Unemployment: Young People

Debate between Lord Kennedy of Southwark and Lord Freud

Tuesday 28th October 2014 Lords Chamber

[Lord Freud]

The fundamental driver of these much sunnier figures is clearly our economy, which is now the fastest growing of the major economies. It is vital that we keep that process going. It is also vital that we have a benefits system that encourages and enables people to go into the workforce rather than being blocked from going into it.

[Lord Kennedy of Southwark (Lab)]

My Lords, any reduction in unemployment is to be welcomed, particularly youth unemployment. Can the noble Lord tell the House how many of those new jobs are part of the 5.2 million people on low pay in this country? Low pay is now a huge problem for us to deal with.

[Lord Freud]

The Governor of the Bank of England has said that the only way that we are going to get growth in real wages is by recovering productivity in the economy. One way is clearly to reduce dependency and to get 1.7 million extra people into work. The second way is to get the skills base up, and there are now some really good signs that we are moving that up by serious percentage points. The third way is progression in work, so that people earn more. That is what universal credit is all about.

Credit Unions

Debate between Lord Kennedy of Southwark and Lord Freud

Thursday 19th July 2012 Lords Chamber

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what are the next actions they plan to take in support of the continuing development of credit unions.

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

My Lords, credit unions provide people on low income with access to financial services and loans. More can be done to support credit unions to modernise, serve more people and become self-sustainable. Therefore, on 27 June, I announced that we are going to provide £38 million to fund a new credit union expansion project and that the Government will be consulting on credit union interest rates, as recommended in the credit union feasibility study published on 10 May.

[Lord Kennedy of Southwark]

My Lords, in the UK today, 1.4 million people have no bank account and 7 million people use high-cost credit, whether it is payday loans, home credit or pawnbrokers. My frustration is that development is still very slow and more could be done to develop the sector. Will the Minister agree to look at what contribution the high street banks could make towards developing the sector? In particular, could they be persuaded to second staff to work in the sector to aid its development? I believe that our banks should make a contribution to the sector to provide financial products at an affordable cost that they themselves will not provide.

[Lord Freud]

My Lords, we have a procurement function going on with the credit unions, which will start shortly, in terms of how they can modernise and improve. It may well be that there are contributions that are not financial but intellectual that the credit unions can add. We are currently having a series of working parties with the retail banks as we develop the requirements for universal credit and financial inclusion.

Youth Unemployment

Debate between Lord Kennedy of Southwark and Lord Freud

Monday 14th May 2012 Lords Chamber

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what action they are taking to reduce youth unemployment.

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

My Lords, the youth contract was introduced in April 2012 to provide additional support, with almost £1 billion, to young unemployed people over the next three years. It builds on the support already available through Jobcentre Plus and the work programme, enabling young people to look for work, gain work experience and skills and find real, lasting jobs.

[Lord Kennedy of Southwark]

My Lords, if it were not so tragic, the lamentable performance of the Government would be laughable. More than 1 million young people are not in education, employment or training. When are the Government going to pull their socks up and do something about this problem, or are they happy for young people to return to the misery of the 1980s?

[Lord Freud]

My Lords, let me just correct those figures. The number of people who are not students and who are unemployed is around 719,000. That figure is much too high but it is not near 1 million. We are doing an enormous amount to help young people into the jobs market, and we are doing it on a structural basis rather than making little fixes here and there.

Credit Unions

Debate between Lord Kennedy of Southwark and Lord Freud

Thursday 2nd February 2012 Lords Chamber

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what action they are taking to promote the accessibility of credit unions.

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

My Lords, the Government wish to see greater diversity in financial services, and credit unions have an important role to play. The recent credit union legislative reform order has opened up membership to different groups such as housing association tenants and employees of national companies working in credit union areas. A feasibility study has looked at how the Government could support credit unions. The study reported to Ministers in December and an announcement will be made in due course.

[Lord Kennedy of Southwark]

Although progress is moving in the right direction, I think it is extremely sluggish. If I asked a question about nurses, I would expect a Health Minister to reply; if I asked about teachers, I would expect an Education Minister to reply. I ask a question about credit unions and three departments could reply in this House. I contend that that is not joined-up government. My question for the Minister is: who is the driver?

[Lord Freud]

My Lords, I am the driver. I commissioned a report on credit unions last year. The DWP is the paymaster for the credit union movement. We have spent £113 million in the past six years. We are determined to go on funding this really important element of financial inclusion and to create an industry that will be viable in the long term and will support the poorest in our society.

