(3 years, 8 months ago)
Lords ChamberA number of groups of individuals have been impacted by Covid and their incomes have been put under stress. The department continually reviews the impact on people but this is a timely reminder for me to go back and make some more representation, which I will do.
My Lords, does the Minister agree that the £20 uplift for universal credit should be extended to include claimants receiving legacy and related benefits, the majority of whom are disabled or carers, or have a long-term illness? These people are suffering great hardship and the Government need to take action now. Will she support that?
Legacy benefits and the £20 uplift have been the subject of lengthy and great discussions in the department. To be absolutely straight and truthful, the only thing I can say is that the Government have no plans to extend the temporary £20 uplift. I know that that will be a disappointment.
(3 years, 9 months ago)
Lords ChamberMy Lords, I support the regret Motion that my noble friend Lady Sherlock has tabled. I congratulate her on a brilliant introduction to what is a very complex area.
The brutal consequences of the pandemic, added to the trend of increasing levels of poverty under benefit cuts and the growth of inequality, have left families trapped, with no prospect of improving their situation. Millions of people on legacy and related benefits did not receive the £20 uplift applied to universal credit and working tax credits. As many speakers have said in this debate, this is particularly important, as most people on legacy and related benefits are disabled, carers or have a long-term illness. The majority of these fall within the poorest 10% of the population and are the very people who are likely to have been unable to work for an extended period and are less likely to have any savings to fall back on. As the Disability Benefits Consortium has said, they still face higher costs as a result of the pandemic, due to increased food, fuel and phone costs and needing extra support from paid carers.
Into this situation, the Government now intend that people on legacy and related benefits should move to universal credit. Therein lies a very big problem, so eloquently explained by my noble friend Lady Sherlock. I am grateful, as other speakers were, to the briefing from Marie Curie, which makes a compelling case, outlining the difficulties for people living with terminal illness who are living alone and do not have a carer in receipt of carer’s allowance to look after them. They will face terrible consequences from the change that is being proposed. As has been said, under universal credit the severe disability premium and the employment support allowance are both being scrapped. That leaves many of those who would otherwise have been entitled to severe disability premium much worse off.
Although the Government try to make compensation arrangements, Marie Curie provides the example of a gentleman who is 55, who has applied for ESA and has a life-threatening illness. As a result of these changes, if he were moved to universal credit he would be more than £44 a week worse off, on an income that is already very small indeed. It cannot possibly be the Government’s intention to severely undermine the financial position of those in receipt of these benefits, particularly at a time of pandemic. As has already been made clear, claimants in receipt of transitional payments will not receive the annual uplift in universal credit; their support will therefore fall, in real terms, year on year. As the Explanatory Memorandum on transitional protection puts very clearly, the Government’s policy is to gradually eradicate the additional income received by former severe disability premium recipients—in other words, to cut their benefits.
The noble Baroness, Lady Ritchie, asked two very important questions to add to the questions asked by my noble friend Lady Sherlock. The Minister must tell us how, in discussion with other departments, the Government will ensure that those affected by this change will still get the care and support they need and will not be left socially isolated as a result of these changes. She also needs to tell your Lordships’ House when the Government will bring forward the special rules for people living with terminal illnesses. Better still, she should tell the House today that these poorly timed changes, which will only increase anxiety and uncertainty for disabled people, will be withdrawn and that the Government will think again.
(5 years, 5 months ago)
Lords ChamberTo ask Her Majesty’s Government how many children who live in a household where at least one adult is employed are currently living in poverty.
On behalf of my noble friend Lady Primarolo, and with her permission, I beg leave to ask the Question standing in her name on the Order Paper.
(6 years ago)
Lords ChamberMy noble friend is entirely right. I could not put it better myself. We have to make sure that we get these regulations through. If we do not, that support for half a million vulnerable people will be lost. The regulations provide transitional support for recipients of the severe disability premium while removing the complexity of dealing with different rules for seven different disability additions. We want to make sure that we take special care of those people when migrating them on to UC. As the CEO of Citizens Advice, Gillian Guy, said,
“improved protection for people who receive the Severe Disability Premium is a welcome move that will mean better financial security for many disabled people who move onto Universal Credit”.
We must have these regulations.
