Welfare Reform and Work Bill

Debate between Baroness Manzoor and Baroness Meacher

Wednesday 27th January 2016 Lords Chamber

[Baroness Manzoor]

My Lords, I have added my name to Amendments 41 and 44. I have listened very carefully to what the noble Lord, Lord Lansley, has said and will try to give some answer to the question that I think he is putting forward, which I fundamentally disagree with.

I thank the noble Lord, Lord Low, the noble Baroness, Lady Meacher, and others for the very good report they undertook. I read it with great interest. I also thank the noble Lord, Lord Low, for making a very comprehensive statement regarding these two amendments.

I do not want to spend too much time on this because we have, as the noble Lord, Lord Low, said, already discussed it for over two hours in Committee. However, I want to say a number of things. I was very disappointed to see the BBC news over the weekend state that government sources had said that people who were concerned about the cuts to ESA and the WRAG were “scaremongering”. This really is not the case. The facts speak for themselves. As I said, we had an extensive debate in Committee, which highlighted the research that has been done and the impact that these cuts would have. I do not want to repeat that research, but it is there. This is not scaremongering.

We on these Benches are opposed to the ESA and WRAG cuts, which will affect people when they are at their most vulnerable—when they are sick. These are people who have been independently assessed by government-appointed assessors—not by their own GPs who they have perhaps had a lifetime relationship with, but by independent assessors—as having limited capacity for work or as being able to return to some form of work in the future. As has already been outlined, over 50% of people in this group have mental health problems and it includes people with disabilities, people with progressive diseases, such as MS and Parkinson’s, and people who may be undergoing cancer treatments.

It is interesting to note that the Government have enshrined in law that there is to be parity between acute services and mental health services in the Department of Health, which is laudable. However, another department—the DWP—is penalising people with mental health problems on ESA and WRAG by cutting their benefit as though this will improve their health and will make them better sooner. That is not true, and there is no research which demonstrates it. The Department of Health and the DWP should at least try to have a dialogue to complement respective government policies. If there was more joined-up thinking between departments the taxpayer could save significant sums of money. There is no evidence that cutting £30 a week from the benefit to that of a jobseeker’s allowance will improve these claimants’ ability and fitness to work. Indeed, it may have the opposite effect.

On the point made by the noble Lord, Lord Lansley, it is unthinkable that we should put it in the Bill that these benefits should be cut from ESA and WRAG without reviews and without putting into place some of the things that noble Lords have suggested. We and the Government could do those reviews first and then implement a policy. To implement a policy that will have such dire effects first, and then consider that, whatever falls out of it, something will happen, is not right or fair. The Government have to undertake research, think about the policy, consider its impact and then implement it in a fair and considered way.

The Government should strengthen the support that is given to ESA and WRAG claimants by ensuring that specialist advice and support is available to these people. Work coaches should also be given the appropriate training to understand and meet the needs of these claimants.

I look at this issue through the prism of work. The Government must also tackle the thorny issue of employer discrimination—which, although against the law, still exists, sadly, in places—and identify exactly what kind of support they will give to employers to enable them to employ more people with disabilities.

Clauses 13 and 14 should be removed from the Bill. They have no place in a caring and compassionate society.

[Baroness Meacher (CB)]

My Lords, I support the proposal to leave out Clauses 13 and 14. I was disappointed in the comments of the noble Lord, Lord Lansley. Of course, we all want people to be able to return to work, and employment is incredibly helpful if people are well enough to take it on. On the idea that, somehow, if we are not in favour of cutting these benefits we are content that people should remain out of work for an indefinite period unnecessarily, the crucial point is: can these people return to work, is it reasonable, and will these cuts facilitate that return to work or drive people further from the labour market? That is issue and we have all the evidence we need to raise serious questions about it.

I want to avoid repeating the arguments so ably put by my noble friend Lord Low but to endorse the view that these clauses will not achieve the Government’s objective of increasing the numbers of sick and disabled people moving into and remaining in jobs. It is remaining in a job which is absolutely crucial, because there is no point in getting a job for two weeks and then finding that you are so ill you have to drop out. Then, you will spend months trying to restore the benefits you have been receiving. In fact, it is a very dangerous thing for most people on benefits to take a job, which is one of the big issues the Government need to tackle. Until people feel freer to move in and out of work, we will not achieve the results we want. I know that that is the aim of universal credit and I applaud the objective. The reduction of £30 a week in the incomes of these vulnerable groups will undoubtedly cause the most incredible misery and hardship for a lot of already very vulnerable people.

