Personal Independence Payment: Mobility Criterion

Lord Low of Dalston Excerpts

Wednesday 4th May 2016 Lords Chamber

[Baroness Thomas of Winchester (LD)]

My Lords, in moving this Motion I must first declare that I have a Motability car as a result of having higher-rate mobility and disability living allowance. As I am over 65, I will not be reassessed for personal independence payments. That is probably the reason why I am so keen to try to persuade the Government to hold urgent talks about the “moving around” part of the PIP assessment, because I am particularly concerned about the reassessment process for all those working-age disabled claimants who at present receive higher-rate mobility DLA and are thus entitled to a Motability car but who are now facing reassessment for PIP. Here I should make it clear that I am not talking about the care component to PIP, which was the subject of the recent climb-down by the Government over the Budget. Tabling a Motion is an unusual course to take, but I assure the House that there is nothing fatal about it. However, if it were to be agreed, it would send a powerful message that this House is very concerned about this particular government policy and is taking a constructive approach to seeing what can be done to help the situation.

Why am I so concerned about the “Moving around” section? Because the relevant walking distance test for PIP has been made much harder than the DLA test, meaning that by the Government’s own estimate the number of people on enhanced or higher-rate mobility will go down from around 1 million people to 600,000 by 2018. Some 400 to 500 Motability cars a week are now being handed back by disabled claimants whose condition may not have improved but who are losing not just their car but, in many cases, their independence. Under DLA, the walking distance was 50 metres, which was in the Department for Transport guidance on inclusive mobility. The new distance of 20 metres is just under two London bus lengths, and is unrecognised in any other setting. There is no evidence that it is a sensible distance for the test, and it is not used anywhere else by the Government.

So someone with a walking frame, say, who can just about manage 20 to 30 metres, will not usually qualify for PIP. I see the Minister even now sharpening her pencil to make a note reminding her to tell me that this is a travesty of the truth. No, I have not forgotten the reliability criteria, which were made statutory in the last Parliament—thanks, in fact, to the intervention of the Liberal Democrats. The full reliability criteria in the PIP guidance are that 20 metres must be able to be walked,

“safely … to an acceptable standard …repeatedly … and … in a reasonable time period”.

Claimants, we are assured, must be asked about these criteria during an assessment. But are we quite sure that they are asked on every occasion? Are claimants taken outside the assessment centre, and does the assessor watch while they do the walking test?

How the questions are asked is likely to have a significant impact. If someone said to me, “Could you walk this distance, not too slowly, even if the pavement was very uneven”—as they all are in London—“and crowded, and there was a gusty wind or perhaps rain? What about crossing the road, which might not have a dropped kerb except at the very end, which would be further away than 20 metres? Could you walk this distance more than once a day if you had to—say, to a local shop or pharmacy and back, or to a bus stop, which would almost certainly be more than 20 metres away? And in the dark?”. My answer would be no. However, if the criteria were mentioned quickly, with the assessor looking down and ready to tick a box on the relevant form, then I might not quite take them in. I also wonder whether every claimant actually knows what distance 20 metres is unless it is demonstrated. I have heard about walking tests being done by claimants inside the assessment centre, but that is not the right test.

In an ideal world, at the assessment all claimants would have a report from a healthcare professional setting out their mobility problems, but I gather that that is not mandatory because in many cases such reports, particularly if they come from GPs, cost the claimant money. The amount varies enormously, but even in 2013 the BMA suggested that £90 was not an unreasonable amount. It is likely that, in time, a person’s medical records may be able to be accessed online, but that is not the case at present. It is only during the tribunal appeal process—not even the mandatory reconsideration—that the DWP will pay for a medical report. This whole area could be explored in the talks that I am calling for, because there are other healthcare professionals who do not charge for their reports. We are told that claimants often produce more evidence at the appeal stage, so why not try to improve this part of the process before that stage?

Why did the Government shorten the walking distance so arbitrarily and drastically? Almost certainly, it was to wipe the slate clean before the tribunal judgments in order to save the money that the Treasury was demanding. After all, who would notice except disabled people themselves? The Government’s excuse would be that the test had changed so the money would now go only to “those most in need”. That is a very worthy-sounding phrase, but it really does not mean very much unless it is qualified. Perhaps disabled people in rural areas, where public transport is scarce, are most in need of their own transport. Perhaps disabled parents with young children are most in need of their own wheels, or those who need a large car because they have most to carry in them, such as a supply of oxygen, walking aids or even toilet equipment. Just to recap, under PIP, if a person can walk more than 20 metres, aided or unaided, they usually will not qualify for the enhanced rate mobility component and thus a Motability vehicle.

How did Parliament allow this change in the assessment rule without challenging it? The answer is that the Government changed the distance at the very last minute without consulting on it. They then realised that no consultation on a crucial rule meant a judicial review, so they consulted in the summer of 2013. They received more than 1,000 responses, almost all saying that the 20-metre walking test was manifestly unfair, not to say meaningless, and that a longer distance should be used. The Government took absolutely no notice, using the excuse that, because there was no unanimity on what the right distance should be, they were going to stick with 20 metres. In other words, the consultation was a complete sham and the Government’s response unbelievably weak.

PIP was fraught with problems for new claimants. It was initially delayed for months, and then reassessments were delayed for months and months but they finally got going last year and are resulting, as was predicted, in hundreds of cars being handed back. Motability has done what it can to mitigate the situation, but it is the Government’s responsibility to make the assessment as fair as possible. If it is fair now, why are there so many successful appeals? Sixty per cent is the figure I have. Appeals, it must be pointed out, can be held several months after a car has been handed back and are quite expensive, costing over £200 each. It surely cannot be right for the Government to rely on appeals to bring some fairness into the situation.

I will now look briefly at just three of the other arguments that the Minister will use. First, I will be told that there is now a better balance between those with mental health problems and those with mobility problems. That is good, but there should not be a trade-off between these two groups. Is that what happens in the NHS? Parity of esteem should mean just that. I will also be told that there are more Motability cars on the road than ever before because a slightly higher percentage of PIP assessments are successful compared with those for DLA. However, the true picture will not emerge until all the reassessments are done, when it is estimated that the number of Motability cars by 2018 will be down to 602,000. Thirdly, I will be reassured that the Access to Work programme can take care of disabled people who lose their Motability car, which they need to get to work. However, it will not help those who need a car to get to a further education college for training or to university, or for volunteering or hospital appointments, or even to visit family and friends at the weekend.

As for the assessors, when one young claimant with cerebral palsy asked why she had to be tested again, she was told by her assessor that there might have been medical advances. The claimant said, “There’s no cure for cerebral palsy. I’m never going to get any better. I’ve been on a lifetime award since I was a teenager, and now someone who has never met me can take that away”. This was not just an isolated example of an uninformed assessor. Someone with muscular dystrophy, a progressive condition, was told by an assessor to get better soon. Many with this and other progressive conditions such as MS and Parkinson’s, with lifetime awards of DLA, are falling foul of this particular part of the PIP assessment. Here, again, the quality and training of assessors is another important issue for talks. It was the last thing that the late and much-lamented Lord Walton of Detchant asked about on 7 March as a supplementary to my Oral Question on that day.

To sum up, to be told that the bill for PIP is too high and must be cut by more than halving the walking distance test is a real slap in the face for thousands of disabled people, particularly those of working age with lifetime awards under DLA. Of course the bill is going up—because the disabled population is going up. The Government must have factored that into their calculations years ago. The last thing that anyone wants is for more and more disabled people to become socially isolated and totally reliant on other services for everything they need. A great deal of money could actually be saved by other government departments, such as health, social services, employment and transport, by making the PIP walking distance fairer. I beg to move.

[Lord Low of Dalston (CB)]

My Lords, the noble Baroness, Lady Thomas, has made an excellent case and I support it. I should declare as an interest that I have an award of disability living allowance, but it is not an interest that I have to defend because it is a lifetime award; and, since I, too, am over 65, I am not subject to reassessment. My only interest in this debate is that I wish everybody else to be able to have the same.

I want to make five points, which I think will add to what the noble Baroness said in her excellent speech. First, as I understand it, 548,000 disabled people will lose out as a result of the revision in the criteria for DLA and PIP. They are set to lose £35.65 a week as a result of this change, which is a considerable amount.

Secondly, Motability has reported that to date 45% of scheme users—over 13,000—who have been reassessed from DLA have lost their Motability car. That can have a dramatic impact on people’s employment. I heard somebody on the radio say that they would not be able to continue to work, but this does not just affect isolated individuals. Of Motability customers surveyed in 2010 who were not currently retired, permanently unable to work or in full-time education, 39% said that their Motability car had enabled them to gain employment, get better employment or maintain their current employment. A Multiple Sclerosis Society survey found that 20% of those surveyed agreed that it enabled them to stay in their job, whereas, without a Motability car, they would not have been able to do so. Making a change that means that people who need a Motability car to go to work lose their car flies in the face of the Government’s welfare-to-work agenda and their aim to halve the disability employment gap.

My third point is that the 50-metre threshold, to which the noble Baroness, Lady Thomas, would like to see us return, is a well-established and research-based measure of significant mobility impairment. It has been used for the last 35 years, notably in relation to other disability benefits, including DLA itself, the blue badge or disabled persons’ parking scheme, and in official guidance on creating an accessible built environment. The 20-metre threshold to which retreat is being sought is completely arbitrary and has no basis in established usage.

--- Later in debate ---

[Baroness Altmann]

To reiterate for the noble Baroness, if a claimant cannot walk up to 50 metres safely, reliably, repeatedly and in a timely manner, they are guaranteed to receive the enhanced rate of the mobility component. Therefore, there is not a strict 20-metre rule. There is discretion, and an individual assessment is made. We take into account whether the person is in pain and whether they can reliably walk or manage on their own.

I can also reassure noble Lords that our door is open. We are happy to engage. The Secretary of State and the Minister for Disabled People regularly engage with disability groups. We would like to continue to do so. Clearly, we want to make sure that this new process is working. As far as we can see at the moment, it appears to be.

[Lord Low of Dalston]

I am aware that Ministers have regular talks with disability organisations, but the request behind the Motion is not that Ministers engage in general talks with them about a range of issues. The point of the Motion is to call on the Government to have specific talks directed at addressing the particular problem identified in the Motion and in the speech of the noble Baroness, Lady Thomas.

[Baroness Altmann]

I thank the noble Lord. The general point I am trying to make is that we are not convinced that there is the problem being identified or described by many noble Lords. If there are problems in the assessment process—of course, it relies on human beings and it is possible that, from time to time, an assessment may not be done correctly—that is why we have the appeals process. But the figure I quoted to the House, that 2% of the assessment appeals are upheld, does not currently suggest that there is a big problem. Indeed, it appears that the PIP assessment process is doing what we want it to.

The noble Baroness, Lady Grey-Thompson, asked about the healthcare professionals carrying out the assessment. They have to consider the reliability criteria as part of the assessment process, and they also have to be registered with a relevant professional body, such as the General Medical Council. They have to have a minimum of two years’ post-registration experience. They also undergo rigorous training and assessment. It is early days, but it seems that the process is working.

