Should the Government desire a simpler method, a commitment to uprate the ESA support group component by around 3% plus CPI would negate most of the effect of the basic rate freeze, while preserving the integrity of the basic rate.

The amendment would simply protect the most vulnerable—those who will never be able to go back to work—from the impact of the benefits freeze. If the Government want to be taken seriously when they claim to be protecting the most vulnerable disabled people in our society from financial hardship, support for this amendment, or one like it, should be a bare minimum. I hope that the Minister will give the matter serious consideration.

[Baroness Evans of Bowes Park (Con)]

My Lords, I have already set out why we believe the freeze of benefits is necessary so I will move directly to the amendments.

Amendment 101, tabled by the noble Lord, Lord MacKenzie, seeks to place into legislation a requirement for the support group component of employment and support allowance to be uprated by an additional amount above the amount it would otherwise be uprated by. This additional amount would be equal to the difference between the current main rate of employment and support allowance and that rate if it were uprated by inflation.

I understand the motivation behind the amendment, and the comments of the right reverend Prelate, but I will explain why we have included the personal allowance rate in the freeze. Personal allowance rates are aligned across all income-related benefits, including ESA, and are designed to provide a basic standard of living to those who are not in work but at a level that does not disincentivise moving into work. Those in the support group also already receive an additional amount, the support group component, which we have specifically exempted from the freeze. This additional amount is in recognition of the fact that this group of people is further from the labour market. In addition, many of those in the ESA support group who are being targeted with this amendment will be in receipt of disability living allowance or personal independence payment, which we have also exempted from the freeze. Again, these benefits are specifically aimed at contributing to the additional costs of disability, and will continue to increase in line with inflation. While I agree with the right reverend Prelate that we absolutely must provide suitable protections for disabled people, we do not support this amendment because the clause already sets out appropriate exemptions.

Amendment 97, tabled by the noble Baroness, Lady Pitkeathley, seeks to exempt carers from the freeze by ensuring that any of the relevant sums of working-age benefits are increased in line with inflation if they are claimed by persons who are regularly and substantially engaged in caring. As my noble friend and I have said, we share in and completely agree with the noble Baroness’s words about the great and vital contribution made by carers. That is why we have exempted carer’s allowance from the freeze, as well as carer’s premiums within other working-age benefits. We have ensured that carers are central to the Government’s reform to care and support, with strong rights for carers in the Care Act 2014. Since 2010, the rate of carer’s allowance has increased from £53.90 to £62.10 and we have further increased the earnings threshold for carers by 8%, to £110 a week net of certain expenses.

Amendments 98 and 99, tabled by the noble Baroness, Lady Lister, and the noble Lord, Lord Kirkwood, would remove the uprating freeze for child benefit which the Bill seeks to introduce. Further, Amendment 99 would instead place child benefit under a triple lock, meaning that it would rise by whichever was highest: the rise in prices or earnings, or 2.5% each year. This would go beyond existing legislation and create an unfunded spending commitment. The noble Baroness, Lady Lister, mentioned the CPAG research on the loss of value in child benefit. However, its methodology assumes that child benefit is uprated by RPI, which is obviously now an updated measure. Indeed, since 2008 child benefit has risen by more than 10%.

There is a parallel between Amendment 99 and the triple lock that the Government have in place for pensioners. In 2008, the basic state pension was at its lowest level relative to average earnings since the 1970s. The triple lock has turned this around and it is now one of the highest levels relative to average earnings in two decades. We believe it is right to continue to protect pensioners, who are often on fixed incomes and have paid into the system throughout their working lives. However, as I have said, it is important to make savings on welfare, including on child benefit. The freeze makes a contribution to forecast savings, given the annual spend on this benefit, so I am afraid that we cannot support these amendments.

The noble Baroness, Lady Sherlock, asked about a cumulative impact assessment. We have already provided detail on the impacts of the various measures and the Treasury published an extensive analysis alongside the Budget. A cumulative analysis for the Bill alone would take the measures out of the context of the wider Budget package, where analysis has shown that a typical family working full-time on the national living wage will be better off by the end of the Parliament.

I believe that we have ensured that we have in place protections for the most vulnerable, balanced against the need to make welfare savings. I once again thank noble Lords for bringing forward these amendments but we do not believe that they are necessary and I urge noble Lords to withdraw or not press them.

