Pensions: Women’s State Pension Age

Debate between Earl of Listowel and Lord Freud

Wednesday 2nd November 2016 Lords Chamber

[Lord Freud]

I can only repeat that we have made it clear—and the Pensions Minister went as firmly on the record as he could—that there will be no further moves in this area.

[The Earl of Listowel (CB)]

My Lords, can the Minister help me? Would it help if more fathers were encouraged to work part time so that they spent more time with their children, building stronger families and stronger relationships with their children? At least one result would be that fewer women would be disadvantaged, spending less time out of the work market because they would be sharing the care of their children with their partners.

[Lord Freud]

One of the transformations in recent times is that women and, indeed, men are paid for caring responsibilities so that their pensions are not affected by that.

Welfare Reform and Work Bill

Debate between Earl of Listowel and Lord Freud

Wednesday 27th January 2016 Lords Chamber

[Lord Freud]

In practice, I think that what I have said produces that outcome. I have said that we will consult very widely with stakeholders to get this right, because these are very sensitive issues. The rape exemption is very difficult. Getting kinship caring and adoption right is not straightforward. In practice, there will be consultation, but I do not want to overformalise that process. I have committed to a much more open process than you might see in some other regulations that we issue.

The next complicated case is the formation of new households through re-partnering of single parents, which we have looked at very closely and which produces a number of difficulties. First, it would be perceived as unfair by those families with three or more children who stay together and receive a maximum amount of child element or child tax credit in respect of two children, whereas other families who have formed more recently could receive more. Secondly, there is a risk that families may try to manipulate the benefit system by breaking up and re-forming, or even claiming to have broken up and subsequently re-formed in order to increase the amount. Thirdly, there would be a practical issue in assigning children in newly formed families to a particular parent. We have not done that before. Your Lordships will hear me muttering the word “carbunclising”. That is not to mention the intrusive nature of that process.

Finally, I looked at the numbers involved. The reality is that, whether we like it or not, the bulk of children stay with the mother. The number of fathers with children joining mothers with children is not many. Once the measure is fully rolled out, we expect that only 7% of single men will have children, so it is not that substantial a problem. The noble Baroness, Lady Manzoor, talked about half a million. That is just not the reality. I reiterate what I said in Committee about the way it is introduced in 2017 for child tax credit and universal credit. Any household which has claimed within the past six months will also be protected. For those reasons, I urge the noble Baronesses and the right reverend Prelate not to press their amendments.

[The Earl of Listowel]

Before the Minister sits down, given the fact that, as a nation, increasingly our children are growing up without a father in the family—according to the OECD, in the 2030s, we will overtake the United States in the proportion of children growing up without a father in the family—will he think again about his last statement? It may be a small proportion of fathers who bring children into these mixed families, but surely we want to encourage those larger families, especially, to have a father. The benefits that that father brings to those two children, or whatever, from the mother’s family is important. Will the Minister keep that in mind?

[Lord Freud]

We have looked at this very sympathetically, but in practice we found it too difficult. We have heard from this Chamber about the kinship and adoption issues, and those are the ones that we want to get absolutely right.

Welfare Reform and Work Bill

Debate between Earl of Listowel and Lord Freud

Monday 25th January 2016 Lords Chamber

[Lord Freud]

The whole point is that these reports are published. It is a forcing mechanism to make sure that the relevant Secretaries of State and the relevant departments of government work together to tackle the fundamentals that produce these outcomes.

Returning to the educational issue, if we made this change to the Bill, it would increase the burden on primary schools and send a signal to schools that Parliament does not trust them to carry out their core functions. That is why I cannot support this amendment.

Amendments 5 and 6 look to expand the reporting duty placed on the Secretary of State so that his annual report containing data on children living in workless households and long-term workless households in England must include data on the health and well-being of these children.

It goes without saying that the Government want the best for our children. We want all children to have the opportunity to have fulfilling lives and to realise their potential, and clearly their health and well-being is an integral part of that. However, we can achieve this aim, which is one that we all share, only by tackling the root causes of child poverty, and I will not parrot what I have already said on this point. Our evidence review shows clearly that worklessness and educational attainment are the two factors that have the biggest impact.

We recognise that, as the evidence review pointed out, child ill-health is also a driver of poverty. We are absolutely committed to reducing health inequalities in terms of access and outcomes, and we are working across government to ensure that ill health does not hold our children back from fulfilling their potential. The Government have already put in place a well-developed reporting framework—the public health outcomes framework—that supports health improvement and protection at all stages of life, especially in the early years. The framework includes a large number of indicators on children and young people’s health and, along with the NHS outcomes framework, sets a clear direction for children’s health that allows anyone to hold us to account.

We are committed to improving access to better services and to promoting early intervention to address children and young people’s mental health issues before they worsen. We are investing £1.4 billion in that over the next five years, and we have invested more than £120 million to introduce waiting time standards for mental health services—the first time that we have done that.

If we concentrate our actions and resources on the root causes of child poverty, such as worklessness and education, that will be the springboard from which everything else will follow. While the Government recognise the importance of tackling child ill-health, these amendments would ultimately distract the Government’s focus and finite resources from what is most important for our children’s future life chances. For these reasons, I cannot support the amendments of the noble Lord and the noble Baroness.

Amendment 7, tabled by the noble Lord, Lord Ramsbotham, would require separate reports for measures of worklessness and educational attainment. We are already committed to reporting on these measures and believe that it is sensible to deal with them together as they are jointly fundamental to improving life chances.

Amendments 9, 10, 12, 13 and 14 are consequential on Amendment 7 and therefore, in the Government’s view, unnecessary.

Once again, I thank noble Lords for their contributions but, on the basis of what I have said, I urge the noble Lord to withdraw his amendment.

[The Earl of Listowel]

Before the noble Lord sits down, will he reassure the House about the future of health visitors? Clearly, they have a very important role in the welcome things that he has just said. The Government have done a great job in recruiting and developing the workforce, but now that responsibility for health visitors has been moved to local authorities, which must fund them, there has to be a concern that in the current atmosphere for local authorities we may go backwards and health visitors will not be commissioned to do the work that is so necessary in relation to what we have just been discussing. Perhaps the noble Lord would consider writing to noble Lords who are interested in this area about the mechanisms that exist to ensure that that does not happen.

[Lord Freud]

I shall be happy to write.

Welfare Reform and Work Bill

Debate between Earl of Listowel and Lord Freud

Monday 21st December 2015 Lords Chamber

[The Earl of Listowel]

My Lords, I am grateful to the Minister for the care with which he is responding to these concerns, particularly about children. He will be aware of a recent small study dated November 2015 from the University of Manchester on the impact of the bedroom tax. It found that children were hungry and were having difficulty in concentrating at school. The response from the Minister’s department was that this was a small study which did not fit the larger picture. I would be grateful if, before Report, he could send a letter setting out what research will be undertaken in the 12 months following the implementation of this provision. What research will be commissioned to look carefully into the impact on children? I take his point that many children will benefit from their parents going into work but I am worried about those who do not.

[Lord Freud]

It was a small report on, I think, 14 children, and we aim to look at things on a much safer basis. I ask the noble Baroness to withdraw her amendment.

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[The Earl of Listowel]

My Lords, I would be grateful if the Minister provided a little detail on the research that will be coming forward after the Bill is enacted so that I and we can see its impact on children. For instance, for some time now the University of East London has been researching the issue of family homelessness. Is the Minister thinking of talking to such institutions? Going back to the previous debate, it is important to get some high quality research that goes into the detail and granularity of the impacts of these measures.

[Lord Freud]

The noble Earl will be aware that an enormous amount of research is conducted in this area. I will write to him with anything specific that I can on our research proposals.

Welfare Reform and Work Bill

Debate between Earl of Listowel and Lord Freud

Monday 14th December 2015 Lords Chamber

[Lord Freud]

We have not yet put out the detail of the transitional regulations and that is where one would expect to see them. We will be producing some precision in how the regulations will work.

[The Earl of Listowel]

My Lords, I am grateful for the Minister’s response and for the work which the Government do to support care leavers. I omitted to say why Amendment 62D was timely: today, research from the University of Lancaster highlighted a huge leap in the number of newborns being taken into care. In 2008 it was about 800, in 2013 it was over 2,000; a very considerable number. Some of that is down to better early intervention; taking children very quickly out of damaged families. However, Nicky Morgan, the Secretary of State, is concerned about this and it suggests, again, that we need to be even better at supporting these vulnerable families. I hear what the noble Lord has said and I will look carefully at it.