We would indeed expect the haemophilia example that the noble Baroness, Lady Grey-Thompson, asked about to be taken into account properly by the assessment process. All the evidence presented by the claimant, along with any obtained by the healthcare professional undertaking the PIP assessment, will be fully considered. Therefore, if a claimant is exposed to a high level of risk when undertaking certain activities, that will be taken into account. Claimants who require supervision when completing activities will receive the appropriate PIP award. I can also assure the noble Baroness that providers can undertake home visits where necessary.

The noble Baroness, Lady Brinton, asked the Government whether we are looking at effective value for money for taxpayers. This is indeed why we are moving from DLA to PIP. We want to ensure that we look at people and their condition with a face-to-face assessment, rather than under the previous system, so that we can spend the public money we spend on disabled people in the most appropriate manner. This issue was also raised by the right reverend Prelate the Bishop of Peterborough. We certainly agree that individuals must be treated as individuals, which, again, is the aim of PIP assessment as well as the Access to Work scheme.

The noble Lord, Lord Low, mentioned the consultation. We have undertaken extensive consultation. The department does not consider further consultation necessary, but as I said, we are more than happy to meet with stakeholders to discuss the PIP assessment and any suggested improvements to the guidance or working practices of the assessment providers.

I hope that I have addressed the points from the noble Baroness, Lady Masham, about the assessors we use. They are health professionals. Indeed, they must have knowledge of the clinical aspects and the likely functional effects of a wide range of health conditions and impairments. I can also inform the House that we have just implemented a new contractual regime that will drive further improvements to the assessment through independent audit and revised audit criteria, and that we regularly review the guidance for the PIP assessors.

As the noble Baroness, Lady Sherlock, rightly said, PIP is specifically designed to help disabled people meet the additional costs of a disability. We believe that the current assessment process is working. Indeed, as I stressed, more than 22% of claimants now receive the highest rate of both components, compared with only 15% under DLA.

Welfare

Lord Low of Dalston Excerpts

Monday 21st March 2016 Lords Chamber

[Lord Freud]

I take that point from the noble Lord, who is very well informed in this area, on advisement. I accept his point that George Osborne is a pussy cat compared with some previous Chancellors sitting not very far from me.

[Lord Low of Dalston (CB)]

My Lords, as the Minister has confirmed, events at the weekend have made it clear beyond any doubt that the Government’s welfare reform programme has run out of road. Its contradictions stand revealed for all to see. Since exactly the same criticisms apply to the cuts to the employment and support allowance enshrined in the Welfare Reform and Work Bill as apply to the cuts to the personal independent payment, I repeat the question asked by the noble Baroness, Lady Sherlock: will the Government now reconsider implementation of the cuts to the employment and support allowance? They may have been voted through, but it is still open to the Government to reconsider the matter, as they have with the personal independence payment.

[Lord Freud]

The welfare reform programme is massive and we are pushing ahead with it. At its heart is universal credit, which is now moving at a pace. As I speak, more than 400,000 people have made an application for universal credit. We have a lot more to do, and we have a lot to do to implement the Bill that we have just passed. I have to disappoint the noble Lord by saying that there are no plans to reconsider the changes to ESA WRAG that we put through in that Bill.

Welfare Reform and Work Bill

Lord Low of Dalston Excerpts

Monday 7th March 2016 Lords Chamber

[Baroness Campbell of Surbiton (CB)]

My Lords, I echo my noble friend Lady Grey-Thompson’s deep regret at the Government’s rejection of my noble friend Lord Low’s amendments—amendments that were carried in this House with a considerable majority, twice. In my view, our arguments were pretty indisputable, especially with regard to the absence of evidence that cutting severely disabled people’s employment support allowance would incentivise them to work. I think that, deep down, we all know that it is attitudinal and environmental discrimination that prevents this group from accessing employment. This will be borne out very soon in the evidence of the forthcoming Select Committee report on the Equality Act and disability, which is to be launched at the end of this month.

Last week, when I listened to the Government’s arguments in the other place in the debate on the Lords amendments, I have to say that words failed me, particularly when Members were told to separate the “issue” from the more important principle of Commons primacy. I find it very difficult when the niceties of parliamentary protocol trump the lives of disabled people. However, we are where we are, and I have to salvage what I can to protect those who will undoubtedly struggle significantly to make ends meet as a result of such a severe cut to their weekly income.

The Minister has generously—and I mean that—acknowledged the deep anxiety that I and expert disability organisations feel about this policy. He has made great efforts to assure me and them that they will be fully involved in the preparation of the White Paper. He also underlined his commitment to detailing in the annual report on full employment progress towards halving the disability employment gap. He said, “No ifs, no buts. We will do it”. In good faith, I therefore withdrew my amendment on additional reporting on disability.

The Minister is asking us to have faith again today, but I hope and pray that we do not look back on this day as the moment when we pushed some of the most severely disabled people in Britain over the edge. I will try not to let that happen and I will do what I can to become involved in the White Paper and the reporting, but, this time, please will the Minister involve disabled people centrally throughout that process?

[Lord Low of Dalston (CB)]

My Lords, perhaps I might be permitted to say a word about the Commons rejection of my amendment. Despite the Minister’s best efforts to soften the impact of the £30 cut in the incomes of disabled people in the employment and support allowance WRAG, which I readily acknowledge, this is a black day for disabled people. The Commons has spoken decisively and we must bow to their wishes, but we do so under protest. Do not let anyone kid you that this is democracy in action. There is more to democracy than just being elected. Questions of representativeness, accessibility, openness and responsiveness all come into it as well. From these standpoints, this House, though unelected, is much more democratic. Organisations representing the needs of poor and dispossessed people find it much easier to get their point across and have it taken on board in the House of Lords than in the House of Commons, which is more politicised and subservient to the Whips—and the Whips were certainly working overtime last Wednesday night in the House of Commons, going round handing out bribes and blandishments like there was no tomorrow.

Last week, the noble Lord, Lord Young of Cookham, took me to task for quoting selectively from the Commons debate on our amendments, but I did so because the debate ran largely one way. Last Wednesday, the Minister had a bit more support, but some telling points were still made against the Government. Commenting on the Commons reason for refusing our amendments— that is,

“Because it would alter the financial arrangements made by the Commons, and the Commons do not offer any further Reason, trusting that this Reason may be deemed sufficient”—

Neil Gray, MP for Airdrie and Shotts, said:

“So the Commons did not offer ‘any further Reason’, which I found shocking. The Government could not come up with anything else to say—no empirical evidence, no logical argument, nothing socially responsible or of any consequence. It relied on a pseudo-constitutional technicality to explain the decision to remove £30 a week from the pockets of sick and disabled people on ESA WRAG … What message does that send from this Government to ESA recipients? It says, ‘We don’t need to justify why we are cutting your ESA, we just are. We just can and we just will. We trust that this reason may be deemed sufficient’”.

Helen Goodman, MP for Bishop Auckland, said:

“The Minister said that she was going to spend another £100 million on supporting these people. If her scheme was going to work, she would not need to cut this £30 from such people’s weekly income, because she would get the savings as they all moved into work. This is doomed to fail and the Minister knows it. If she was convinced that it was going to work, she would do the impact assessment, because she would be confident of the upshot. She is not doing so, and she is ignoring the very real impact that this will have on the health of the most vulnerable of our fellow citizens”.

From the Conservative Benches, Stephen McPartland, MP for Stevenage, said:

“I genuinely think we would not have been in this position if the White Paper had been brought forward already and we were not having to take on faith something we are not really sure is going to happen, who the Ministers will be, who will be in charge of the money, and how we are going to move forward for these disabled people”.

With those words in mind, it is essential that the White Paper focuses on better back-to-work support for disabled people and better support for employers. Jo Cox, MP for Batley and Spen, said:

“If implemented, these cuts will surely also hinder the Government’s ambition to halve the disability employment gap. Instead, they will push many disabled people further into poverty and have a significant and harmful impact on the health and wellbeing of many people, including many in my constituency”.

Accordingly, I agree with the noble Baroness, Lady Grey-Thompson, that the Government must monitor how these cuts affect disabled people, both in and out of work, and gather evidence as to the impact on disabled people’s physical and mental health and their finances as well as their ability to move towards work, as called for in your Lordships’ amendment.

A little later on, Jo Cox said that,

“it is time to listen to Macmillan, Scope, Sense and Parkinson’s UK, to the many experts who have lined up”,

to oppose the cuts to ESA. Stephen Timms said:

“The judgment that the House has to make … is whether”,

to listen to Ministers or to the organisations representing disabled people. Your Lordships have listened to disabled people, but the House of Commons, which ultimately determines how things play out, has preferred to listen to the Government, who have not been able to give any convincing reason for their decision to cut £30 a week from the incomes of 500,000 disabled people. As I said, it is a black day for those 500,000 disabled people—and for disabled people in general because this action is emblematic of the way in which this Conservative Government have chosen to treat disabled people. As Helen Goodman said:

“The fact is that Ministers are looking for large savings at the expense of the poorest and most vulnerable. That was not made clear in the general election campaign; then, the Prime Minister said that disabled people would be protected”.—[Official Report, Commons, 2/3/16; cols. 1052-58.]

By this action, the Government have betrayed the trust of disabled people and they should not be surprised if they forfeit it for the rest of their time in office.

[Lord Kirkwood of Kirkhope (LD)]

My Lords, before the Front Benches wind up this final session on this important Bill, I am prompted to follow the noble Lord, Lord Low. I am sure that I speak for the whole House when I commend him and his colleagues on the Cross Benches who experience some of the problems facing disabled people for their work and for the contribution that they have made to the Bill—and I agree with the Minister that some of the contributions have been important. Their experience and the report of the commission chaired by the noble Lord, Lord Low, helped me to understand exactly what was at stake in some of these measures.

Concentrating on Clauses 13 and 14 and sending this back to the Commons for further consideration was the right decision. It was the right part of the Bill to concentrate on. There are a number of things that we will need to watch carefully. I support those who have said that we must now engage in careful and urgent monitoring across the piece of how the ESA support group is catered for in future. Something that particularly worries me is the perverse incentive that will now be introduced into the scheme for people to hide from the truth in terms of the statements that they make when applying for their work capability assessment, because the cliff-edge for getting into the group will be that much steeper. These things must be carefully monitored going forward.

I think that the Minister has done everything that he could and that this is a better Bill, but it is still a severe Bill that will cause hardship for the rest of this Parliament. I look forward to the discussions with colleagues on the White Paper. That will be an important moment when we can remedy some of the defects that are still in the Bill and the savings that will be occasioned by it. Mental illness and fluctuating conditions are other areas that we will need to study carefully.

Finally, over the weekend I read an interesting report from the think tank Reform, Working Welfare: A Radically New Approach to Sickness and Disability Benefits. Reform has come up with interesting ideas that are new to me and it would be reassuring if the Minister could ask his officials to look at it; some of those ideas are worth pursuing. This Bill will now go for Royal Assent and I think that the best thing the Minister can do in concluding these proceedings would be to commit himself and the department to urgent and fine-print monitoring of how it works in practice.