[Baroness Pitkeathley]

My Lords, I thank all noble Lords who have spoken in this short debate. As my noble friend on the Front Bench reminded the House, I have a long history in bringing carers’ issues before Parliament. In the course of that long history, I have learned that however little progress you seem to be making you have to keep going. I will keep going, as we all will, but I ask again that the Government think before Report about the effects of these policies—unintended consequences, perhaps, on the most vulnerable in our society. If, for example, we make carers so impoverished and oppressed that they give up caring, where is the gain in that for either society or the individuals? I am struck, as I have been so many times during the course of the Bill, by the parallel universes that we appear to be inhabiting. People from all around the House say that this is what is going to happen to vulnerable people and that here is the reality of the situation, as we hear it; and the Government say, “It’s all fine and we’ve done this to ensure that it is”. I am depressed but I beg leave to withdraw the amendment.

Welfare Reform and Work Bill

Baroness Evans of Bowes Park Excerpts

Monday 14th December 2015 Lords Chamber

My noble friend has done us a service by bringing forward this issue. Given the pivotal role that sanctions are designed to play in helping deliver full employment and make progress in halving the disability employment gap, we need to be assured that the system is fit for purpose. An independent review must assist at this time. As my noble friend said, surely it is in the department’s interest to know, as well.

[Baroness Evans of Bowes Park (Con)]

My Lords, the amendment, moved by the noble Baroness, Lady Lister, and supported by the noble Baroness, Lady Manzoor, the noble Lord, Lord McKenzie, and the noble Earl, Lord Listowel, would put into statute an independent review of the sanctions system. However, we are not sure that that is necessary, as the Government already keep the operation of the sanctions system under constant review to ensure that it continues to function fairly and effectively.

There is clear evidence that sanctions are effective with more than 70% of JSA and more than 60% of ESA recipients saying that sanctions make it more likely that they will follow the rules, but, where we identify that there is an issue, we act to put it right. This is clearly shown in the improvements already made to the JSA and ESA sanction system following the recommendations of Matthew Oakley’s independent review last year. However, as I said, we do not stop reviewing the process to ensure that it is fair and effective. That is why we have accepted, or accepted in principle, many of the recommendations made by the Work and Pensions Select Committee’s recent report into sanctions.

The chair of the Work and Pensions Select Committee, the right honourable Member for Birkenhead, has welcomed our response and our willingness to work with the committee to ensure that the conditionality system works as it should. In our response to the committee, we announced that we will trial a sanctions warning system giving claimants a further two weeks to provide evidence of good reason before a decision is made. We believe that this will help to strike the right balance between conditionality and fairness.

I can confirm to the House that it is our intention that the trial will operate in Scotland from March 2016, running for approximately five months. A full evaluation of the trial will be undertaken, and findings will be available from autumn 2016.

The noble Baroness, Lady Lister, asked about the monitoring of the destinations of sanctioned claimants. DWP officials are currently quality-assuring the data for universal credit official statistics. As part of this review process, we will carefully consider the option of including destination data. We are not yet in a position to confirm which statistics will be provided in future.

We are also considering extending the list of JSA vulnerable groups for hardship payment purposes to include those with mental health conditions and those who are homeless. This will mean that these claimants can receive hardship payments from day one of their sanction, provided that they also meet the other criteria.

The noble Baroness, Lady Lister, also asked about sanctions being applied fairly. Any decision to sanction a claimant is not taken lightly, and there is a full and proper process that includes the claimant from the start. At the start of the claim, as noble Lords will know, all claimants receive a tailored claimant commitment, and the requirements take into account mental health conditions, disabilities or caring responsibilities. Any failure to meet a requirement is always thoroughly considered and claimants are given the opportunity to provide good reason for not complying before any decision to sanction is made by the decision-maker, but I will need to come back to the noble Baroness, Lady Hollis, on the timescales that she asked about, because I do not have that information to hand.

The noble Baroness, Lady Lister, also mentioned the Crisis report. We absolutely understand that homelessness is a complex issue, and our priority is to ensure that individuals affected get the right support. That is why we have made more than £1 billion available to prevent and tackle homelessness and support vulnerable households since 2010, and we will continue to work closely with organisations such as Crisis to make sure that support is provided where it is needed most.

On the question of the noble Baroness, Lady Hollis, about lone parents being required to come to jobcentres without a toddler, no, requirements to attend appointments at the jobcentre should be tailored to take into account individual claimants’ caring responsibilities, and work coaches should be able to help to make appropriate arrangements, including helping to arrange appointments around childcare. I cannot speak about the range of facilities within jobcentres, but it is within the gift of the work coaches to be flexible in working with lone parents.