Welfare Reform and Work Bill

Debate between Earl of Listowel and Lord Freud

Wednesday 9th December 2015 Lords Chamber

[The Earl of Listowel]

Before the Minister replies, it might be helpful to remind him that the amendment on targets is in the next group. I quite understand why he might choose to address it here but the amendment he is addressing that I and my noble friend tabled is simply about the measurement. I think the noble Lord, Lord Kirkwood, began the argument on targets but my amendment was intended to be strictly on the measurements.

[Lord Freud]

In practice, that is not the case. There are two sets of amendments in this group and Amendment 46 from the Opposition deals with the targets so I must deal with both issues. That is what I have been trying to do. I hear around the Chamber that more noble Lords are concerned about measures than targets.

In reality, there is only one word between us: statutory. I made a commitment that we will go on publishing HBAI and that is a protected position. Let me just explain how that works. The HBAI is a national statistic. That means that it complies with the code of practice for official statistics, which states that it must be produced independently of political influence. Any changes to HBAI in future would therefore be made only following the judgment of the head of profession for statistics in the Department for Work and Pensions. Any such changes would be subject to formal consultation with users, as required under the code of practice for official statistics. I think I am on reasonably safe ground in assuring noble Lords that we currently gather HBAI with a full documentary analysis. Like the noble Baroness, Lady Lister, I have that on paper in front of me or on my shelf. That has on it not only the Excel tables but also a clear commentary. By implication, I am saying that that will go on being published in a similar format.

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[Lord Freud]

I think the noble Baroness, Lady Lister, will support me here but my memory is that the material deprivation figures are in the HBAI statistics. She nods that that is the case, so I can confirm that.

I shall summarise briefly. I am not in a position to give noble Lords the one word they want, but hope I have indicated that the measures will be available to see what is happening to relative child poverty. I am convinced that it is our new life chances measures—the measures rejected six years ago by the noble Lord, Lord McKenzie, which focus on the key drivers of worklessness and educational attainment—that will make the biggest difference to children, and that these amendments, were they on a statutory basis, would dilute that focus. We want to focus on the measures that make a real difference to children’s lives. I therefore invite the noble Baroness to withdraw her amendment.

[The Earl of Listowel]

I am grateful to the noble Lord, and, in particular, to the noble Baroness, Lady Stroud, for raising the questions that she did. As I said earlier, I am particularly concerned about the life chances of care-experienced adults and young people leaving care. In earlier debates the Minister assured me that there were strategies, and I know that there are many welcome investments, in terms of statute and finance, to improve outcomes for care leavers and care-experienced adults. However, the latest figures on 19 year-olds coming out of care who are not in employment, education or training are the worst for many years. Only 6% of young people leaving care are going on to university, compared with 40% in the general population. Despite massive investment by this and previous Governments in improving educational and work outcomes for young people leaving care, it is still not being as effective as one might wish. I think that what is being done is very good, but there needs to be a lot more work.

Then there are the young people on the edge of care, who do not reach the threshold. There are many more young people and children in need, who will have even worse educational and work outcomes. That is relevant to this debate, because what happens to these young people as they become adults, when they have such low educational qualifications that they cannot get on to apprenticeship schemes, have very little prospect of getting work and are likely to remain uneducated? One should always remember that many of them do do better in later life; because of early trauma, it takes them time to catch up. This large group may not be as susceptible to the incentives to work, or go on to further education, that the Minister is talking about. They might be particularly helped by measures of this kind, which focus on those in long-term poverty, and which would keep Parliament’s mind on them and how they are doing. I hope that that makes sense to the Minister. He might like to write to me if he cannot respond now.

[Lord Freud]

I will write, because the issues that the noble Earl raises are genuinely important and difficult. We are all struggling with them. As we develop the life chances suite, we need to bear in mind the particular problems for those people, because as a group they have much poorer outcomes than they should.

Welfare Reform and Work Bill

Debate between Earl of Listowel and Lord Freud

Monday 7th December 2015 Lords Chamber

[Lord Freud]

No. Every year I stand here because there is a forecast that says that child poverty is going up, has gone up or will go up, but when we actually see the figures we find that child poverty has actually gone down; the Government have been impressed and shocked by that. When you transform the economy, change the culture so that work is what has been driving things, and move up the employment rates and the earning rates in the way that we have, you find that the behavioural impacts are very different from the static analysis that many of the external experts tell us about.

[The Earl of Listowel]

My Lords, it is late so I will ask just two brief questions. I thank the Minister for his response. Can he give an indication of when a homelessness strategy might be produced, or is there already one that I am not aware of? He has mentioned that there are various kinds of homelessness, such as overcrowding and unfit accommodation. The one that is of most concern, though, is housing insecurity, when families just do not know where they will be from one day to the next. What is the strategy to deal with that? Is one forthcoming? How often does the interdepartmental group meet? Perhaps he might like to write to me on that last question.

I have been talking with practitioners working around the troubled families initiative, which I warmly welcome. Their work is much undermined by the fact that they build a relationship with a family, as they must and do very effectively, but then that family is moved somewhere else because the accommodation was private and temporary, and there just is not the security of tenure that there needs to be. Perhaps the Minister could help me with those questions.

[Lord Freud]

As I said, we will be putting out the life-chances strategy in time. The interministerial meets every quarter, I think.

[The Earl of Listowel]

Sorry, but I am asking about a homelessness strategy, dealing with the particular issue of housing security for families.

[Lord Freud]

Is the noble Earl talking about the interministerial meeting, which deals with those issues? Yes, I think it meets quarterly.

[The Earl of Listowel]

That is very helpful.

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[Lord Freud]

What we are doing is working with local authorities to support them in getting at the root causes. That will be our strategy.

[The Earl of Listowel]

While I am grateful to the Minister for that information about the interdepartmental group and how often it meets, I wonder if he could give an indication of whether it is looking to develop a strategy specifically for housing security for families, or whether he might be prepared to take back to that group a request from this House—at least, from myself—that such a strategy should be developed. This seems a very important area.

[Lord Freud]

I will be pleased to do that.

Welfare Reform and Work Bill

Debate between Earl of Listowel and Lord Freud

Monday 7th December 2015 Lords Chamber

[Lord Freud]

I would never launch something at noble Lords on Report in that way. Let me go and think about how I might present some useful figures in a reasonably timely way. That is not a promise to produce anything more than I have but I will look and see whether I can be more helpful, given that I clearly have not been now.

[The Earl of Listowel]

My Lords, will the Minister consider writing me a letter about improving access to childcare for disabled families?

[Lord Freud]

Can I look at that? I am not sure quite how much of this is in my own purview. If I can, I will.

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[Lord Freud]

That is the best I can do at this stage. However, I accept that that is a bit tentative as an answer, so I will look to get the noble Baroness a better answer, or as full an answer as I can provide after talking this through with colleagues.

The Government believe that these changes strike the right balance between protecting the vulnerable—we have discussed the extra support for families with disabled children—while encouraging families which receive both child tax credit and universal credit to make the same financial decisions about the number of children they can afford as are made by those families who support themselves solely through work. They help to make the welfare system sustainable and the move towards a high-wage, lower-tax and lower-welfare country. Clauses 11 and 12 should therefore stand part of the Bill.

[The Earl of Listowel]

Before the noble Baroness responds—and I do not wish to keep the Committee from its dinner—while I thank the Minister for reminding us about the very welcome new higher minimum wage that the Government are introducing, looking at figures from the Institute for Fiscal Studies on projections for the difference that that will make, it has been clear to me that the complex way in which the tapers work will often mean that, for instance, lone working parents will not benefit that much more from this new, very welcome offer. Therefore I encourage your Lordships to keep that in mind. It is a very welcome offer but it may not make that much difference to the families that we are concerned about today.

[Lord Freud]

I will just deal with that. In universal credit we are producing something very clearly tapered, without the trap at the 16-hour point, which is in the current legacy welfare system. Therefore we have a pathway. One of the things we are doing, particularly for lone parents, is that once you are freed from that tyranny of the 16-hour rule, it is interesting how firms in the north-west, where that is already happening, are able to work with those people and start moving them up the earnings progression—not just as regards the number of hours but earnings progression—and we are beginning to see signs of a transformation. That is behind some of these changes—we want to make people independent of the state as much as we can.

Welfare Reform and Work Bill

Debate between Earl of Listowel and Lord Freud

Monday 7th December 2015 Lords Chamber

[Lord Freud]

Clearly there is a difference between the voluntary and involuntary taking on of children, whether they are your own or anyone else’s. That is what our exemptions are for. We are seeking to try to draw the line between where it is involuntary, as in the case of rape, and where it is not.

