Employment: Job Creation
Baroness Manzoor Excerpts(8 years, 7 months ago)
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Lord Freud
I shall have to write to the noble Baroness, as that is quite a detailed question.
The Lord Privy Seal (Baroness Stowell of Beeston) (Con)
My Lords, I think that we ought to hear from the Lib Dem Benches, and then I am sure that the noble Lord, Lord Wigley, will want to go next.
Baroness Manzoor
My Lords, women contribute significantly to the UK economy, both through paid and unpaid work. Yet despite 45 years of equality legislation, there remains a gender pay gap, particularly for women working in finance and the insurance sector, as well as for women aged over 40. I welcome the commitment of companies that are going to show the gender pay gap for men and women next year, but what will be done about the root causes of gender inequality? Most women are in low-paid work and there are limited levels of progression to better-quality, higher-paid work.
Lord Freud
Some of the statistics in this area are very interesting, in that among the younger generation the pay gap has disappeared. We will wait to see whether that goes on as that generation moves ahead. The most dramatic fact about female employment in this country is that the rate now stands at 69%, which is higher than the rate for the US for both men and women. That shows how far we have gone with female employment.
Welfare Reform and Work Bill
Baroness Manzoor Excerpts(8 years, 7 months ago)
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The Earl of Listowel (CB)
My Lords, I attached my name to this amendment because in past experiences of working with young people in hostels, I have often seen how the administrative machine makes mistakes and causes young people such hardship. On Friday I visited the First Love Foundation food bank in Poplar. I spoke with young people and families asking for help from the foundation. I heard that often, because of mistakes in sanctions, or because of sanctions, children were going hungry. I was also told of the case of a man who would be sanctioned if he failed to finish a course he was on, but who would also be sanctioned if he failed to attend the other course he was supposed to be doing. He was put in an impossible situation. This amendment is a reasonable request to make of the Government and I hope the Minister will accept it.
Baroness Manzoor (LD)
I accept everything the noble Baroness, Lady Lister, and the noble Earl, Lord Listowel, have said. The last time this Committee sat, noble Lords touched on the question of how we can learn lessons if we do not put reviews in place. If we do not review sanctions, how will the Government assess whether they have been effective or whether they can be adjusted to get people back into work? That is surely what it is about and why sanctions have been put there in the first place. We must have an independent review and I hope the Minister will look seriously at this issue.
Lord Hodgson of Astley Abbotts (Con)
My Lords, I do not object to reviews in principle. I have done some for the Government and I am now doing the official review of Part 2 of the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act, which covers the impact on non-party political campaigning. They have a useful role and, in light of the work I have done for the Government, it would be strange if I objected in principle to what the noble Baroness and the other noble Lords proposing these amendments are saying. I leave aside the question of whether there is a real purpose here: the noble Baroness rather disregarded the Oakley review and other things as being of little value. If reviews are to have worthwhile purposes, they need to meet certain tests. Other noble Lords will have their own tests, but I will share three with the Committee this afternoon.
First is the question of timing. The full impact of legislation takes time to emerge. In these circumstances, we are obviously seeking to change people’s behaviour. Their first reaction may not be their last and further reactions—good or bad—may emerge over the months and years after the legislation comes into effect. The amendment suggests 31 March 2016 as the date by which the review must be set up into whether sanctions are an,
“effective and proportionate means of meeting the Government’s objectives”.
I doubt whether it is possible to adhere to that timescale and reach meaningful outcomes, given the complexity of the subjects we are discussing and the likely evolution of events and behaviours. I am therefore concerned about the timing.
The second question is about the remit, which is too narrow. Each statute contains a number of pieces, as in a jigsaw. If one piece of the jigsaw is moved, all the other pieces have to move as well. The amendment looks at just one piece and does not pay enough attention to the wider implications, strategic aims and objectives of the Bill as a whole. Its benefits and value suffer as a result of its proposers making it so narrow.
The third question is the terms of the review. To be worth while, a review has to be reasonably even-handed as it sets out. I notice that the word “sanctions” is used four times in the amendment. By no stretch of the imagination can “sanctions” be said to be a neutral word: it is a pejorative term. The review sets out with these terms in order to arrive at, and find, a particular outcome.
Welfare Reform and Work Bill
Baroness Manzoor Excerpts(8 years, 7 months ago)
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Baroness Manzoor
“Universal Credit (Work Allowance)
The Universal Credit (Work Allowance) Amendment Regulations 2015 are repealed.”
Baroness Manzoor (LD)
My Lords, I am delighted that in his comprehensive spending review the Chancellor bowed to pressure and agreed with my fatal Motion to scrap the proposed cuts to tax credits for working families. He was lucky to receive a £27 billion windfall to enable him to do this, but it was the right thing for him to do. However, this is little consolation to families who start claiming universal credit after April 2016. Despite George Osborne’s decision in his Autumn Statement to scrap cuts to tax credits, the new universal credit system will mean a less generous benefit entitlement for working families.
The Institute for Fiscal Studies has estimated that 2.6 million working families can expect to be, on average, £1,600 a year worse off under universal credit than they would have been under the existing system. The institute says that the transitional protection means that potentially very different amounts of benefit could be paid to people in similar circumstances depending on when their universal credit claim started.
Universal credit transitional protection is the system the Government are implementing whereby an additional amount is paid to universal credit claimants to make up the shortfall. However, it can act as a barrier to taking on higher-paid work, according to the Social Market Foundation. This is because for many family types, universal credit will be less generous than the tax credit system it replaces. The foundation states that the difference will be quite substantial for some families. An example is that a two-earner family with two children could be £2,700 better off receiving tax credits as compared with universal credit if both parents are working full time and earning £7.20 per hour. As a consequence, many families will be understandably reluctant to move from tax credits on to universal credit.
That is because the transitional protection will cease to apply if the family undergoes any change in its circumstances, such as a partner moving in or out of the household, a person moving off universal credit due to a lot of earned income in just one particular month or one or both adults leaving work, or indeed even moving home. The Social Market Foundation illustrates the problem by citing an example, stating:
“Suppose a family was receiving transitional protection as a result of being moved from tax credits to UC. One partner is offered a better-paid job, but one that would require the family moving home. The family faces a dilemma. Do they move to take up the job offer, increasing their income but losing their transitional protection payments? Or do they refuse the job offer in order to continue the receipt of their transitional protection?”—
That protection may be important for the family, particularly when moving between low-paid jobs.
“This example … illustrates precisely the kind of situation that universal credit was designed to avoid: a barrier to taking up better-paid work. The problem will be exacerbated in April 2016 when the cuts to UC create considerable differences in the generosity of tax credits as compared with universal credit”.
Another problem is that, if income levels in a household fall, the universal credit entitlement does not rise to offset that fall until the transitional protection has been exhausted. Families losing work will face the double whammy of experiencing not only worklessness, but also of being transferred on to a much less generous welfare system under universal credit.
The Universal Credit (Work Allowance) Amendment Regulations 2015 will have exactly the same impact as the cuts to tax credits for working families which may need to have work allowance as part of their universal credit from April 2016. Under universal credit, cuts will be made to work allowance and large reductions will be made to how much families can earn before benefits start to be withdrawn—called work allowance under universal credit. This will mean that tax credits start to be withdrawn once family earnings are above £3,850 rather than the current £6,420 under tax credits. The IFS states that this will weaken the incentive for families to have someone in work.
As a result of the changes, universal credit, which when originally introduced by the coalition Government was intended to see 2.7 million working claimants better off, will now mean that 2.6 million working people will be worse off by an average, as I have said, of £1,600 a year. The whole point of universal credit is to make sure that it always pays more to be in work than on benefits. The Universal Credit (Work Allowance) Amendment Regulations 2015 further undermine that vital principle. They are an attack on hard-working, low-income families.
I know that the Minister supports the framework of university credit, and I applaud him for doing so because I support the framework as well. However, this undermines some of the fundamental principles that we are working towards. I would be grateful if the Minister could give an assurance that, in light of the Chancellor’s assurance to the public and to working families that work will always pay, the Government will consider repealing these regulations, or at the very least end the anomalies presented by them—particularly given that they were introduced, again, by secondary legislation.
Can the Minister also say what effect the Chancellor’s announcement in the Autumn Statement on the minimum income floor, which is in line with the national minimum wage, will have on self-employed people, particularly as this means that universal credit claimants who have been self-employed for more than 12 months are assumed to have earnings of at least 35 hours a week at the national living wage? I understand that there are exceptions, such as for those with caring responsibilities, but claimants will receive no additional support if their income drops below this level. I beg to move.
Lord Freud
We will help them make the transition. It will vary for each of those families: it might be some more work or it might be upskilling to earn more. The numbers are very particular and specific but they are clearly a focus of our obligation to those groups to help them to manage their position. We will put the resource in to help them to do that. That is what we are talking about. Helping those on lower income towards financial independence requires a tax and welfare system that encourages and rewards work, and one which provides people with the right support to progress in the labour market and provide their families with long-lasting security.
The next question asked by the noble Baroness, Lady Sherlock, was about how the transitional protection works. The people who get transitional protection are only those whom we have managed migration for, which, as the noble Baroness pointed out, will start in 2018. It is not designed to provide indefinite financial protection. Over time, transitional protection will be eroded as claimant circumstances change. It will be appropriate to end it when circumstances underlying the award are no longer recognisable as those on which the legacy calculation was made. We have not yet regulated for transitional protection, but we have described its principles. We will bring forward those regulations in due course.
