Welfare Reform Bill

Lord Bishop of Leicester Excerpts

Tuesday 13th September 2011 Lords Chamber

[The Lord Bishop of Leicester]

My Lords, it was Archbishop William Temple, one of Beveridge’s key associates, who first coined the term “welfare state”. He asked how one could justify an individual giving up some of his or her autonomy to the state. He contrasted the welfare state, in which Government gained legitimacy from their commitment to the welfare of the people, with the power state, epitomised by the fascist and communist totalitarianisms of his day.

These concerns remain in the minds of many today, not least those of the clergy of a diocese such as mine in Leicester and on the outer estates, who daily see desperate people turn up on their doorsteps. The church is the last resort when the inflexibilities of the welfare system have proved insurmountable. They know that many are often in the position of needing help not because of inadequacy, stupidity or fecklessness, but because they have made a mistake, lost their job, become ill or because they are children. They also know that, as the most reverend Primate the Archbishop of Canterbury said recently, it cannot be said often enough that most people in poverty—and we should be thinking of children in particular—have not chosen it. That is why the Church of England has strongly supported a just welfare system since its very beginnings as one of the key building blocks of a civilised society that cherishes mutuality at all levels and which sees each person as of equal worth.

We on these Benches recognise the principles behind this Bill: they reflect a desire on the part of the Secretary of State to see true welfare reform improving the lives of the most vulnerable children and families. We understand the department’s desire by means of universal credit to simplify a system that has become so complex that it is open to unintended mistakes and intended fraud. We endorse the principle that people’s well-being is more effectively enhanced when they are in work, but today we must put the question: how far do these reforms measure up to a national moral responsibility to ensure the well-being of the most vulnerable? In that sense, what is at stake here is the legitimacy of the state because well-being means more than cash benefits: it is about social inclusion, the bonds of strong communities under severe strain in the recent riots and the ability to live fulfilling lives.

My primary focus today as a bishop and a former chair of the Children’s Society will be on the effects on children who, by almost any measure, will be disproportionately affected by this Bill. We cannot go into a period of reform claiming to be all in this together while having our eyes closed to those who could be made homeless or could drop into the most severe poverty.

Let me raise, as other noble Lords have, some particular areas of concern. First, I underline what has been said about childcare costs. The Government want families with children to take responsibility for them by working their way out of poverty, yet it seems to me that these proposals will effectively make this impossible for many low-income families. Under the current system, the childcare element of working tax credit provides parents with support covering up to 70 per cent of eligible childcare costs up to a maximum of £175 for one child or £300 for two or more children. Significantly, because childcare costs are currently disregarded for the purposes of calculating entitlement to housing benefit and council tax benefit, some households receive help for up to 95.5 per cent of their childcare costs. The Government have presented a number of possible options outlining how to help with childcare costs, which will be integrated into the universal credit. We surely must have serious concerns that these options will leave working families facing substantial cuts to the help they receive for the childcare costs, leaving them worse off in work than under the current system. Can the Minister explain how he can guarantee that work pays for all families in view of the option to halve the current cap on eligible childcare costs?

Secondly, the proposed changes in support for disabled children will result in children with all but the most severe disabilities having their maximum level of support halved, leaving those families up to £1,400 per year worse off. Can the Minister help us clarify how the Government propose to support these families? Thirdly, there is the crucial issue of support for young carers. Sometimes the best intentions lead to perverse consequences, and the Children’s Society, which has developed specialised work with many young carers, has explained clearly that universal credit will substantially cut this support by up to £3,500 a year in some cases. It points out that this can be remedied by continuing to allow disabled parents who are child-dependent to receive support under the universal credit.

Finally, there is the effect of an overall cap on benefits entitlements and on how local housing allowance is calculated for out-of-work households. The Government have estimated that this cap will cost those families affected an average of £93 per week. The DCLG has suggested that the cap could lead to 20,000 families being made homeless. Furthermore, the Children’s Society has made it clear that the primary impact of this cap is not on adults but on children, with more than 200,000 of them affected. Can the Minister explain how this will help rebuild our communities and help people take responsibility for themselves and their children by getting back into work?

Time prevents the raising of other points today. We on these Benches have concerns about the aggregated effects of this legislation, taken alongside other changes to the National Health Service and to the legal aid system. The risk is that the reduction of financial deficit will threaten a huge social deficit, especially for the young. I hope this House will speak not just for the marginal people of so-called broken Britain but for the much greater numbers who fear the spectre of illness, unemployment and misfortune, who pay their taxes and rightly trust the state to prevent destitution. It is their voice, their fears, their understandable concerns that I hear regularly as a bishop and which I hope the Minister will attend to today.