[The Earl of Listowel]

First, I thank the Minister for his response, in which he said clearly that he is listening to the concerns raised in what has been expressed in the debate. Perhaps I should speak only for myself. I feel very anxious indeed about the welfare of the children whom we are discussing. I am anxious that children in care or on the edge of care might not have the prospect of a secure home that they currently have if this legislation is brought into being. I would be grateful if the Minister could act as soon as possible to reassure me on this. I am sure that this is a concern for all noble Lords in the Committee.

The question I want to raise with the Minister relates to his introductory comments on the rationale for the two-child limit in terms of child tax credit. I am sure that he will correct me if I am wrong, but he said that the Government are assuming that people make a rational choice when they choose to have a third child, and therefore, given that they are making a rational choice, that it is fair to say, “Of course the state will allow you to have another child, but it will not subsidise that additional child, or at least not to the extent that it has in the past, so you should bear this in mind if you are thinking of having a third child”. That is my rough understanding of what the noble Lord is saying.

When I think about young people in care, I know that most of them come from poverty in the first place, and many of them will go on to have families in poverty. Many will not get good qualifications; only 6% currently go on to university compared with 40% of the wider young people’s population. Their educational attainment remains stubbornly low. On apprenticeships, one hears all the time that these young people do not have the basic mathematical and literacy qualifications to get on to an apprenticeship scheme. So many young people leaving care will end up in poverty.

But we also know that many of them will have children very early. Many young women have children while they are still in care, and many will have them immediately after they leave. This, I suggest, is not a rational choice on their part. One reason that is often given, which seems to me plausible, is that, because they have never been loved themselves, they want to have a child who they believe will love them—and they will have other reasons for starting a family so early. However, they are not starting from a rational point. So my concern—which we will debate this more fully—is that this aspect of the Bill will be particularly disadvantageous to care-experienced adults and care leavers. They will be penalised because their lives are sometimes so chaotic and unhappy that they will start large families and they will be poor, and this area of the Bill will make them poorer still. I wonder if the Minister might say whether he has thought through the implications for care leavers and care-experienced adults of this aspect of the legislation in terms of penalising people who seem to choose to have larger families and who are poor.

[Lord Freud]

I know that the noble Earl is very concerned in this area of the care leaver and I understand exactly where he is coming from. Clearly the Government have a great deal of concern about some of these outcomes for young people in care—the noble Earl touched on some of the figures—but the choices, rational or not, should not be different from those of people who have to support themselves. I know that we will come back to this issue slightly later so I will stop on that particular point because we are dealing with another one today.

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[Lord Freud]

I am trying to think of another example because, as the noble Baroness knows, we are trying to incorporate all means-tested benefits. The main one is housing benefit and the other one that the noble Baroness may be thinking of is support for council tax where we have not made any provision because each council has its own policies. I cannot think of any other means-tested benefit to which, once universal credit is in and working, that would apply. I think that I have dealt as best I can with all the points raised and, for the reasons set out, I urge noble Lords not to press their amendments.

[The Earl of Listowel]

My Lords, I am grateful to the Minister for his responses. I am reminded by what he said of the importance of universal credit, which I think we all support in terms of enabling more people into work. I pay tribute to the Government one more time for their achievement in getting so many of our people into work after a time of such austerity. It is hugely important for families and for all of us.

I also thank the Minister for his acknowledgement of the work that I do and the interest I take in looked-after children. I have a specific question. The Minister talked about important strategies that the Government have developed for care leavers, which are very welcome indeed. But we know that outcomes, despite this good work, are often still very poor for care leavers. Will the Minister consider making an exemption among those that he is considering specifically for care leavers in this regard? Separately, will he consider making a similar exemption for care-experienced adults? These young people and adults have had a disastrous start in life and often their experience in the care system is unsatisfactory, with much instability. As a society, we should consider exempting them because of the histories that they have experienced.

I listened with interest to the noble Lord, Lord Lawson, in his riposte to the noble Baroness, Lady Hollis. If I understood him correctly, he said that we should bear in mind that for the taxpayer, payments of this kind are not popular. Hard-working taxpayers may well not wish to pay other people to have more children when they have had to make hard choices themselves about clothing and schooling their own children. I take his point, but just because a measure is not popular, it is not necessarily not the right thing to do.

As an example, the decision by the Prime Minister to make a commitment of 0.7% of gross national income to the Department for International Development seems to have been pretty unpopular, but I certainly think that it was the right one. It becomes clearer and clearer that it was the right decision when we look at what is going on in Syria. I may well be mistaken, but my personal view is that it seems more and more right when we consider the instability in Syria and other places.

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[The Earl of Listowel]

I thank the noble Lord for drawing that to my attention and I shall make it my business to read that finding.

Perhaps I chose a poor example, but often decisions that are unpopular can be the right decisions to make. Governments have a little more time to reflect and can decide that the cost of bringing children up in poverty has such long-term problems in terms of poor educational outcomes, imprisonment and later dependency on the state that despite such a policy being unpopular it is worth while investing in large, impoverished families to prevent their offspring becoming dependent on the state later on.

The Minister said that the average size of families was 1.7 children. What is the average size of families on benefit and the average size of a family in poverty? My sense is that they tend to be larger families and that this particular legislation will penalise larger families.

[Lord Freud]

Taking the noble Earl’s points in order, we need to have good strategies for care leavers. Clearly, the statistics are disturbing, and they have been for decades. I am not utterly convinced that exemptions in this particular area are the best way of supporting care leavers. There are other things that we can do that are way ahead of this. However, we do now flag care leavers in the benefit system so we know who they are and we can look at what they are doing, certainly with JSA, and I hope that we will be putting that into UC, although I am not absolutely up to date on where we are with that system.

On the noble Earl’s point about popularity, it is important that the benefits system does not become unpopular because that will undermine its legitimacy. It could be argued that one thing that we are doing now is creating a benefits system that has legitimacy and acceptance because it is perceived to be fair and to drive the right outcomes, which is not something that people feel about the legacy benefits system. That is a subtle point and closely related to what we are doing here.

The figures that I have seen, which I am afraid I cannot recall off the top of my head, show that very rich families and very poor families tend to be larger than those in the middle—thereby hangs a tale that goes to my noble friend’s point about who can afford to have large families. But I will have to write to the noble Earl with the exact figures.

Poverty and Social Exclusion

Debate between Earl of Listowel and Lord Freud

Thursday 17th July 2014 Lords Chamber

[Lord Freud]

Maybe I am not the best person to comment on Liberal Democrat manifesto planning. I can, however, assure the House that the removal of the spare room subsidy remains government policy—and I remind the House that this was coalition policy, which was decided in 2010 at the highest levels of government.

[The Earl of Listowel (CB)]

My Lords, I warmly welcome the excellent steps that this and the previous Government have taken in improving support for young people leaving local authority care, but may I draw the Minister’s attention to today’s report from the Education Select Committee in the other place, which highlights the fact that too many young people from care are going into bed-and-breakfast accommodation? There is still a lot of work to do, so will he look at that carefully? I also ask him to look at the next iteration of the care leavers strategy, which his department has been involved in, and to ensure that health, particularly mental health, is fully included, so that young people of 16 to 25 leaving local authority care, and the people who support them, have the excellent mental health support they need to avoid those young people entering social exclusion and poverty?

[Lord Freud]

The noble Earl is absolutely right to concentrate on this issue because this group has traditionally done disproportionately badly. We have taken steps to ensure that these young people are better off in terms of housing than youngsters who are not coming out of care. As regards the mental health issues, it is absolutely correct to concentrate on the fact that a large proportion of people develop long-term disabilities due to mental health issues. We are devoting a lot of energy to consideration of that area.

Employment: Universal Jobmatch

Debate between Earl of Listowel and Lord Freud

Tuesday 11th March 2014 Lords Chamber

[Lord Freud]

I do not have to hand how many prosecutions we have made, but I will of course write when I know that information.

[The Earl of Listowel (CB)]

My Lords, as more people are being encouraged into work, is the Minister aware that unidentified mental health needs are becoming more apparent? How can these people be helped to address their mental health needs so they can benefit from the services of the kind he is discussing?

[Lord Freud]

The greater intensification of the relationship between the jobcentre and claimants as a result of universal credit and the claimant commitment has begun to unpick some of the challenges and barriers that claimants face. One of those, clearly, is mental health and we are undertaking an exercise to look at how we can help such claimants. That is not easy. No one in the world has managed to achieve this. We are currently looking at doing a series of pilots to find out how best to help people with mental health problems.

