Carer’s Allowance

Julie Elliott Excerpts

Monday 22nd April 2024 Westminster Hall

On resuming—

[Julie Elliott (in the Chair)]

Order. The debate may now continue until 7.55 pm, although that depends on there being no more votes, of course. I call Beth Winter to continue.

[Beth Winter]

Like many other Members here, I have lots of constituents who are carers and come to me for assistance. One constituent has been a carer for his wife for more than 40 years following her diagnosis of schizophrenia. He is now a pensioner with a low income, but that impacts significantly on his entitlement to carer’s allowance. Another constituent who cares for her grandfather had her carer’s allowance revoked, before we intervened, for exceeding the income threshold during a period of financial difficulty and mental health impact. The DWP confirmed that a payment should not have stopped and she received over £1,000 back. There is the issue of overpayment, but I also worry about how many carers may be being underpaid significantly without accessing support or advice. There is also a large proportion of people who do not claim the benefits that they are entitled to.

Only 71% of carer’s allowance claimants in 2023 were receiving a payment, and the remaining approximately 400,000 claimants met the conditions set out above but were not receiving the benefit due to the overlapping benefits rule—including nearly all pensioner carers, which hon. Members spoke about earlier. The e-petition asks that carer’s allowance be raised to the rate of 35 hours per week at the level of the national minimum wage. That would equate to £400 per week. The Government’s response says that carer’s allowance is

“a benefit that provides some financial recognition that a carer may not be able to work full-time.”

But should someone earn more than £151 per week, they lose all access to carer’s allowance; that is the cliff edge situation that others have mentioned today. That £151 is only around 13 hours of work at the adult national minimum wage, and the number of minimum wage hours that can be worked before hitting the threshold has declined in recent years. That is completely inadequate and unacceptable, and it is in need of urgent reform. That is why the Government must commit to improving the carer’s allowance.

I have previously spoken in the House about the Work and Pensions Committee’s call for an increased earnings limit and the introduction of a taper. Here today is the Chair of that Committee, my right hon. Friend the Member for East Ham (Sir Stephen Timms), who has spoken about the issue in much more detail. I have also said that the uprating of the carer’s allowance needs to be synchronised with the real living wage.

Carers UK has set out a number of demands ahead of the election. It calls for an increase in the earnings limit for carer’s allowance to the value of 21 hours per week at the national living wage rate and for that link to be defined in law, so that the ability of carers to earn is not eroded over time. That would take the earnings threshold to £240 from the current £151. It also calls for reform to the eligibility rules for the carer’s allowance, including ending the cliff edge, giving access to a tapered rate for those working more hours each week, enabling more than one person to receive the benefit if multiple people care for the same person, and extending the run-on payments for bereaved carers from eight to 12 weeks. Most importantly, Carers UK urges the Government to carry out a full review of the link between caring and poverty across the UK and to commission an independent inquiry to explore longer-term solutions to bringing more unpaid carers out of poverty.

The Carer Poverty Coalition says the carer’s allowance itself should be increased and I think that is vital, having spoken to many carers in my constituency. The current rate is undoubtedly a poverty payment, and the earnings threshold cliff edge makes a mockery of social justice. The reality is that many carers work full time as a carer and the state refuses to recognise that financial benefit to society, as well as the invaluable contribution that carers make. The idea of earning a minimum wage for a full-time job has long been accepted, and we should do the same for those people caring.

I want to comment more generally on the demonisation of people who receive social security benefits, which are an entitlement and a right. More recently, that demonisation was demonstrated by the Prime Minister’s comments about a “sick note culture”, which were dangerous and absolutely disgraceful and will do nothing except exacerbate the hardship that people experience. The demonisation and stigmatisation of claimants, including millions of carers, must stop. As an example, in my constituency of Cynon Valley, we have high rates of social security claimants, including people in receipt of carer’s allowance. [Interruption.]

[Julie Elliott (in the Chair)]

Order. There is another Division. We will suspend for 15 minutes.

Private Pension Schemes: Regulation

Julie Elliott Excerpts

Wednesday 21st June 2023 Commons Chamber

[The Parliamentary Under-Secretary of State for Work and Pensions (Laura Trott)]

I congratulate the right hon. Member for North Durham (Mr Jones) on securing the debate and I thank all hon. Members who have contributed to it.

It is absolutely vital that pension savers have confidence in the running of their pensions, as we have discussed this evening. Employers and trustees must be open and transparent with their pension scheme members, and be absolutely clear when they make changes to the benefits members will receive or how they are able to take their pensions.

Savers in defined-benefit schemes are in entirely advantageous positions, which is why the Government require specialist advice to be sought in advance of anyone wanting to transfer significant savings out of a defined-benefit scheme and into a defined-contribution scheme.

It is equally important that when members opt to make changes to the way they receive their benefits, or indeed any pensions, they can access the information and guidance they need to understand what the implications of that would be. It is extremely concerning that there seems to have been a lack of communication, as the right hon. Gentleman outlined. It is of course the case that many schemes offer members a number of choices of how to take their benefits, such as partly in a lump sum if the scheme rules and tax rules permit it. In these cases, the scheme rules detail the calculations to be used, and the trustees can change the details of the scheme rules if they are able to do so within the scheme.