My Lords, I thank the Minister for the information she has given about the changes made in the Budget last week. However, she will know that the Government had already pre-announced billions of pounds to be cut from the budget that will facilitate universal credit by 2020. Last week’s announcements have given some money back, but not all of it. The Government’s original estimate was that universal credit would lift 350,000 children out of poverty, but the Joseph Rowntree Foundation says that, as a result of these changes, an extra 1.2 million children will grow up in poverty by 2020. What is the Minister’s latest estimate for raising families and children out of poverty as a result of universal credit?
I am proud to say that this country provides more benefits for families than any other advanced nation. I do not recognise the estimates; it is not right to make estimates without any underlying evidence. We have come a long way since the cuts some years ago to which the noble Baroness referred. There were cuts right across the board, in all departments. For example, the cost of social security went up by 65% under Labour and was becoming totally unsustainable. We could not continue with that rise. We have therefore had to adjust and make some very difficult choices.
We are doing all we can, with the working tax allowance and increased support for childcare costs, to support children and families. An additional 80,000 working parents who are in receipt of transitional protection and who access support for childcare costs provided by UC are expected to benefit from these regulations. The support for childcare costs provided by universal credit, worth up to £1,108 per month for two or more children, is more generous than the system it replaces. However, the most important support that anyone in a family can give their children is being in work; setting a course for that family out of poverty—a hand up, not a handout—and being role models for the children. There are over 800,000 job vacancies at the moment. We want to do everything we can to support people into work, because that is the best way to lift children out of poverty.
(6 years, 5 months ago)
Lords ChamberMy Lords, I congratulate my noble friend Lord McKenzie on initiating this debate. I echo the very positive points he made about auto-enrolment: it is a good thing and has enabled millions of people to be drawn into workplace pension systems for the first time. The government review published last year concluded that, regrettably, of the 10 million people enrolled for the first time by 2018, only 3.6 million were women. We have the opportunity now to reflect on the introduction of auto-enrolment and the changing nature of the labour market and government policy, and to find ways of ensuring that we continue to draw more workers into auto-enrolment to enable them to save for their retirement.
The government review also identified that 900,000 of the 1.6 million individuals who are under-saving and earn less than £25,000 a year are women. This is on top of the dramatic changes to the state pension for women, the changes to women’s entitlement to benefit from contributions made through national insurance by their husbands, and the fact that women often have multiple part-time jobs to fit around caring responsibilities, be that childcare or care for a relative. They then find themselves unable to be auto-enrolled because they do not have “a job” that gets them over the £10,000 trigger. It would be a very poor outcome for the introduction of a good scheme in theory if, in 10, 20 or 30 years’ time, we found that women in many sectors of our society were still totally excluded from an ability to provide for themselves in their retirement through a contribution in this way.
According to the Annual Survey of Hours and Earnings—ASHE—8.8 million employees are not currently saving into a pension scheme. This headline figure is worrying in itself but it disguises a greater inequality in the UK workforce. In some occupations, up to 85% of the lowest paid are not in a pension scheme and are missing out on the employer’s contribution that better-paid workers receive. Some industries, such as agriculture and the wholesale and retail sectors, lag far behind other areas. The TUC published an analysis based on the latest ASHE data, which shows that among highly paid professionals earning more than £600 a week, nearly nine out of 10 are saving into a pension. But at the other end of the spectrum, nearly 86% of those in, for example, sales or customer service jobs who are paid far less a week are not members of a scheme. Four in 10 employees undertaking care, leisure or other service work are not entitled to enrol in a pension scheme, including nearly three-quarters of the lowest paid.
It therefore appears that the current pension arrangements are in danger—I put it no higher at this point—of hardwiring inequality between the lowest-paid and the better-paid occupations into the auto-enrolment pension system. As my noble friend said, those who earn under £10,000 from one employment do not have an automatic right to enrol in a workplace pension. The lack of pension provision means that the pay gap is wider than at first appears, with low-paid workers missing out from the employers’ pension contribution. It also suggests that whatever the gap in pay workers experience in their working lives could be amplified into retirement.