Universal Credit Regulations 2013

Debate between Earl of Listowel and Lord Freud

Wednesday 13th February 2013 Lords Chamber

[The Earl of Listowel]

My Lords, I shall share some concerns with your Lordships about the regulations but, first, I underline my support for the principle behind the introduction of universal credit. I recall, when I first entered this House, the work of Louise Casey, who was then the rough sleepers’ tsar, appointed by the then Prime Minister. A key part of her successful programme in reducing the number of rough sleepers on the streets was to find purposeful activity for those who had been homeless. It seems to me such a curse that many people are not finding useful things to do with their time and are allowed to fester, sometimes for generations, without being actively involved and engaged in productive work on a daily basis. I welcome the fact that the legislation will make that more possible for more people.

My concern is about vulnerable families. I recall for your Lordships what my chemistry teacher used to say to me. He talked about dynamic equilibriums. I suggest that vulnerable families are subject to a dynamic equilibrium. If they are given the right support, they can thrive and do well. We saw that recently again with the work of Louise Casey, who has been tasked by the right honourable gentleman Iain Duncan Smith, I think—or at least by the Government—with looking at the 120,000 most troubled families and making a difference in their lives. Through her work supporting those 120,000 families, she has managed to decrease significantly the level of domestic violence in their homes and to increase significantly the number of their children attending school on a regular basis. It is possible to act on the positive side of that equilibrium and make a difference to families.

On the other hand, one can see that if one puts those families under too much stress, they can fail. I was reminded recently of that experience when I visited Feltham young offender institution and spoke to prison officers. I had not visited for 10 years, but the same theme came through: so many of the young men with whom they were dealing had never known their fathers—had never had fathers—and the officers found that they had to adopt that role for those young men.

It is critical to support those vulnerable families in the best way that we can. I thank the noble Lord, Lord Eden, for his speech. In this extremely difficult time, when local authority funding is being cut by 28%—and there will be further cuts to services—which is impacting very heavily on services for vulnerable families and their children, a complex change such as this has to be carefully considered to minimise any adverse impact on those families.

So I welcome the principle, but I have concerns about various issues. They have all been raised this afternoon, so I need not go into detail. I was grateful for what the Minister said about the monthly payment of housing benefit to families. There is the payment exemption scheme, which he described, and he is paying particular attention to drug and alcohol misusing families and those with gambling problems. I welcome that, but I share the continuing concern of the noble Baroness, Lady Hollis, that that may well not go far enough. I found what she said very persuasive: there is a danger of underestimating the chaos in many of those families and their inability to manage their finances in the way that we and the Minister would like.

With regard to childcare, important questions have been raised about significant increases in the cost of childcare to families. The changes to housing benefit and the limit on the number of bedrooms that families can have is clearly putting a lot of stress on some of our most vulnerable families and may cause some of them to have to uproot and move to new areas and communities in which they know no one. They may easily feel isolated and, again, are at risk of collapse. I am particularly concerned about the ability of foster carers to keep a room open for a fostered child. In the past, the Minister has gone quite a long way in reassuring me on that point but I would be grateful if he could go further in reiterating that today.

Finally, the right reverend Prelate the Bishop of Worcester and others alluded to the concern raised by the Children’s Society, and by my noble friend Lady Grey-Thompson in her report, about how this all impacts on children with a disability. He was concerned that these are often the poorest families, struggling to make ends meet. Given that 100,000 of these children will be up to £28 worse off under the new arrangements, that is a very real cause for concern. I hope that the Minister can say something about how he will monitor the situation for these children carefully and that he will go as far as he can in offering me reassurance on this point.

To conclude, in my experience vulnerable families exist in a dynamic equilibrium. Given the right support, many of them can do a lot better and their children may perhaps break through the generational failure that that family may have experienced. Without the right support, however, particularly in such difficult times, one will often find that their children will fail and possibly end up at Feltham young offender institution, costing the public purse well over £40,000 or £50,000 a year to maintain them there. It is crucial that we get this right and I look forward to the Minister’s response.

[Lord Freud]

My Lords, I give really sincere thanks to everyone who has spoken because I do not often hear a debate where people have worked quite so hard to understand the issues. I might not agree with everything that people have said but the quality of debate has been pretty extraordinary, given the complexity of the issues we are dealing with. I hope that your Lordships all know now that I listen very hard—and I steal or plagiarise as much as I can—so a lot of what your Lordships have said has fallen on fertile ground.

Let me deal with the amendment proposed by the noble Lady, Baroness Sherlock. There are some serious misconceptions in it about what universal credit will do. First, on work incentives, the fact is that universal credit will change them out of all recognition—and manifestly for the better because it will reduce participation tax rates and take away some of the scandalously high rates under the current system, which may be 91% or even 100% in some cases. There are some losers but they are losing, on average, a rather modest 4 percentage points. In many cases, the increased marginal deduction rate is because people are being brought into entitlement for UC, so they are actually better off. They may have a higher marginal deduction rate but have become better off because they have been brought into universal credit.

I do not agree that universal credit penalises savers. In practice, it corrects an overgenerosity in the current tax credit system. It must be right to focus our resources on those households with the fewest resources. Under universal credit, claimants will be able to save up to £6,000 without any impact on their entitlement, in contrast to the typical working-age household, which has £300 in savings.

We are not cutting childcare support; we are investing an additional £200 million in it when we remove the 16-hour rule, which we think will help an additional 100,000 families. The combination of childcare support, higher work allowances and a single taper rate will provide a clear financial incentive that rewards work.

We estimate that around 3.1 million households will have a higher entitlement as a result of universal credit. It is true that, on a static analysis, some households will receive less benefit; however, in practice, we expect that people will adjust their working patterns where they can and will be able to gain—as they can under universal credit. I cannot agree that universal credit is bad for women and lone parents. We know from the experience of tax credits that, in practice, lone parents are among the groups most likely to respond to the financial incentives in the system. In any case, even on a static analysis, in the 3.1 million households that gain there are 2.6 million women. Lone parents will on average gain around £5 per month.

Throughout the passage of the welfare Bill and in recent months, we have debated at length the support for disabled people. We recognise the concern about the impact of the severe disability premium but our aim here is to target additional support on those who have the most severe disabilities or health conditions and who are unable to work, or to work full-time. On average, disabled households will gain by £8 a month. Responsibility for assessing and meeting significant care needs sits with local government. This week, we have set out proposals to put the longer-term funding of such care on a better footing. However, I put on record again my personal commitment to ensuring that we carefully monitor and evaluate the impacts of UC on disabled people.

Universal credit provides appropriate support to self-employed people but only in so far as self-employment is the best route for them to become self-sufficient. As I said in my opening remarks, we have carried out extensive engagement with groups representing businesses and the self-employed, and have responded to their concerns.

In relation to housing, universal credit provides fairness and responsiveness to the housing choices that working families faced already. The best protection against homelessness is a job. Universal credit will provide work incentives and support people in moving into work. Discretionary housing payments are available to help those at risk of being homeless.

The amendment implies that the objective of universal credit is as a savings measure. Nothing could be further from the truth. We are spending more and have huge ambitions to change people’s lives. In any case, we will be monitoring outcomes very carefully. We published a high-level evaluation framework in December 2012, which sets out our proposed evaluation approach and our key aims and objectives. I am happy to reassure the noble Baroness, Lady Lister, that the evaluation of universal credit comprises part of a continuous programme of analysis. It provides real-time evidence and information, as well as a measure of overall impact and success further down the line, although it will take time to assess how different groups experience universal credit and to build up a clear evidence base.

Implementing a system that is dynamic and responsive is at the heart of these reforms. That is why the welfare Act contains a provision to enable the piloting of changes to the system that aim to achieve simplification or change claimant behaviour to improve their labour market outcomes. I am happy to reassure my noble friend Lord Kirkwood that I will personally value continuing the dialogue with this House. I know that this House knows how much it has put into the creation of universal credit.

There were a huge number of points and I will do my best in the limited time to touch on them. The noble Lord, Lord Touhig, requested a lot of detailed figures on IT. I think I will write to him with details, as I have dealt with quite a few of those points in recent PQs, but I will make sure that the noble Lord has an up-to-date list of exactly what we are spending in each year. As I said, I will not go into detail, but we are on time and on budget, we are pushing ahead and we are starting with a pathfinder, to make it work, in April.