Welfare Reform and Work Bill

Lord Low of Dalston Excerpts

Monday 29th February 2016 Lords Chamber

Moved by

[Lord Low of Dalston]

At end insert “but do propose Amendments 8B and 8C in lieu—

8B: Clause 13, page 14, line 24, at end insert—
“(8) Subsections (2) and (3) shall not come into force until the Secretary of State has laid before both Houses of Parliament a report giving his or her estimate of the impact of the provisions in those subsections on the—
(a) physical and mental health,
(b) financial situation, and
(c) ability to return to work,
of persons who would otherwise be entitled to start claiming the work-related activity component of employment and support allowance.
(9) Regulations bringing subsections (2) and (3) into force shall not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”

8C: Clause 13, page 28, line 2, at end insert “, subject to section 13(8) and (9)””

[Lord Low of Dalston (CB)]

My Lords, I beg to move Motion B1 as an amendment to Motion B. I shall speak also to Motion C1. The proposed amendments set out in Motion B1 provide that cuts to ESA should not come into force until the Secretary of State has laid a report before Parliament, while the amendments set out in Motion C1 make similar provision in relation to the limited capability for work component, the equivalent component in the new universal credit which will replace ESA and a number of other benefits. My remarks will mainly be directed to Motion B1 but they should be taken also to apply to Motion C1 mutatis mutandis.

When the matter was debated during consideration of Lords amendments in the other place last week, Jeremy Lefroy said from the Conservative Benches that he hoped that the House of Lords would have taken up the idea which he moved as an amendment on Report that the Government should carry out an assessment of its impact before implementing a cut of £30 a week for those in the work-related activity group of ESA. These amendments in lieu are what Mr Lefroy was looking for. The case for removing Clause 13 and the £30 cut from the Bill remains as strong as when we did that on Report on 27 January, but the amendment in lieu, drafted in the same terms as the amendment moved by the noble Lord, Lord Patel, in Committee, recognises that the Commons have reasserted their commitment to Clauses 13 and 14 by reinstating them and attempts to find a compromise by simply providing that the cut should not come into force until the Secretary of State has laid before both Houses of Parliament a report giving an estimate of the impact on the,

“physical and mental health … financial situation, and … ability to return to work, of persons who would otherwise be entitled to start claiming the work-related activity component of employment and support allowance”.

The Government have brought forward no more evidence for their central contention that reducing benefit support incentivises people back to work. In the debate in the other place last week, Dr Eilidh Whiteford MP said:

“If someone is seriously sick or disabled, reducing their income will not make them better quicker. There is not a shred of evidence to support that ill-founded fantasy, but there is plenty of evidence that financial worries and the stress associated with work capability and PIP assessments have a negative impact on people’s health. A large and growing body of evidence suggests that hardship and stress slow down recovery and push people further away from the labour market”.—[Official Report, Commons, 23/2/16; col. 236.]

Indeed, several of those who spoke in the debate made the point, supported by the Institute for Fiscal Studies, that abolishing the WRAG component of ESA could strengthen the incentive for claimants to try to get into the ESA support group. Taking the disincentive thesis head on, Paul Scully MP said that,

“61% of people in WRAG want to go back to work. The majority of people who are out of work want to go back to work”.—[Official Report, Commons, 23/2/16; col. 226.]

Stephen McPartland said:

“I do not accept that £30 a week is an incentive for somebody not to go to work. Most Conservatives do not accept that. Most Conservatives consider it to be their proud duty to look after the disabled. Ideologically, we have no issue about providing a welfare system that is a safety net for those who need support when they fall on hard times, to help people back into work”.—[Official Report, Commons, 23/2/16; col. 232]

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[Lord Low of Dalston]

My Lords, I thank the Minister and all noble Lords who have spoken. We have had 10 speeches in this substantial debate on my Motion which in my estimation break down to eight to two in favour of the amendment, so the opponents are gaining. We also had 10 speeches on Report, but they broke down to nine to one in favour of the amendment. Eight to two still gives us a substantial lead. Frivolity apart, I thank all noble Lords who have contributed to the debate and for the support which has been signified right across the House. I am also grateful to the Minister for the way he has engaged with this.

I wish to pick out four points from the debate to allude to. The noble Lord, Lord Young of Cookham, is very knowledgeable about the dynamics of these matters and I am sure we all respect his views, but I am afraid that we will just have to disagree about who won the argument in the Commons. Yes, it is a subjective question, but in support of my interpretation of the debate I would simply argue that, as I said when moving the amendment, the Government have not really brought forth any more evidence in support of their case. What they have said is based largely on assertion, and in the circumstances I believe that it would be wrong for your Lordships not to draw attention to the weakness of the case.

Secondly, we would be failing disabled people, who will suffer dramatically if these changes to ESA go through, if we did not at least move an amendment like this and, it is hoped, carry it. I have long thought that a particular strength of this place is its openness to pleas for support from constituencies of the vulnerable outside this House. I am strengthened by the independent mindedness of noble Lords and the comparative independence of the Whips. That makes this place more open and accessible to the concerns of vulnerable communities, and I do not think that we should clam up against them at this point. The House should be true to its traditions and true to the spirit that it showed in carrying Amendments 41 and 44 on 27 January on Report.

If we are to keep faith with disabled people, the only way in which to do that is by calling for a report to be brought forward under secondary legislation. That is why the amendment seeks to use secondary legislation rather than primary legislation; it is the only course open to us.

Thirdly, the amendment is extremely appropriate given the EHRC’s strictures on the impact assessment that the Government have come up with. Fourthly, it is a question of delay. I do not think that the amendment will be delaying because the Government have 14 months to comply with what it is calling for. To the extent that it is delaying, it is appropriate that the changes to the benefits system for claimants of ESA should be finalised in the context of the White Paper. That point has been strongly made by a number of noble Lords.

The Minister made the point that it is impracticable for the DWP to carry out the sort of assessment that the amendment is asking for. I cannot remember who it was—it may have been the noble Lord, Lord Kirkwood—who said that surely the DWP, with its hundreds of researchers, can at least have a stab at it. We are not seeking the last word in methodological rigour, but within the time available it should not be impossible for the department to have a better stab at an impact assessment than what we have seen so far.

I do not think it is a wrecking amendment. It is more than possible for the Government to come up with a passable show of what we are asking for. However this goes today, I undertake to the Minister that we will continue to work with him to get the best outcomes for disabled people, which I know is what he wants, too. For now I hope he will not mind if I seek to test the opinion of the House.

--- Later in debate ---

Moved by

[Lord Low of Dalston]

At end insert “but do propose Amendments 9B and 9C in lieu—

9B: Clause 14, page 14, line 27, at end insert—
“(2) This section shall not come into force until the Secretary of State has laid before both Houses of Parliament a report giving his or her estimate of the impact of the provision in this section on the—
(a) physical and mental health,
(b) financial situation, and
(c) ability to return to work,
of persons who would otherwise be entitled to start claiming the limited capability for work element of universal credit.
(3) Regulations bringing this section into force shall not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”

Welfare Reform and Work Bill

Lord Low of Dalston Excerpts

Tuesday 9th February 2016 Lords Chamber

[Baroness Manzoor]

My Lords, we broadly support Amendment 5. It is a positive change. I take this opportunity to thank the Minister for the very constructive way in which he has allowed us to meet him, because there have been great challenges in the Bill. It has been a very difficult Bill and he has been a master at defending a very difficult piece of legislation. I sensed at times that he himself felt, “My gosh, what are we doing here?”. I may be putting words in his mouth but that is the sense I got.

Obviously, there are significant financial cuts to some of the most vulnerable in our society. As the Minister is aware, I have been very concerned about the issues relating to the work allowance and the cuts that will affect working people. We have looked at the Bill through the prism of work. I am also very concerned about the cuts to employment allowances for people with disabilities and progressive illnesses. I state again that I really cannot understand how cutting £30 a week from the employment allowances for people in the ESA group is going to make them better and fitter and enable them to go back to work. I say to the Minister: this is going back to the House of Commons but please could the Government look at this? It is so important as a sign of a compassionate, caring society that we look after the most vulnerable. But I thank the Minister, and the Bill team, for the time he has given to the Bill and the very constructive dialogue he has held with us.

[Lord Low of Dalston (CB)]

My Lords, the Minister made reference to the Bill going back to the other place without the provisions relating to the removal of the ESA WRAG premium and the comparable allowance under universal credit, and to the fact that he would be working to achieve the best outcome in relation to these provisions. I wonder if he would be prepared to meet my noble friends Lady Meacher and Lady Grey-Thompson and me so that we could work together on achieving the best outcome in relation to these provisions. My office is in touch with his office to see if we can set up a meeting with him and Priti Patel, who I believe has also been involved in these issues. I very much appreciate the support of the noble Baroness who spoke before me, and her plea for the Minister to give earnest consideration to this issue, with a view to achieving a better outcome than was in the Bill originally.

Housing Benefit (Abolition of the Family Premium and Date of Claim Amendment) Regulations 2015

Lord Low of Dalston Excerpts

Wednesday 3rd February 2016 Lords Chamber

[Lord Low of Dalston (CB)]

My Lords, I support the Motion of the noble Lord, Lord Kirkwood. I will speak particularly on the backdating aspect of the regulations.

Limiting backdating of housing benefit payments to one month is likely to put vulnerable people at risk of rent arrears and subsequent eviction, and possibly homelessness. Crisis, the charity for single homeless people, wrote to tell me that it is concerned that the most vulnerable will be affected by this change, including those who have experienced homelessness. It says that many of the people it supports to find and sustain tenancies make successful backdating claims for housing benefit often for upward of 12 weeks. These are often the result of clients having additional support needs that make it difficult for them to navigate the benefits system. Consequently, they fail to claim the benefits to which they are entitled in time.

The Government dispute the suggestion that limiting the backdating period will lead to tenants falling into rent arrears but Crisis says that many of its clients accrue considerable arrears before they seek the support they need to backdate a claim. Backdating claims are often made following a change in circumstances that affect a person’s entitlement or because of failures in the system that lead to housing benefit not being paid. I will mention three examples of when people may need to make a backdated claim. There is where there are fluctuations in income. When someone finds a job their entitlement to housing benefit must be adjusted. If they enter casual work, such as on a zero-hours contract, their entitlement must be calculated on a weekly basis. This can lead to payments being stopped until the claimant can provide all necessary payslips. That causes delay and the need for a backdated claim. The ability to backdate by only one month may not be enough to cover that delay.

Housing benefit claim forms may be lost. Despite the best intentions of council staff, housing benefit claim forms can go missing or online submissions may not be received. I can empathise with this and can vouch for the fact that this kind of thing can happen through nobody’s fault. Today, I rang up to buy some more premium bonds, only to be told that I needed to provide a password. Apparently, one had been sent to me in the course of the last year but it never arrived. Getting back to housing benefit, resubmitting claim forms can cause serious delays at the beginning of a tenancy. We need a backdating period sufficient to cover such delays.

Again, housing benefit is sometimes stopped in error when someone is sanctioned. This can lead to arrears, particularly if the landlord is receiving direct payments and does not notify the tenant that the rent has not been paid.

The Social Security Advisory Committee advised that the case for this policy has not been made out and recommended that it should be possible to backdate housing benefit for at least three months. It says that inconsistencies between the rules attaching to different benefits are hard to defend and add to the complexity that claimants are required to navigate. For people whose rent is paid monthly or four-weekly in arrears, the proposal will mean that there is no slack in the current complex legacy benefit context for them to realise that there is a problem with their housing benefit entitlement and make a late claim. This presents a clear risk that the impact on landlord and tenant behaviour could result in upward pressure on homelessness among the more vulnerable, with attendant costs that could offset the projected savings. It is disappointing, the committee says, that there has been no cost-benefit analysis of these aspects. For people whose rent is paid monthly or four-weekly in arrears, the proposal will mean that the new rules will not provide sufficient time for a backdated claim to cover the delays that have taken place.