Baroness Manzoor
Will the Minister say what those changes will be? The changes in circumstances are really important. The Minister has not highlighted those issues.
Lord Freud
We put them out at the time of the Bill. They were reasonably large changes. There is a list of them: re-partnering would trigger one, as would a new member of the household. Other changes might be a sustained drop in earnings—an equivalent almost to moving out of work—or one or both members stopping work. As I said, those are all indicated. We will set out those changes in due course.
Lord Freud
The trouble is that one can make up particular stories and play around, but overall the position is that, as we get through to the time when the managed migrations happen and the national living wage and various other things come in, the norm will be pretty stable, as I said before.
I will move on to the next question on those people who move earlier—that is, not in the managed migration—and reconfirm that they are effectively making a new claim for universal credit. Therefore, they will not be transitionally protected. I think I have gone through those very specific questions.
Baroness Manzoor
In terms of the flexible element of the budget, can the Minister say, as the noble Baroness, Lady Sherlock, requested, how large that budget will be? It is not the transitional protection money but the other fund that may be available.
Lord Freud
I do not have the precise figures here so it is quite hard for me to know how much of that flexible support fund will need to be diverted, but it is a mixture of support and funding. It is a question of how that is combined. We do not anticipate a large amount because the numbers are not very large. We have not isolated the precise numbers. It is too difficult—we just have not done that—but our anticipation is that it is not a substantial amount.
Let me pick up the point from the noble Baroness, Lady Lister, on incentives to work. There are only two ways of reducing the cost of universal credit: looking at either the taper or the work allowances. The taper is what maintains the incentives to work and to work more. Keeping it at a steady rate so that people can understand exactly where they are, so that if they change their work hours they can understand exactly what happens in a way that they cannot with the present system, was something that we saw as a priority, particularly at a time when the economy is strong and there is work available. There may be a different dynamic at different stages of the cycle, but that is the position we are in now.
On the question from the noble Baroness, Lady Manzoor, the minimum income floor will continue to be calculated by reference to the national minimum wage, which includes the national living wage.
I turn now to Amendment 62D, tabled by the noble Earl, Lord Listowel. In the current system there is considerable complexity around the rates for young people, with some differences between benefits. The structure of age-related rates in universal credit is much simpler than the benefits it replaces, with just four rates of the standard allowance: two for singles, two for couples. That compares with 15 in employment and support allowance, for example.
The age-related rates are now established in universal credit and the Bill does not make changes in this area. Doing so would start to replicate some of the complexity that we are looking to remove and noble Lords have heard me grumble about “carbuncleising” enough to know what I mean. However, the Government do recognise the challenges which these young people face. We should be supporting vulnerable young people and parents to stabilise their lives and find work and we have a number of measures within the context of universal credit. We will ensure that care leavers claiming universal credit who need help managing their money and paying bills on time will have access to personal budgeting support. Care leavers are exempt from serving waiting days in universal credit to ensure a smooth financial transition, and single care leavers aged 18 to 21 are exempted from the shared accommodation rate for LHA housing costs. I ask the noble Baroness to withdraw her amendment.
Lord Freud
I will take that request in the helpful way that it was offered. I will write to the noble Baroness to see if I can give her any comfort.
Baroness Manzoor
I thank all noble Lords who have taken part in discussing this group of amendments, particularly the noble Baronesses, Lady Lister, Lady Sherlock and Lady Hollis, and the noble Earl, Lord Listowel. I also thank the Minister for his considered response and for allowing me to intervene when he was speaking. A number of issues have been raised. The noble Baroness, Lady Hollis, stated very clearly what happens to an individual when there is a change of circumstances. It is important that there is some guidance before Report. I have not been reassured by the answers which have been given. I have every sympathy for the Minister in terms of what he is trying to deliver, but I passionately believe that cuts are affecting people who want to work and will want to go into work under what is being proposed. I will consider what has been said, but I am likely to bring it back on Report. As the noble Baroness, Lady Lister, said, I would be grateful to receive any other information that would help us make our minds up. On that basis, I beg leave to withdraw.
Baroness Manzoor
“Housing benefit: age of entitlement
In section 130 of the Social Security Contributions and Benefits Act 1992 after subsection (1)(a) insert—“(aa) he is aged 16 or over”.”
Baroness Manzoor
My Lords, I am pleased that the noble Lord, Lord McKenzie, has added his name to Amendment 60. Support for housing costs for 18 to 21 year-olds is not contained in the Bill but it was announced in the Budget. From April 2017, 18 to 21 year-olds making a new claim for universal credit will not be automatically entitled to support for their housing costs. As the Bill creates no new powers for this, these measures are likely to appear in regulations, using powers already contained in the Welfare Reform Act 2012. Crisis states that it has serious concerns that removing young people’s access to support for their housing costs will lead to an increase in youth homelessness. Crisis, the Joseph Rowntree Foundation and the Homelessness Monitor state that youth homelessness is already on the rise, with 8% of 16 to 24 year-olds reporting being recently homeless.
According to the Crisis analysis of CHAIN data, in four years the number of young people sleeping rough in London has more than doubled. There are many reasons why young people may find themselves homeless, including parental relationship breakdowns; abuse and violence from family members; and leaving care. For many young people, housing benefit is all that stands between them and homelessness and is an important safety net.
My proposed new clause attempts to address this hole in support for young people. The amendment says “aged 16” in order to avoid excluding 16 year-olds already entitled to housing benefit from eligibility in the future. But the amendment is ultimately about stopping the Government’s attack on 18 to 21 year-old claimants. Some 15% of current 18 to 21 year-old claimants are in work. They need this housing benefit to subsidise their rents; one only has to look at the level of rent in cities such as London.
Housing benefit is also vital for those living in areas of low employment to enable them to move to somewhere where they will have more chance of getting a job. Does the Minister really believe that it is better for our economy, and our young people, for them to remain in the family home, away from possible employment opportunities, than to temporarily pay for their housing benefit? I recollect the “get on your bike” sentiments expressed by Norman Tebbit—now the noble Lord, Lord Tebbit. These appear to be holding little water now. I beg to move.
Baroness Manzoor
I thank all noble Lords who took part in discussing the two amendments. I am very grateful to the Minister for stating that there are likely to be exemptions in certain aspects of this area. Of course, my amendment referred to current entitlement—the 16 year-olds who currently are entitled to housing benefit—and I wanted to safeguard that same provision for the future, for the reasons so well articulated by noble Lords. I personally would have preferred to see what the exemption said.
On that basis, I am particularly keen to explore this area much further, because I am very concerned about those of 16-plus and the fact that they are excluded from the 18 to 21 year-old group, for their vulnerability in terms of work and where they are going out to work. I am thinking of someone living in a small village. That comes to mind when I think of two young people who may well be searching for work; they are very likely to go into low-paid work. That means that if they are going into the city, which is quite a number of miles away from them, they cannot come backwards and forwards from home. In fact, it would be very expensive for them to do so, so they would be looking for accommodation in the cities. They would be unable to do so as matters stand, under this Bill.
I feel very strongly that there needs to be a clause such as the one that I have indicated. Indeed, I take on board the other amendment—and like other noble Lords I am not sure why I did not have my name to it. I understand where the noble Lord, Lord Low, and others are coming from.
I give notice that I shall come back to this amendment on Report. On that basis, I beg leave to withdraw the amendment.
Baroness Manzoor
My Lords, I shall speak to my Amendment 65. I recognise that my proposed new clause may be imperfectly drafted, as the word “disabled” should perhaps have been defined. As this is a probing amendment, I hope the Committee will make allowances.
My amendment is pretty self-explanatory, in that it requires the Secretary of State to,
“lay a report before Parliament annually on the progress which has been made towards halving the disability employment gap”.
It also requires that,
“the report must set out how the Secretary of State has interpreted ‘disability employment gap’ for these purposes”.
I would like the report to include,
“an assessment of the sectors in which disabled people have primarily secured jobs … an assessment of the type and level of jobs primarily secured by disabled people, and … an assessment of the progression of disabled people within the job market”.
My amendment will help to improve the transparency of employment outcomes for disabled people and allow monitoring of the Government’s target.
I am, however, rather concerned because we have asked the Minister for reviews of sanctions, conditionality criteria and so on. From my perspective, we have not had an answer that might have given us some hope. However, I hope the Minister will give this measure careful consideration because, across the Committee, I see there is some support for it.
Baroness Lister of Burtersett
My Lords, I shall speak briefly in support of Amendment 64 in the name of my noble friend Lady Pitkeathley, an indefatigable champion of the rights of carers. I also express my support for other amendments, particularly those concerning the disability employment gap, on which we heard very eloquent arguments from the noble Baroness, Lady Campbell of Surbiton.
It is very welcome that the constraints on labour market participation created by the care of children are much better recognised now than they were in the past, but we still have a long way to go with regard to carers, who are an increasingly important part of the labour force. I hope that the carer strategy the Government are working on will address the need for policies that make it easier to combine paid work and care, such as the statutory paid care leave for just a few days a year which many other countries provide. I have argued for this very important policy in relation to a number of Bills going through your Lordships’ House. We are becoming a laggard compared with other countries. We can learn a lot from them.
As care is such an important part of the economy, the amendment underlines the case for reporting on the position of carers and former carers in the labour market as part of any duty to report on employment trends. I suggest that it might go a bit further, so that any such report includes information on those who combine paid work and care and those who have had to give up paid work to care, as well as former carers.