Many under-pensioned sectors typically employ large numbers of women. Thus, the rules governing automatic enrolment at present mean that women are less likely than men to come into the workplace pension system. A series of points makes this difficult for women, and my noble friend touched on the first one: contribution rates. The structure hinders contribution, in my view, so the legal minimum contribution of 1% for each employer—rising, I know, by 2019 to a total contribution from all of 8%—means that those who come in at the lowest point will not accrue enough for their retirement to give them a basic income.
When this is compounded by applying contributions to a band of earnings rather than based on a full salary, for someone on £10,000 a year, only £4,124 is pensionable, so 8% of qualifying earnings actually means that only 3.3% of their total salary is being contributed. When we put into that complicated mix insecure work, the growth of self-employment, where employers are contracting out and wanting to employ people on a more flexible basis, we can see that the contribution rate for employers is simply not high enough at present.
Then we have the question of the trigger of £10,000. As I have already touched on, for many women in low-paid, part-time work, juggling care responsibilities and a number of jobs, that £10,000 is simply not a viable measure for them. Again, the research conducted by the TUC, published in 2016, found that 106,000 workers—70% women—held multiple jobs but could not enter the trigger at £10,000. Cutting or abolishing the earnings trigger would help low-paid women to come into workplace pension schemes.
Why do we not use the national insurance contribution level, which I think is referred to in the report’s summary of conclusions? Using that would bring about 1.5 million more people into workplace savings, of whom 73% would be women.
A case can be made that those with wages below the trigger can opt in to a workplace pension anyway, although we know that pensions are often complex. Importantly, however, individuals who are on low incomes rarely feel that they are, if you like, flush for cash and, not unreasonably, when budgets are tight, they favour the short term over the long term. We know this from experience with the married woman’s national insurance contribution rate, a much lower rate with less benefits for that woman. Many women opted for that to help the household budget, with the consequences that we now find for them with the development of policy in pensions, excluding them from a decent pension. With the trigger, as my noble friend said, linked to the tax threshold, which is now much higher than originally envisaged as a result of coalition Government action, this situation can only get worse.
The Government now need to go further and build on the success of auto-enrolment and what they say in their review. They need to ensure that employers make decent contributions to a pension scheme for all workers from the first pound earned, that women workers and low-paid workers get the same pension benefits as their colleagues. They need to cast an eye over their review and undertake a gender analysis on take-up in this area. I think that they will see that there will be vastly different work practices in different sectors, and that that directly influences the ability of those workers to enter the workplace pension provision.
Increasing employer contribution rates, reducing the trigger, looking at every pound earned counting, allowing people to use more than one job to contribute to their pension and dealing with the vastly increasing economic precariousness for the self-employed—that is a good starting point for the Government to get further accolades on building a proper pension system. But that will not be done without a timetable, and it will not be done without clear identification by the Government of what they hope and intend to do next. I hope that when the Minister replies to this debate, she will give noble Lords some comfort that the Government intend not to sit on their laurels but to energetically, urgently and with determination build on this scheme to make an even better one for women workers in this country.
(6 years, 5 months ago)
Lords ChamberMy Lords, I can confirm that the PIP assessment criteria were extensively consulted on prior to their introduction and were developed in collaboration with disabled people and independent specialists. The 2017 amending regulations did not represent a policy change. They were introduced to restore the original policy intent and to clarify the distinction between the needs of claimants who require assistance to manage therapy and those who require assistance for medication or in monitoring a health condition under daily living activity 3.
For the benefit of all noble Lords, let me explain that what we are talking about is, unlike DLA, a very personalised system of support. It is not based on condition; it is based on need. The important point is that it focuses on managing the condition at one end of the scale and actually requiring extensive therapy at the other end of the scale within the particular 3b criteria that have to be followed. Each case has to be considered on its individual merits. That is one of the flexible and important aspects of PIP. Of course, the outcome of that is that many more people are receiving the highest rate of award under PIP than under DLA.
My Lords, in the interests of clarity for the Government and certainty for the claimants, can I return the Minister to the question raised by my noble friend Lady Sherlock? Will the Minister explain to the House how the Government intend to move forward in ensuring that they have identified other cases that are potentially affected by this judgment and the lack of clarity—some might call it error—in the regulations originally drafted by the Government?
My Lords, it is important to re-emphasise the fact that this Urgent Question is about two specific cases that occurred before the regulations were amended in March 2017. It is about a five-month period. We are focusing on support for those two particular claimants and will ensure that any loss will be recovered and paid to them, literally within the coming days.