[Baroness Hollis of Heigham]

So I have the Minister’s assurance that any lone parent who turns up with a toddler in tow will not as a result be sanctioned?

[Baroness Evans of Bowes Park]

I have already said that I cannot speak to all the facilities, but as I am writing to the noble Baroness on a previous issue I will include that in that response.

It is important that we focus on ensuring that all the agreed recommendations proposed by the Work and Pensions Select Committee are delivered and can be embedded in the design and delivery of universal credit. To clarify for the noble Lord, Lord Kirkwood, I say that universal credit sanctions are just on the standard element, not on the whole amount. We believe that a call for a further independent review is unnecessary to embed this in legislation.

[Lord Kirkwood of Kirkhope]

The noble Baroness said earlier that a pilot was being mounted in Scotland for five months. Is that for all of Scotland, or just individual areas within Scotland? I would be surprised if it was Scotland-wide.

[Baroness Evans of Bowes Park]

No, it will be within a particular region of Scotland.

Sanctions play an important part in the labour market, encouraging people to comply with conditions which help them move into work. We want the sanctions system to be clear, fair and effective in promoting positive behaviours and we will continue to keep it under review so that it meets its aims, but also to ensure that it is flexibly delivered, as noble Lords said.

The noble Lord, Lord McKenzie, asked about sanctions statistics. We will look carefully at the point raised and consider what further information is useful to inform public debate. We have made a start on this, and our statistical releases now include additional information on sanctions.

[Lord McKenzie of Luton]

Can the noble Baroness deal specifically with the issue of how many, if any, three-year sanctions there have been?

[Baroness Evans of Bowes Park]

JSA sanctions continue to decrease, and the JSA monthly sanctions rate has slightly fallen—by 15%—over the past year. Each month, on average, 95% of JSA claimants comply with the reasonable requirements placed on them. On average, 5% of JSA claimants were sanctioned each month of last year. We can provide those figures; I will write to the noble Lord.

The noble Lord, Lord Kirkwood, asked about the gulf between the department and what charities say about sanctions. I can only attempt to reassure him that officials are working closely with charities to investigate concerns. For instance, we have worked closely with Crisis and Gingerbread on improving communicating sanctions and will continue to do so. I will take the issues raised by the noble Lord, Lord Beecham, back to the department, because I do not have some of the more detailed information that he was asking about.

On the basis of those responses, I hope that the noble Baroness will withdraw her amendment.

[Baroness Hollis of Heigham]

I realise that this is a sensitive issue, but the amendment in the name of my noble friend has been tabled for some time on sanctions, time, efficaciousness and the need for a review. I would have expected in the Minister’s brief the detail of how many sanctions for how long, how long the decision-making is taking, the number of people going through as a result to appeal, and the results of the appeals. I would have expected two or three pages in her brief giving her the statistical detail which would empower her to answer many of the questions which, understandably, she is taking away today. I am surprised at that, because the amendment has been tabled for some time. The department will have the statistics, and they should have been made available to us in Committee, so that we have that material here today before we consider what we—and my noble friend in particular—may or may not do on Report.

I am in no sense criticising the Minister, but Ministers are coming to this House woefully underprepared with the information they need, which is of a detailed sort, to deal with the amendments being discussed. Members on the Opposition Benches have a right to expect Ministers to have that at their fingertips.

Welfare Reform and Work Bill

Baroness Evans of Bowes Park Excerpts

Monday 14th December 2015 Lords Chamber

[Baroness Evans of Bowes Park (Con)]

My Lords, Amendment 58, tabled by the noble Lord, Lord Low, seeks to make part of statute all guidance relating to the safeguarding of vulnerable claimants in relation to any sanction. It also seeks to define vulnerability and to commit the Secretary of State to report annually to Parliament on the application of the guidance. In his speech on this Bill on 17 November, the noble Lord, Lord Low, said that the Work and Pensions Select Committee had called for safeguarding measures to be included in legislation. However, it did not recommend that specific action and did not suggest that the guidance should be put on a statutory basis. Therefore we do not believe that the amendment will achieve what the noble Lord intends.

As a principle, the guidance that the department produces to support the implementation of key policies is comprehensive. It is also regularly reviewed and refreshed to ensure that it meets policy intent, reflects new evidence about its effect and implementation and allows us to introduce easements within the scope of the current legislation. Much of the guidance relating to the safeguarding of vulnerable claimants in relation to any sanction, reduction of benefit or disallowance of benefit is based on individual assessment of need. Defining the scope of vulnerability too closely or predetermining who these groups are in statute could create unintended consequences. One example is the plight of Syrian refugees: fixed guidance might not have been able to respond to the specific and varied needs of those fleeing the conflict. Embedding a definition which may appear fit for purpose today within statutory guidance would remove important flexibility to ensure that we can respond to change quickly tomorrow and thereafter.