The fact that there has been no effective impact assessment makes it difficult to assess the effect of reducing backdating by different amounts from the current six months. Centrepoint undertook a survey of more than 800 young people using its services and found that 78% of those who made a late claim for housing benefit were not seeking backdating for longer than three months; the majority of backdating claims could therefore be accommodated within a three-month period, and reducing it further could have a financial impact on a sizeable group of vulnerable young people, potentially causing hardship to those least able to withstand it. The Committee highlighted the fact that the legacy benefits system is more complex than universal credit; that being the case, there is a strong case for maintaining a longer backdating period to account for these complexities. Removing the ability to back-date housing benefit claims for a sufficient period may deter landlords from letting to tenants in receipt of housing benefit. Landlords may be particularly reluctant to let to people who have experienced homelessness in the past, given that they may be vulnerable to falling into rent arrears, often through no fault of their own.

The committee concluded that the position faced by housing benefit legacy claimants, particularly the more vulnerable, is substantially different and more challenging than the position following migration on to universal credit. It added that in the absence of a robust impact assessment, the case for a simple alignment with a one-month backdating rule has not been made and that there is a significant risk of offsetting additional costs to the estimated one-year saving of £10 million if the proposal is pursued in this form. It therefore recommends that, if the Government still wish to make an early reduction in the backdating period, a three-month period would strike a better balance between the aim of securing an expenditure saving and recognition of the substantial differences between the housing benefit legacy and universal credit positions. With the noble Lord, Lord Kirkwood, I would want to maintain that the three-month compromise is the one that we should go for, and the Government should rethink.

[Lord McKenzie of Luton (Lab)]

My Lords, we should be grateful to the noble Lord, Lord Kirkwood, for giving us the opportunity to range over this issue this evening and to the noble Lord, Lord Low, for his very extensive analysis of some of the risks around homelessness that these changes will create. Given the hour and the business to follow, I shall raise one or two brief questions.

On the family premium, the Explanatory Note with the regulations says:

“Removing the Family Premium helps to simplify the overly-complex HB system … and should therefore reduce administration costs”.

Can the Minister seriously tell me how much of a reduction in administration costs is anticipated just from removing this one component of what is and can be quite a complex calculation? It seems to me that it should be built into the system, so whether it is there or removed would make very little difference to the cost.

As for backdating, we have heard the arguments against the Government’s position that effectively we want to get equality with universal credit and if universal credit only needs one month’s backdating why does the housing benefit system need longer? I should have thought that it was recognised—and the noble Lord, Lord Low, has made it clear—that the housing benefit system is more complex. Indeed, is that not one of the boasts of the Government about universal credit, which we have supported—that it is an easier system whether you are in or out of work? You simply move up the scale; you do not have to come off one system of benefits and go on to another, or seek to return to them in due course.

We are in danger of overlooking a fundamental point here—that this is about backdating if there can be shown to be good cause. It is not something that is awarded willy-nilly. There are particular concerns around people with mental health conditions and the extent to which they are supported to make the right sort of decisions and judgments about their claim for benefits. That seems to sweep aside that issue.

There is one technical issue that the Minister may be able to help with. If somebody is awarded JSA after making a claim, they would be entitled to a three-month backdating of that benefit. The award of that benefit could automatically transport somebody on to maximum housing benefit—somebody who was not previously eligible for housing benefit. So we get somebody on JSA with a three-month backdating, which opens up the opportunity for housing benefit for somebody not previously entitled. There is something in the text that suggests that that backdating would apply to housing benefit as well, but I cannot quite see technically how that comes about. I would be grateful if the Minister could clarify that on the record tonight, because clearly there would be an anomaly with accessing one benefit opening up the opportunity for another benefit and giving rise to different backdating results, as a result particularly of these regulations.

--- Later in debate ---

[Lord Freud]

My Lords, I ask noble Lords to forgive me for not keeping up with the exact floating role of the noble Lord, Lord McKenzie, as he moves forward and back on the Benches. I thank all noble Lords for their contributions which, as one would expect, covered a number of issues.

I start with the family premium, which will align housing benefit with universal credit, which does not have this process. As noble Lords will be well aware, it applies to new cases only. It will therefore not affect people in receipt of family premium on 30 April this year. They will continue to receive the family premium until they are no longer responsible for any children or young people under 20 or make a new claim for housing benefit. To avoid people dying at the stake for the sake of these premiums, I remind noble Lords of their very complicated history which started in 1988. With the reform of tax credits, they were removed from income support but not from housing benefit. I know there is a lot of historical nostalgia for bits of the benefit system, but this one reminds me more of an appendix than of anything else: it had a purpose at one time, but it is pretty odd to remember what it was and it can cause you problems, as I am discovering.

On the linking rules, where claimants are in receipt of housing benefit and subsequently move house into a different local authority, they are required to make a new claim for housing benefit. That has always been the case and the policy does not seek to change it. If the claimants were in receipt of the family premium before their move and they move after 30 April, they will no longer receive the family premium in their new housing benefit claim from their new local authority. That responds to the question from the noble Baroness, Lady Sherlock. I know that the noble Baroness likes to stretch out the period for which this will last, but universal credit will be coming in for new cases reasonably soon. It is simply not feasible to introduce linking rules for these cases because that really would introduce a level of complexity and cost.

I regret that I cannot answer the precise question from the noble Lord, Lord McKenzie, on the administration costs saved. When you go through the sums of how you reach that family premium amount and then do the taper with it, and you have to do that differently through every local authority, I have to believe that it genuinely saves some money. However, I cannot put any amount on that.

On the point about work incentives made by the noble Baroness, Lady Sherlock, the loss of family premium would be one factor among many others, including the financial gain and development prospects that would come from entering work. It is important to mention the likely behavioural change that could result from this policy, as the potential reduction in benefit may make claimants more likely to find work or increase their hours. Indeed, you see evidence of that in some of our welfare reforms already.

I turn to the issue of backdating, which noble Lords touched on. This change introduces equality for working-age claimants by aligning housing benefit rules with those in universal credit. Under current rules, as noble Lords have pointed out, the working-age housing benefit claimants may have their claim treated as made from a date up to six months before they actually make the claim. The backdating period will apply from the date of claim and is not dependent on the time that it takes to process claims. Our rationale is that the one month provides a reasonable period to seek assistance or to get claimant affairs in order for those who can demonstrate good reason as to why they did not claim more promptly. While claimants still receive legacy benefits before migration to UC, there is sense in preparing them for the transition to UC by, so far as practicable, equalising how they are treated. The other factor that is useful when we look at this is that our administrative data show that more than two-thirds of backdating claims for housing benefit are awarded for one month or less.

The noble Lords, Lord Kirkwood and Lord Low, asked why we rejected the three-month recommendation —although, interestingly, the numbers between the one-month figure and the three-month figure are actually not very great. We are aiming to change behaviours. If people want to claim benefits, one month allows sufficient time for them to register a claim in the first instance. It does not matter if it is a more complicated process, because the processing and getting the detail does not change the date of entitlement, which is established on the initial claim.

To respond to the noble Lord, Lord McKenzie, who as usual has excruciating detail at his fingertips, I confirm—and I am impressed that he has looked at this—that where a claim for housing benefit is linked to a claim for one of the legacy income-related benefits that applies the three-month backdating rule, entitlement to housing benefit will be linked back for the full three months if it is made within one month of the award for legacy benefit. So he got that spot on.

On the point from the noble Lords, Lord Kirkwood and Lord Low, we do not anticipate pressures on the homelessness front. I am slightly influenced by the fact that every time we make such a change we are warned about that but so far it has not come through.

[Lord Low of Dalston]

Does the Minister not agree that I gave some concrete and tangible examples where people might be justified in needing to have their claim backdated for longer than a month, through no fault of their own—for example, where forms have gone missing or where they have been sanctioned in error? Would it really mean any skin off the Government’s nose to include an element of flexibility to take account of those cases? If someone has lost a form or they have been sanctioned in error, those are not instances of behaviour that can be changed by limiting the backdating rules to one month.

[Lord Freud]

I listened very carefully to the noble Lord on those points. My response to that is, if the claim was made on that date and it was lost but it was made then, the issue is whether the bureaucracy accepts the claim that it is lost. The date is established then, and would be established in both of those cases. A lot of the problems may be through legacy benefits, where, as I just explained, the situation has not changed.

DHPs are designed to give additional support to claimants who need it. It is technically possible for DHPs to meet a historic need, although in practice we suspect that it is rather unlikely that a local authority would make this award for that reason, as the regulations state that a claimant should need further financial assistance with housing costs to receive a DHP. As the time period that they are applying for would have passed, it would be difficult to argue that there was a need for financial assistance with housing costs. Therefore it is unlikely but not impossible.

Welfare Reform and Work Bill

Lord Low of Dalston Excerpts

Wednesday 27th January 2016 Lords Chamber

Moved by

[Lord Low of Dalston]

41: Clause 13, leave out Clause 13

[Lord Low of Dalston (CB)]

My Lords, I have been sitting here listening in amazement as the Minister has been shelling out goodies right, left and centre. It is a quite unfamiliar experience. I just hope that his bag is not now empty; I hope that he has not completely run out of goodies to dole out.

Amendment 41 would leave out Clause 13. It is tabled in my name and those of the noble Baronesses, Lady Meacher and Lady Manzoor, and the noble Lord, Lord McKenzie of Luton. I shall speak also to Amendment 44, which would leave out Clause 14, which is tabled in my name and those of the noble Baronesses, Lady Sherlock, Lady Meacher and Lady Manzoor.

Clause 13 would abolish the work-related activity group component of employment and support allowance —which I shall call ESA from now on—for new claimants from April 2017. Clause 14 abolishes the equivalent component in the new universal credit, which will replace ESA and a number of other benefits. If Clauses 13 and 14 were to remain in the Bill, the effect would be to reduce income for those in the work-related activity group, which from now on I shall start calling “the WRAG”. It would reduce income for those in the WRAG from £102.15 to £73.10 a week—the same level as jobseeker’s allowance—which would be a reduction of £29.05 a week. Existing claimants would be protected but would be affected if they moved into work and then returned to claiming ESA in the WRAG. Furthermore, as the noble Lord, Lord Patel, showed in Committee, anyone initially placed in the support group, but who subsequently moved into the WRAG, would drop from £109 to £73.10, a reduction of £35.90 a week.

--- Later in debate ---

[Lord Freud]

My Lords, these amendments seek to remove Clauses 13 and 14 in order to prevent the proposed changes to the ESA work-related activity component and the universal credit limited capability for work element. Clause 13 amends existing legislation to remove this additional payment for new claims to ESA and aligns the amount of benefit paid to claimants with limited capability for work with that paid to jobseeker’s allowance claimants. I think I need to clarify that although some Peers have mentioned a loss of £60, the work-related activity component is just under £30 a week. Clause 14 is designed to introduce a similar outcome for UC claimants. The measure will save £640 million over the long term but in 2017-18, it will save £55 million while we will invest £60 million into additional practical support.