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[The Earl of Listowel]

Before the Minister sits down, if it is in order in this procedure of the House, may I ask him a question? I was grateful for his reassuring reply to the noble Lord, Lord Eden, about the great efforts he is making in looking at the administrators and the support and training they need. If he will write to me with some idea of the minimum standards for the supervision of administrators that he might be considering, I will appreciate it.

[Lord Freud]

I will be pleased to write.

Child Poverty

Debate between Earl of Listowel and Lord Freud

Tuesday 26th June 2012 Lords Chamber

[Lord Freud]

My Lords, one thing on which there has not been enough focus is the importance of behavioural impacts. Income transfers have their place in tackling poverty but they are simply not enough. Behavioural changes are required, and one thing about universal credit is that it brings a change in work incentives, as well as some very precisely targeted income transfers. Vocational education and apprenticeships in this country have just not been adequate, and we have not looked after vulnerable groups—I am thinking of those leaving care and prisoners leaving prison. We need a large number of strategies to tackle this very difficult problem.

[The Earl of Listowel]

Education is the key route out of poverty. Will the Minister encourage his colleagues to look still more closely at the Finnish education system, where 20 candidates compete for each teacher training place, where every teacher, whether in primary or secondary school, has a masters qualification and where excellent results are achieved in numeracy, literacy and science? With regard to young people in care, will he consider again looking at the continent, where he will see how much more qualified the staff in children’s homes are compared with those in our country? Surely these are the children most at risk of poverty. Their carers and the people around them should have a high level of qualifications—ones that they can aspire to themselves.

[Lord Freud]

Yes, my Lords, this is an important point. We have a different approach from many of our continental peers. Looking at the figures, we do not seem to be doing well enough in some of these areas. When there are people who need real support, we need to look more closely at the education of the workforce.

Welfare Reform Bill

Debate between Earl of Listowel and Lord Freud

Wednesday 16th November 2011 Grand Committee

[The Earl of Listowel]

My Lords, I support the amendment. Does the Minister think that it might be worth while if he made a few comments on the issues of continuity and supervision of staff? I hesitate to ask because I am unfamiliar with this area but in the areas of the asylum and immigration process, which has some similarities, and in social work and work with vulnerable children and families, the two themes seem to be, first, continuity of relationship wherever possible and, secondly, good quality supervision.

[Lord Freud]

I apologise to the noble Earl, Lord Listowel, for not responding to that point previously and I intervene to do so. There is a huge difference between a one-off assessment—which you may not repeat for another five or 10 years or never again—and an ongoing relationship in the Immigration Service. It is not a relevant analogy at all.

[The Earl of Listowel]

I suspected it might not be. For people with fluctuating conditions, where there is a likelihood of their going back on repeated occasions, perhaps one could sort out within a particular group individuals who would benefit from having regular contact with the same person. In the spirit of co-production, some individuals who are going to be assessed on a repeated basis may perhaps like to choose the person they deal with. However, as I say, I do not know how it works in practice at the moment so this may be by the by.

On listening to this debate, the question of the supervision which takes place in the social care arena seems to be pertinent. I am grateful to the Minister for making it possible for a social worker to visit the officials working on this and to discuss matters of supervision. In social care it is very important for front-line staff to receive quality supervision on a regular basis for three purposes: first, to check that they are doing the right job; secondly, to check that they are receiving the right continual professional development; and, thirdly, to ensure that they are not responding inappropriately to the clients.

On the third purpose, we all come to life with our experiences, and some assessors may find it difficult to work with particular clients who rub them up the wrong way. They need to be able to go to their supervisor and say, “Look, I feel really uncomfortable working with this person. I am not sure it is actually anything to do with them. Can you help me to sort this out?” They need a sounding board, if you like. That is one aspect.

On the continuing professional development side, this is a training aspect to check that they are continually building on their understanding of, let us say, autism. They will start from a point of ignorance but, in the course of years of experience, they will learn more and more. They are helped to do so and their supervisor ensures that they get the opportunities for that learning and enrichment. It is a draining job and the people doing it need to be recognised, supported and enriched. I have covered those three points but, as I say, I am not sure it is pertinent.

The proposal for a trial arrangement might allow an opportunity for us to find the most effective kind of supervision we can afford to provide and where there are opportunities to build continuity of relationship with clients.

I have an amendment later in the Bill which relates to how one manages the system and the culture in this area. If the people at the very top of some of these organisations had experience of social care—if one could be confident that there was a senior social worker at the top of the Jobcentre Plus arrangements, or whatever—they would have the necessary insight and the understanding to help people on the front line who will need a system of this kind to assist them in working with vulnerable adults. In that way, even with limited resources, the best outcomes could be achieved in the circumstances.

However, I will come to that amendment later. I look forward to the Minister’s reply.

Welfare Reform Bill

Debate between Earl of Listowel and Lord Freud

Thursday 10th November 2011 Grand Committee

[Baroness Howe of Idlicote]

My Lords, I had not intended to speak but, listening to the debate, I think that the opposition expressed by the noble Lord, Lord McKenzie, would provide the necessary time to reconsider the effects that the Bill will have in this respect. I also agree with my noble friend that the business about child support is a problem. Quite apart from the cost, the quality has come under quite a lot of doubt recently. The major point that I want to make is about stress on parents. I invite your Lordships to think about how stressed all of you have been by the extensive amount of work we have all had to consider recently, and bear that in mind when you come to consider whether or not to support this amendment.

[Lord Freud]

My Lords, with regard to the point made by the noble Baroness, Lady Howe, on how we could take it slightly easier, I regret that I cannot apply it to myself because my children have gone way past that age, although they do not seem to be any less stressful.

Our policies for lone parents are based on the key principle that work is the surest and most sustainable route out of poverty. In June last year we announced our intention to align the age at which lone parents could reasonably be expected to work with the time their youngest child enters school. Current legislation, yet to come into force, provides that income support must be made available to lone parents with a child under the age of seven. This clause lowers that age to five so that lone parents with children aged five or over will no longer be entitled to income support solely on grounds of lone parenthood. We would effect this change through regulations, and implement it drawing largely on the experience of having progressively lowered the age from 16. Support for these lone parents will be available through jobseeker’s allowance or employment and support allowance if they meet the relevant conditions of entitlement, or through income support if they qualify on grounds other than lone parenthood, most notably if they are carers.

We want to encourage lone parents to enter work but not at the expense of the crucial role they play as parents. We intend to carry forward the current safeguard that allows those with children aged 12 or under to restrict their availability for work to school hours. It is worth reminding noble Lords of the powerful impact that this policy has. When the age was brought down to 12, 16 per cent of lone parents leaving income support went straight into work and 56 per cent went on to JSA, many of whom will have subsequently gone in to work. We estimate that bringing the age down to five could lead to an extra 20,000 to 25,000 lone parents in work. Children in workless lone parent households are almost three times more likely to be in relative poverty than those where the lone parent works part-time, and five times more likely to be living in relative poverty than children of lone parents working full-time.

The noble Lord, Lord McKenzie, asked about flexible work. The Government are keen to promote flexible working and have a strong commitment to greater family-friendly working practices. We have committed in the coalition agreement to consult on extending the right to request flexible working to all employees. The public consultation process ended recently and we intend to respond to the comments by the end of the year. We understand that stimulating real culture change to make flexible working practices the norm across the whole labour market requires more than just regulatory change on the right to request. There also needs to be help for employers to operate in a more flexible way and demonstration of the benefits it can bring to them and their employees. The Government have a role in leading culture change. This is why we are working with business leaders and employers to promote the business case for flexible working and ensure that employers know where to go to find support to implement practices in their organisation.

This clause also amends Section 8 of the Welfare Reform Act 2009, which relates to the possibility of requiring work-related activity from certain lone parents with children aged under seven. Section 8 as it stands would require regulations in this respect to be subject to the affirmative resolution procedure. This clause lowers that age from seven to five, in alignment with the lowering of the age for withdrawal of income support on grounds of lone parenthood alone. The key question asked by the noble Lord, Lord McKenzie, was whether it is right to make this change now rather than waiting for the introduction of universal credit. Introducing this change before introducing universal credit will help more lone parents into work, with knock-on reductions on child poverty.

A recent evaluation of lone parents’ experiences of moving into work also found that working had had a number of positive effects on their children, both direct and indirect. These range from children having the opportunity to go on school trips because of extra family income to observing the good example of a working parent and greater independence, both financially for the parent, once in work, and for the child, in terms of their role in the household. Help with childcare costs is currently available through tax credits and the flexibilities in JSA mean that childcare responsibilities are taken into account. There are a range of flexibilities available: lone parents with a child aged under 13 can restrict their job search and availability to their child's school hours, while lone parents will not be sanctioned for failing to meet requirements if they had good reason for the failure. Access to appropriate childcare will be taken into account before a decision is made.