Baroness Nye (Lab)
Before I speak to Amendment 68A, I apologise for not being able to take part at Second Reading. I also take this opportunity to declare an interest as a trustee of the Young Women’s Trust, to which I am grateful for the briefing it provided.
My amendment calls on the Government to include in the report the number of apprentices disaggregated by protected characteristics. As I support the other amendments in this group in the name of my noble friend and others, I shall concentrate on young women and apprenticeships.
The Government’s target of 3 million apprenticeships by 2020 is to be welcomed because they can be an important route to skills development and work for all young people, but only if they are of high quality and reach those such as the under-25s who are in the most need. It is also welcome that the Government propose to report on progress each year, but it is important that the information contained in that report is useful and not just a pat on the back for numbers going through the system. The report should identify areas where more attention is needed and inform policy development, because evidence shows that apprenticeships are not working as well for young women as they are for young men.
The Young Women’s Trust aims to improve the lifelong opportunities for young women aged 16 to 30 with few or no qualifications, who might be unemployed or in precarious or insecure employment and who are on very low or no pay. Because of a lack of understanding, the Young Women’s Trust undertook a year-long inquiry into the problems of young women who are not in education, employment or training. It produced a report called Scarred for Life?, which was based on consultations with young women and other interested parties, as well as polling conducted by ComRes.
The polling showed that young women work in fewer sectors than men. Two-thirds of female apprentices work in just five sectors, while the same proportion of men work in more than 10. Female apprentices account for fewer than 2% of apprentices in construction, 4% per cent in engineering and still only 12% in IT and telecoms, but 93% of early-years childcare and beauty places are female. The IPPR has said that traditionally masculine areas may receive better-quality training and these sectors also lead to better employment and further education prospects. As young women are less likely to receive training as part of their apprenticeship, they are more likely to be out of work at the end. This is compounded by other research which shows that employment gains from further education are generally not as great for women as they are for men.
The apprenticeship wage also deters women without parental support from applying. Young women say they understand the logic of earning less before being qualified but the pay is just too low to support themselves. Young women also receive less hourly pay on average than men; they could earn £2,000 less over the course of a year. Apprentice equal pay day was marked on 28 October—for the following 64 days, female apprentices would be working for free.
Young women also recognised that when apprenticeships worked well they were a good route into employment. However, they were concerned about how to meet their current needs while training. There is insufficient flexibility to balance apprenticeships and other responsibilities such as caring. They therefore have different priorities in considering apprenticeships.
Data from the Skills Funding Agency and BIS show that 90% of apprentices are aged over 25, with a greater proportion of women in that age group. It is therefore likely that they have been recruited from the existing workforce and that opportunities are not being provided to young people who are just starting out or who are NEET. These challenges prevent thousands of young women making the most of their potential as well as meaning that the wider economy and companies miss out on a vital source of talent.
Destination data are especially important in measuring quality. Apprenticeships are worth while only if they develop skills in all young people and provide a good route into employment. Young women are three times more likely than young men to be out of work after completing an apprenticeship. University education has long been assessed against destination data. Similar measures should be applied to apprenticeships if the esteem in which they are held is to be raised.
If the figures in the Government’s proposed annual report were disaggregated, it would also give added impetus to employers to develop a diversity policy for their apprenticeship schemes; to monitor the protected characteristics of their intake; and to work with careers services, schools and others to attract a diverse workforce, which I believe would command support from all quarters. Without any measurement of the quality of the apprenticeships, the jobs that might or might not follow, or the impact on the reduction of low wages, they offer no real route out of poverty.
I will listen with interest to the Minister’s reply to the questions posed by my noble friend, but, given the lateness of the hour, I will not add to them.
Baroness Manzoor
My Lords, I have added my name to Amendment 68. The only thing that I wanted to add—all other noble Lords have eloquently put forward the reasons why there should be reporting obligations relating to apprenticeships—is that I note that gender is missing from the amendment. It was an oversight, rather than because we did not care passionately about this particular issue. Once again, I am pleading with the Minister: we really need to be able to differentiate between the different groups to see where apprenticeships fall and who is getting what apprenticeship. The noble Baroness, Lady Nye, made a very important argument relating to young women, but the same applies to disability, race and so forth. There are variations that we need to bottom out so that employers can then have appropriate strategies in place to address the anomalies.
Baroness Lister of Burtersett
My Lords, I will speak very briefly in support of my noble friend Lady Nye, who has made such a good case about gender. She made most of the points I want to make, but I have been sent information by City & Guilds, which has done research into careers advice, which shows how gender-biased careers advice is channelling young women into a very gender-biased labour market. So it is being reinforced. It is crucial that the apprenticeship system does not reinforce and aggregate that gender bias which we have heard about from my noble friend. As other noble Lords have said, it is about not just quantity but quality. From a gender perspective, quality is about the sectors within which young women and young men are being channelled.
Welfare Reform and Work Bill
Baroness Manzoor Excerpts(8 years, 7 months ago)
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Lord Kirkwood of Kirkhope (LD)
My Lords, I added my name to this amendment. I do not want to add anything to what was said by my noble friend Lady Lister of Burtersett—I call her that advisedly as we worked so closely for so many years and have always had a common approach to this kind of problem. It is a priority for me in this Bill to try to establish the importance of working poverty. Because of the incipient recovery we are experiencing at the moment and some of the other labour market conditions that apply, subject always to risks from the global economy, the future challenge for Government will be less one of providing employment and more one of providing sustainable, predictable employment and career progression.
Universal credit has the mechanism and architecture to enable us to do that but I am concerned that we seem stuck in the problems of the past 10 years, which clearly included worklessness. It was right that we focused on those problems. Universal credit was created in 2008 and at that time our economy was suffering from many years of serious unemployment and its consequences. However, conditions have now changed. It is very important that in-work poverty should be addressed together with career progression. As my American friends say, it is any job, better job and then career—an ABC of employability. That is a very important part of the Government’s responsibilities.
In passing, I have to say that I am disappointed that the Child Poverty Act 2010 has been emasculated to the extent that it has been. I want to underscore everything that the noble Baroness, Lady Lister, said; she is merely reflecting the problems relating to the reporting requirements. What we have lost from the 2010 Act are the targets and the strategy. I think that it was the noble Lord, Lord Lansley, who made the point in his excellent maiden speech that declaratory legislation is not always that clever, given that it is not what Governments intend to do, but what they actually achieve and how they go about it, that is important. When the noble Lord, Lord McKenzie, brought forward the Child Poverty Act 2010, I approached it from that point of view. However, I am now better informed and have changed my mind—I think it is worth having and that the targets and strategies are certainly worth fighting for. We are losing a lot in picking this 2010 legislation apart; I really regret that. We will come back to that in later amendments, but for the moment I am satisfied to seek to get the Government to concentrate on in-work poverty in the development of their poverty programme—such as it is—but even more so to get career progression developed within the mechanism of universal credit.
Baroness Manzoor (LD)
My Lords, I shall speak to Amendments 24, 26 and 46, to which I have added my name along with those of the noble Baroness, Lady Lister, and my noble friend Lord Kirkwood of Kirkhope. Amendment 24 clarifies what we mean by children in low-income households where one or both parents are in work. Amendment 26 builds on Amendment 24 and inserts “low income” and “in work” for further clarity.
The Bill repeals the Child Poverty Act 2010 and the requirement for the Secretary of State to develop a strategy for tackling child poverty. That is really worrying, because poverty is a cost that the UK cannot afford. It wastes people’s potential, drains public finances and hampers economic growth. The new definition risks underestimating the rise in in-work poverty, downplaying income and obscuring families’ ability to pay for decent housing. Moreover, as we all know and heard again in the first Committee sitting, such children are more likely to suffer from poor health, do worse at school, be jobless in future and die earlier.
I agree with the Joseph Rowntree Foundation, which believes that income measures should better account for household costs by including analysis of income after essential costs such as childcare and housing costs are removed—particularly given how high housing costs are in cities such as London. I agree that that would support a much more dynamic picture of the living standards of UK households. Will the Minister consider bringing forward government amendments to develop and publish a life chances strategy that retains some income-related measures in the basket of measures we already have—given, in particular, that the Government intend to retain the HBAI reporting measures? I cannot see why those could not be added, because they are going to be collated anyway, but it would be good to have them on the face of the Bill.
The Earl of Listowel (CB)
My Lords, I rise to speak to my Amendment 25 in this group. Before I do so, I apologise to your Lordships for my overenthusiasm on Monday in Committee. I am afraid that I spoke too often and at too great a length, and therefore contributed substantially to the delay that day. I will seek to be shorter today. I have an amendment in this group and two or three in the next group, so please bear with me.
Amendment 25 would reintroduce into the Bill the four measures of child poverty that were introduced in the Child Poverty Act 2010. I listened to what the noble Lord, Lord Kirkwood, said, and regret with him that so much of that Act is being taken away by the Bill. I am concerned that this is a pattern one sees over the years: one Government come in and often undo the good work of the preceding Government. I am attracted to the approach Finland took towards its education system. Some years ago it began to be concerned about the quality of its education system, and a cross-party consensus was built that what was most important was to recruit and retain the best teachers and raise their status. Some 15 years down the line, it has the best-performing education system in the world. Therefore, in these important issues there is a lot to be said for building on the best of what is produced by whatever Government and not simply taking away what was put in place before.