This change does not affect the support group component, the UC equivalent or the premiums which form part of income-related ESA. Existing claimants in the support group will be entitled to the work-related activity component if they are reassessed into the WRAG. We aim to protect existing ESA claimants who temporarily leave the benefit to try out work and then return to ESA, an issue which the noble Baroness, Lady Meacher, was concerned about.

ESA was set up by a previous Government to support people with health conditions and disabilities into work but it has unfortunately failed the very people who it was designed to help. Despite spending £2.7 billion this year on the WRAG, currently only 1% of people in this group actually move off the benefit every month. As a Government, we want to ensure that we spend money responsibly in a way that improves individuals’ life chances and helps them to achieve their ambitions, rather than paying for a lifetime wasted on benefits.

Currently, those in the WRAG are given additional cash payments but very little employment support. As the Prime Minister recently stated, this fixation on welfare treats the symptoms and not the causes of poverty. Over time, it traps people in dependency. That is why we are proposing to recycle some of the money currently spent on cash payments, which are not achieving the desired effect of helping people to move closer to the labour market, into practical support that will make a genuine difference to people in these groups.

The additional practical support is part of a real-terms increase that was announced at the Autumn Statement. How the £60 million to £100 million of support originally set out in the Budget will be spent is going to be influenced not only by Whitehall but by a task force of representatives from disability charities, disabled people’s user-led organisations, employers, think tanks, provider representatives and local authorities. I thank the noble Lord, Lord Low, and the noble Baronesses, Lady Grey-Thompson and Lady Meacher, for their work during Committee in this area.

The new work and health programme will provide specialist support for the very long-term unemployed. We are committed to supporting everyone who is able to work to do so. The forthcoming White Paper is aimed at ensuring that we offer the best possible support to those with health conditions or disabilities, a point raised by the noble Baroness, Lady Campbell, and the right reverend Prelate the Bishop of St Albans.

There have been ongoing discussions with the noble Baroness, Lady Hollins, about learning difficulties. Mencap’s website points out that despite the fact that research shows that 65% of people with a learning difficulty want to work, and the fact that with the right support they make highly-valued employees, only one in 10 people with a learning disability known to social services is currently in paid work. The Autumn Statement announced a real-terms increase in funding of almost 15% for those with health conditions and disabilities.

In Committee, some noble Lords raised concerns that we are expecting claimants who have been found “not fit for work” to be able to work. Although this was discussed then, it is important to stress once again that claimants in the work-related activity group have been found to have “limited capability for work”, which is very different to being unfit for any work. That is an important distinction, as this misconception helps drive people further away from the labour market and perpetuates the benefit trap.

As for returning to work and improved mental health, this Government are committed to ensuring that people with mental health conditions receive effective support to return to and remain in work. The noble Baroness, Lady Meacher, was concerned about this issue. We are investing £43 million over the next three years in trialling ways to provide specialist support for people with common mental health conditions. I have trawled the international evidence, and I know that we are going to build up a very substantial body of knowledge in this key area.

The noble Baroness, Lady Meacher, also raised the issue of deteriorating conditions. People with Parkinson’s who are currently getting the work-related activity component will not lose it, and will continue to receive ESA at the same rate, but any claimant who reports a deterioration in their condition can request a WCA to assess whether they may be eligible for the support group. As all Peers in the Chamber will acknowledge, some of these conditions can take a very long time indeed to develop, and there are times when people in the early period of those conditions are able to work, and indeed really want to.

Another area discussed at length in Committee was the evidence to support the Government’s view that the work-related activity component, in some cases, acts as a financial incentive to remain on benefit. I went through that evidence in some detail then but will summarise the points now. The findings of the OECD report, which we have touched on today, covered the whole population. Although the report does not specifically focus on the disabled population, it does not indicate the incentives would not apply there. We have the paper by Barr et al in 2010, which found that,

“eight out of 11 studies reported that benefit levels had a significant negative association with employment”.

It also noted that, “The most robust study”—by Hesselius and Persson—

“demonstrated a small but significant negative association”.

I have already mentioned the Norwegian study of the impact of financial incentives.

It is important to also recognise that the changes to ESA and universal credit work together and cannot be taken forward in isolation. Universal credit will replace income-related employment and support allowance once fully rolled out. We want to ensure that we build on what is working in universal credit to help those with health conditions and disabilities move into work. We have invested a lot in universal credit to make sure that we keep people connected to the labour market from the outset of their claim. Unlike under ESA, UC claimants with a health condition or disability are offered labour market support, where it is appropriate to do so, at the very start of their claim. This helps them to remain closer to the labour market, even if they are not immediately able to return to work.

The noble Baroness, Lady Lister, said that about 116,000 people in the whole country benefit from the disability element of tax credits. The smallness of that number illustrates how the current system is not working. That is why universal credit gets rid of the hours rules that stop people entering the labour market. It makes every hour—every fluctuating hour—pay and gives people the work coach support they need to find and then retain work. I have to say that some of figures from the noble Baroness, Lady Grey-Thompson, do not accurately reflect the situation. The point is that universal credit will make smaller, regular hours pay. Rather than dealing with a lot of very complicated sums, I will write to her and set out our response.

The findings from Universal Credit at Work show that universal credit is making a real difference in getting people closer to the labour market. It is easier to understand. People are earning more, they say they have better incentives to work and, indeed, they are working more. Universal credit is a step towards modernising the welfare system into one that improves individuals’ life chances, but we intend to go a lot further than that. We will publish a White Paper in the new year that will set out reforms to improve support for people with health conditions and disabilities, including exploring the role of employers, to further reduce the disability employment gap—which we are committed to doing —and promote integration across health and employment.

As for the impact of another budget, I should point out to the noble Lord, Lord Low, what we spend on disability benefit: it went up by £2 billion in real terms over the last Parliament. We spend £50 billion every year on benefits to support people with disabilities or health conditions, which is rather more than we spend on defence and police combined—6% of government spending.

Clauses 13 and 14, together with the additional practical support announced in the Budget, provide the right support and incentives to help people with limited capability for work move closer to the labour market and, when ready, into work. I therefore urge the noble Lord to withdraw his amendment.

[Lord Low of Dalston]

My Lords, I thank the Minister for his very full and careful reply. I knew that it was too much to hope that his generous spending spree would continue into this group of amendments, so we will deal with the case that has been made on its merits. I also thank all those noble Lords who have spoken. The amendment has attracted support from right across the House: I made it 10 speeches in all and 9:1 in favour of the amendment.

--- Later in debate ---

Moved by

[Lord Low of Dalston]

44: Clause 14, leave out Clause 14

Welfare Reform and Work Bill

Lord Low of Dalston Excerpts

Monday 25th January 2016 Lords Chamber

The Minister must go further than general reporting, which will not identify very complicated disability issues. He needs to set a challenge across government to report accurately on the barriers faced by millions of disabled people who want nothing more than a worthwhile occupation, personal status and a financial reward for working. If the Minister does not accept my arguments, I hope that he can present this House with a credible alternative strategy and not simply tell us again that it will be reported generally and will be highlighted in a White Paper. I am afraid that that generic approach will not work for disabled people—we simply do not fit the generic lexicon. I beg to move.

[Lord Low of Dalston (CB)]

My Lords, I support the amendment, which my noble friend Lady Campbell moved with great eloquence. After her speech, there is not really a lot that I can add but I will summarise the points that I want to make.

The Conservative Party manifesto set this ambitious aim to halve the disability employment gap by 2020. As we have heard from my noble friend Lady Campbell, this gap has been intractable over many years. It is quite structural and it will not be easy to reduce it substantially, let alone halve it. There is a real concern that, unless the Government actively measure, and are required to report regularly on, progress towards attaining this goal, it may not be achieved and a crucial opportunity to deliver on disability employment will be lost. This is a wonderful opportunity. The Government are much to be congratulated on setting this goal but it will take a lot of work to achieve it. Having targets specific to this objective and reporting regularly on them will be necessary if we are to monitor the progress desired and to take remedial action if required.

There are three other specific reasons why I think we should support the amendment. The first is simply consistency of approach. The Bill introduces reporting requirements on the Government’s pledges to achieve full employment and fund 3 million new apprenticeships but there is no similar reporting requirement on halving the disability employment gap. So simply from the point of view of consistency of approach, it would seem to make sense to have a specific reporting requirement for this objective as well.

Secondly, disability employment presents very specific problems which are not well understood across government, and that is part of the reason why the employment gap has proved so intractable over so many years. The DWP is getting on top of it but I do not think the same can be said of government departments generally. It would provide a departmental and cross-governmental focus on disability employment and reducing the disability employment gap, and help to embed this in the organisational culture, if there were specific reporting requirements in relation to this.

Thirdly, simply from the point of view of targeting support, introducing clear reporting on how many disabled people are in employment, separate from scrutiny of other employment statistics, will allow better analysis of how current support arrangements are working and help the Government to better target resources and support where they are most needed. It will also enable data to be disaggregated by such things as learning disabilities, autism, mental health problems, visual impairment, deafness and hearing problems—things such as are mentioned in the amendment.

On all these grounds—consistency of approach, providing an incentive for action across government and targeting support where it is most needed—my noble friend Lady Campbell has made a very strong case for the amendment, and I wholeheartedly support it.

[Baroness Doocey (LD)]

My Lords, I, too, support this amendment. As the noble Baroness, Lady Campbell, has said, in Committee, the Minister said that the amendment is not necessary because a report on progress will be included in the annual report on full employment. However, my concern is that although the Government are very good at proposing big ideas and related targets, they seldom back them up with clear and unambiguous plans as to how they will achieve them. Halving the disability employment gap is a prime example of this.

Amendment 1 will guarantee that the Government must report to Parliament on progress and sets out clearly the form that this reporting should take. It will enable proper public and parliamentary scrutiny, and will provide consistent and thorough data which will give the Government the information that they need to measure the impact and progress of their policies, year on year.

I know from a number of my disabled friends of the enormous barriers that they have to climb through in trying to find a job: being invited to interviews just to ensure that employers can tick a “disability” box; losing out, time and again, to candidates far less qualified than they are to do the job for which they are being interviewed; receiving rejection letters giving reasons for their rejection that simply do not add up; and the heartache of knowing, without a shadow of a doubt, that the real reason they did not get the job is simply because they are disabled. This is all because employers, particularly SMEs, do not understand that somebody who is blind can be every bit as good as, if not better than—at IT, for example—somebody who is able to see properly. These employers running small companies have no idea of the specialist equipment that is available to disabled people. So although they are generally sympathetic, they are just not willing to take a step into the unknown by employing disabled people.

I am very grateful to the Minister that in his letter following Committee stage he answered the questions I had posed to him about the steps the Government were taking to support more disabled people into work. At the moment, the Bill is quite silent on that. I look forward to seeing what the White Paper will say on how the Government plan to improve support for disabled people. However, to significantly close the employment gap, we need to begin now and to raise the game of all government departments on meeting the target. This can be achieved only by giving the exercise a much higher priority.

At a time when so much is happening, a separate reporting amendment will provide cross-governmental focus on the laudable aim of halving the disability employment gap. Placing this requirement in the Bill will demonstrate the commitment the Government have made to improve the employment rate for disabled people. It will also clearly demonstrate to Parliament and the public the priority and importance that the Government place on this goal and ensure efforts to deliver it.