On the state of the economy, we have to bear in mind that even in difficult times—which I accept that we are in—Jobcentre Plus holds an average of 275,000 unfilled vacancies at any one time, around a quarter of which are part-time opportunities. Clearly those figures are a snapshot which hides the number of new job opportunities that come up all the time. On average, about 10,000 new vacancies are reported to Jobcentre Plus alone every working day, while many more come up through other recruitment channels. It is not worth getting into a huge debate about the meaning of these figures but, as noble Lords understand, much of our approach to the work programme is aimed at trying to help the people who have not managed to get a job reasonably early back into the market. As the numbers of unemployed get bigger, one factor we are looking at is the average length of time that people are unemployed. As I say, there are flows all the time and many lone parents have excellent opportunities to find a job. Even in difficult times, there are still jobs going. On that basis, I commend Clause 57 to the Committee.

[The Earl of Listowel]

My Lords, I thank the Minister for his helpful reply. I want to check with him about the question of school hours. Does that really mean “school hours”, and will the adviser take into account that the person will have to travel for an hour or an hour and a half to get to work, and back again at the end of the day, so that it will go over school hours? Does it also mean that if a job requires someone to work in the school holidays as well, that will be seen as an inappropriate job for that person? I would guess that it clearly means that, but I would appreciate a response to my first question.

[Lord Freud]

On working in school hours, it is quite clear that the working includes the travelling time. It is incorporated in that and it is clear in the legislation. To refer back to the noble Lord’s earlier reading of the e-mail, I could not resist making the point that we still remain grateful to the Egyptians for inventing papyrus. Maybe in another couple of years we will have dumped it.

--- Later in debate ---

[The Earl of Listowel]

My Lords, at the last Conservative Party conference the right honourable Iain Duncan Smith talked about 1 million children in this country being born into families where the parents are either substance misusers or misusing alcohol, so clearly it is key that we address this problem from the point of view of the welfare of children. Perhaps this is a good time to offer my congratulations to the Government’s drug treatment agencies and the UK Border Agency on the reduction in the use of class A drugs in recent years. However, it is still a very significant problem, while of course alcohol figures strongly in incidents of domestic violence, which is terrible for children to experience. So I hope that the Minister can give a strong assurance in his reply that robust mechanisms will be in place to offer help to job applicants who are suffering from these issues because a lot of the current provision is being cut back due to the recession. Particularly, how is capacity in the voluntary sector being harnessed in order to make the best use of those resources? I look forward to the Minister’s reply.

[Lord Freud]

My Lords, Clause 59 repeals provisions introduced by Section 11 of and Schedule 3 to the Welfare Reform Act 2009. These provisions would have applied to claimants of jobseeker’s allowance and employment and support allowance where their dependence on alcohol or drugs affects their prospects of finding or remaining in work. The regulation-making powers inserted by Schedule 3 to the 2009 Act could have been used to require JSA claimants to undertake a range of activities, including answering questions about whether they are dependent on or at risk of misusing drugs, and attending drug-related assessments or drugs interviews that would involve testing unless the claimant agreed to provide a sample that could be tested. Claimants could then enter a voluntary rehabilitation plan which might involve treatment. If claimants did not agree to enter the voluntary rehabilitation plan they could be required to enter a mandatory rehabilitation plan. Although a mandatory rehabilitation plan would not require a claimant to undergo treatment it could, for example, require the claimant to attend an educational programme or take part in interviews and assessments. These provisions also extended to alcohol dependency. Equivalent provisions were introduced for ESA claimants who are members of the work-related activity group. The mandatory requirements would have been enforced by using regulation-making powers to sanction a claimant’s benefit if they failed to comply.

These provisions, as the noble Lord, Lord McKenzie, suggested, have never been commenced. The previous Government produced draft regulations for a pilot scheme to run for two years from October 2010. Those regulations were considered by the Social Security Advisory Committee in March 2010. The committee’s report, published in May last year, raised significant concerns. It recommended that the pilot scheme should not go ahead as drafted. The committee considered that the pilots were unlikely to be effective, contained a number of significant flaws and would not produce robust results. Having listened to SSAC’s concerns and having undertaken their own work on drugs, in December last year the Government published their drugs strategy, Reducing demand, restricting supply, building recovery. The strategy recognises that work is a key contributor to sustained recovery from addiction, but we also recognise that the previous Government’s approach of mandating drug testing and assessments, and requiring claimants to undertake a rehabilitation plan on pain of losing benefit, is not the right one. We say it is not the right approach in particular for the following three reasons.

First, it mandates claimants to do something, such as being tested for drugs, that is not directly about helping people to approach the labour market. That does not mean that entering treatment is not the right approach to help many claimants who are substance dependent to address their barriers to work, but—and this leads to my second reason—claimants enter treatment for a series of complex reasons, and whether or not they succeed also depends on a series of complex reasons. Forcing claimants to answer, for example, questions about possible drug use, requiring them to attend substance-related assessments about drug use and insisting that claimants enter a mandatory rehabilitation plan if they decline to enter treatment voluntarily would be asking them to do something a large proportion of them would not want to do. If we took the approach of the previous Government, we would create a high risk of those claimants immediately failing these requirements and having to be sanctioned.

Perhaps I could pick a trick that the Opposition have enjoyed using on me on occasion. I am aware that there may have been some differences within the previous Government regarding their attitude to this legislation. I am enjoying watching on the faces of some of the people opposite a similar smile to the one that I sometimes have to use.

Finally, we consider that the previous Government’s approach towards substance or alcohol-dependent claimants would be one that all the evidence from treatment providers and agencies who are experts in this area, as well as SSAC which consulted with those organisations, say would not succeed.

On the question asked by the noble Lord, Lord McKenzie, about our alcohol strategy and what service will be available, the Department of Health will be publishing a new alcohol strategy early next year which will set out what services we plan to have available.

Welfare Reform Bill

Debate between Earl of Listowel and Lord Freud

Wednesday 26th October 2011 Grand Committee

[The Earl of Listowel]

My Lords, I apologise for coming so late into this Committee debate. Earlier in the discussions on the Bill, I referred to research in the United States which looked at the effect of parental employment on educational outcomes for children. It found that within the younger group, five to 12 or so, outcomes were better when parents were in employment, but that in the older age group—and I am not quite sure of the cut-off point—outcomes for children in school were poorer when their parents were in employment.

I do not have the details, and I am sure there is much more context to it than this. Does the Minister know what the research says about the impact of parental employment on children’s outcomes at school, and is there separate research into the impact of lone-parent employment on the outcomes for children in school, post-13?

[Lord Freud]

The first point I make to the noble Baroness, Lady Sherlock, is to assure her that full-time is not the default setting. The default setting is that we look at the circumstances of the claimant, particularly taking into account their caring responsibilities and available care, and reach a reasonable position. That is the position. On that basis, a lot of her concerns surrounding her point fall away. Of course we are not looking to have latch-key children.

On flexible working, I made the point earlier that we understand that when we look at the value of a job, the monetary implications are not the only measure; and that the gains of flexibility, in terms of how the employer behaves, and the relationship, are key and critical factors and have to be taken into account.

--- Later in debate ---

[The Earl of Listowel]

My Lords, sorry—

[Lord Freud]

No, let us take them all—

[The Earl of Listowel]

Before the noble Baroness withdraws the amendment, I want to take this opportunity to thank the noble Lord, Lord Newton of Braintree, and the Minister for their very kind words. If praises are our wages in this House, I feel well paid today—I wish I were more worthy of what has been said. I am grateful to the Minister for his careful response. It is reassuring to be reminded how important it is to children and their success that their parents are in work. Shall I wind up?

Welfare Reform Bill

Debate between Earl of Listowel and Lord Freud

Monday 24th October 2011 Grand Committee

[Lord Freud]

There are quite a few moving parts to this. I have talked about the WFHRAs reviewing that and there is also a review coming out on the sickness absence regime in the not too distant future. There are areas that need to be brought together, which impact on this reasonably specifically.

[The Earl of Listowel]

I thank the noble Lord, Lord McKenzie of Luton, for his support and the Minister for his helpful reply. Clearly, he has a great depth of knowledge of this area and I am grateful to learn from him this afternoon. I have a couple of brief points to raise. I also have an aside which is that his black-box approach sounds very familiar, in terms of the young offender programme for National Grid and Transco, to which I referred. It was developed for National Grid and Transco by Dr Mary Harris, who is an astrophysicist by background. Her approach was very much testing and incrementally trying things out until she got a method that seemed to work very well for young people. Maybe there is some read-across there to what is being discussed this afternoon.