Although legislation is silent on the way in which these rules and calculations must operate, there are safeguards for members. Trustees, as discussed, have a duty to act in the interest of all members rather than of any particular group, and to do so they must take into account a range of factors. They will, for example, take into account the funding position of the scheme to protect the interests of current and future members and may make changes to the shape of benefit arrangements in the pursuit of that goal provided that the scheme rules allow it. Trustees should also work closely with the scheme actuary to ensure that all members get a fair value from the commutation arrangements. But— this is the key point of the debate today—it is crucial that each member has sufficient information before deciding whether alternative arrangements, such as taking a lump sum, are the best course of action for them. If members feel that they were given incorrect or insufficient information to make an informed choice, or if the trustees did not act according to the scheme rules, then they can take their complaint to the pensions ombudsman.

The right hon. Gentleman said that he wrote to the regulator and to the ombudsman and both referred him to the other, and he asked what redress there is for members in this situation. Let me clarify the role of the two organisations. The Pensions Regulator is the UK regulator of workplace pension schemes. It makes sure that employers put their staff into a pension scheme and pay money into it. It also makes sure that workplace pension schemes are run properly, so that people can save for their later years. Its focus is on the running of those pension schemes, trustees and scheme managers. There are duties on those parties and those working with them, including to report breaches to the regulator.

The pensions ombudsman, on the other hand, adjudicates on disputes between pension schemes and their members, as we are discussing in this case. If members of any scheme would like help in understanding options for retirement income and any documentation they have received for their scheme, I encourage them in the first instance to contact MoneyHelper, which is provided by the Money and Pensions Service, an independent, non-departmental public body.

[Julie Elliott (Sunderland Central) (Lab)]

Many dozens of my constituents are affected by the Nissan pension scheme. We have discussed in this debate the role of the ombudsman. The answer the ombudsman has given in this case is entirely unsatisfactory, and I know that all my constituents affected think so too. What was the Minister’s view of the ombudsman’s response in this case?

[Laura Trott]

I will come to that in a moment. If the hon. Lady thinks I have not answered her question properly, then she is very welcome to intervene again.

As I was saying, the Money and Pensions Service is an independent, non-departmental public body, which provides a free information and guidance service to the public on all matters related to workplace and personal pension schemes. In this case, I understand that in determining one case—not the individual case of Mr Steve Clare, but a case relating to identical issues in the Nissan pension plan—the ombudsman noted that the plan members were presented with an illustration of future benefits and options in retirement. However, if that was not the case—and certainly from the speech of the right hon. Member for North Durham that is not what appears to have happened—I ask him to provide me with all the details that he has and I will raise it directly with the ombudsman myself and provide a copy of the response.

Local Housing Allowance

Julie Elliott Excerpts

Wednesday 15th March 2023 Westminster Hall

[Mims Davies]

The hon. Gentleman points out the many questions he is asking about transparency, and I welcome that. Where policy is in development, we need to protect it, but, ultimately, if it needs to be transparent, I am very happy, where suitable, to share it.

On the point made by the right hon. Member for East Ham and others about temporary accommodation, it is, of course, an important way of ensuring that no family is without a roof over their heads. We are committed to reduce that need for temporary accommodation by preventing homelessness. We are investing £366 million into the homelessness prevention grant to support local authorities to prevent homelessness. The key point, and our main duty, is how best to support people so that they are not in that situation. I very much understand that, and I am keen to respond about how we are trying to do a little more about that.

It is important for Members to understand that the local housing allowance is not intended to cover all rents in all areas. In April 2020, in direct response to the covid-19 pandemic and the influx of new claimants because of the pandemic, we increased local housing rates to the 30th percentile of local market rates, costing nearly £1 billion and giving claimants on average an extra £600 in 2020-21. We have maintained that increase since then, ensuring that all those who benefited from the increase continue to do so.

I recognise that there are circumstances where extra help is needed, which is where we distribute the discretionary housing payments according to local need. Those payments play a critical role in providing support to the most vulnerable households in meeting their housing costs. Since 2010, we have provided nearly £1.6 billion in DHP funding to local authorities.

Of course, the competitive nature of the private rented market is driving up prices, alongside the annual review of LHA rates. I say to the hon. Member for Westminster North and the Chair of the Select Committee, the right hon. Member for East Ham, we are absolutely determined to work around the quality and supply challenges that are ultimately driving that. Overall, the DWP Budget measures today represent £3.5 billion over the next five years to boost workforce participation.

In conclusion—

[Julie Elliott (in the Chair)]

Order. Very quickly, please.

[Mims Davies]

I will wind up. I take all the points from hon. Members from all around our wonderful nations today, and I am sorry I cannot tell them any more than that this issue is a very strong focus for me, and that we will continue, I hope, to work together for all our communities.