Welfare Reform and Work Bill

Lord Low of Dalston Excerpts

Monday 14th December 2015 Lords Chamber

Moved by

[Lord Low of Dalston]

58: After Clause 15, insert the following new Clause—
“Safeguarding of vulnerable claimants: guidance
(1) The Secretary of State shall issue statutory guidance for the safeguarding of vulnerable claimants in relation to any sanction, reduction of benefit, or disallowance of benefit (“the guidance”).
(2) The guidance shall incorporate all relevant provisions and operational protocols contained in the following Departmental operating guidance—
(a) procedural guidance within the Labour Market Conditions Guide;(b) universal credit guidance for agents;(c) Employment and Support Allowance (ESA) guidance for Jobcentres;(d) ESA operational guidance for benefit delivery centres;(e) ESA Incapacity Reference Guide;(f) Core Visits Guide;(g) Work Programme guidance;(h) guidance for health professionals.(3) The guidance shall specify—
(a) indicators of vulnerability and procedures for identification of vulnerable claimants;(b) situations which may demonstrate good cause for inability to participate in a work-focused interview, undertake work-related activity, or attend mandatory Work Programmes or back-to-work schemes;(c) where claimants must be referred for a Core Visit conducted by a Department for Work and Pensions (DWP) Visiting Officer;(d) how to support claimants with additional or complex needs;(e) liaison arrangements with mental health services where claimants are mental health service users; (f) collaborative approaches through which DWP can work with independent advice and support bodies in assisting such claimants;(g) who is responsible for ensuring that the guidance is complied with.(4) “Vulnerability” and “vulnerable claimants” shall be taken to refer to individuals who are identified as having complex needs or requiring additional support to enable them to access DWP benefits and use DWP services.
(5) Complex needs may refer to difficult personal circumstances, life events, or health, disability or incapacity conditions that affect the ability of individuals to access DWP benefits and services.
(6) In issuing the guidance the Secretary of State shall ensure consistency of definitions, terminology and language in the guidance.
(7) The Secretary of State shall ensure that consistent principles, good practice and fairness in safeguarding procedures is applied across all types of benefit claims, including Jobseeker’s Allowance claims, and by all agents involved in the assessment and administration of benefits.
(8) The Secretary of State shall report to Parliament annually on the application of the guidance.”

[Lord Low of Dalston (CB)]

My Lords, I shall speak also to Amendment 62. At Second Reading I spoke about two issues that had been highlighted for me by my work as chair of an independent commission which had been considering the future of advice and legal support on social welfare law in England and Wales: how to protect the most vulnerable from the worst effects of sanctions, and how claimants might get the advice and support they need to adjust to the changes brought about by welfare reform legislation. Amendment 58 deals with the first of these and Amendment 62 with the second.

Operational guidance has been developed over a number of years to build some minimum safeguards into the application of conditionality-based decision-making—for example, in dealing with claimants with serious mental health problems or cognitive impairments. It has been evolved in a piecemeal fashion around certain minimum requirements covering, in broad terms: the identification of claimants with mental health conditions or a background of mental illness and liaison with social and mental health services, with such cases referred to a higher managerial decision-maker before a benefit withdrawal decision is made; the requirement for the DWP to consider any good cause as to why a claimant may not have met a particular condition; and a requirement for the DWP to attempt to contact the claimant, conduct a face-to-face discussion about the conditionality and, if necessary, arrange a home visit if they do not accept that good cause.

Welfare reform legislation and new policy on sanctions since the 2012 Act in particular has complicated matters, although the same guidance on minimum requirements carries over to a significant extent. The guidance is, however, piecemeal and scattered over several different operational guidance manuals, each with subtle differences in language and terminology, leading to application and practice that is far less consistent than it should be. Overall, this has meant that the guidance is weaker in its application to new JSA claims—in fact, there is no JSA-specific guidance—universal credit claimants and clients of Work Programme providers.

Welfare rights workers can also point to numerous cases where the DWP has failed to apply safeguards correctly, especially following ESA work capability assessments. The consequences for vulnerable claimants can be devastating. In its inquiry on benefits sanctions beyond the Oakley review, the Work and Pensions Select Committee concluded that:

“Given the complexity of the existing legislation, there is a strong case for a review of the underpinning legislative framework for conditionality and sanctions, to ensure that the basis for sanctioning is clearly defined, and safeguards to protect vulnerable groups clearly set out”.

The Select Committee further recommended strengthening and clarifying guidance around the protocols and purposes of home visits or core visits. It also recommended better guidance on vulnerability specifically directed to Jobcentre Plus staff in identifying vulnerable JSA claimants, including those with mental problems and learning difficulties who may face difficulties in understanding and/or complying with benefit conditionality.

I have a number of cases that illustrate the need for a stronger legal framework to protect vulnerable claimants in situations where they potentially face sanctions. Given the time, I will mention only one, but it graphically makes the point. Mr D had his ESA stopped after failing to attend a work capability assessment. The DWP was aware of his history of mental ill health and that he was receiving support from his local NHS mental health service. However, it did not carry out safeguarding procedures and did not attempt to contact his local NHS mental health service to find out more about the risks to Mr D’s health if his income were to be stopped. After benefit was stopped, Mr D’s mental health deteriorated and he became suicidal. His psychiatrist assessed that the benefits stopping was a stressor that put Mr D at severe risk of suicide. Mr D was assisted in contacting the advice service by his psychiatric nurse. After the advice service challenged the DWP on its handling of the case, benefit was reinstated and Mr D was placed in the support group of ESA.

Amendment 58 would address the state of the guidance and the recommendations of the Select Committee by inserting a new clause in the Bill which would provide a clear statutory underpinning and codification for all safeguarding procedures and guidance; put all the guidance in one place, which should make it more accessible, user-friendly and easier for professionals to use; require consistency and robustness of application, especially consistency between new and legacy benefits systems; and require the Secretary of State to report annually to Parliament on the operation of the safeguarding procedures. As the language used in the amendment is drawn from existing guidance—for example, as regards the approach to vulnerability—it does not attempt to impose a higher threshold of safeguarding requirements in relation to conditionality but rather to ensure that existing standards are made more effective, consistent and transparent. The amendment is therefore consistent with the scope of the Bill, and the 2012 Act and its predecessor legislation.

Amendment 62 addresses the question of how claimants might get the advice and support they need to adjust to changes brought about by welfare reform legislation. The universal credit support service framework is a DWP-led collaborative project with the Local Government Association to deliver local support for more vulnerable claimants and to assist those who might be unable to use the digital claims process or who may need help budgeting, given the transition to monthly payments. The DWP drives a lot of the demand for advice as a result of delays and failures within the system, so it is only right that it should have an obligation to support and fund welfare rights advice. It therefore needs to be engaged in directly supporting the advice sector to help vulnerable claimants transition to new benefit regimes and/or adjust to new entitlement rules, as well as helping to challenge the system when it gets decisions wrong.

Amendment 62 would insert a new clause in the Bill providing that the Secretary of State shall publish guidance for local authorities about their role in developing schemes to support claimants, especially claimants with additional needs or indicators of vulnerability, and report annually to Parliament on the operation of the universal credit local support service framework. It provides that guidance shall specify, among other things, the role of local authorities in developing partnerships to deliver support and a priority role for independent local advice agencies. Finally, it provides that the Secretary of State shall ensure that the universal credit local support service framework is appropriately resourced so that it can be rolled out to all local authority areas. It is difficult to establish how far the DWP intends to roll out its local universal credit support services beyond the initial UC pilot areas and how the funding for this works. Therefore, it would be helpful if the Minister told us what the department’s plans are in this regard and what the relationship is between the universal credit local support service funding and other grants to local authorities, such as the troubled families programme, and the information and advice strategies required by the Care Act. I beg to move.

[The Earl of Listowel (CB)]

I rise to support both these amendments and have attached my name to Amendment 62. I have an interest in this as vice-chair for the last 10 years of the parliamentary group for children in care and care leavers, and as a carer of a mentally ill adult. I know how fragile many of the individuals seeking welfare support are. The Minister himself may have been shocked to discover the issues around mental health as he has done his important work in building capacity in jobcentres. I strongly support my noble friend’s amendments.

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[Lord Low of Dalston]

My Lords, I thank the Minister for her full and careful reply and my noble friend Lord Listowel and the noble Baroness, Lady Sherlock, for their speeches in support of the amendments.

I missed out the end of my speech. I would have said that I hoped the Minister might agree that these are two useful amendments, almost of a good housekeeping nature. The Minister has given a substantial reply to the points that I made. In particular, she has told us that the guidance is available and referred to the hub. It is perhaps in more of a one place than I allowed for when moving the amendments. However, all in the garden cannot be said to be lovely when cases of the kind I mentioned in my remarks come to notice. I had a good many more up my sleeve than there was time to tell noble Lords about.

Although the guidance may be found in one place, there still may be a need for some rationalisation. The noble Baroness has told us that it is constantly kept under review and has been updated and I like to think that the process of continuous rationalisation is taking place. However, I wish to read the noble Baroness’s remarks—there was a lot in them to digest all at once and I should like to take time to consider them carefully—go back to my advisers on the low commission, take further advice and, if we feel there are further points we could make to assist the department or that there are still matters to discuss with a view to improving the guidance, I hope the noble Baroness and her colleagues at the department would be prepared to meet us to discuss these matters.

Having said that, I propose for now to withdraw Amendment 58.

Amendment 58 withdrawn.

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[Lord Low of Dalston]

My Lords, I rise to speak to Amendment 62C. In the summer Budget, the Chancellor announced that under universal credit there will be no automatic entitlement to support for housing costs for 18 to 21 year-olds. This is to make sure that young people are unable to leave home and start claiming housing support unless they have a job. It is intended to mirror the choices made by young people who choose to live at home until they can afford to support themselves. The Government have been clear that vulnerable groups will be exempt, but have not yet confirmed how this will work in practice. Amendment 62C is intended to fill this gap by setting out the vulnerable groups which should be exempt. I am grateful to the organisation Crisis for briefing me on this amendment. It is also supported by Nacro, the Salvation Army, Caritas Social Action Network, Centrepoint, Shelter, Action for Children, St Mungo’s, Homeless Link, the YMCA, the Prison Reform Trust and the Albert Kennedy Trust, so we can be sure that there is a good deal of consensus as to the groups which should be exempt.

The Government have committed to protect care leavers, those with dependent children and those receiving the equivalent of ESA or income support. Young people living in homeless hostels or domestic violence refuges are also expected to be exempt given that they will continue to be funded through housing benefit and not universal credit, at least in the short term. If the groups listed in the amendment are not exempt, there is concern that we could see a further rise in youth homelessness. This could also damage the prospects of the young people affected finding employment. In four years, the number of young people sleeping rough in London has more than doubled, and 8% of 16 to 24 year-olds report recently being homeless. For young adults who are trying to rebuild their lives following a period of homelessness, failure to provide the safety net contained in this amendment—if the protections for the most vulnerable are not sufficient—may make it much harder to keep their lives on track.

For many young people housing benefit is all that stands between them and homelessness. This includes those who have experienced violence or abuse from family members. Some younger adults may be unable to live with their parents because of relationship breakdown but find this difficult to prove—for example, if they have been thrown out because they are gay or if a parent has remarried. To make sure that all young people at risk of homelessness are protected, the list of those who will be exempted from the proposals must take into account all the reasons young people may need support with their housing costs.