The Select Committee for the Department for Work and Pensions looked at the work programme, and although it welcomed it, it had this to say:

“However, there is a risk that creaming and parking may still take place under this model”—

the work programme model—

“since it remains open to providers to continue to focus on the easier to help participants within each customer group”.

Perhaps the Minister could write to me, or say now to the Committee, whether he is aware of that particular problem and what needs to be done within each of the tranches.

The second issue that I would like to raise with the Minister—and I would like to think more about this—is where he talks about attending being a fundamental requirement. One just has to attend if one is going to get anywhere through this process. I can imagine for some young people that even attending would be a big step to take. I do not want to push it too far, but if you have someone coming out of the criminal justice system who is very oppositional and who has complete distrust for authority of any kind, you might need to woo them a little bit before you can even get them in a meeting—but it would be well worth while wooing them in terms of the outcomes at the end. That is the first point; I will go back and think about the second.

[Lord Freud]

To save the department writing a letter, I actually think that “creaming and parking” is not desperately helpful, although I know that it is a very popular phrase. I shall explain exactly why. Within a black-box approach, if you are a provider you are clearly trying to spend your money on an outcome that will be successful. Our job is to ensure that we put the amounts of money into the right level. There will be people who are ready and worth while investing in and people for whom it is not the right time—you need to wait. There is quite a sophisticated judgment there, and you can get those judgments too crudely wrapped up with what are basically terms of abuse in “creaming and parking”. That is how I would respond to that, and I hope that that has saved us a letter.

[The Earl of Listowel]

I thank the Minister and beg leave to withdraw the amendment.

--- Later in debate ---

[The Earl of Listowel]

My Lords, I apologise. I should have put a couple of questions to the Minister. How will care leavers be treated in this system, and what additional support and flexibility might they expect to be shown? Perhaps he might prefer to write to me on those two points.

[Lord Freud]

Before I start on the amendment formally, it is worth making it crystal clear that the structure of the changes we have made bear in mind some of the real issues that we are talking about. I am particularly conscious of people with learning difficulties and fluctuating conditions, or a nest of other problems. I want to spend one minute on the design of the new welfare system, when it comes out like Aphrodite coming out of the sea near Paphos. The first point is the design of the work programme, where the rewards are not to get someone into a job and to keep them there, as it used to be, for 13 weeks. When you think about it, that is not what we want; we want someone to be in a long-term job. The structure, particularly for the hardest to help, is that the real rewards for the provider are when someone is in work for more than two years—it is two years and three months. You do not get someone into a job for two years and three months if it is inappropriate. That simply is not going to happen so when we are talking about the work programme, the incentive on the providers is to match people up with jobs that they can do in a way that the current system simply does not.

The second structural change that we are making, and which is really relevant in this area, is in how the universal credit works. By pulling together the two systems, the out-of-work benefits system and the in-work tax credit system, you do not have this desperate problem that we have today where if you take a risk and try to get a job and it did not work, you go back to go—and now try to get your benefits again. It is a nightmare but there have been bits of sticking plaster on it.

If you are in a fluctuating condition and this week you cannot work—let us say you have a job where there is a little flexibility—all that would happen would be that you would slide up the taper. Nothing would have changed in the nature of your benefit. There is just an adjustment in your universal credit payment and when you can work more, you get more. Those two things are big structural changes to bear in mind when we deal with these areas. They will help a lot because much of what people are rightly so concerned about are some of the incredible blocks that are in the current system and which make it so difficult for people to partake. It is why we have excluded so many people from having a full life, because in modern western society being part of the economy of the country is having a full life. They have been excluded and there is all the depression that results, so there are some really strong underlying changes that should help.

Welfare Reform Bill

Debate between Earl of Listowel and Lord Freud

Tuesday 18th October 2011 Grand Committee

[Lord Freud]

My Lords, I hope that I am indicating that we are looking very hard at what proposition we can bring forward later on in this process of considering this Bill to deal with that particular set of problems that noble Lords have raised. So I will have something to say later on in the process.

[The Earl of Listowel]

I am very grateful to the Minister for reassuring the Committee that he will think carefully about the treatment of foster carers. That is welcome. However, I have a strong concern about a number of issues in this area. I have two questions. I wonder if he could drop me a letter on this, if he cannot reply now. Those registered foster carers who may have one, two or possibly even three rooms vacant, who do not have foster children with them at the moment but are waiting for them, and because of that are not getting an allowance and are on benefit, are hit by that—it is a bad situation for them. So reassurance on their position would be good. I am grateful to him for his response with regard to those parents who have their children removed from them. I think he was saying that for a short period it would be acceptable to give those families where the child has been removed an exemption in certain circumstances. I feel very worried about those families, which are very dysfunctional by definition. To have one’s children taken away is a very serious situation, and to lose a child and then to have an extra room or two rooms and to be further hit—that does worry me. Reassurance on that point, what happens to them, would be welcome.

[Lord Freud]

I will repeat the two points. The first point is exactly the issue that we want to deal with and the one that the foster community is worried about—the voids area. That is something that we are aiming to address. My response to the second point was, and remains, that this is where we would expect discretionary housing payments to come into play. It is exactly the complex set of judgments that need to be made, and local authorities are best placed to make them.

--- Later in debate ---

[Lord Freud]

Yes. I always prefer to answer rather than write, but I think I will on this occasion go to paper. It may be that the noble Baroness prefers paper.

[The Earl of Listowel]

My Lords, I was grateful, as I said before, that the Minister is giving this issue of arrears careful consideration. I think it might be helpful to the Committee if he could provide some reassurance that by Report we will have considerably more detail on what the plight will be of those who face arrears under the new arrangement. Can he give any assurance on that point?

[Lord Freud]

By the time we get to this again, I will come back with that answer.

Welfare Reform Bill

Debate between Earl of Listowel and Lord Freud

Monday 10th October 2011 Grand Committee

[Lord Freud]

Yes, my Lords, a careful assessment has been done of how it will work in practice, which incorporates those kinds of effects.

[The Earl of Listowel]

My Lords, I hope that the Minister will forgive me if I ask his help on a point of detail. It may come up during fine-tuning, but it might be helpful to flag it up now. I refer to young people who leave the local authority care system and win an award against their authority because in their time in care they were not properly cared for. Therefore, they have a capital sum that they might need to use for education, therapy or something else. What circumstance will they find themselves in under these arrangements?

Housing Benefit

Debate between Earl of Listowel and Lord Freud

Tuesday 3rd May 2011 Lords Chamber

[Lord Freud]

My Lords, the key principle behind these housing benefit reforms is that people who are benefit recipients should experience the same kind of pressures as everyone else. That is the way to integrate them back into the world of work, which is one of the fundamentals of our whole welfare reform strategy.

[The Earl of Listowel]

Is the Minister aware that there is a concern that some families may be moved to different areas, which will put additional pressure on children’s services? Is there a mechanism to give additional support to local authorities if there is an additional burden on those services?

[Lord Freud]

My Lords, yes, the system works so that, as families move to different areas, funding follows those families. There may however be lags, which clearly is an issue of some concern. The fundamental principle is that funding follows the requirement.

Women: Assistance in Pregnancy

Debate between Earl of Listowel and Lord Freud

Tuesday 8th March 2011 Lords Chamber

[Lord Freud]

There are two areas of financial help. The first is the budgeting loans. As I said yesterday, we are encouraging people to look at budgeting loans in the widest possible way. The second area is community care grants. Again, we expect that many people in the most difficult circumstances will be able to take advantage of those. The noble Baroness’s second question concerned what we were doing to help pregnant women. The Department of Health and the Department for Children, Schools and Families are developing a project, Preparing for Pregnancy, Birth and Beyond, which is looking at a renewed model of universal antenatal education and preparation for parenthood.

[The Earl of Listowel]

My Lords, is the Minister aware that young women in care are two and a half times more likely to become pregnant than their peers and that a quarter of young women leaving care are either pregnant or have a child already? Will he consider asking his colleagues who talk with local authorities whether all best practice in the area of support for such young women is collated and being shared as it should be?

[Lord Freud]

My Lords, I share the noble Earl’s great concern for children in care and take his point about the relatively much higher rate of pregnancy. I shall look closely at what we can do in that area.