I want to avoid duplicating the comments of other speakers and rather to draw the Minister’s attention to the four key points made by the Royal College of Psychiatrists about Clauses 13 and 14 and the cuts. First, as others have mentioned, more than 50% of people affected by this cut will be suffering from mental and behavioural disorders. These people find it particularly hard to get into work and, indeed, to maintain a job for reasons that have nothing to do with their benefits but more to do with fears about employers, health problems, travel problems and so on. Secondly, a survey by the Disability Rights Coalition found that almost seven in 10 disabled people say that the cuts to ESA will cause their health to suffer. To judge by my experience of some 25 years in mental health services, mentally ill people’s health will suffer most severely—if I dare say that in front of colleagues who know about other disabilities far better than I do. When faced with severe financial hardship, people with psychiatric and psychological problems will find it extremely difficult to function at all. Common sense tells us that someone with an anxiety disorder or depression will find rising debts and the prospect of eviction from their home impossible to cope with. Are these people really going to be able to search for jobs effectively? Of course not.

The third point made by the Royal College of Psychiatrists reinforces this. It points out that there is no evidence that cutting the amount of benefit someone with mental health problems receives will make it more likely for them to find work. This point has been made in respect of disabled people in general, but given the sizeable number of ESA/WRAG clients with mental health problems, the view of the psychiatrists should not be ignored. Finally, and most important from the point of view of the Government, these cuts could lead to an increase in demand for NHS mental health services. According to a Rethink Mental Illness survey, 78% of respondents said they will need more support from their GP, community services or in-patient mental health services if their benefits are cut. I do not believe that these services have the capacity to deal with an influx of demand from these groups.

Macmillan Cancer Support has made the point that success in finding a job and moving off ESA is related to the quality of back-to-work support offered, the availability of jobs, and the health of the individual rather than impoverishment. Surely these realities should drive the Government’s policy. Macmillan argues that its own research proves the correlation between financial deprivation and poorer health outcomes. In the case of cancer patients, too early a return to work can be dangerous and may drive people into the support group. That is detrimental to them and, of course, to the taxpayer.

The third group I want to mention briefly is the 8,000 ESA/WRAG claimants with progressive and incurable conditions including Parkinson’s, multiple sclerosis and motor neurone disease, as already mentioned by the noble Baroness, Lady Manzoor. Does the Minister believe that anyone currently unfit for work due to Parkinson’s or motor neurone disease will become fit for work in the near future—or ever? These illnesses are relentlessly, tragically and depressingly progressive. Does not the Minister regard it as quite immoral—I do not often use that word but I feel I need to in this context—to treat such clients in the same way as young, fit people looking for work? I would be grateful for his views on this point.

In conclusion, I find Clauses 13 and 14 immoral in certain respects, as well as counterproductive even in achieving the Government’s own objectives of cutting the costs of sick and disabled people to the taxpayer through driving them back into work.

Welfare Reform and Work Bill

Debate between Baroness Manzoor and Baroness Meacher

Monday 21st December 2015 Lords Chamber

[Baroness Manzoor]

My Lords, I shall speak to Amendments 72 and 92 in the names of the noble Baroness, Lady Sherlock, and the noble Lord, Lord McKenzie, which I support. As I said at Second Reading, although we on these Benches agree on the need for a cap, we do not see the logic in reducing it to £23,000 a year for households in Greater London and to £20,000 for those in the rest of the country. Nor do we see the logic behind breaking the link between average earnings and the cap, as has already been said. I agree with the Child Poverty Action Group, which states that:

“The reduction in the level of the benefit cap severs the link with median earnings, and instead is based on an arbitrary figure, leaving it unclear what the fairness test is now”.

The Government’s rationale is that the benefit cap will deliver strong work incentives. However, the real concern here is that the requirement to find housing at an affordable level may force families away from areas where there are high levels of work opportunities, such as in London, to places of high unemployment. This would undermine the ultimate aim of getting people off benefits.

