Inclusive Society

Debate between Baroness Watkins of Tavistock and Baroness Sherlock

Wednesday 14th April 2021 Grand Committee

[Baroness Sherlock (Lab) [V]]

My Lords, I congratulate my noble friend Lady Lister on her brilliant introduction to this important debate.

This pandemic has revealed some unpalatable truths about the way we have been living. The first one we spotted was the positive impact on the environment of the first lockdown. Others took longer to surface. Michael Marmot drew a comparison with Hurricane Maria, which hit Puerto Rico in 2017. The storm killed 64 people, but the longer-term impact on the infrastructure led to thousands of deaths. After two months, mortality had risen sharply for the poorest people, somewhat for those on middle incomes, and least for the highest group. A huge external shock had thrust the underlying inequalities in society into sharp relief.

That is what the pandemic has done to us. Covid did not strike equally. It disproportionately hit disabled people and many minority ethnic communities. It hit those living in poorer areas or in overcrowded housing. It hit those whose jobs or finances meant they could not stay home in relative safety. The aftermath will not be spread evenly either. Examples of inequality abound, but I will highlight just two. The first is employment. The Resolution Foundation report mentioned earlier by my noble friend Lady Royall showed that 16 to 24 year-olds account for nearly two-thirds of the fall in payrolled employment. Within that group, there was further inequality. Before Covid, 25% of economically active black young people were unemployed, versus 10% of their white counterparts. By the end of 2020, that had opened up, with 34% of black young people unemployed and 13% of white.

The second example is debt. A report from the Joint Public Issues Team, representing a group of churches, estimates that some six million people in the UK have been swept into debt as a result of Covid. Low-income families with children seem to have been especially badly hit, seeing their wages falling fastest while the cost of living increased. So they were pushed further into debt, while higher-income families could pay off debts and save more. Has the Minister read that team’s report, Reset the Debt, and its proposal for a jubilee fund to help address pandemic debt? If so, what does he think of it?

Like Hurricane Maria, the pandemic hit unevenly because of pre-existing inequalities. People tended to do better if they were already privileged—if they had chosen their parents with care, if they lived in the right area, and if they had a secure job they could do from a safe and comfortable home. For all the levelling-up rhetoric, unless we change course, we are heading back to the old normal but worse: to a world where poor countries suffer the worst effects of the climate damage they did not create; to a Britain where a man living in Warfield Harvest Ride in Berkshire can expect to live to 90 while one in Bloomfield in Blackpool is likely to die at 68, where poverty is rife and where racism is—yes—still widespread. While we are here, when I hear past wrongs, from discrimination to slavery, defended on the grounds that in those days we did not know any better, it brings to mind a quote I saw recently from the writer Teju Cole, who asked: “We who?”

We all agree that a good country is one which enables its citizens to flourish. We should have learned by now that a good society is one which recognises that the flourishing of each depends upon the flourishing of all, and that a society structured to enable some people to flourish at the expense of others is ultimately bad for everybody. It is not surprising that the poor do better in more equal societies; what is more interesting is that the rich do too, according to the evidence, as does society as a whole.

Surely the time has come for us explicitly to recognise our interdependence and pursue the common good, to tackle inequality and to invest in the infrastructure of our shared life—our communities and public services—and in a revitalised welfare state fulfilling its original ambition to be a companion service to the NHS, which pools risk across the population and across our lifetimes. I look forward to the Minister’s reply.

[The Deputy Chairman of Committees (Baroness Watkins of Tavistock) (CB)]

The noble Baroness, Lady Gardner of Parkes, has withdrawn, so I call the noble Lord, Lord Razzall.

Universal Credit (Transitional Provisions) (Claimants previously entitled to a severe disability premium) Amendment Regulations 2021

Debate between Baroness Watkins of Tavistock and Baroness Sherlock

Thursday 11th February 2021 Lords Chamber

[Baroness Sherlock (Lab) [V]]

My Lords, I am pleased to move this Motion standing in my name. These regulations are the latest twist in a long-running saga that concerns the severe disability premium, or SDP, which provides support for the extra costs of care incurred by severely disabled people living alone without a carer. It is worth about £67 a week and is paid on various means-tested benefits.

The latest government figures I could find suggest that over 500,000 working-age households get SDP. But when the Government created universal credit to replace legacy benefits, they chose not to include an equivalent of the SDP. As a result, although some disabled people are better off, many of the severely disabled people getting this premium will be much worse off on universal credit. That is a wider pattern: some people are better off on universal credit than legacy benefits and some much worse off.

To deal with that, the Government pledged a system of transitional protection, so that, at the point of transfer, no one would lose out in cash terms. But they will apply this only during what they call mass migration, the point when the DWP closes down legacy benefit claims en masse and tells people they have to claim universal credit instead. If someone moves on to UC before that point, which is called natural migration, they get no transitional protection.

