Tax Credits (Income Thresholds and Determination of Rates) (Amendment) Regulations 2015

Debate between Baroness Lister of Burtersett and Baroness Campbell of Surbiton

Monday 26th October 2015 Lords Chamber

[Baroness Lister of Burtersett (Lab)]

My Lords, I have several points to make about the substance of these regulations. First, this represents a lamentable example of non-evidence-based policy-making, the victims of which are going to suffer greatly. Secondly, the arguments used to justify the policy—by reference to other policy changes and to how people could or even should work harder—betray a lack of understanding of policy and of people’s lives.

In its letter to the Financial Secretary to the Treasury, the Social Security Advisory Committee criticised the “scant” evidence to support the policy changes. It thus encouraged the Government to make available to Parliament,

“more detailed information that clearly explains the changes and potential impacts to ensure that they can be subject to effective scrutiny”.

With due respect to the noble and learned Lord, Lord Mackay, SSAC clearly believed it possible to provide such information. Its advice was ignored, leading the Secondary Legislation Scrutiny Committee to observe that the explanatory memorandum laid in September “contained minimal information”.

Getting an impact assessment out of the Government has been like pulling teeth. That which finally emerged is a travesty; much of it simply reiterates repetitively the rationale behind the policy. It certainly does not provide the information about potential impacts that SSAC sought. There is no information on the impact on different groups affected, including the self-employed, who, as we have heard, cannot benefit from an increase in the minimum wage. The information about the impact on protected groups is simply laughable. When I asked in a Written Question,

“how many people in receipt of Carer’s Allowance are also in receipt of Working Tax Credit”,

and are therefore vulnerable, I was told that the information,

“could only be provided at disproportionate cost”.

I know that Carers UK is very worried about the likely impact on all carers receiving working tax credit.

In the letter accompanying the impact assessment the Chancellor excused the delay on the grounds that the Government do not usually publish an IA for statutory instruments of this kind. I found this statement very revealing. It suggests that the Government made no attempt to assess the impact for themselves before going ahead with such significant cuts and that they see an IA simply as a tick-box exercise to pacify pesky parliamentary committees. Surely, given the Prime Minister’s pledge at his party conference of an “all-out assault on poverty”, the Government would want to know the impact on poverty. But no: it was left to the Resolution Foundation to point out that it could mean an additional 200,000 children falling into poverty next year, rising to 600,000 by 2020 when other summer Budget measures have taken effect.

Surely a Government who have promised to apply the family test to every measure would want to know the impact on low-income families—a point made by Heidi Allen MP in her passionate maiden speech demolishing her own Government’s policy. Surely a Government who go on constantly about making work pay would want to know the impact on low-paid workers. But we had to look to the IFS for that. In effect, the Government appear to be contracting out to the voluntary sector genuine assessment of impact. Of course, that is assessment after, rather than as part of, the policy-making process. That is one reason why it is so important that your Lordships’ House asks the Government to think again in the light of the evidence that has emerged of the damaging impact that the cuts will have.

I am grateful to all organisations that have exposed how the overall policy package that the Government constantly cite does not amount to an adequate defence of the policy, particularly in the case of lone parents, who will be disproportionately affected, according to Gingerbread. A key reason why the overall policy package does not provide adequate protection is that with the exception of childcare, which applies to only a very limited age range, the other policies—the increase in the minimum wage, welcome as it is, and in personal tax allowances, which is less welcome because it is wasteful and poorly targeted—cannot take account of the presence of children, a point made by my noble friend Lady Hollis. All the talk about tax credits subsidising low pay ignores the fact that child tax credits were introduced primarily as a child poverty measure. Wages cannot take account of the presence of children. That was one reason why family allowances were originally introduced and why an increase in child benefit, which also helps families below the tax threshold and is currently frozen, would provide more effective mitigation than further increases in tax allowances.

Finally, according to the Health Secretary, the cuts are intended to send a “very important cultural signal” about hard work. Leaving aside his denigrating suggestion that receipt of tax credits is somehow incompatible with “independence, self-respect and dignity”, he does not appear to understand that reducing the income threshold and the universal credit work allowances while increasing the taper rate penalises what he calls “hard work”. Likewise, the Work and Pensions Secretary suggested that the problem can be solved if those hardest hit are encouraged to work a few extra hours. Even if extra hours were feasible and available, the gain from doing so will be reduced by the very changes that they are supposed to mitigate. As the Children’s Society points out, every extra £1 in wages will provide a net income increase of only 3p for those also in receipt of housing benefit and only 20p for those not. What about those with family responsibilities, particularly lone parents and carers, for whom working extra hours could impact negatively on their and their families’ lives?