Although the Government demonstrate that the existing benefit cap successfully strengthens work incentives, as evidenced by the greater proportion of those capped moving into employment as compared to those under the cap, in-depth interviews conducted by DWP itself in 2014 show that many households responded to the cap by,

“being willing to accept low-skilled, low-paid jobs, rather than pursuing further qualifications which they hoped would help them get a better job in the future”.

As the noble Baroness, Lady Sherlock, has already said, the Institute for Fiscal Studies, which undertook a peer review of the DWP research, concluded that its analysis told us:

“that the large majority of affected claimants responded neither by moving into work nor by moving house”.

Forfeiting further education and training for low-skilled, low-paid jobs limits an individual’s long-term human capital and earning prospects, which lowers potential tax revenues paid to the Government and, on an aggregated level, hinders economic productivity and potential output.

Long-term reductions in welfare spending will be realised only by increasing people’s income through employment and by reducing their outgoings, primarily through improving access to affordable housing. I urge the Minister to maintain the benefit cap as currently set.

At Second Reading, I asked whether the Government intended to undertake a distribution analysis of the levels of housing benefit that the average person hit by the benefit cap would receive and where they might be able to secure suitable housing. I wonder whether the Minister is in a position to answer this question more fully on this occasion. Will he also say what impact the further lowering of the benefit cap will have on single parents and how the rights of children will be protected? This has been very clearly highlighted by the noble Baroness, Lady Lister. Gingerbread quite rightly is concerned. Lowering the benefit cap will continue disproportionately to affect single parents, of which as many as 70%—I think that the noble Baroness, Lady Lister, quoted 69%—will have a child under the age of five. That cannot be acceptable.

[Baroness Meacher (CB)]

My Lords, I speak to Amendment 94—I emphasise that it is a probing amendment. I do so in the hope that we can highlight the need for a comprehensive and regular review of the impact of the totality of the benefit cuts on specific groups—who are the most vulnerable—applied during the past few years, including those in the Welfare Reform Act 2012, in more recent legislation and in this Bill. The amendment requires that in carrying out a review of the benefit cap, the Secretary of State must include an assessment of the impact of the benefit cap on disabled people, their families and carers. I for one have not fully grasped the full impact of the multitude of cuts. At the very least, I believe that the Government have a moral obligation to understand the implications of their policies for the most vulnerable citizens in this country and to make public that information. That is what this amendment is about.

The benefit cap applies even to benefits designed to compensate for the extra costs of disability or caring for disabled people, including ESA WRAG, incapacity benefit, severe disablement allowance and carer’s allowance. We know that one-third of disabled people—fully 3.7 million—live below the poverty line already. The benefit cap combined with the freezes and cuts to employment and support allowance for those in the WRAG group will see disabled people’s incomes reduced significantly again. This significant reduction is from a level which is already below the poverty line.

The Government argue that the new lower, tiered cap has been designed to strengthen the work incentives for those on benefits. When I met the Minister from the other place, he said, “The whole point of this is to encourage people to work for more hours”. I find that so cynical, when most of these people simply cannot work more hours for a range of reasons. However, as we have argued previously in Committee, the Government have provided no evidence to back up the claim that cutting benefits that disabled people receive will incentivise them to work. As I have already indicated, the Government’s reference to an OECD study failed to point out that the study did not even refer to disability throughout, and rightly so—of course, people who are disabled are in an entirely different position from those who are healthy and able bodied. We have evidence that reducing disabled people’s incomes will make it harder and not easier for them to move into work.

In addition, the impact assessment provides no detail on the impact of lowering the cap on disabled people who are in receipt of DLA/PIP—those who are severely disabled and cannot do much about their situation. This amendment has no financial consequences. I hope that the Minister will take this matter away with a view to bringing back a government amendment on Report.

I support Amendment 93 tabled in the names of the noble Baroness, Lady Lister, the noble Lord, Lord Kirkwood, and the noble Earl, Lord Listowel. The case for the amendment has been eloquently spelt out and, fortunately, I do not need to add to that. I hope that the Minister will assure the Committee that this crucial issue will be dealt with on Report.