I sense that the House is perhaps referring to a judicial review decision that was made in the sense that the Secretary of State decided not to appeal a judgment towards the end of 2017 in relation to mobility activity 1, which is different from today’s Question. However, in relation to that, we will be carrying out an administrative exercise to identify claimants who may be eligible for more support under PIP and we need to screen the whole PIP caseload of 1.6 million to identify those people as a result of that JR judgment. The actual number of people whose award will be affected is much smaller. The judgment relates to people who suffer from overwhelming psychological distress that affects their ability to plan and follow a journey. Anyone who is identified as affected will be contacted by DWP and their payments will be backdated to the effective date in each claim.
(6 years, 7 months ago)
Lords ChamberYes, they are, I am pleased to say. The Government have taken a number of steps to reduce the risk of problem debt, including capping payday lending costs and promoting savings. In addition, we have outlined a firm timetable for taking forward the breathing space scheme, and we are progressing with policy proposals for this and a statutory payment plan, all through the single financial guidance Bill, under which overindebted individuals will continue to be protected from creditor action.
My Lords, will the Minister explain why the universal credit sanctions regime imposes multiple sanctions on claimants with mental health problems, damages individuals’ health, causes unnecessary suffering and hardship, and does absolutely nothing to improve their ability to find paid work?
My Lords, I have to disagree with the noble Baroness. Putting aside the raft of additional support and improvements that come with universal credit, we can demonstrate that universal credit is a far better route than the old legacy system to giving much better support to the people to whom she referred. Sanctions are used only in a minority of cases where claimants fail to meet their conditionality requirements without good reason.
(6 years, 8 months ago)
Grand CommitteeMy Lords, I had not planned to speak this afternoon, since I was supposed to be in two different places. But then I had this horrible memory of reading Hansard from our most recent debate on the uprating order, and of my noble friend Lady Sherlock naming and shaming me, in the nicest possible way, for not being there. I thought that I could not let this happen two years running, so here I am.
The Minister rightly said that the orders are compatible with the European Convention on Human Rights. However, there are other international obligations with which I do not think they are compatible. I would like to talk about the elephant in the room—those benefits that are not being uprated. This happened last year and the Minister very fairly accepted that it was a reasonable thing for us to do, because we cannot talk about uprating the benefits without thinking about benefits in the round.
As the Minister is aware, the European Committee of Social Rights recently issued a report, saying that levels of contributory benefits to the sick and unemployed are inadequate and therefore do not conform with Article 12 of the European charter. That was based on 2015 levels on benefits, so they would be even more inadequate now because of the benefits freeze in most working-age benefits.
In a report published last week the Resolution Foundation said that,
“in every year from 2016-17 to 2022-23 the UK is projected to miss its international commitment—through the 2030 Sustainable Development Goals”.
Those goals apply to us, as well as to poorer countries. The report said that it will fail,
“to deliver higher growth for the poorest 40 per cent of the population than for the population as a whole”.
Inequality is projected to rise to record highs by 2022-23. The Resolution Foundation says that this is,
“a story of the poorest working-age households being left behind”.
A key driver is the freeze in most working-age benefits. This is a policy choice. The Minister will talk about the living wage and personal tax allowances at some point but all this is taken into account. The fact is that the poorest people are falling behind, largely because of the benefits freeze.
According to the Resolution Foundation report, by 2020 jobseeker’s allowance and child benefit beyond the first child will be worth less than 32 years ago and child benefit for the first child will be at its lowest real-terms level in 20 years. I am sure that the noble Lord, Lord Kirkwood, will feel the same as me: as someone who has been working in this area for so long I find it very depressing to see how seriously we are going backwards.
The Minister gave us the welcome news about how pensions are improving relative to average earnings, but child benefit for a two-child family is less generous that at any previous point in the almost 40 years since it was fully introduced. It is set to fall even further over the next five years. Jobseeker’s allowance—unemployment benefit as was—was around a fifth of average full-time pay in the 1970s. It is now around 11% and is on track to fall to 10% by 2022, which will be a new low.