The first time I met the noble Lord, Lord Freud, he was just publishing or launching his report for the Labour Government into improving employment. He has a very single-minded and focused passion to get more people in this country into work and is a supreme advocate of the value and importance of work not only to the nation and its economy but to its individual citizens. It was my privilege to work with the noble Lord, Lord Nash, on the education legislation coming through, and he in his turn is very focused on improving education incomes, principally through developing more academies. I pay tribute to the huge success the Government have had in getting more of our people into work in this difficult time. I make these points because I hope that the Minister might be prepared to be broad-minded and embrace other approaches which might help him to achieve the outcomes he wishes to achieve.
I read with great interest the speech of the Prime Minister, David Cameron, to his party conference, when he spoke about the importance of social justice and social mobility and in particular about looked-after children and improving their outcomes. I suggest that the Government may be missing a trick here. Yes—more work and improving educational outcomes are important. However, a very important contribution to both of those is to address income poverty. A child attending school who has not eaten the night before or had breakfast may well find it hard to do well at school. If there is not the transport to enable families to see each other and keep connections, they may well suffer from isolation or mental ill health and the family can decline. If these measures were reinstated in the Bill, that would help the Government with regard to their aims on social mobility.
The Minister may wish to refer to the letter from the Children’s Commissioners for the UK, which was copied to me. The Children’s Commissioners of the UK—for England, Wales, Northern Ireland and Scotland—wrote to the Minister supporting this amendment on reintroducing the measuring of child poverty, and they made a very powerful case. I look forward to the Minister’s response and I hope that he can be sympathetic. From our previous discussions, and from listening to his response at Second Reading, I have the sense that he is strongly opposed to these proposals but I hope that perhaps, on reflection, he might be able to see that this will enrich and support what he proposes and not be a hindrance to it.
Lord McKenzie of Luton
My Lords, this is an extremely important group of amendments. On behalf of the Labour Benches, my noble friend Lady Sherlock and I will oppose Clauses 13 and 14 standing part of the Bill and will support Amendments 50 and 53, in the name of the noble Lord, Lord Patel. We support the thrust of Amendment 52 in the names of my noble friend Lord Layard and the noble Baronesses, Lady Hollins and Lady Tyler, which concerns access to psychological therapies. I acknowledge the campaigning work conducted by my noble friend when we were in government and the fact that he managed to move the issue of psychological therapies up the political agenda. More than that, he was significantly responsible for people getting treated.
As we have heard, Amendments 50 and 53 defer the changes to ESA coming into force until their impact on individuals’ physical and mental health, their financial situation and their ability to work has been estimated. All these matters have, in one way or another, been the subject of real concern since the substance of this policy—a £30 a week docking of the WRAG rate—became apparent. The noble Lord, Lord Patel, explained that he was particularly focused on people moving from the support group to the WRAG who were recovering from cancer. In so far as the Government’s impact assessment seeks to address these matters, it seems to conclude that it is doing claimants a favour by removing the WRAG rate and its equivalent in universal credit because this will encourage them to take steps back to work, with a consequent improvement in their health and the life chances of their children.
We should be ashamed, if not surprised, that a priority for our Government is to reduce the income of disabled people—individuals who have been assessed as not currently fit for work—from the current rate of £102 a week to just £73 a week, and to pray in aid a 10 year-old OECD report which, by all accounts, does not make a single reference to disabled people. We should also be concerned about the attempt to incentivise and coerce people into work when they have been found by a rigorous assessment not to be fit for work. There is either a lack of understanding of, or a callous disregard for, the financial circumstances that many in the WRAG face today, let alone in the future—circumstances that mean they struggle to pay their bills and maintain their health, rather than not drift into social isolation and focus on activity that will move them closer to work.
Of course, this is not a small group. There are nearly 500,000 disabled people within the ESA WRAG, almost half of them with a mental and behavioural disorder, including learning disabilities and autism. These are individuals who will need time and proper support to make it back to the labour market. Far from help with their struggles, the ESA cut will add to debt, stress and anxiety, making their journey more difficult, if not impossible, and pushing them into further poverty.
Most noble Lords here today will have received a raft of substantial and authoritative briefings from charities and other organisations whose opposition to this particular cut is remarkably consistent. We should thank them for their defence of disabled people, particularly their robust challenge to the proposition that cutting the WRAG is a work incentive. We also now have the benefit of the formal review of the proposed reduction in the employment and support allowance and how it will assist the Government’s declared aim of halving the disability employment gap.
The report was led by the noble Lord, Lord Low, and the noble Baronesses, Lady Meacher and Lady Grey-Thompson, at the request of a group of charities. We should acknowledge their commitment and the clarity of their conclusions and recommendations. I hope we will hear from them and have the benefit of their expertise during this debate. One of their central recommendations was to reverse the removal of the ESA WRAG component and the equivalent payment in universal credit. This is precisely what our amendments will do. But the review is not just about objecting to the change that the Government are seeking to impose. It sets out a series of recommendations focused on helping the Government to help more disabled people move closer to and into work. Perhaps a recast amendment on Report might better capture this broader approach.
I will not attempt to outline each of the 11 recommendations of the review in the hope that others will cover some of them but of particular significance is the call to redesign the WCA, focusing on a holistic approach which understands the barriers to work that people face, and ensuring that this information is used to provide appropriate support. Not only did the review find no evidence that the £30 a week WRAG component is acting as a disincentive to work, or that reducing the payment will incentivise people to seek work, it received evidence to the contrary—that the reduction would hinder rather than help people take steps towards work.
The extra money individuals in the WRAG receive is to recognise that they are likely to be unemployed for a longer period than those receiving JSA, and that once out of the workplace disabled people find it more difficult to return. The typical time for which claimants were expected to be in the WRAG was two years; for those on JSA it was much less. This loss of resources is being imposed on a range of other measures that can affect disabled people—council tax support cuts, the bedroom tax, the benefit cap for those not on DLA/PIP—and benefit freezes are in place. The review reminds us why this extra income is so important to disabled people and why the threat of its loss—as well as the reality, should it come about—is so hazardous to their health and well-being.
Your Lordships should read the report and understand the strains of daily living for so many of our fellow citizens—individuals who would welcome the chance of moving towards and into work if we would only invest in tailored and personalised programmes to make this a reality for them. I urge the Government to reject these misguided cuts, listen to the views of those whose lives would be made a misery if they proceed, and instead grasp the opportunities that could genuinely transform the lives of so many disabled people.
Baroness Manzoor
My Lords, we on these Benches strongly oppose the question that Clauses 13 and 14 stand part of the Bill, along with the opposition party. At Second Reading, I made it clear that these were the clauses that the Lib Dems were most concerned about—in a Bill which had little to be joyous about.
Clause 13 legislates to reduce the amount of money that new claimants receive within the employment and support allowance work-related activity group—known as ESA WRAG—by £29.05 per week or nearly £1,500 a year. This cut is mirrored in Clause 14 for the equivalent payment in the new universal credit, called the limited capability for work group. As the Disability Benefits Consortium says, this is despite the fact that the WRAG is specifically there to provide support for disabled people who are assessed as being not fit for work, as the noble Lord, Lord Patel, stressed.
In his summer Budget, in order to make savings on welfare expenditure, the Chancellor announced that he would reduce the level of benefit paid to claimants in ESA WRAG to the value of jobseeker’s allowance—JSA. How can that be right? These are people who have been deemed to be ill. This is despite the fact that, as the noble Lord, Lord Patel, and others have said, the people receiving ESA WRAG and the limited capability for work element of universal credit have been independently medically assessed by government assessors as being too ill to work—not by their own GPs but by independent assessors, and that is really key. These are people with disabilities—nearly 500,000 people; people with long-term health conditions such as mental health and behavioural disorders—nearly 250,000 people; and people with cancer or progressive motor neurone illnesses such as MS and Parkinson’s disease.
I entirely agree with Macmillan Cancer Support, the Disability Benefits Consortium, Mind, Mencap, Leonard Cheshire Disability, Scope, the Rowntree Foundation and many others—they cannot all be wrong—that reducing the amount of money received by individuals on ESA WRAG and the limited capability for work element of universal credit will make it harder for individuals to cope with the financial impact of their condition and to afford what they need to support their recovery. The additional pressure to seek work when not fit could detrimentally impact on an individual’s health and recovery. I have seen this, having worked in the NHS for many years. This could actually move them further from the labour market. That is not what the Government want to do. The negative impact of returning to work before individuals are fit to work compromises them and is unsustainable, and may lead individuals to require welfare support for longer or indeed move them into the support group, where they do not work again. That cannot be right.
The Government’s impact assessment states:
“Someone moving into work could, by working around 4-5 hours a week at National Living Wage, recoup the notional loss of the Work-Related Activity component or Limited Capability for Work element”.
Frankly, that is unbelievable, as people in this group have been found not fit for work. That is the hub of the whole issue. Clauses 13 and 14 have no place in a caring and compassionate society and I urge that they be removed from the Bill. It is far better that the Work Programme trains advisers better to understand conditions so that the most appropriate support and help can be given to individuals to return to work. Barriers to employment such as lack of job opportunities, attitudes and transport difficulties must also be addressed by the Government, and employers should be given the necessary training and support to enable them to take on more disabled people so that people can return to work when they are deemed fit to do so.