The projected savings from this measure are small in relation to the overall savings from the Welfare Reform and Work Bill. The Treasury has estimated that this measure will save the public purse £25 million in the first year, rising to £40 million a year in 2020-21. However, if the Government’s exemptions are not sufficient to protect young people at risk of homelessness, greater costs will be incurred. Homelessness is estimated to cost the Exchequer £1 billion a year. Investing in homelessness prevention on the other hand can make significant savings. Recent research commissioned by Crisis found that tackling homelessness early could save the Government between £3,000 and £18,000 for every person helped. The report uses illustrative vignettes, each based on qualitative data from 165 interviews to give an overview of the costs of homelessness. Each vignette explores two scenarios: one where homelessness is prevented or resolved and the other where homelessness persists for a year. One of these vignettes concerns a 19 year-old who is expected to leave the parental home and exhausts sofa-surfing arrangements with friends. In the first scenario she is helped into immediate temporary accommodation in supported housing for four weeks. She then receives a low-intensity floating support service during a short-term return to the parental home, which enables her to make a planned move into suitable shared private rented accommodation. Parental relationships become positive while she is able to live independently and she secures paid work within a year.

In the second scenario the local authority finds her ineligible for the homelessness duty. She receives a list of private rented accommodation but no other assistance. She relies initially on sofa-surfing but negative experiences from these arrangements lead to a deterioration in her mental health. She makes increasing use of homelessness services and uses drugs as a result of stress and depression. She has a non-elective long stay in hospital as a result of the deterioration in her health. She is admitted into a residential detoxification service for six weeks but lack of settled suitable housing presents major challenges. The research calculated that preventing her homelessness in the first scenario cost £1,554. By comparison, this cost rose to £11,733 when her homelessness was not properly resolved, as described in scenario 2. If this young person were unable to meet the eligibility threshold for claiming the housing costs element of universal credit, the first scenario would not be open to her.

I shall go through the groups of young people who would be protected by the amendment. Crucially, the system must be flexible enough to cover more difficult or complex cases. First, I shall address those who are owed a rehousing duty under the Housing Act 1996 and the comparable Scottish and Welsh legislation. By definition, people who are already homeless have nowhere else to live and should be exempted from these proposals or they will be at serious risk of street homelessness. Young people who approach their local authority and meet the statutory definition of unintentionally homeless in Scotland, and of being in priority need in England and Wales, should automatically qualify for support. Local authorities have a statutory duty to house those who meet this threshold, which they will be unable to meet if the young people owed the duty cannot claim the housing costs element of universal credit.

Secondly, I shall address those who are homeless or at risk of homelessness being supported by local authority housing options teams. In England, the threshold for priority need is high, however, and most single people will not meet it. Nevertheless, they are owed a general duty of advice and information about homelessness and the prevention of homelessness. Across England, Scotland and Wales, many homeless people are supported by local authority housing options teams to prevent or alleviate homelessness. In England, statutory homelessness guidance advises housing options teams to use family mediation services to prevent homelessness when family or friends are no longer able or willing to accommodate. It is therefore vital that those who fall short of the statutory homelessness threshold, as well as those young people at risk of becoming homeless, are protected.

Thirdly, I address those who are homeless or at risk of homelessness and are being supported by voluntary or statutory agencies into more settled accommodation. While many homeless young people are housed in supported accommodation which will continue to be funded through housing benefit, homeless hostels are not right for everyone who has experienced homelessness. Others may struggle to find a bed space since numbers of beds are declining. Those being supported by homelessness organisations to find and sustain alternative forms of accommodation should therefore be protected. This includes private rented sector access schemes and supported lodgings. Withdrawing support from young people using such schemes would undermine the Government’s own efforts, including significant investment to tackle single homelessness.

Fourthly, I address those who have formerly been homeless as young adults aged 16 or over. People who first become homeless when young are particularly vulnerable to repeat homelessness. To mitigate the risk of people becoming homeless again following a period of stability, it is important that young homeless people who qualify for the housing cost element of universal credit can continue to do so following a change in circumstances up to the age of 21. Young people ready to move on from a homeless hostel or domestic violence refuge must be able to access financial support to maintain a private tenancy, or moving on will be impossible. The chance to move on in this way will in turn enable other young homeless people and those experiencing domestic violence to access hostel and refuge places.

Fifthly, the amendment refers to,

“a person without family or for whom the home environment is not suitable to live in”.

The Government have been clear that those who cannot live at home will be protected. We welcome this commitment, since relationship breakdown is a leading cause of homeless young people no longer being accommodated by parents. A broad exemption to protect young people at risk of homelessness due to family breakdown will prevent young people having to become homeless before they can access support. This protection must apply to those without living parents or parents in the UK, and to those for whom it would be damaging to remain in or return to the family home. For example, up to 24% of homeless youth identify as lesbian, gay, bisexual or transsexual, and in 69% the primary cause identified is rejection or abuse after coming out to parents or caregivers.

Some young adults need to leave home because the family home is unsuitable or puts them at risk of harm. This may be because of overcrowding, for instance, if the family has downsized due to the social sector size criteria. Overcrowding is a form of hidden homelessness with implications for family cohesion and well-being. In some cases of severe overcrowding, councils may offer to rehouse adult children independently, rather than move the entire family. If young people in overcrowded homes can no longer access housing support, this will not be possible. For some young people, the neighbourhood may be unsuitable: for instance, due to risk of involvement with gangs or other anti-social and unlawful activity. A 2011 cross-government report, Ending Gang and Youth Violence, committed to roll out schemes to rehouse former gang members wanting to exit the gang lifestyle and cited joint police and council projects which seek accommodation for people at high risk from gang violence. This work will be significantly undermined if young people in such circumstances cannot access support for their housing costs.

Sixthly and finally, regarding “those leaving custody”, young people leaving custody are at particular risk of homelessness due to their higher levels of need, vulnerabilities and chaotic lives. Thirteen per cent of young homeless people are offenders and 22% have an offending history. Accommodation is critical for effective resettlement. A return to the family or neighbourhood may expose them or their families to risk of harm and the negative social networks which they are trying to leave behind. An exemption for young people at the point of release will provide stability and support to help them adjust at this critical time, when the risk of reoffending is greatest.

[Baroness Hollins (CB)]

I support Amendment 62C, as spoken to by my noble friend. I do not usually speak on homelessness but I have a keen interest in the mental health and well-being of young people. I am also a huge admirer of Crisis and other charities offering support to people experiencing homelessness. I was extremely concerned to hear that the number of young people sleeping rough in London has more than doubled in four years, and that 8% of 16 to 24 year-olds report having recently been homeless, for reasons such as those outlined by my noble friend—being victims of or at risk of violence or abuse, or a breakdown in family relationships. According to Crisis, tackling homelessness early can save the Government between £3,000 and £18,000 per person. Can the Minister describe exactly which homeless young people will be entitled to the housing costs element of universal credit?

Welfare Reform and Work Bill

Lord Low of Dalston Excerpts

Wednesday 9th December 2015 Lords Chamber

[Lord Low of Dalston (CB)]

My Lords, I gave notice that I wish to oppose Clause 13 standing part of the Bill and I now wish to do that in support of the noble Lord, Lord McKenzie, and the noble Baroness, Lady Manzoor. Clause 13 would cut ESA by just under £30 a week, or £1,500 a year, for new claimants in the WRAG group from 2017. The Government’s reasoning is that the £30 a week uplift from the JSA level constitutes a disincentive for those in the WRAG group to seek work and that cutting this premium would remove that disincentive.

As I hope many noble Lords will by now know, with my noble friends Lady Meacher and Lady Grey-Thompson I have just carried out a review of this policy approach and its impact on the Government’s objective of halving the disability employment gap. The review was published yesterday; copies have been distributed and I hope that many noble Lords will have had a chance to look at it. I place on record my thanks to the disability charities which supported the review, including Leonard Cheshire Disability, Mind, the Multiple Sclerosis Society, the National Autistic Society, the Royal Mencap Society, Scope and RNIB, of which I am a vice-president and I declare my interest. I also thank the 30 or so organisations which responded to our call for evidence and the nearly 200 disabled people who gave us eloquent and often very personal accounts of their lives and aspirations, and the hardships that they face.

Our review found no evidence to support the Government’s approach. The Government’s impact assessment contains no detail on how disabled people might be affected and seems to be concerned only with savings to the Government, which would amount to £640 million by the end of the Parliament—not a massive amount as these things go. The Government rely principally, as the noble Lord, Lord McKenzie, said, on a 2005 OECD study which deals only with unemployment generally and not the unemployment of disabled people at all, which is generally reckoned to be very different, as evidenced by the intractability of the disability employment gap. Officials have referred us to a 2010 study by Barr and others in the Journal of Epidemiology & Community Health, which suggests that there is a significant negative association between benefit levels and employment. But the authors commented that:

“While there was some evidence indicating that benefit level was negatively associated with employment, there was insufficient evidence of a high enough quality to determine the extent of that effect. Policy makers and researchers need to address the lack of a robust empirical basis for assessing the employment impact of”,

the 2010 welfare reforms.

The central recommendation of our review is therefore that the proposal to reduce payment to claimants in the WRAG group to JSA level should be put on hold in order to carry out a thorough assessment of ESA and the impact that any reductions might have, not only on disabled people, their families and carers but on other services that might be affected, such as social care and the National Health Service, as well as knock-on effects on other benefits. As we conducted our review, I was hugely impressed by the wealth of expertise possessed by the organisations which came and gave evidence to us. If the Minister were to establish a working group to tap into this expertise, I am sure that these organisations would be only too happy to help him get this matter right.

ESA is an income replacement benefit for those assessed as not fit for work. It is important to stress this point, as the noble Baroness, Lady Manzoor, has done. They are assessed as not fit for work; they may have been assessed as capable of undertaking activities potentially leading to work but the essential point to grasp is that they are in the WRAG group because they are not currently fit for work. Moreover, the extra £30 a week is there in recognition of the fact that it takes much longer and costs more for disabled people to take steps towards work, during which time savings run down. It is important to remember that this is a group in which many are already in or close to poverty.

According to the Office for National Statistics, 31% of disabled working-age adults live in poverty compared with 20% of non-disabled adults. Currently, roughly 60% of people spend approximately two years in the WRAG group. This may be even higher for some groups. For example, blind and partially sighted people are five times more likely than the general population to have had no paid work for five years. This compares with 60% of people spending roughly six months on JSA. As I have said, the extra payment is there to reflect that but also to recognise the additional costs that disabled people face when looking for work or undertaking work-related activities. Respondents told us about increased travel costs, as well as the cost of assistive technology. Of course, DLA and the personal independence payment are designed to cover additional costs associated with disability. However, respondents reported that DLA and PIP are not enough to cover all their costs—it is only a contribution to them—and we know that only around 50% of individuals in the WRAG group also receive DLA or PIP in any case. Individuals would really struggle to cover those additional costs if the ESA WRAG component is removed.

Our review took place in the context of the Government’s welcome aim to halve the disability employment gap. It concluded, however, that the proposed cut to ESA would hinder rather than promote this aim. One respondent said that they would need to cancel their phone and broadband contracts, with the result that,

“I would not be able to make calls regarding workplace volunteering that I want to do”,

in order to help them get back to work,

“or make job applications when I am ready. I would also no longer be able to afford smart clothes which you need for work”.