Unfortunately, many people have no choice. You cannot make new claims for legacy benefits, and if you are already getting them but your circumstances change—say you lose your job, have a baby or move house—you are forced on to universal credit. Two people getting the SDP found themselves in this position when they moved home. They were forced on to UC and were much worse off. They went to court and in 2018 the High Court ruled that this was unlawful discrimination. So the DWP created something called the SDP gateway to stop those getting the premium naturally migrating to universal credit and losing out. Those who had already crossed over were given compensation for the lost premium, although that was originally set arbitrarily low, so that was challenged in court again, and it is now based on the lost SDP.

These regulations remove that gateway and give some compensation to those who will then be moving over to universal credit. But it is not full compensation; it does not compensate for the loss of the enhanced disability premium, only the severe disability premium. Nothing is paid where the SDP is attached only to housing benefit. And it is a fixed sum, which is reduced when any part of your universal credit rises, even if that is only because your rent has gone up. So claimants will see the support they receive fall in real terms, year on year.

If someone moved on to universal credit during a managed migration, they would have transitional protection based on all their legacy benefits, not just the SDP. That managed migration process has been paused. Can the Minister tell us what the new target date is for completing it? Zacchaeus 2000 points out that Covid-19 has increased rates of redundancy and caused changes in working hours, increasing the number of people on legacy benefits experiencing a change in circumstances. More claims will therefore end up moving on to universal credit with no transitional protection or with just the transitional SDP element.

Some vulnerable people risk losing a lot of money. Marie Curie, in its excellent briefing, points out the impact on people with terminal illnesses or life-limiting conditions. It says that the loss of the two disability premiums could leave new claimants up to £84 a week worse off. Then there is the related issue of the £20 uplift to universal credit. That was not applied to legacy benefits, many recipients of which are disabled people or carers. This is incomprehensible, as well as unfair. Since there is meant to be a pandemic measure, many sick or disabled people have spent the last year shielding at home, with spiralling energy costs and lots of additional costs such as home deliveries, PPE and much more.

Astonishingly, the Secretary of State for Work and Pensions, Thérèse Coffey, suggests that claimants should simply claim universal credit if they want the £20. This is terrible advice. Some people will be worse off on universal credit than they were on legacy benefits, even with that extra £20. Others, who would be better off on universal credit because of the £20 uplift, will be worse off if it is taken away. How will they know? It is really complicated. The DWP says that it cannot advise individual claimants, so why on earth is the Secretary of State for Work and Pensions telling people to switch?

If someone applies for universal credit, there is no going back. Noble Lords may have seen cases of people in the news of people getting tax credits who then applied for universal credit and were rejected because they had savings; UC has a savings threshold, unlike tax credits. But then they were not allowed to go back to tax credits, so they got nothing. We surely cannot have that apply across all kinds of other categories of claimant.

What should be done? First, the Government should urgently address the flaws in their strategy for dealing with people in receipt of severe disability premium who are going to be forced on to universal credit. The House of Lords Economic Affairs Committee said:

“The DWP should introduce an equivalent to the Severe Disability Premium. This should be a self-care element for any disabled person who does not have someone assisting them and claiming the carer element of Universal Credit.”


Many charities agree. What is the Government’s response to this?

Secondly, the DWP should address the process of claimants moving from legacy benefits on to universal credit. We need an urgent update on managed migration. We need mass communication, and we need personalised advice for anyone thinking of moving so that they know the consequences before they make that jump.

Thirdly, the Government should extend the £20 uplift to legacy benefits. They should do the right thing and make that uplift permanent. The Economic Affairs Committee put the case simply:

“We believe that the increase shows the original rate was not adequate … The Government should commit to making the increase in the standard allowance permanent.”


That original rate is not adequate as a result of years of benefit cuts and freezes. The House of Commons Library figures show that, excluding Covid-related increases, most working-age benefits were between 9% and 17% lower last year than they would have been if the Government had simply uprated them by inflation since 2010. The OBR estimated that the 2015 Budget would cut over £9 billion from social security spending by the end of this financial year. No wonder that before that £20 uplift, unemployment support was at its lowest level in real terms since 1992.

We need action. Temporarily extending the uplift will simply temporarily extend the confusion and uncertainty. The Government should do the right thing, address the problem with SDP, extend the uplift to legacy benefits, make it permanent and announce it as soon as possible, so that people have certainty and can judge for themselves whether they will be better off on universal credit or legacy benefits. The case for taking action on this matter could not be clearer. I hope I do not have to press the Motion to a vote, because I hope the Government will realise what is at stake and do the right thing.

[The Deputy Speaker (Baroness Watkins of Tavistock) (CB)]

As the noble Baroness, Lady Bowles, has withdrawn, I call the next speaker: the noble Baroness, Lady Altmann.