I urge the Minister to exempt people on the ESA WRAG and that Clauses 13 and 14 do not stand part of the Bill. The Government must give people hope and support. I fear that these measures are merely about the Treasury wanting to demonstrate that it can achieve a budget surplus—how wrong is that?—without, I fear, the Treasury thinking about real people and real lives, and the impact it will have on those people. This is not about figures on a balance sheet but people who will find the impact of these clauses deeply damaging, as they will affect their life chances. This is not just about the young. I agree with the noble Lord, Lord Patel, that these clauses are not sensible or morally right.
Lord Lansley
The noble Baroness is drawing me into a debate that I was not intending to enter into. My point was not about whether having a structure in which those who are currently on ESA WRAG and then go into employment and come off it should lose the benefit after 2017. My point is that within the terms of the review, contrary to the argument that is being presented that there is no incentive effect of the level of benefits relative to work, people are arguing that that is not true and that there is a disincentive effect in going into work if the level of benefits is higher.
I shall conclude on that point. It seems to me that we need to be operating on each of these areas. As a Government and a country, we are doing well in providing opportunities for employment. If we do the right thing in terms of support, we can give people with disabilities greater access to those employment opportunities that are increasingly available and, most importantly, give people access to the support. The review gives very good material for the Government to continue the process of thinking towards what that structure of support should be to be of the greatest possible benefit for people with disabilities.
Baroness Manzoor
Surely with his health background the noble Lord is not saying that people who have been deemed to be sick and ill should be given jobs and should be made to go into employment. That is not what he is saying, is it?
Lord Lansley
No, it is not—and I do not think that we should construe an incentive structure as being coercion. It is precisely what it describes. We are talking about the level of relative benefits and if people fall properly into this category—I have not got into the question of whether the work capability assessment is accurately placing people in the WRAG ESA rather than the support group—they should be in a position to work. It is not about coercion. Sixty-one per cent want to work, but not enough of them are getting work. We should have incentive and support structures that help them to get that work and we should make sure that the incentives do not get in the way but support this. It is nothing to do with coercion.
Welfare Reform and Work Bill
Baroness Manzoor Excerpts(8 years, 7 months ago)
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Baroness Manzoor (LD)
My Lords, I shall speak to Amendments 22, 23, 27, 29, 30 and 34. Given that it is quite late, I will try to be as brief as I can. I support Amendment 22. It has already been said that Clauses 4 and 6 remove any income-based measures of child poverty, the duty on the Government to work towards eradicating child poverty by 2020, and the duty on local authorities to work together towards eradicating child poverty. Instead, under the new heading, “Life chances”, Clause 4 focuses on measuring children in workless families and with poor educational attainment.
As I said, I support the noble Lord, Lord Ramsbotham, in his Amendment 22 as it provides for development measures in the early years, allows for the capture of data for all children at the age of five, and puts disadvantaged children in the same group. My Amendment 23 builds on this, particularly as the latest government figures show that 62% of children in poverty now live in working homes: that is 2.5 million children, according to the End Child Poverty Coalition.
Without question, worklessness and a lack of access to employment are key drivers of child poverty. However, as I said at Second Reading, while work can be a key route out of poverty, it is by no means a guaranteed one. There is much research which shows the significant impact that growing up in poverty has on children. As was said earlier by the noble Baroness, Lady Hollis, children are much more likely to suffer from poor health, do worse at school, be jobless in the future and die earlier. The changes that the Government plan to make to the support of low-income working families are likely only to make the situation worse.
Clause 4 as it stands proposes a statutory duty to publish an annual report on children in workless households and on the educational attainment of children in England at the end of key stage 4; that is, for children of 16 years of age. That is far too late and there are no baseline comparators. Improving children’s life chances must be more than about teenage educational attainment. I agree with the organisation Action for Children that the Government’s limited measures are a missed opportunity. Educational attainment at 16 does not reflect how far development in the earlier stages of our lives affects our future, from our health to our likelihood of being employed.
Amendment 23 would mean reporting on the educational attainment of children in England, including disadvantaged children, at the end of key stage 1, at the age of five, rather than reporting on educational attainment only at the end of key stage 4, when children are 16 years old. It would also allow a baseline for the Government to measure the progress made by investing in children’s futures. I hope that it will be supported by the Minister, particularly as such data are currently available, so the financial cost would be minimal. If my amendment is not accepted, perhaps the Minister could consider including a measure towards addressing income poverty in the basket of measures in the Bill.
Amendment 27 reinforces the point that “key stage 1” means the first key stage within the meaning of Part 6 of the Education Act 2002. Amendment 29 would allow the Secretary of State to publish and lay before Parliament data which report on children who are homeless or are at risk of homelessness. This is important as the data identified can help to support strategies much more effectively in the Troubled Families programme.
Amendment 30 is concerned with children,
“in families living in problem debt”.
This provision will ensure that data are consistently collected and reported on to enable early intervention by programmes such as the Troubled Families programme. Borrowing figures released on 30 November confirm a significant and prolonged increase in household debt, and the measures in this Bill are likely only to make matters worse.
Amendment 34 is about reporting obligations for:
“Working and workless households and health”.
I have added my name to those of the noble Lord, Lord Ramsbotham, and the noble Baronesses, Lady Meacher and Lady Hollins. As has been said, there is significant evidence that children living in poorer households are much more likely to be born prematurely, have low birth weight, and as adults to die earlier. They are also more likely to be absent from school due to illness, to be hospitalised, and to have long-standing illnesses, and are three times more likely to suffer from mental health problems.
Data collection on the impact of mental health on workless and in working households with incomes below the national minimum wage is important, particularly as the Government have put an emphasis on improving mental health services. The amendment will enable the link between inadequate incomes and their impact on the mental and physical health of the poorest people compared to others, and will allow better joined-up targeting of services between the NHS and the DWP. I want the Minister to look at this very carefully in terms of data collection.
The Earl of Listowel
I will speak to Amendment 22, moved by my noble friend Lord Ramsbotham and to which my name is attached, simply to say I strongly support the idea of taking measurements earlier in the child’s life. I note what my noble friend said, his reference to a strategy and that the Bill removes a strategy for child poverty. I note in the Government’s general direction of travel that they are quite sceptical of strategies. My sense is that the Government prefer to work from the bottom up, and that in education policy, as in other areas, they are reticent to have overarching plans. I would briefly like to challenge that.
The academy schools seem an example of government trying to build from the bottom up. However, what we see in the education department are real difficulties around teacher recruitment. Visiting an academy school—indeed, the best performing non-selective state school in the country—I saw wonderful results but heard complaints that because of the lack of strategy regarding teacher recruitment, there were real concerns that teachers of various kinds and at various levels would not be easily available and of the excellent quality needed in the future. My sense is the Government are rather opposed to strategies in general but I think in certain areas such as this they are really important, and we will come back to that.
I speak as a Cross-Bencher here: after 15 years in your Lordships’ House, it is rather regrettable that sometimes it seems as if one Government set certain things up and then the next Government set them down. I remember the debates about the Youth Justice Board, which seemed a very effective institution but because it was a quango the Government felt strongly that it had to go. I was pleased that the noble Lord, Lord Ramsbotham, managed to persuade the Government that, in fact, it was worth keeping. Therefore, in the discussion of the old Child Poverty Act and the new Welfare Reform and Work Bill, it is worth challenging the Government a bit. I would like to challenge the Government a bit about whether, in part, their motivation might be to simply undo what others have done in the past, and whether there might be a chance to build on the best of the past as well as bring the Government’s own unique contribution to this area.
I want to be as brief as possible so I will speak now to my amendments in the grouping, the first of which is Amendment 28 on children in care and care leavers. The Bill is a real opportunity to improve the outcomes for young people in care and care leavers. It is an opportunity to gather data, for instance on their educational attainment—yes, that is gathered already—but also on their mental health. Historically, there was recognition by the ONS in 2004 of the mental health needs of looked-after children and great work was done by people such as Professor Jackson on the educational attainment of looked-after children. The educational side has been well resourced and legislated on since then, with things like virtual school heads, designated teachers in schools and priority in admissions—all really important steps forward, but the mental health needs of looked-after children have not been so successfully addressed.
The Bill is an opportunity to look at various areas of performance with regard to young people in care and care leavers. Gathering them in one place and obliging Parliament to look at them on an annual basis would really keep our focus on making the most effective difference. Of course, in the care system we have the notion of the corporate parent. In each local authority, I suppose the leader would be the corporate parent for the young people in the authority’s care. I suppose that principle extends somewhat to us as well in Parliament. What that means is sometimes difficult to explain. Obviously we do not have relationships with individual young people in care.
In Barnet in the past, when Paul Fallon was the director of children’s services, it was ensured that each senior member of the council was an advocate for a young person in care. They did not meet that young person but their job was to follow the career, as it were, of the young person in care. They would write to people, nobble them and just be a champion for the young person in care. We in Parliament cannot meet and know young people in care but we can do our very best to be champions for them in this place. They are the children of the state. If we had the data at our fingertips we would be better equipped to do that.
A couple of weeks ago I attended the presentation by Dr Mark Kerr of his doctoral thesis. Dr Kerr left care with no educational qualifications. He subsequently has successfully gone through two degrees and it was a tremendously moving experience to hear him making his presentation on young people in care. The system can work well. Young people can do extremely well and it is on us to ensure that we do even better for them.