It is our job to scrutinise legislation. This legislation does not stand up to scrutiny. The policy-making process from which it has emerged does not stand up to scrutiny. It is not noble Lords, or Government Ministers, who will bear the cost of this. It will be people like the low-paid worker who emailed me to say that he was very scared about how he will manage next year. Hundreds of thousands of children will be pushed into poverty. We have a duty to defend them, our fellow citizens.

[Baroness Campbell of Surbiton (CB)]

My Lords—

Welfare Reform Bill

Debate between Baroness Lister of Burtersett and Baroness Campbell of Surbiton

Wednesday 16th November 2011 Grand Committee

[Baroness Lister of Burtersett]

My Lords, I support the amendments which seek to revert to the existing qualifying period of three months. The noble Baroness, Lady Thomas of Winchester, said that six months is a long time to wait for extra resources, and we have heard from a number of noble Lords about the significant additional costs which can be incurred during this period.

However, there is a further twist in the tale—the benefit cap—which we will be discussing next week. PIP exempts people from the benefit cap but, of course, if you cannot qualify for PIP for six months then you would not only have to wait for additional resources but could find that your own resources are being significantly depleted during this period. This is very worrying. Can the Minister say whether any estimate has been made of the number of people who may be caught in this way? I suspect that it is not a large number, but one person is one person too many. It could be potentially very frightening for people to find that they might have to face this horrible benefit cap.

I hope that the Minister will accept the amendment. If not, and the six-month period goes ahead, a perhaps minimalist way of addressing the question—although it does not really address it—is that someone who qualifies after six months should have the money backdated to cover what they lost through the benefit cap.

[Baroness Campbell of Surbiton]

My Lords, I support the amendment. I hate the term “alignment”. I worried about it enormously when it was used by the Government in connection with the proposal that mobility allowance should be removed from people in residential care homes because they wanted to align it with hospitals. We are now back to “alignment” again.

One of the major problems that nurses and doctors in specialist units face in trying to discharge their patients with brain injury or the onset of MS, which causes vast deterioration, is getting their support sorted out so that they can leave the hospital. DLA with a time limit of three months is cited as being difficult to get into now, so raising it to six months is wrong. We forget that people do not on day one think of their long-term disability—whether that be a spinal injury, a brain injury or something that is sudden and quick—and say, “Ah, I must put in my DLA request now so that I will get it in six months’ time”. That just does not happen.

This is another delay for people who find themselves in an appalling situation, in a crisis, and having to face even further barriers to the support that can give them some independence, enable them to get back into the community and return to their families as soon as possible. The three-month eligibility period should remain. The six-month period will cause more problems. Hospitals will despair about discharging people and it could mean that disabled people will have to leave work earlier than they would have because they are not getting the support that they require quickly to keep them mobile and to enable them to stay in work. It is a lose-lose situation.

Welfare Reform Bill

Debate between Baroness Lister of Burtersett and Baroness Campbell of Surbiton

Wednesday 14th September 2011 Lords Chamber

[Baroness Lister of Burtersett]

My Lords, the noble Baroness will be aware of the consternation that is being expressed by disabled people about this decision. I have been copied into an e-mail to the noble Baroness. Noble Lords have received a number of e-mails. There is both a practical and a symbolic significance to this decision. I am new to this House and I do not know the ins and outs of where Committee stage is taken, but disabled people feel that their democratic right to observe the proceedings at the Committee stage is being severely curtailed by any decision to take the whole of the Committee stage off the Floor of the House. It has been accepted on this side that some of the Committee stage should be taken in Grand Committee, but there are clauses in the Bill that are highly controversial. It is not just about experts coming in; it is about people who feel that their lives or livelihoods are at stake.

[Baroness Campbell of Surbiton]

My Lords, normally I would not come in on the next day after participating in a very lengthy and big debate the night before. I generally need 24 hours at home to recover. However, this morning I was woken by several phone calls from disabled people who told me of this proposal and urged me to come in to speak. I feel compelled to be here. I am deeply concerned at the noble Baroness’s proposal. I had understood that the technical parts of the Bill would happen outside the Chamber—and we can live with that. However, the new proposal that takes us completely away from the Chamber unfortunately makes it tremendously difficult to have access, not just for disabled Peers to participate effectively—it is much easier in here—but for disabled people who are following this debate online or on the TV and who come here to brief us. It will be almost impossible for them to do this. Yes, a few can come into the room, but it will be more difficult.

Perhaps more importantly, not to be able to test the opinion of the House—I know it is not often done in Committee—on one of the most significant pieces of legislation for disabled people in my adult life is deeply disturbing. I ask the noble Baroness the Chief Whip please to reconsider.