Does the Minister have the figures for what these key benefits, for people of working age and their children, would have been had they been uprated in line with prices since 2010? If she does not have them here—I would not expect her to read them all out anyway—would she be able to send them to Members of the Committee? It is important that we know what effect this freeze is having.
Given the way benefits are falling behind, it is hardly surprising that more people are turning to food banks and that poverty, especially child poverty, has started to rise again and is projected to increase by more than 1 million by the next decade. It is quite shocking. We are happy to allow the poorest to pay the price of increased inflation while the better off continue to enjoy cuts in taxation which do nothing for those whose income is too low even to pay income tax. I was very struck by reading in the paper yesterday that the Archbishop of Canterbury has said:
“Austerity is a theory for the rich and a reality of suffering for the poor”.
As the Resolution Foundation and others have said, these are choices. How we have responded to the financial crisis has been a matter of choices. I believe they are the wrong choices and that those with the narrowest shoulders are being asked to carry the burden. With inflation continuing to be significantly higher than it was projected to be at the point when the benefit freeze was first announced, is it not time that the Government think again about that policy and come back at the next available opportunity to say that they will now lift the benefit freeze?
My Lords, I shall briefly follow the points that my honourable friend made and developed to ask the honourable Lady—I beg their pardon; I am not in the other place and should say my noble friend and the Minister—some specific questions about the Social Security Benefits Up-rating Order with regard to child benefit and child tax credit, which are not in the order, and in particular how it fits with previous decisions by this Government to cap uprating at 1% between 2013 and 2015 and subsequently to put a freeze on the vast majority of social security payments.
I want to address rising child poverty and, in particular, the rise of absolute child poverty. I am sure that the Minister will be aware that the evidence shows that money paid through child benefit and tax credits directly to the parent, mainly the mother, is spent directly on children, yet in this period we have seen a shocking increase in child poverty in a country which has the sixth largest economy in the world, notwithstanding the points that my noble friend made. While the price of food and energy is rising at 4% and more, the poorest families will see their income drop as they struggle to balance feeding their children and heating their home, and many of them will fall prey to loan sharks.
Does the Minister accept that, as CPAG has said, as a result of the cumulative cuts to social security, which are pushing more people into poverty, the failure to uprate benefits in line with inflation is the single biggest driver of child poverty? What is her assessment of the impact of the decisions contained in this uprating order on poverty levels and, in particular, child poverty? Does she accept the CPAG’s analysis that 1 million more children will be pushed into poverty? One million! I mean, one child would be awful; I cannot think of a word to describe adequately the prospect in our society of 1 million more children in poverty as a direct result of this Government’s policies and the cuts to universal benefit.
(9 years, 9 months ago)
Commons ChamberI thank the Backbench Business Committee for approving this debate and my right hon. Friend the Member for Sutton and Cheam (Paul Burstow), my hon. Friend the Member for Broxbourne (Mr Walker) and the hon. Member for North Durham (Mr Jones)—but like my hon. Friend the Member for Broxbourne I will call him my hon. Friend for the purpose of this debate—for securing it.
I am afraid, Madam Deputy Speaker, that I will try your patience by congratulating my hon. Friend the Member for Broxbourne on his OBE, which he collected this morning. I can see from your furrowed brow that you were not aware of that, but you are now. He has been congratulated rather a lot today, but I felt that it would have been remiss of me not to do so from the Dispatch Box.
Order. One can never be congratulated too much, and it is right that the hon. Gentleman’s contribution should be acknowledged.
I am grateful, Madam Deputy Speaker, that you were also able to join in the congratulations to my hon. Friend and embarrass him still further.
It has been a very good debate. It is an important matter for our constituents because mental health conditions are very common, with one in six people being affected at some time in their life. That statistic has been mentioned a few times, including by my hon. Friend the Member for Windsor (Adam Afriyie) who put on record his contribution on the subject early in his parliamentary career. All Members made the clear link between mental health—whether good or bad—and someone’s employment position. Many Members also highlighted the fact that labour market outcomes are poorer for people with mental health conditions than for the population as a whole and those with health conditions in general. As my right hon. Friend the Member for Sutton and Cheam and others said, the vast majority of people with mental health conditions want to work.