An important contribution came from the Disability Benefits Consortium, which surveyed 500 disabled people in the ESA WRAG group. Almost half of these—49%—said that such a cut would mean that they were not able to return to work so quickly. The disability employment gap is a long-standing structural one, exacerbated by failed back-to-work schemes—the Work Programme in particular—as well as societal and employer attitudes. It is not generous benefits that are holding people back.

Our review identified a very close connection between the proposed cuts and people’s mental health, which, in addition to the human cost, would lead to people being pushed further from the labour market. As one respondent commented:

“Losing this money would make me more worried and stressed which would impact my mental health considerably turning the whole thing into a vicious circle”.

The noble Lord, Lord Patel, stressed this point very eloquently. It is important because the current ESA WRAG group consists of close to quarter of a million people with mental health problems as well as learning disabilities.

In summary, our review concludes that there is no evidence to suggest that disabled people can be incentivised into work by cutting their benefits. Instead, the Government should look to improving support by making it more tailored to people’s individual needs as well as working with employers to tackle attitudinal barriers. If the Government could only do this effectively, and halve the disability employment gap, that would really make dramatic inroads into the size of the ESA bill.

[Baroness Meacher (CB)]

My Lords, I rise to support Amendment 50, moved by my noble friend Lord Patel. I also support the call of the noble Lord, Lord McKenzie, for Clause 13 not to stand part of the Bill. I put on record my thanks to the charities that worked tirelessly to produce what I think was an excellent report for the review, and in particular Rob Holland of Mencap. I also express my gratitude to the hundreds of disabled people who took time to share with us their stories, experiences and concerns. I thank the Minister for a very helpful meeting yesterday focusing on our review.

We need to be conscious of the fact that the cut in the income of WRAG claimants is just one of many cuts to the benefits of sick and disabled people, as has become apparent through these debates. The OBR report shows that there will be a steady fall in the percentage of GDP spent on benefits for sick and disabled people between now and 2020, which I would have thought is something the Government should be rather ashamed of. This is being achieved of course through freezing a number of benefits, tighter criteria for eligibility for PIP—which will lead to 500,000 disabled people no longer qualifying for the benefit by 2018—cuts in the level of disability benefits and, of course, the cut in WRAG benefits by £30 per week, the subject of Clause 13.

Amendment 50, if agreed, would in my view ensure that Clause 13 would never be implemented. There is no doubt in my mind that the implications of this clause for the mental and physical well-being, the financial situation and, more particularly, the ability to return to work of WRAG claimants will be devastating. The first problem concerns the inadequacies of the WCA—the work capability assessment. Many people in the WRAG should very obviously not be there, and should be in the support group instead. One of the problems, but a very important one, is that the WCA is a functional assessment that does not take any account of the real world, in which employers simply will not employ someone with a progressive disease who is already assessed as unfit for work—someone with Parkinson’s disease, for example. The early stages are fine, but then they would be assessed as fit for work. In addition, over half of WRAG claimants have mental and behavioural disorders, including learning disabilities, autism and mental illnesses, which generally fluctuate in their severity.

The Royal College of Psychiatrists reported new research by the universities of Liverpool and Oxford which estimates that the increase in WCA assessments may have led to 590 additional suicides, as well as an increase in mental health problems and in the number of prescriptions for anti-depressants. One has to think about the cost of all these downsides. While some WRAG claimants are, no doubt, quite properly preparing to return to work, many are being inappropriately required to jump through all sorts of work-preparation hoops and, no doubt, being required to make dozens of fruitless job applications, even if they are aware of the electronic screening of such applications, which I learned about from the Minister, most helpfully, yesterday.

Many of these claimants are having to try and come to terms, at the same time, with the fact that they have long-term mental or physical illnesses, terminal health problems or unpleasant symptoms which in many cases will only get worse, as well as with the misery of thinking that no employer may ever take them on again—quite a lot for someone to cope with.

--- Later in debate ---

[Lord Lansley (Con)]

My Lords, I rise briefly to contribute to this debate. I am pleased to have the opportunity to do so and especially to follow the noble Lord, Lord Layard. At Second Reading, he kindly made a favourable reference to the work we did together in the previous Parliament to undertake the national rollout of improving access to psychological therapies. It was very important to do so and he has just eloquently explained to the Committee why it is particularly important in this context of giving people with mental health problems who want to work the opportunity to access treatment that takes them closer to work and gives them opportunities to return to work. I remember visiting just such a centre in Reading and seeing the success it achieved in enabling people with mental health problems to access treatment and get back to work much faster than would otherwise have been the case.

I confess to the Committee that I do not exactly support Amendment 52. There must be very limited circumstances in which we seek statutorily to provide for when the NHS should give treatment to particular individuals or sets of individuals; we have to be extremely careful. I applauded otherwise pretty much everything the noble Lord had to say. I was glad he was able to reference the support in the spending review for increasing access to talking therapies. I thought we had already established the fact, but further evidence has shown that talking therapies are at least as effective, as treatment, as access to medication. It has been reported that medication is no more effective than talking therapies, but I would put it the other way round—namely, we have discovered that talking therapies are at least as effective as medication, and often without the drawbacks associated with the dependence on medication that can emerge. I am very pleased that we were able to work together on the national rollout for the IAPT programme that was announced, if I recall correctly, in February 2011. That was published alongside the first national strategy for mental health, No Health without Mental Health.

I also want to speak to Clauses 13 and 14 stand part, which I very much support. As I said at Second Reading, one issue we need to focus on is helping people with disabilities into employment. Though I mean in no sense to be patronising, I think the report published yesterday, Halving the Gap?, is an extremely helpful contribution by the noble Lord, Lord Low and the noble Baronesses, Lady Meacher and Lady Grey-Thompson. It is an extremely good report, very clearly set out. Its focus is absolutely right—namely, how do we reduce the gap between employment for disabled people and the access to employment that is being achieved by those without disabilities? We are doing this in the context that this country is an economy creating jobs as fast as the rest of Europe put together. Not only are we creating jobs and bringing down unemployment and the claimant count, but we are doing so with a record level of vacancies in the economy. We have the opportunity for employment, therefore, to a degree that we can be proud of; the question is whether we are giving people the appropriate support into work and creating the right incentive structure. I make no apology for saying that all three are important: opportunities for work, which I believe are there; support into work; and incentives for work.

I do not want to go on at length, but this is important. There is a great deal of material in the Halving the Gap? review that sets out some of the ways in which support for people getting closer to employment and taking it up can be improved. It is important never to think about legislation without understanding that, from the Government’s point of view, it is often conducted with legislation on the one hand and administrative action on the other. This is very much one of the areas where the administrative changes are potentially at least as important as the legislative changes. In that context, the Work Programme has worked very well in some respects, but not so well in others—though it is of course a payment-by-results programme, and it was important that it was. Together with the evidence on work choices—which, although small in scale, had some benefits, as has been referred to—it is important to look at those examples, the work in jobcentres and all the other evidence, to see how, in particular, we can design the health and work programme from 2017, which will coincide with the changes proposed in this legislation, to ensure that it helps people in the work-related activity group into employment.

I listened with great care to the noble Lord, Lord Patel. I completely understand his point about giving time. We have to be very careful to understand that we are talking about people in the work-related activity group who may need more time than would customarily be true for those on JSA, but this is not a situation in which the more time is taken, the better it is—far from it. We are looking for people on a part of employment and support allowance to move towards employment and for progress to be made in that respect. That is where we need to focus and why the support that we give is extremely important. The reshaping of that support, which I know is contemplated alongside these legislative and benefit changes, has to happen.

I also mentioned incentives, which are important. It has been said that there is no evidence. One tends to think that the absence of evidence is not evidence of absence, but in this instance the reports from the OECD 10 years ago and from the Barr and others study refer to evidence of a relationship between the generosity of benefits and the employment implications. I do not think we should be surprised by that. The disparity between people’s income out of work and in work is an essential part of understanding the incentive structure. Where that disparity is small, the incentive to work will be less. Where the disparity is greater, the incentive to work will be greater. We have to be clear that that is prima facie. It is not a matter of looking for evidence; we know that it is demonstrably true and there is plenty of evidence of it.

I completely understand that we also need to understand this in the context of people with disabilities and disability employment, but understanding that people with disabilities have special requirements and special constraints should not constrain our understanding that incentives must be aligned with support and opportunities. If the incentives are wrong—if they do not align with the support that we give in encouraging people to be in work or to be continuously moving towards work where they are capable of doing work-related activity—the system will not succeed.

The review was absolutely honest. It said that unemployment and economic inactivity have been stubbornly high for many years, so this is not a situation where we should simply say that what is happening now is good enough. We want to achieve change, and strengthening the incentive structure, alongside the support structure, is an essential part of the overall policy. Therefore, we need to keep the legislative change and the support changes administratively.

I shall make one final point. I was listening carefully to the noble Lord, Lord Low. While the review said that there is no evidence that the generosity of benefits has an incentive effect in relation to employment, there is something of a contradiction within the terms of the review. It is said in the review that there is a difficulty associated with current claimants—they will not be new claimants necessarily moved off accessing the additional support under WRAG in future—who go into employment and might then come back on to the WRAG element of ESA. Logically, because people asserted to the review that they would be disincentivised from taking jobs because they would not be able to go back on to the ESA WRAG element on their previous basis, by implication people were saying that the level of financial support under ESA is in itself a disincentive to taking work. We have to be clear that, within the review itself, there is a sense in which people are openly acknowledging that the level of benefits relative to work is an issue in terms of incentives.

[Lord Low of Dalston]

I understand the point the noble Lord is making, but I put it to him that the contradiction he points to arises only if you decide to remove the extra ESA WRAG component for new claimants. If the benefit remains the same, there is no disincentive in moving off work and moving back again.

--- Later in debate ---

[Lord Freud]

I am not now looking at recommendations for action. I am just looking at what evidence we have that incentives either way work for the disabled community because that is the issue that noble Lords are querying. Let me go on. A paper by Barr et al, published by the Journal of Epidemiology and Community Health in 2010, asks:

“To what extent have relaxed eligibility requirements and increased generosity of disability benefits acted as disincentives for employment?”.

It finds that eight out of 11 studies reported that benefit levels had a significant negative association with employment. To pick up the point made by the noble Lord, Lord Low, about the level of the evidence, while they state that they cannot quantify the size of the effect, they conclude that there definitely is one. The most robust study in that paper, by Hesselius and Persson from 2007, demonstrated a small but significant negative association. The final paper, by Kostøl and Mogstad from 2012, is about evidence from Norway regarding a positive incentive structure allowing disabled claimants to retain more of their benefits when moving into work, which resulted in more claimants starting work. The study shows the impact of financial incentives on disabled people able to undertake preparation for work or work itself, which is a group synonymous with our WRAG population.

[Lord Low of Dalston]

I am sorry to have been a little slow in coming back to the Minister; it took me a little while to find the reference. With regard to the Barr study, the Minister will recall that I pointed out that Barr et al said that, with regard to whether there was a negative association between benefits and employment rates, there was insufficient evidence of a high enough quality to determine the extent of that effect.