Welfare Reform Bill

Debate between Lord Kennedy of Southwark and Lord Freud

Tuesday 1st November 2011 Grand Committee

[Lord Kennedy of Southwark]

My Lords, when I spoke at Second Reading, one point that I made was my deep concern that there could be considerable problems, considerable hardship caused to people if changes were made that were not thought through properly. Many noble Lords who spoke at Second Reading and who have spoken during Grand Committee have been clear about their support for the principle of universal credit, and I am one of them.

The noble Lord, Lord Freud, will be aware that I have asked a number of Written Questions on these matters. My amendments in this group are intended to ensure that there is some form of piloting of the proposals, so that we can assess their effect and make informed decisions having looked at the reality of what is happening on the ground.

I still have considerable concerns, but I was very pleased to see, first, the Minister himself opposing the question that Clause 30 stand part of the Bill and then the amendments he has tabled; Amendments 56A and 69A. It would be very sensible if we moved on to consider those and probed the Minister's proposals in this group. They are a welcome step in the right direction. I thank him for that and I am very pleased. They may need further refinement, and I am sure that we will have more to say about that in Grand Committee and at Report on the Floor of the House.

I leave it there with a view to quickly getting on to the Minister’s proposals. I am sure that that is what the Grand Committee wants. I beg to move.

[Lord Freud]

My Lords, we will ensure that the full universal credit system is extensively tested with claimants before the new benefit is introduced. However, this will not take the form of a pilot scheme as this would add extra costs and delays to the introduction of universal credit. It is vital that we are able continuously to test, improve and evolve the universal credit system after it is introduced. It is key element that we should have the flexibility to respond to change and ensure that the system does not stagnate while the world develops around it. The amendments I tabled will achieve this constant evolution.

The original wording of Clause 30 provided for piloting measures only to see if they would improve a claimant's chances of entering work, or of finding more or better-paid work. While this is a key objective, universal credit will also simplify the benefits system, improve work incentives and change behaviour. Amendments 56A and 69A will ensure that we are able to test approaches that cover these wider principles.

If we are to ensure that we have the flexibility to develop and continuously improve universal credit, we must ensure that piloting can also include the testing of changes to the structure, design and delivery of the benefit. The ability to run controlled pilots of tests—for example, of whether advances in technology could improve the structure or delivery of universal credit—will be a fundamental part of the evolution of the benefit and of its ability to remain responsive to claimants' needs.

I will add that the inspiration for this measure came from thinking about what happened to NHS hospitals when they were brought into state control in 1948. Their service levels were almost frozen. It is vital, with a big state system, constantly to move, change and evolve it. This is the mechanism to ensure that we have a responsive system. If we do not have this kind of power, we could find ourselves with a system that is perfectly in tune with what we require in 2011 but by 2030 is absolutely out of touch with what society needs.

I recognise that any pilot must be transparent and timely, which is why the clause includes a number of safeguards. For example, we have time-limited each future pilot scheme to three years. Through Amendment 69A we will ensure that any pilot regulations will be subject to the affirmative resolution procedure. I hope that noble Lords on all sides will support this enthusiastically, and I urge the noble Lord to withdraw his amendment.

--- Later in debate ---

[Lord Freud]

I think that I had completed everything I need to say about these piloting powers and ask the noble Lord to withdraw his amendment.

[Lord Kennedy of Southwark]

I thank the Minister for his response. As he says, it is important that we are able to respond to changed situations—that certainly is progress—but we still have some way to go. I agree with the comments made by my noble friends Lady Hollis and Lady Hayter, and by the noble Lord, Lord Boswell. The integrity and transparency of the process is paramount. As noble Lords have said, it is possible that what comes back will not support the aims or proposals of the Government. With that, I beg leave to withdraw the amendment.

Housing Benefit

Debate between Lord Kennedy of Southwark and Lord Freud

Tuesday 3rd May 2011 Lords Chamber

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what are the implications of housing benefit reform for the geographic distribution of low-income families.

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

My Lords, our published impact documents specify average losses by local authority. We expect that a very small proportion of people may have to move as a result of the housing benefit reforms, with a minimal impact on the geographic distribution of low-income families. My department has commissioned a consortium of leading research organisations to comprehensively evaluate the effects of recent local housing allowance changes. Further information on that will be available from the Library today.

[Lord Kennedy of Southwark]

I thank the Minister for his response. Does he agree with me that the success of UK cities is that people from all walks of life live and work together and that introducing a policy that forces low-income families to move to the suburbs, as happened in Paris, would lead to alienation and social unrest and contradict the Government’s belief in the big society?

[Lord Freud]

My Lords, the comparison of London with Paris, which has been made quite widely, is very misleading. The structure of London is very different from that of Paris. London is made up of a collection of villages and is quite unlike the doughnut of Paris. I would not agree with that assertion.