It is also worth noting that the existing vulnerability guidance already provides detailed material to assist work coaches in identifying and supporting the complex needs of vulnerable claimants. It is linked to an online vulnerability hub which has been specifically created to support staff in dealing with all forms of vulnerability and to ensure that guidance is in one place, which is what the noble Lord is suggesting. For instance, the hub contains information such as the mental health toolkit and the hidden impairment toolkit, both of which have been developed in conjunction with health experts and DWP work psychologists to ensure its effectiveness.

The content of all eight sets of guidance is reviewed frequently and the department works with both internal and external stakeholders to ensure that it effectively recognises and supports vulnerable claimants. We are also currently changing elements of the guidance in response to a recommendation made by the Work and Pensions Select Committee to supplement the existing work coach guidance to illustrate how conditionality can be tailored to take account of individual claimants’ circumstances where they have complex needs or need additional support.

Amendment 62, in the names of the noble Lord, Lord Low, and the noble Earl, Lord Listowel, refers to the universal credit local support services framework, now called universal support delivered locally. Again, I am sure that the noble Lord has tabled this amendment to ensure that vulnerable claimants are identified and supported as we move to universal credit. However, again, we do not believe that the amendment is best placed to achieve this aim.

The universal support framework was developed in acknowledgement that some people will need additional help in making and maintaining a claim for universal credit, which for the majority of people will be an online service with payments made monthly direct to the household. The framework aims to align with a flexible approach to services for vulnerable complainants and those with complex needs and recognises that individual local needs may be best met through integrated localised support service offers. It aims to help DWP and local partners plan the level of appropriate services and delivery methods to support the delivery of universal credit and to support claimants in moving towards greater individual self-sufficiency and independence.

Universal support trials started across Great Britain in September 2014. Five of the trials ended on 31 August this year and the remaining six ended on 30 November. The trials tested digital inclusion, financial inclusion, different arrangements for triaging household needs and the sharing of data, skills and estates to create the right integrated local foundation to support more households into work. The final evaluation of these trials will published in late spring 2016, although a short summary of key learning will be published before then. The trials will also allow us to better understand the business case for universal credit delivered locally, claimants’ needs, funding requirements and the delivery approaches that tested best. This information will be used to inform a refreshed framework alongside the full universal credit digital service from May 2016 and a refreshed specification of requirements.

The intention is that the universal support framework sets out the principles and specifications but is not prescriptive about delivery, although learning from the trials and local expertise will be brought to bear to enable continuous improvement. We want to ensure that local areas support their local communities as best they can and it will be up to them to decide how they want to bring resources together and to effectively provide the support needed. For instances, trials in Greater Manchester, Kent and Flintshire have all produced different ways of working which have been effective for those local communities.

On the basis of this explanation, I hope that the noble Lord will withdraw his amendment.

--- Later in debate ---

[The Lord Bishop of Durham]

My Lords, in the north-east I get to see apprentices in the car industry, the subsea industry, traditional industries such as stonemasonry, farming, and all kinds of sectors in schools. It is brilliant to be able to see them face to face, to meet them and talk to them. There are brilliant apprenticeships and we need to grow them. Therefore, the 3 million target is fantastic, but I have to say that where the Bill refers to,

“information about the progress made in the reporting period towards the apprenticeships target”,

which is simply the figure of 3 million, that does not give the information about the types of apprenticeship that there are. In the light of the previous comments, I add that in two particular manufacturing industries I went to there were fantastic apprenticeships with brilliant young men, but no young women at all. I am told that there have not been any. We need this kind of information to ensure that apprenticeships are of the quality and standard needed. Because of the lateness of the hour, I will stop at that.

[Baroness Evans of Bowes Park]

My Lords, I will attempt to respond to various points, but again, due to the lateness of the hour, I will try to keep my remarks brief. Where I do not respond to points I will endeavour to get further information to noble Lords relatively quickly.

The Government are committed to reaching 3 million apprenticeship starts in England in 2020. Clause 2 will place a duty on the Secretary of State to report annually on progress towards meeting that target. The amendments that have been tabled would place additional reporting requirements on the Secretary of State to publish a range of information as part of the annual apprenticeship reporting requirement set out in the Bill.