Amendment 29 is on children and homelessness. It puts a duty on the Secretary of State to lay data before Parliament on children who are homeless and at risk of homelessness. The purpose of bringing this forward is that child homelessness increases year on year. It now stands at about 90,000, and the number of children living in bed-and-breakfast accommodation increases year on year. There is a maximum limit on the time that a local authority is allowed to place children in bed-and-breakfast accommodation with their families. That is more and more often broken. We know about the housing shortages in particular areas, especially in London and the south-east. The purpose of the amendment is to focus our minds on these young people.
We might get better data. For instance, we could have data on children at risk of becoming homeless, on how effective we are at preventing children and their families from becoming homeless, and on children who are accepted as homeless with their families, in bed-and-breakfast accommodation, and so on. There is already a statutory duty to gather data on homeless children but there are various duties. There is a different duty for 16 and 17 year-olds which local authorities are obliged to have, so it might be helpful to have in one place a more thought-through approach to this.
There is an interdepartmental group looking at homelessness, which I welcome. Perhaps this is a bit far from the Minister’s remit, but I would like to know more about how that is progressing. On this issue, particularly given the fact of ever-increasing immigration, there needs to be a senior Minister looking at this, taking forward and championing this matter of family homelessness and having a strategy to really make a difference across the Department of Health, the DWP and the Department for Communities and Local Government. Such a change as this would be helpful in taking that forward.
My final point is on children in families living in problem debt. I am not sure how much time I have taken and I want to take as little time as possible, but this is a very important matter. The Government have decided to replace the child poverty measures with new life-chances indicators, focusing on measuring the number of children in workless households and the number of children with low levels of educational attainment. When the Secretary of State announced this change, he also highlighted the importance of problem debt in understanding child poverty and children’s life chances. The absence of a measure of problem debt has always been a limitation of the current Child Poverty Act. I know, from the families that I have had experience of, that where a family faces problem debt, a large proportion of family income can go on repaying debt every month, substantially reducing the money available for meeting the basic needs of children in the household. As shown in the report The Debt Trap, families in problem debt owe, on average, £3,437, or an estimated total of £4.8 billion, in arrears to service providers, creditors and government, both national and local. The social cost of problem debt is as high as £8.3 billion.
Lord Freud
My Lords, by virtue of Clause 4 the Government are committing themselves to reporting annually on their life chances measures of children in workless households, including long-term worklessness in England and the educational attainment of children, including disadvantaged children, in England at the end of key stage 4. The collective purpose of all the amendments in this group, laid by the noble Lord, Lord Ramsbotham, the noble Baroness, Lady Manzoor, and the noble Earl, Lord Listowel, is to place additional duties on the Secretary of State to publish and lay before Parliament further reports, information or data about a range of other areas. The question for us to consider is: what is the most effective way of harnessing primary legislation to achieve these aims?
We want to make a difference by taking action in the areas that will improve the life chances of all children and I think that is the answer to the question from the noble Lord, Lord McKenzie, about the policy. It will be addressing the life chances of those children, tackling the root causes of poverty, not the symptoms. Our new approach focuses government action on the most important drivers of poverty—worklessness and poor educational attainment—and on reporting progress in those areas annually. We will prioritise action in those areas and follow up our clear commitment to publishing a life chances strategy. As part of this we will develop a wider set of non-statutory measures on the root causes of child poverty, including family stability, problem debt and addiction.
The noble Lord, Lord Ramsbotham, by virtue of Amendment 22 seeks to expand the duty placed on the Secretary of State to include a duty to report on the progress of children living in England at age five, including disadvantaged children, in their cognitive, personal, social and emotional, and physical development. It is vital that all pupils thrive and develop in their early years and I recognise the importance of understanding where pupils are at the start of their school journey. Monitoring a child’s personal development is a core function of every education setting, enabling teachers to tailor their support based on how each individual is progressing. However, there are two key issues at the heart of the life chances reforms—action on work and education. Lives can be transformed through focusing on those two key drivers of poverty.
The end of key stage 4 is a vital point in a young person’s education. It represents the culmination of primary and secondary schooling and provides a consistent point at which to measure attainment across all young people. Pupils who fail to achieve at the end of key stage 4 are at higher risk of not being in employment, education or training. That is why the Secretary of State is making a commitment through the life chances measures in this Bill to report annually to Parliament on educational attainment at key stage 4.
Noble Lords will be reassured to know that the Department for Education already publishes a great deal of data on the progress of pupils—how well they are doing in the earlier stages of their career, including key stage 1 and key stage 2—and the annual reporting at different stages of primary schooling already provides significant detail on the progress and attainment of disadvantaged pupils.
The noble Baroness, Lady Manzoor, by virtue of Amendments 23 and 27 seeks to expand the annual reporting duty placed on the Secretary of State to include data on the educational attainment of children and disadvantaged children at the key stage 1 point. I recognise the importance of understanding and tracking pupils as they make their way through the key stages. It provides a basis for teachers to look at how each child is progressing. I am pleased to reassure noble Lords that the department already publishes a statistical first release each year on the assessment of key stage 1 pupils in reading, writing, maths and the results of phonics screening. That includes disadvantaged pupils.
Baroness Manzoor
Just on that point, I have heard this evening that various departments do their own thing, but coming new into the House I find that maybe we need a little bit more joined-up thinking. When you look at the Bill it would be nice to have something that says very clearly that key stage 1 is very important and this is what the Government are doing to track from key stage 1 to key stage 4.
Lord Freud
That is a good point but, in essence, if you are not achieving the target in the earlier stages, you will know you are not going to get to the right point at key stage 4, so I think in practice this is built into the process.
Amendment 28, in the name of the noble Earl, Lord Listowel, would place a statutory duty on the Secretary of State to publish and lay before Parliament a report on children in care and care leavers. As I think we indicated earlier this evening, we share the noble Earl’s commitment to improving life chances for this particular group. We publish a wealth of information on both children in care and care leavers. There are two annual statistical publications, the first of which provides data on the numbers of children in care and the numbers entering and leaving care. It also includes data on placements, children who go missing from care and outcomes for care leavers, including their economic activity. The second publication deals with educational attainment at both key stage 2 and key stage 4, so I hope that noble Lords will be reassured that we already have the comprehensive data that the noble Earl is looking for.
We are also taking action. We recognise that children in care often need special attention at school. The Government’s own measure of educational disadvantage includes children who have been in care. Children in care also attract the highest rate of funding through the pupil premium plus and, from December, will be recognised in the education performance tables. At a local level, we have given local authorities £44 million over three years to support all young people to continue living with their foster families after the age of 18, helping to provide a stable setting at the key point of transition.
In Amendment 29, the noble Earl looks to do much the same with children who are “homeless” and “at risk of homelessness” every year—in other words to create a duty to lay an annual report. The noble Earl will be pleased to know that I have been a member of the ministerial homelessness committee now for the last five and a half years, so I am absolutely informed in this area. We agree of course that care and attention are required in the case of children who are at risk in this area, and we publish relevant data. Local authorities collect and publish data on the number of households with children who are eligible as homeless and in priority need and data on the number of children in temporary accommodation, which is published on a quarterly basis. I think that the last figures came out in September. This area is a key priority. Since 2010, we have invested over £500 million to support local authorities and voluntary sector agencies to help the most vulnerable back into society.
On Amendment 30, problem debt clearly is a key factor in trapping families in poverty and adversely impacting on their living standards, mental health, family stability, financial inclusion and well-being. This is a well-chosen issue. We intend to develop a range of non-statutory indicators, which will include that one, as well as family breakdown and drug and alcohol dependency, and set these out in our life chances strategy.
Welfare Reform and Work Bill
Baroness Manzoor Excerpts(8 years, 7 months ago)
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The Earl of Listowel (CB)
My Lords, I support my noble friend Lady Meacher in her amendment, which she so eloquently moved. A couple of years ago a woman called Stacie visited Parliament to talk to your Lordships in preparation for a childcare Bill. She talked about her difficulty, as a mother of a disabled child, in finding appropriate childcare. I think she went through more than 20 childcare providers who just said, “Look, we cannot deal with the needs of your child”. Eventually she found a very good provider that was prepared to go the extra mile. I know that this is an issue we have to take seriously and are looking to improve in terms of making childcare more easily accessible. It continues to be a problem. So there is that additional issue that I would highlight to your Lordships.
My noble friend also highlighted the fact that so many of these women are bringing up disabled children on their own. I invite your Lordships, women and men, to think about trying to bring up a child on your own when that child has a disability. The risks of isolation, of being overwhelmed—all those things must be exacerbated.
The Minister, in the early discussion about popular feeling with regard to taxation, made his response. It made me reflect a little that perhaps part of the way the public sees these issues is mediated by how the Government present them. I encourage the Government to be very careful, and I hope that this will not be taken the wrong way. On Saturday morning I was speaking to a mother with a two week-old baby, and she was speaking with another mother. The other mother, perhaps a little unkindly, because this two week-old baby had an elder sister, who was three, said, “Has the older sister started trying to kill her yet?”. What this highlighted for me is that it is such a basic element of human nature to be envious, to resent something that somebody else has, that one has to think through very carefully how one presents sharing resources with somebody else, or giving resources to somebody else and not giving it to another person. I am afraid that that may not come across very well. I say to the Government that I hope they are being very careful about how they present these things.