I listened carefully to the statistics that my right hon. Friend quoted about people with severe mental health problems. In the spirit of trying to cheer him up a little, noting that he referred to some positive data from the Time to Change campaign about the changing views of employers on mental health, let me reassure him that although I am not in any way complacent, as the gap between those with a mental health problem working and those generally working is significant and far too wide, there was at least some improvement between the last quarter of 2013 and the last quarter of 2014, when the employment rate for those with a variety of common mental illnesses went up by 2.6%, with a further 70,000 people in employment. That is obviously positive and a step in the right direction. I will not overclaim for it, as it is just a step, but perhaps it shows that the good work of the organisations involved with the Time to Change campaign means that employers are open both to keeping people who develop a mental health problem in work and to employing people with mental health problems. We might be seeing the start of improvement in those employment figures, but I do not want to claim more than that.
We are doing a lot, but clearly there is also more to do. I want to pick up on a couple of points mentioned by the shadow Minister, the hon. Member for Stretford and Urmston (Kate Green). I absolutely agree with her comment early on in her remarks referring to employers who say that they would not employ someone with a mental health problem. She was absolutely right that if they employ a reasonable number of employees they almost certainly do, although they might not know that they do. Perhaps the employee does not know that they have a mental health problem either.
The statistics suggest that anyone who employs more than six people is likely to have at least one member of staff with a mental health problem. Perhaps they ought to look around their workplace, think about the people they employ who have a mental health problem and think about how well they support that person, not out of any sense of altruism, although it is of course the right thing to do, but, as the hon. Member for North Durham said, because it is the right thing to do for the business. The person will be more productive, will stay working for that business for longer and will be beneficial. That was a point well made.
Looking at the cast of characters in the Chamber, I recall clearly that three years ago my hon. Friend the Member for Broxbourne, the hon. Member for North Durham and my right hon. Friend the Member for Sutton and Cheam, who was then the Health Minister, participated in a debate in which my hon. Friend and the hon. Gentleman spoke about their own personal experiences. They were both nervous during the debate about how their comments would be taken outside this place. I followed it quite closely, and it was heartening to see that their remarks were taken positively, not just by the organisations that one would expect—those that are familiar with these issues—but more widely and, interestingly, among members of the public. They kicked off an interesting process and since then a number of other right hon. and hon. Members have talked about their own experiences both inside and outside the House. It is right that more Members are encouraged to do that.
The hon. Member for North Durham put it very well when he said that the more we talk about these issues, the more we are open about them, the more the House debates about them and the more we talk about mental health issues in the same matter- of-fact way—I mean that in the most positive sense—as we do about physical health issues, without making a huge drama about them, the more employees and employers will be encouraged to have those sensible conversations in the workplace.
Members spoke about a number of support mechanisms. My hon. Friend the Member for Halesowen and Rowley Regis (James Morris) mentioned the improving access to psychological therapies programme and the shadow Minister referred to the various talking therapies that are available. Those programmes have a proven record of delivering and were started by the Labour party when it was in government. They have been continued by us and expanded. By next month, they will have been expanded so that 15% of people who could benefit will have access, covering about 900,000 people a year. Next year, we will introduce for the first time access standards and waiting time standards in mental health services, and an £80 million investment will ensure that 75% of people will receive the IAPT treatment within six weeks, and more than 50% of people who are experiencing their first episode of psychosis will receive a treatment within two weeks. There is more to do, but I think that that is significant progress.
The hon. Member for North Durham talked about the work capability assessment and the performance of Atos in delivering that. With just a teeny bit of partisanship, I will remind him that it was his party’s Government who introduced the work capability assessment and appointed Atos as the contractor. We inherited that arrangement and spent quite a long time putting it right. I detected in what he said that he is not the biggest fan of Atos, so he will be pleased to know that it is exiting the contract to deliver that service in Great Britain. In fact, Maximus takes over next week, and ahead of that, in the next few days, Members will receive a communication from that company. The hon. Gentleman will be pleased to learn that one of the areas that Maximus takes very seriously and has itself highlighted, and where it is keen to improve WCA performance, is mental health. I hope that he will engage with Maximus, using his local expertise and his personal experience, to help to improve that performance.
(9 years, 9 months ago)
Commons ChamberOrder. There is a time limit on all Back-Bench speeches of five minutes. The wind-ups in this debate will start at 4.10 pm.