Housing Benefit (Amendment) Regulations 2010

Debate between Earl of Listowel and Lord Freud

Monday 24th January 2011 Lords Chamber

[The Earl of Listowel]

My Lords, I apologise. I omitted to declare my interest as a landlord. I do so now.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)]

My Lords, this has been an important and interesting debate. I commend particularly the noble Lords, Lord Knight of Weymouth and Lord Best, on bringing forward these Motions and securing this debate. I shall try to answer as many as possible of the points raised, but, since there was an awful lot of them, I may not cover absolutely everything.

Perhaps I may first put the debate into context and explain why the statutory instruments are essential to advance the changes that we have planned. Housing benefit increases have been quite startling, as a number of noble Lords have pointed out. During the last 10 years, housing benefit expenditure as a whole has nearly doubled in cash terms from £11 billion to £21.5 billion in the current year. Only £2 billion of this increase is due to caseload. About £5 billion is due to general price inflation, but, most importantly, £4 billion is due to growth in private and social rents over and above general inflation. Private rents for benefit recipients have risen in real terms 10 per cent more rapidly than rents in the general market. These are exactly the sort of increases that we are seeking to contain. Without any reform, expenditure is forecast to be £24 billion by 2014-15.

It was imperative that we acted swiftly to stop the runaway costs of housing benefit, those costs having been allowed to rise without restriction year after year. As we made clear in the June Budget last year, welfare reform savings play an important role in reducing the overall budget deficit. The changes introduced by the statutory instruments alone add up to £1 billion by 2013-14.

We must be fair to the taxpayer. It is not right that families who work hard to pay their own rent have to pay even more so that those on housing benefit can live in homes that they could not think of affording. Some of the rates are extreme. I know that not a lot of people are taking £2,000 a week for a five-bedroom property in central London, but there are some and the current system allows it. Further down the scale, £500 a week is being paid for two-bedroom properties and £370 a week for one-bedroom properties at this year’s rates. The Government’s measures are designed to take this under some control.

One of the measures that we have announced, and which has been widely welcomed tonight, is providing for an additional bedroom for disabled people living in the private rented sector who need a non-resident, overnight carer.

Noble Lords have gone through the other changes, but I shall summarise them. They include applying an overall cap to local housing allowance rates and setting the maximum rate at four bedrooms. Those rates are £250 for one bedroom, £290 for two bedrooms, £340 for three bedrooms and £400 for four bedrooms. That is a little over £20,000 as the top rate. We are also removing the £15 weekly excess, which the previous Administration would have liked to do but did not. I do not think that anyone argues that it is appropriate that we pay people more than they pay in rent. It was introduced to encourage a process of negotiation between those who are renting and landlords, but it does not seem to have had that effect, so there does not seem to be much point in paying those figures.

The final element that we have been discussing tonight is the adjustment of the local housing rate from the median to the 30th percentile. Overall, there has been a lot of scaremongering generally, and a little of that tonight—and some false reporting about the measures, although there has not been that tonight. Some estimates of the number of people who will be made homeless are, quite frankly, ridiculous. It is simply irresponsible to suggest that thousands on thousands of people will be made homeless and will have to leave the capital in droves, as some have said. I welcome the opportunity to put the record straight and to respond to the concerns raised today.

First, I shall address what is essentially a London issue, surrounding the maximum weekly rates of local housing allowance that we will apply from April. They are still extremely generous rates. It is still far more than the vast majority of people pay out—at the rate of four bedrooms and £400 and more than £20,000 a year, a typical family would need to earn £80,000 a year to be able to afford that kind of rent.

These reforms are not about excluding benefit recipients from the nicest areas, as some have argued. We are simply ensuring a fair deal for the taxpayer. The simple truth is that individuals who claim housing benefit according to local housing allowance rules should face similar choices to those people in low-paid work. There is simply no reason why we should see people moving vast distances, and no mass moves out of the south of the country. In all but three of the most central areas of London, at least 30 per cent of properties will be affordable within local housing allowance rates. I shall just explain that figure, because there has been quite a lot of misunderstanding about it. The survey is based on the properties that are not in large occupied by recipients of housing benefit—so it is 30 per cent at least, except in those three areas, plus whatever elements of the housing stock currently occupied by housing benefit recipients that will go on being affordable. So it is a large proportion, although it is impossible to put an exact number on it, because clearly we are expecting prices to move and more properties to come into that category. But a large proportion of houses will remain affordable.

A small number of people in the most expensive places will, of course, have to move, but they will not have to move far, and we will work with local authorities to give those people the support that they need. In central London, 2.5 million jobs are accessible within 45 minutes of travel. Bus fares, although they went up this month, are no more than £1.30 for a single journey so they can go long distances on a bus. Low-income working households mostly pay a rent slightly lower than the appropriate local housing allowance rate. This group living in private rented accommodation is mobile; 40 per cent of them have been in that accommodation for less than a year. It is not unusual for families to move. Indeed, over a quarter of a million people moved out of or between inner London boroughs in 2008-09, which is a point that the noble Lord, Lord German, made.

On the estimates of homelessness that various bodies have put out, it is important not to rely on those estimates if they are based on what landlords say they will do or on early experience. We must look at the shortfalls. After the reforms, 32 per cent will see no change in shortfall, 450,000 households will have a shortfall of less than £10 a week and 35,000 will have a shortfall of more than £20 a week. Not all of those will have to move, let alone become homeless.

One difficulty in writing an impact assessment when there are behavioural and market-based effects is that it is not easy to quantify those impacts, because they involve a complex interplay of behavioural decisions by individual landlords and individual tenants. We are talking about market forces here. Although economic theory would suggest that if a purchaser of up to 40 per cent of a market reduces the amount that they are willing to spend, it will cause rents to fall, it is only in the end through observation that we will be able to obtain absolutely conclusive evidence.

We have had similar concerns raised about our decision to cap local housing allowance levels at the four-bedroom rate but that reflects the kind of housing choices that are made by larger families who are not on benefit. It builds on the restriction introduced by the now Opposition in April 2009 to cap at the five-bedroom rates. Let us be clear: most families not on benefit cannot afford to live in properties with five or more bedrooms. We are reflecting here the choices made by families everywhere.

These measures have been closely scrutinised. We have made available more data on impacts than has ever been the case. Clearly, some people will receive less benefit as a result of the changes but that does not necessarily mean that all of those people will be drastically worse off. The gap between the 30th percentile and 50th percentile can be quite narrow. On average, it is currently £15 a week for one-bedroom properties and £26 per week for two-bed properties in London. In the outer south-east area, the difference can be as little as £8 a week for two-bedroom properties. Clearly, one effect that will happen is that the 30th percentile and the median can start moving together if we do not get the downward pressure that we are trying to impose on the rates. That would actually be bad news for the Government, because we would not lose some of the gains but see a market response as those medians move together, rather than the wholesale disruption that some people have been forecasting. In practice, setting the local housing allowance rates at the 30th percentile merely reflects the choices of low-income households; we know that from the research that we undertook last year.

The noble Lord, Lord Best, told us about the attitude of landlords. Rather than accept his concerns wholesale—although he is clearly a great authority in this area—I would point out that, in the last 18 months, more than 400,000 private rented sector tenants have been claiming, which shows that landlords are certainly prepared to rent to tenants claiming housing benefit. I repeat my point that, at 40 per cent of the market in not all, but many areas, landlords will have no choice but to reduce their rents and give back some of the excess gain that we seem to have seen in this part of the market. We are also giving landlords an incentive by widening local authority discretion to pay housing benefit direct to the landlord, a point raised by the noble Baroness, Lady Thomas. We are not giving this discretion away for nothing and the complex language here was to make sure that we get something for something: that if we are translating a payment stream from, let us say, a triple-B-rated level to a triple-A sovereign income stream, we get something for our money. That is why that is written so carefully.

Because I do not want to run out of time, I will jump to the key thing and I will come back to whatever I can fit in after that. I want to turn to the important issue of the monitoring and evaluation of these changes. I am very grateful to the noble Lord, Lord Best, for his timely Motion. I am very happy to agree to his proposal for an independent review. I make a firm commitment to the House that we intend to commission independent, external research to help us evaluate the impact of the reforms. This review will cover all the areas that the noble Lord outlined in his Motion. I can assure the House that it will be comprehensive and thorough and, of course, I readily agree that the outcome of the evaluation should be presented to both Houses, together with a written ministerial statement. Among the issues that it would cover—these were points raised by noble Lords—will be homelessness and moves; the shared room rate and houses in multiple occupation; what is happening in Greater London; what is happening in rural communities; what is happening in black and minority ethnic households; large families; older people; people with disabilities and working claimants. That is what this review will cover.