Baroness Manzoor
My Lords, we on these Benches support these amendments, too—Amendment 3 in particular. The House needs some assurances from the Government that the disability premium for each disabled child in both tax credits and universal credits will be protected, regardless of the number of children in the family. However, the child element in tax credits and universal credit will be paid only in respect of two children in a family, even when the third child is disabled. That is the point. We need to look at those exemptions, so if the Government have already said that there is some protection, surely that same protection should be afforded to the third child who is disabled.
Baroness Lister of Burtersett (Lab)
My Lords, I want to make a brief point in support of the powerful case that has already been made. I believe that the latest HBAI statistics showed an increase in poverty among disabled children. Can the Minister tell us his assessment of the impact of these clauses on the number of disabled children living in poverty?
Welfare Reform and Work Bill
Baroness Manzoor Excerpts(8 years, 7 months ago)
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Baroness Manzoor (LD)
My Lords, we on these Benches also agree with kinship care as an adoption exemption. According to the Children’s Society, kinship carers support an estimated 200,000 children across the UK. These, as we have already heard, are families who have taken in children, often in difficult circumstances, out of love and kindness. They could find it all the harder to do so if they are unable to access any additional support through the tax credits system. Although the Government and David Cameron personally have said that they want to dramatically improve the adoption process, stopping child tax credits and universal credit for those who adopt or take in family members or friends runs counter to what they have said in the past. Can the Minister say what has changed?
The Earl of Listowel (CB)
My Lords, my name is attached to Amendments 1 and 16 in this group. First, can I make an apology to the Minister and the Committee? On Second Reading, I feel I was rather too soft on the Government. I commend the Government for their achievements in terms of employment, but there are several areas in this Bill that cause me real concern the more I contemplate them, and I should have said more about them at Second Reading.
I agree with the right reverend Prelate—if I may agree with him—that it would be unwise for the Government not to pay full attention to these amendments. I was speaking to a kinship carer earlier today. She was a godmother to a child. About six years ago, the child’s mother came into difficulties so she became a kinship carer. It was very challenging for her because local authorities do not offer much support at all for such carers. The child must have been about 11 when she came into the godmother’s care. Over the last six years, the girl has done well and done well at school. About a year ago, the carer adopted the girl. Currently, the girl is making applications to university and it is very good to see how well she has thrived, first under the kinship care arrangement and now under the adoption arrangement.
As the noble Baroness, Lady Sherlock, said, people in care often lack stable relationships and the only one they may have is with their siblings, yet it can be difficult to find a foster carer or an adoptive parent who will take on a sibling group. We should be very careful to avoid any disincentive to potential adopters to do that. I take this opportunity to pay tribute to the work of Delma Hughes, a care leaver herself, who never got to know her five siblings. As an adult with care experience, she set up a charity called Siblings Together, which she has now been running for about 10 years. It provides holiday gatherings for siblings in care and opportunities for them, for example, to go to the Young Vic and perform in plays together or to go off to write poetry together, which bring together separated siblings and are immensely important for them.
I am sure the Minister will give a very sympathetic response to these concerns, which I look forward to. I also thank the Family Rights Group, which provided a very helpful briefing for this amendment on kinship care and has been working in this area for many years. I very much value its work, as I am sure all those in this area do.
Baroness Manzoor
“(c) subsection (3C) applies.”
Baroness Manzoor (LD)
My Lords, in moving Amendment 2, I shall speak to Amendments 4, 7 and 12 in my name. As we have heard, the Bill introduces a two-child limit on receipt of child tax credits for children born before 5 April 2017 and the child element of universal credit for families making a new claim, whether or not the child is born before April 2017.
My Amendments 2, 4, 7 and 12 are about introducing exemptions. On this, I concur with my noble friend Lord Kirkwood because I understand the budget restrictions that the Minister is facing in relation to the welfare budget. My exemptions also highlight the importance of sensitivity in implementing these provisions. Many exemptions are needed. There are groups of people who cannot make rational decisions—or rational choices, should I say? The problem is about determining whether these exemptions are met, which can be very difficult.
Amendment 2 is an enabling amendment to Amendment 4, which addresses the need for exemptions for,
“the person or persons claiming an individual element of child tax credit”,
if the person,
“has been a victim of rape … is a kinship carer”,
which we have already discussed. Again, I concur with what the noble Baroness, Lady Drake, said so well. Exemptions would also apply to an individual who,
“has previously claimed tax credit as a single parent but is now part of a stepfamily, or a cohabiting multiple family … has fled domestic violence, or … has suffered a bereavement of their husband, wife, civil partner or cohabiting partner who is the parent of the child or children for which an individual element of child tax credit is being claimed”.
Families are complex units. If two single-parent families, each with two children live together, they are entitled to retain or claim the child tax credit but not if they marry. This is because their change in circumstances mean they will fall under universal credit and the two-child limit. Transitional arrangements are supposed to ensure that existing claimants are unaffected by these changes. However, households in receipt of child tax credits and which are migrated into universal credit will be protected only in so far as they maintain their current claim—in this case, if they stayed single.
Iain Duncan Smith has talked about encouraging dual-parent families but this Bill, as I said previously, runs counter to that. However, let us be clear. We on these Benches do not necessarily agree that two-parent families are in some way better, as Iain Duncan Smith effectively believes. All family types are valid and important. In my view, not exempting families where single parents come together is difficult to understand, given the commitment made in other statements.
In domestic violence cases, a woman—it usually is a woman—with more than two children who flees a violent relationship must know that she will be able to afford to care for all her children so that she is not trapped into staying in a violent or abusive relationship due to financial hardship. It is also clear that if a working husband or wife dies, the income in the family will fall. It is logical that these families should be exempt from the two-child tax credit limitation.
The Bill also impacts on many families who already have three or more children if they make a new claim for universal credit as a result of common, but unpredictable, life events. Anyone can lose their job at any time; we can all get sick; we can all have a disability in the future. So this is totally unfair and unreasonable. The DWP’s own analysis demonstrates the risk of child poverty, which is already significantly higher among families with three or more children: 35% compared to 25-26% for families with one or two children.
Other noble Lords will, no doubt, speak on these important issues. As has already been identified, other exemptions may need to be applied in areas such as private foster care arrangements and disability. This is why I have put down Amendment 4, proposing that:
“The Secretary of State may, by regulations, make further provisions relating to the operation of subsection (3C).
The main point of my amendments is that there are lots of complex family situations and many areas could be considered for exemption. However, the ability to exempt these people requires knowing what exemptions they meet. Some exemptions will be easier to assess than others, but how will DWP caseworkers assess if a child is born as result of rape? How intrusive will the questions be and what evidence will caseworkers look for? As we know, many people sadly do not report rape and, when they do, convictions are low, so that will not help. The Minister has already stated that cases of rape will be exempted. How will the DWP know whether a claimant’s child is indeed a result of rape? The only way would be to ask, and I shudder to think how deeply upsetting and totally inappropriate it would be for a caseworker to venture into such traumatic, deeply sensitive and personal issues.
Therefore, although the Government should include exemptions in the Bill, they will also need to consider how exemptions will be assessed and applied. To safeguard against deeply intrusive questioning, Amendment 7 would insert in the Bill the provision that the DWP must,
“have regard to the importance of the person’s right to respect for private and family life”, under Article 8(1) of the Convention for the Protection of Human Rights and Fundamental Freedoms as set out in Schedule 1 to the Human Rights Act 1998”,
and should not,
“in seeking to determine whether the exemption applies, request any information about the claimant’s private medical or sexual history”.
I turn to Amendment 12. As the Bill stands, Clause 12 will mean that families with children born before April 2017, making a new claim under universal credit, do not receive the same protections as those available to claimants of tax credits and may have their child additions within universal credit limited to two children. This seems totally unfair and I do not understand the reasoning behind it.
My Amendment 12 would afford the exempted people I have previously identified, such as people who have been raped and single parents, the same protections once universal credit comes into force through the child element in universal credit. Proposed new subsection (1C) in Amendment 12 states:
“The Secretary of State may, by regulations, make further provisions relating to the operation of subsection (1B)”.
This is a very difficult and sensitive debate. I listened carefully to the discussion on kinship carers and concur with everything that was said. For many of the categories that we have outlined this is not about rational choice. People sometimes find themselves in certain circumstances for the right reasons—for example, the joy of bringing an additional child into a family. However, circumstances such as rape are not so pleasant or nice. I think that noble Lords around the Committee want the Minister to commit to look at exemptions very carefully. As has been outlined by other noble Lords, I want to avoid unintended consequences. I cannot believe for one minute that the Government want such unintended consequences to arise. I believe that they want to do the right thing. Putting exemptions on the face of the Bill will give many people in our country great hope. We are talking about a lot of people—millions, in some cases. I beg to move.
The Earl of Listowel
My Lords, my name is attached to Amendments 4 and 12. It is a privilege to follow the eloquent noble Baroness, Lady Manzoor, and I shall concentrate on one or two aspects of her comments. As regards the need for these exemptions, someone commented to me that the poor have always had the largest families. The austerity that we are experiencing is due in large part to the fact that some vastly wealthy people made some very poor choices. Yet today we are looking to penalise the poorest in our society, and most especially their children, by taking money away from them. Therefore, I support very strongly the noble Baroness’s call to make the exemptions as wide as possible.
Last Friday a report on the education of children in care was launched at the Nuffield Foundation. The Children’s Minister, Edward Timpson MP, addressed the launch. The report highlighted the fact that the educational performance of children in care was still a long way behind that of the rest of the general population of young people. That is a matter of concern. However, children in need who have stayed with their families and not been taken into care, fostered or taken into a children’s home do far better once they are taken into the care of the state than those children who have not been subject to intervention by the state. We all know that due to pressures on local authorities, the threshold for being taken into care is quite high. Many more children in need live in fairly dysfunctional families but those families are not dysfunctional or abusive enough for the children to be taken into care, and those children are struggling. We need to think about families in which the parents grew up in deprivation, not just financial but emotional deprivation. Often the parents will have had issues around drink and drugs, and have not been able to show the children very much love.
Lord Freud
We can cut through debating this by getting the facts, which I shall get to noble Lords.
Baroness Manzoor
My Lords, this has been a fascinating and passionate debate and I thank noble Lords who have taken part. I particularly thank the Minister. I know that he is a kind and caring man and I have spoken to him about some of these issues. But I want to bring him back to the exemptions, which are really very important. I hope that he will forgive me if I did not hear him correctly. I assume that he was saying that other regulations addressed some of the issues that noble Lords and I raised. I will certainly read what he said very carefully to see if that is the case. If those regulations do not apply elsewhere—and they cannot, because we are talking about tax credits and universal credits limited to two children—would he please think again very carefully about these exemptions? It really will make all the difference to some of these very hard-working, low-income families we all want to support and help. I beg leave to withdraw the amendment.
Employment
Baroness Manzoor Excerpts(8 years, 8 months ago)
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The Lord Privy Seal
We will go to the Lib Dems but, if the contribution is brief, we can get another Labour Peer in.
Baroness Manzoor
My Lords, in education, girls outperform boys in GCSEs, A-levels and graduate studies. However, across 90% of all sectors there remains a pay gap for women working full-time, particularly for those working in the finance and insurance industry. What are the Government doing to address this gap?
Baroness Altmann
The latest figures show that the pay rate for women under 35 is now higher than that for men. However, I agree with the noble Baroness, and we will look at the fact that there is still a gender pay gap for older women.
Welfare Reform and Work Bill
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Baroness Manzoor (LD)
My Lords, the Liberal Democrats’ approach to this Bill is based on two simple principles. First, the benefits system should encourage people into work whenever they are able and it really should pay to be in work. Secondly, the £12 billion of welfare cuts the Government announced in the Budget are unnecessary to deal with the deficit. They are a political choice based on the Government’s wider political agenda to achieve a budget surplus by 2020, rather than the pragmatic need to eliminate the structural deficit by 2017-18.
While we are not averse to finding savings from the welfare budget, we do not believe that savings of the scale set out by the Government are needed. Cuts of the scale proposed will harm the principles of making sure that work pays and will remove much-needed support to the most vulnerable in society. This cannot be defendable on the grounds of savings alone. Having a job is not just about earning an income. It is also strongly linked to building dignity, self-esteem and improving health outcomes. The social security system must be able to help people avoid the benefits trap and to make work pay by ensuring that there is a more gradual withdrawal of benefits when someone enters work.
There is also a third principle that guides our view of this Bill: Lib Dems remain committed to the framework of universal credit, a project that has the capacity to fundamentally improve the structure and goals of our welfare system. We recognise the hard work and commitment that the noble Lord, Lord Freud, has given to universal credit and we are clear that he deserves significant recognition for this. However, I hope that the Chancellor will not seek to undermine the universal credit framework in the comprehensive spending review to dig himself out of the hole that he has created on tax credits—or, indeed, to introduce new horrors.
Although the Government assert that a central goal of the Bill is to strengthen work initiatives and to encourage households to move out of poverty through employment, many components of this Bill will weaken work initiatives, further negatively impact the most vulnerable, drag more people into poverty and may hinder the United Kingdom’s economic recovery.
There is a fundamental problem with the Bill, in that the worthy aim set out in the first clause—that of achieving full employment—risks being undermined by the subsequent clauses. We are proud that our work in government helped turn the tide on unemployment to the point where more people are now in employment than ever before. But that means that, to take the next step, we need to focus on supporting the hardest to help. That means looking at how we improve the work programme, how we support the disabled and how we provide high-quality training in skills needed by the labour market. Sadly, the Bill does nothing to address these issues. It is not a Bill about work.
The Lib Dem’s biggest concern is around Clauses 13 and 14, which would effectively reduce the amount of money given to claimants in the work-related activity group—WRAG—of the employment and support allowance. It is worth noting that more than 50% of the people in the WRAG have a mental health and behavioural disorder as their primary condition. I cannot see how cutting the amount of money going to people in this group, especially those that the Government’s own work capability assessment has deemed vulnerable, can possibly help achieve the Government’s own target of halving the disability employment gap. Indeed, we are concerned that it will instead push these people further from the job market and it risks aggravating conditions such as depression or eating disorders.
The changes are also likely to increase appeals and intensify high levels of stress. They may have the perverse effect of pushing people from the WRAG into the support group, rather than into the labour market. The Government would do better focusing on providing people with the support that they need to get better and with specialist disability employment advice via the jobcentres to make the transition into work, rather than placing the emphasis on the stick. In its review of the links between disability, long-term conditions and poverty, the Joseph Rowntree Foundation found no evidence that disability employment rates are improved by reducing benefits.
With reference to the proposed benefit cap, while we agree on the need for a cap, we do not see the logic in reducing it to £20,000. Nor do we see the logic behind breaking the link between average earnings and the cap. The real concern here is that the requirement to find affordable housing may force families away from areas where there are high levels of work opportunities, such as London, to places of high unemployment. This would undermine the ultimate aim of getting people off benefits. Will the Minister say whether the Government intend to undertake a distribution analysis of the levels of housing benefit the average person hit by the benefit cap would receive and where they may be able to secure suitable housing?
The Bill also introduces a two-child limit on receipt of the child element of tax credits for children born after 5 April 2017, and the child element of universal credit for families making a new claim, whether or not the child is born before April 2017. The Government estimate, based on the current profile of tax credit claimants, that by 2020-21 640,000 families will lose support as a direct result of this limit.
While it is right that people should take responsibility for the number of children they have, there are a number of cases where exemptions should be made. These are: families fleeing domestic violence; stepfamilies; bereaved families; kinship carers, who, according to the Children's Society, support an estimated 200,000 children across the UK; cases of rape; multiple pregnancies; and where the third or subsequent child is disabled. I would be grateful if the Minister gave an assurance to make exemptions and to review the two-child limit in all such cases.
It is also of concern that the Bill repeals the income targets and associated duties to eradicate child poverty that are set out in the Child Poverty Act 2010. Without question, worklessness and lack of access to employment are key drivers of child poverty. However, while work can be a key route out of poverty, it is by no means a guaranteed one. As the End Child Poverty coalition has shown, the latest government statistics show that 62% of children in poverty now live in working families. This affects 2.4 million children. The changes that the Government plan to make to the support for low-income families is only likely to make this situation worse. Will the Minister look at maintaining income-related measures of poverty among the life chances measures?
We have a significant concern about the decision to reduce social housing rents over four years. This represents, as the Minister has said, an overall reduction of 12% compared to current forecasts. While this may indeed help to reduce the housing benefit bill, and the costs for people living in social housing, we are concerned about the impact it will have on the ability of housing associations to borrow in order to build more homes or to ensure that improvements are made to current social housing stock.
The Government have already decided to keep housing costs for specified accommodation—such as that offered by St Mungo's Broadway, which provides specialist services and housing for the most vulnerable—out of universal credit and benefit calculations. This is very welcome, but by introducing a rent-reduction measure the Government will undo these steps and a vital safety net may be cut. Will the Minister give an assurance that the Bill will be amended to exempt specified accommodation?
Finally, there are a number of areas which are not in the Bill but we believe will further undermine the principle that work should pay and people who are able to work should be supported back into work. In particular we are concerned about the appalling cuts to tax credits, which even Conservative MPs are now in open revolt over; the cuts to housing benefit for those under 21, which will make it harder for young people to move to areas of high employment in pursuit of career opportunities; and the deepening cuts to further education colleges, which make it harder to ensure that young people get the skills they need to become employable. These are all areas in which further work is needed by the Government if they are to be truly on the side of all working people. This Bill is not a Bill for work.
Before I sit down, I wish my noble friend Lady Thomas a speedy recovery from a knee operation after a fall last week. I hope that she will be well enough to join us for the remainder of this Bill.
Families: Work Incentives
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Lord Freud
Clearly one thing that has happened in universal credit is that the work allowances, as the noble Baroness pointed out, have come down. On the other hand, we have increased some of the costs that are directly tied to work incentives around childcare. As my noble friend pointed out, the effect of doubling free childcare from 15 hours to 30 hours is worth £2,500 per child per year. Another element of universal credit—childcare support going up from 70% to 85%—is worth in excess of £1,000 per child per year. There are real supports coming in for parents who need them.
Baroness Manzoor (LD)
My Lords, fewer than one in 10 people with learning disabilities are in work. The Government’s welcome objective is to halve the disability employment gap. Will the Minister say what progress the Government are making in order to hit their target?
Lord Freud
The target to halve the disability employment gap implies that we need to find work for 1 million more people in this category. We are currently working pretty hard on the strategy for that. It was announced by the Secretary of State in August, and we are now consulting with the various interest groups to find out the optimal way of achieving it. One group that is particularly important is people with learning disabilities; they have had a tough time in the work market.